A. 7339 2
VISION" INCLUDES A COUNTY, TOWN, CITY, VILLAGE, SCHOOL DISTRICT, FIRE
DISTRICT, PARK DISTRICT OR IMPROVEMENT DISTRICT TO WHICH ARTICLE THIR-
TEEN OF THE TOWN LAW APPLIES. THE POWERS GRANTED TO A SAVINGS BANK BY
THIS SECTION SHALL BE IN ADDITION TO, AND NOT IN LIMITATION OF, THE
POWERS CONFERRED ON SAVINGS BANKS BY OTHER PROVISIONS OF LAW.
S 2. Subdivision 2 of section 237 of the banking law is REPEALED.
S 3. The banking law is amended by adding a new section 378-f to read
as follows:
S 378-F. DEPOSITS RECEIVED FROM POLITICAL SUBDIVISION. A SAVINGS AND
LOAN ASSOCIATION THAT RECEIVES DEPOSITS, INCLUDING DEMAND, TRANSACTION
AND/OR TIME DEPOSITS, FROM A POLITICAL SUBDIVISION OF THIS STATE AND
ACTS THEREBY AS A DEPOSITARY OF ITS PUBLIC MONEYS, MAY SECURE ANY
PORTION OF SUCH DEPOSIT WHICH IS NOT INSURED BY THE SAVINGS ASSOCIATION
INSURANCE FUND:
(A) A PLEDGE OF SUCH OBLIGATIONS OR SECURITIES AS SHALL LAWFULLY BE
REQUIRED OR ACCEPTED BY SUCH DEPOSITOR; OR
(B) IN LIEU OF SUCH PLEDGE, BY FURNISHING THE POLITICAL SUBDIVISION
WITH A GOOD AND SUFFICIENT UNDERTAKING WITH SUFFICIENT SURETIES IN
ACCORDANCE WITH THE REQUIREMENTS OF OTHER PROVISIONS OF LAW APPLICABLE
TO THE MONEYS OF THE POLITICAL SUBDIVISION.
A SAVINGS AND LOAN ASSOCIATION IS HEREBY AUTHORIZED AND EMPOWERED TO
RECEIVE SUCH DEPOSITS, INCLUDING DEMAND, TRANSACTION AND/OR TIME DEPOS-
ITS, TO ACT AS SUCH DEPOSITARY (INCLUDING THE POWERS CONTAINED IN
SECTION NINETY-SIX-B OF THIS CHAPTER), AND TO SECURE SUCH DEPOSITS BY
SUCH PLEDGE OR BY SUCH UNDERTAKING. FOR THE PURPOSES OF THIS SECTION,
THE TERM "POLITICAL SUBDIVISION" INCLUDES A COUNTY, TOWN, CITY, VILLAGE,
SCHOOL DISTRICT, FIRE DISTRICT, PARK DISTRICT OR IMPROVEMENT DISTRICT TO
WHICH ARTICLE THIRTEEN OF THE TOWN LAW APPLIES. THE POWERS GRANTED TO A
SAVINGS AND LOAN ASSOCIATION BY THIS SECTION SHALL BE IN ADDITION TO,
AND NOT IN LIMITATION OF, THE POWERS CONFERRED ON SAVINGS AND LOAN ASSO-
CIATIONS BY OTHER PROVISIONS OF LAW.
NOTWITHSTANDING ANY OTHER PROVISIONS OF LAW TO THE CONTRARY, ANY
DEPOSITS RECEIVED FROM A POLITICAL SUBDIVISION SHALL NOT BE CONSTRUED TO
CONSTITUTE MEMBERSHIP IN THE SAVINGS AND LOAN ASSOCIATION AND SHALL BE
CONSTRUED TO BE THAT OF A CREDITOR OF THE SAVINGS AND LOAN ASSOCIATION.
S 4. Section 464 of the banking law is amended by adding a new subdi-
vision 4 to read as follows:
4. A CREDIT UNION THAT RECEIVES DEPOSITS, INCLUDING DEMAND, TRANS-
ACTION AND/OR TIME DEPOSITS, FROM A POLITICAL SUBDIVISION OF THIS STATE
AND ACTS THEREBY AS A DEPOSITARY OF ITS PUBLIC MONEYS, MAY SECURE ANY
PORTION OF SUCH DEPOSIT WHICH IS NOT INSURED BY THE NATIONAL CREDIT
UNION ADMINISTRATION BY:
(A) A PLEDGE OF SUCH OBLIGATIONS OR SECURITIES AS SHALL LAWFULLY BE
REQUIRED OR ACCEPTED BY SUCH DEPOSITOR; OR
(B) IN LIEU OF SUCH PLEDGE BY FURNISHING THE POLITICAL SUBDIVISION
WITH A GOOD AND SUFFICIENT UNDERTAKING WITH SUFFICIENT SURETIES IN
ACCORDANCE WITH THE REQUIREMENTS OF OTHER PROVISIONS OF LAW APPLICABLE
TO THE MONEYS OF THE POLITICAL SUBDIVISION.
