Numerous Process Serving Jobs Lost Thanks to the New York DCA
- September 16, 2012
- by Chris Rossi
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The City of New York has basically placed a large entry barrier on the process serving profession during the harshest economic times this country has experienced since the Great Depression. All of this happened even with the generous assistance of NAPPS and NYSPPSA, which sued the city and the mayor to get the original bill amended to its current form which I still find unsatisfactory.
Ever since I started my process serving company people have asked me for advice on how to start their own business and the first thing I always tell them is this: start your own business, just beware of choosing New York City as your location. Here in NYC, all small businesses including process serving companies and individual process servers must be licensed by the Department of Consumer Affairs (DCA). Besides licensing businesses the DCA is responsible for handling consumer complaints, enforcing the city’s consumer protection laws and participating in consumer education. The DCA’s motto is that they “ensure a fair and vibrant marketplace”. However, I view their policies and legislative actions over the course of the last few years to be anything but vibrant for businesses.
In 2008 the DCA introduced legislation to regulate the process serving profession in an effort to rid the city of “sewer servers”, a handful of individuals who operated fraudulently and perpetuated a negative image of our profession. At first, I was all for this legislation and even openly offered to help at a public hearing that was held regarding the matter. Yes there were some “sewer servers” out there and yes people familiar enough with the business knew who they were, but catching a few bad apples wasn’t too complicated. In fact, to the best of my knowledge, the DCA has since gotten rid of the few unscrupulous servers and that’s fine by me and all those who take pride in what we do for a living.
By 2008 I had a dozen years of experience in process serving so I felt I had a lot to offer the DCA as far as general knowledge of the business and education were concerned. It seemed to me that some process servers were just not familiar enough with the New York C.P.L.R. rules of service of process and may be serving papers improperly not fraudulently, so I thought the best solution would be to educate said process servers. My business partner and I, along with other knowledgeable individuals, were even invited to the DCA’s offices for a roundtable discussion regarding the creation of an educational program for NYC process servers. My partner and I enjoyed interacting with all those present and were happy to be doing our part to help inject more integrity into our profession. The deputy commissioner seemed open-minded and was very receptive to our ideas and input. Afterward, he thanked us all via email and stated that he felt it was a lively discussion and was looking forward to meeting with us again, but a second discussion never took place. Rather than cooperate with a process serving community that was more than willing to help and has every day hands-on experience, the DCA instead chose to employ law students from Fordham University to design this educational exam. That is correct, law students who don’t possess a shred of real-world experience in process serving.
Fast forward to 2012 and the DCA is now charging a $75 fee for taking this exam and if an applicant fails the exam they must pay again to retake it. Why charge anything for an exam when an applicant is already paying a $340 licensing fee and a $75 fingerprinting fee? That is pure highway robbery and it must be exposed. In addition to these fees, the regulations that were imposed upon us by the DCA and passed by the New York City Council mandates that process servers obtain a $10,000 surety bond ($100,000 bond for companies), utilize a GPS device at their own expense and keep a digital record of each service attempt they make regardless if that paper ever gets served or not. Also, each attempt must be transferred to a spreadsheet every two business days and saved to a non-rewritable disc. This must be done in addition to the paper log book that was always required by law. Some people think it’s not a big deal but when you consider that an NYC process server may serve approximately fifty papers or so per day that’s an awful lot of homework to do when you finally do get home. Sure it’s true that software companies have stepped up efforts to make this process less frustrating but that’s just one part of the big picture of this threat to our profession. What bothers me the most is that none of this is required by law according to the rules the New York State C.P.L.R. so the DCA has literally rewritten the rules and procedures of the Civil Practice Law and Rules and no one in the legal community has raised this as an issue. Where does the DCA’s authority begin and end? Why is a notarized affidavit of service not good enough proof for all process servers in New York City? Why is it that process servers are viewed and treated like second-class citizens?
A bigger part of the threat is that these regulations have not only gotten rid of the bad apples but almost all of the apples. . . these individuals are leaving the business because the cost and time it takes to be in compliance is just too much for them to bear.
A bigger part of the threat is that these regulations have not only gotten rid of the “bad apples” but almost all of the apples. I work with some men and women who already have other jobs and serve papers simply to supplement their incomes to make ends meet. Basically, for them, process serving is a part-time gig. Many of these individuals are now leaving the business because the cost and time it takes to be in compliance is just too much for them to bear. The City of New York has basically placed a large entry barrier on the process serving profession during the harshest economic times this country has experienced since the Great Depression. All of this happened even with the generous assistance of NAPPS and NYSPPSA, which sued the city and the mayor to get the original bill amended to its current form which I still find unsatisfactory. I find it very disturbing that the same city I’ve lived and worked in my entire life has been the biggest burden to me and my business partner’s desire to start our own business and make a better life for ourselves and our families.
According to a report released by the NYC Public Advocate’s office, the Department of Consumer Affairs expects to collect an unprecedented $10.6 million dollars in fines from small businesses last fiscal year. That’s a 45% increase since 2009. Have all small businesses become wildly unscrupulous in the last three years? No. It seems to me that the goal of the DCA is to raise money for city bureaucrats in order to justify their department and their jobs, all under the guise of protecting consumers. But process servers shouldn’t feel singled out. Many other businesses are being subjected to the same red tape; towing companies, funeral homes, income tax preparers, cigar shops, nail salons, sightseeing buses, you name it and they’ll fine it. Most of these fines are for very minor infractions that hardly warrant the financial burden. And what about the precious consumers they claim to protect? Due to the cost of complying with these regulations all process servers and process serving companies are raising their prices. So the cost of litigation will rise for attorneys and the neediest of New Yorkers, let’s say a single mother trying to collect child support from a deadbeat dad, may not be able to afford a process server now. We live in a city where every other week there’s another politician being charged with allegations or being indicted for fraud; a city where bureaucrats are telling us what we’re allowed to drink and how we’re allowed to drink it. What’s next?
The true impact of these regulations would unfold on the license renewal date for process server individuals and organizations which was February 28, 2012. The buzz around the industry was “How many process servers would NOT be renewing their licenses due to the regulations? And what will the companies do with process servers potentially leaving the business in droves?” Earlier in February 2012, I saw a tweet from my local city council member Domenic Recchia which stated: “With SBs accounting for 1/2 of our city's private sector jobs, fines + overregulation can disrupt our local economy” to which I replied “Please help the NYC Process Serving SBs. On 2/28 over 1,000 applicants may NOT renew licenses due to DCA regulations/fines”. I was pleased to get the response “Call my office let’s figure this out”. I thought this was a man who may view things differently and perhaps at least look into this situation. So I called his office and a staff member told me to write down my main concerns and email them to her. I wrote a courteous and professional letter detailing the situation and I never heard back from the council member at all even after several follow up calls to his office. Everyone knows politicians can talk the talk but I regret that I was naïve enough to think this councilman would walk the walk. Now Mr. Recchia is running for City Comptroller.
It was city council member Dan Garodnick who introduced this legislation upon us in the first place and he is also currently running for City Comptroller. If a small-time elected official representing a small neighborhood in Manhattan can unleash a bill that sent ripples of great concern throughout our nationwide process serving profession, what would become of us if a politician with much more power and influence decided to embrace similar legislation, perhaps at the federal level? This is the bureaucracy in action and we better find ways to deal with it much better in the future.
About the author:
Chris Rossi is the founder and president of Premier Legal Services, Inc. located in Brooklyn, New York. Chris has been a New York City process server since 1996. Chris has worked as a private process server as well as at a large process serving firm simultaneously unil August 2007 until he started Premier Legal Services with Michael Smith.