A CREDIT UNION IS HEREBY AUTHORIZED AND EMPOWERED TO RECEIVE SUCH
DEPOSITS, INCLUDING DEMAND, TRANSACTION AND/OR TIME DEPOSITS, TO ACT AS
SUCH DEPOSITARY (INCLUDING THE POWERS CONTAINED IN SECTION NINETY-SIX-B
OF THIS CHAPTER), AND TO SECURE SUCH DEPOSITS BY SUCH PLEDGE OR BY SUCH
UNDERTAKING. FOR THE PURPOSE OF THIS SECTION THE TERM "POLITICAL SUBDI-
VISION" INCLUDES A COUNTY, TOWN, CITY, VILLAGE, SCHOOL DISTRICT, FIRE
DISTRICT, PARK DISTRICT OR IMPROVEMENT DISTRICT TO WHICH ARTICLE THIR-
TEEN OF THE TOWN LAW APPLIES. THE POWERS GRANTED TO A CREDIT UNION BY
A. 7339 3
THIS SECTION SHALL BE IN ADDITION TO, AND NOT IN LIMITATION OF, THE
POWERS CONFERRED ON A CREDIT UNION BY OTHER PROVISIONS OF LAW.
NOTWITHSTANDING ANY OTHER PROVISION OF LAW TO THE CONTRARY, ANY DEPOS-
ITS RECEIVED FROM A POLITICAL SUBDIVISION SHALL NOT BE CONSTRUED TO
CONSTITUTE MEMBERSHIP IN THE CREDIT UNION AND SHALL BE CONSTRUED TO BE
THAT OF A CREDITOR OF THE CREDIT UNION.
S 5. Subdivision 1 and the opening paragraph of subdivision 2 of
section 105 of the state finance law, subdivision 1 as amended by chap-
ter 204 of the laws of 2002 and the opening paragraph of subdivision 2
as amended by chapter 154 of the laws of 1953, are amended to read as
follows:
1. All moneys received by the commissioner of taxation and finance on
account of the state, excepting such moneys as are required by law to be
deposited to the credit of the comptroller, but including such moneys as
are thereafter paid into the state treasury by the comptroller, shall be
deposited by the commissioner of taxation and finance within three days
after the receipt thereof, either as a demand deposit or an interest-
bearing [time] deposit (other than a time certificate of deposit), as he
and the comptroller may determine, in such banks, trust companies [and
industrial banks], CREDIT UNIONS, SAVINGS BANKS AND SAVINGS AND LOAN
ASSOCIATIONS as in his opinion and the opinion of the comptroller are
secure. The moneys so deposited shall be placed to the account of the
commissioner of taxation and finance. He shall keep a bankbook in which
shall be entered his account of deposit in and moneys drawn from the
banks and trust companies [and industrial banks], CREDIT UNIONS, SAVINGS
BANKS AND SAVINGS AND LOAN ASSOCIATIONS in which deposits are made by
him, which he shall exhibit to the comptroller for his inspection on the
first Tuesday of every month and oftener if required. He shall not draw
any moneys from such banks, trust companies [or industrial banks], CRED-
IT UNIONS, SAVINGS BANKS OR SAVINGS AND LOAN ASSOCIATIONS unless by
checks signed and countersigned in the manner prescribed by section one
hundred one OF THIS CHAPTER, unless otherwise provided by law. No moneys
shall be paid by any such bank, trust company [or industrial bank],
CREDIT UNION, SAVINGS BANK OR SAVINGS AND LOAN ASSOCIATION out of any
such deposit except upon such checks. Moneys may be paid through elec-
tronic transfer in accordance with procedures developed by the commis-
sioner of taxation and finance and the comptroller and consistent with
the requirements of this section for recording payments. Such payments
through electronic transfer shall be considered, for purposes of this
chapter, to be moneys drawn by check. Every such bank, trust company
[or industrial bank], CREDIT UNION, SAVINGS BANK OR SAVINGS AND LOAN
ASSOCIATION shall transmit to the comptroller monthly statements of all
moneys received and paid by it on account of the commissioner of taxa-
tion and finance.
Every bank, trust company [and industrial bank], CREDIT UNION, SAVINGS
BANK OR SAVINGS AND LOAN ASSOCIATION designated for the deposit of state
moneys under the provisions of this section shall, before deposits are
made:
S 6. The opening, second and third undesignated paragraphs of section
106 of the state finance law, the second undesignated paragraph as
amended by chapter 293 of the laws of 1992, are amended to read as
follows:
Such moneys received by the commissioner of taxation and finance as
are now deposited to the credit of the comptroller pursuant to statute,
and thereafter paid into the state treasury, shall be deposited by him
to the credit of the comptroller in such bank [or], trust company,
A. 7339 4
SAVINGS BANK, CREDIT UNION OR SAVINGS AND LOAN ASSOCIATION as shall be
designated by the comptroller at such rate of interest, if any, as shall
be agreed upon by the depositary and the comptroller.
All other moneys received by the commissioner of taxation and finance
except as provided in section one hundred five of this article and all
moneys received by any other state officer or other person receiving
moneys belonging to the state, or for which such state officer or other
person may be responsible in his official capacity, and all moneys
received by any state institution, except for moneys received pursuant
to a clinical practice plan established pursuant to subdivision fourteen
of section two hundred six of the public health law and all moneys
received from the state by any charitable or benevolent institution
supported in whole or in part by the state, shall be deposited to his or
its credit in such bank [or], trust company, SAVINGS BANK, CREDIT UNION
OR SAVINGS AND LOAN ASSOCIATION as shall be designated by the comp-
troller at such rate of interest, if any, as shall be agreed upon by the
depositary and the comptroller.
Every [bank or trust company] DEPOSITARY designated by the comptroller
for the deposit of any such moneys
S 7. Subdivision 1 of section 2523 of the education law, as amended by
chapter 794 of the laws of 1951, is amended to read as follows:
1. The treasurer of each city school district shall demand, collect,
receive and have the care and custody of moneys belonging to or due the
district from every source. On the business day next following the day
of their receipt the treasurer shall deposit in his name, as treasurer
of the city school district, all such moneys in or with ONE OR MORE OR
ANY COMBINATION OF such banks [or], trust companies, SAVINGS BANKS,
CREDIT UNIONS OR SAVINGS AND LOAN ASSOCIATIONS as shall have been desig-
nated as depositaries of the moneys of such district. Where the board
of education with the written consent of the city authorities, has
appointed a city officer as city school district treasurer, such treas-
urer may not commingle school district funds with city funds.
S 8. Section 3-a of the general city law, as added by chapter 519 of
the laws of 1936, is amended to read as follows:
S 3-a. Liability of city officials. No official of any city of this
state who shall deposit any moneys coming into his hands by virtue of
his office in any bank, savings bank, national banking association,
CREDIT UNION, trust company, SAVINGS AND LOAN ASSOCIATION, or with any
private banker, in accordance with the provisions of any general or
local law or charter, or in accordance with the official action taken by
the governing body or board of any such city, shall be liable for the
loss of any such moneys resulting from the default or insolvency of any
such depositary.
S 9. Subdivision 2 of section 11 of the general municipal law, as
amended by chapter 708 of the laws of 1992, is amended to read as
follows:
2. The governing board of any local government or, if the governing
board so delegates, the chief fiscal officer or other officer having
custody of the moneys may temporarily invest moneys not required for
immediate expenditure, except moneys the investment of which is other-
wise provided for by law, in [special time] INTEREST-BEARING deposit
accounts in, or certificates of deposit issued by, a bank or trust
company, SAVINGS BANK, SAVINGS AND LOAN ASSOCIATION, OR CREDIT UNION
located and authorized to do business in this state, provided however,
that such [time] deposit account or certificate of deposit shall be
payable within such time as the proceeds shall be needed to meet expend-
A. 7339 5
itures for which such moneys were obtained and provided further that
such [time] deposit account or certificate of deposit be secured in the
same manner as is provided for securing deposits of public funds by
subdivision three of section ten of this article. NOTWITHSTANDING THE
ABOVE, A CITY OF ONE MILLION OR MORE SHALL NOT BE REQUIRED TO DEPOSIT OR
INVEST MONEYS NOT REQUIRED FOR IMMEDIATE EXPENDITURE IN INTEREST-BEARING
DEPOSIT ACCOUNTS OR CERTIFICATES OF DEPOSIT.
S 10. Section 70 of the second class cities law is amended to read as
follows:
S 70. Deposits and accounts. All moneys deposited by the treasurer,
as provided herein, shall be placed to the credit of the city. The
treasurer shall keep bank books in which shall be entered his accounts
or deposits in, and moneys drawn from, the [banks or trust companies]
DEPOSITARIES in which such deposits shall be made. He shall exhibit
such books to the comptroller for his inspection at least once each
month, and oftener if required. The [banks or trust companies] DEPOSI-
TARIES in which such deposits are made[,] shall respectively transmit to
the comptroller monthly statements of the moneys which shall have been
received and paid out by them on account of the city.
S 11. Subdivision b of section 4-408 of the village law is amended to
read as follows:
b. deposit, within ten days after receipt thereof, in the name of the
village, in [a bank or trust company] DEPOSITARIES designated by the
board of trustees, all monies received by him;
S 12. Paragraph d of subdivision 1 of section 10 of the general munic-
ipal law, as amended by chapter 623 of the laws of 1998, is amended to
read as follows:
d. "Bank" shall mean a bank, OR SAVINGS BANK OR SAVINGS AND LOAN ASSO-
CIATION as defined by the banking law or a national banking association
located and authorized to do business in New York.
S 13. Subdivision 1 of section 10 of the general municipal law is
amended by adding a new paragraph i to read as follows:
I. "CREDIT UNION" SHALL MEAN A CREDIT UNION AS DEFINED BY THE BANKING
LAW AND AUTHORIZED TO DO BUSINESS IN NEW YORK.
S 14. Severability. If any clause, sentence, paragraph, section or
part of this act shall be adjudged by any court of competent jurisdic-
tion to be invalid, such judgment shall not affect, impair or invalidate
the remainder thereof, but shall be confined in its operation to the
clause, sentence, paragraph, section or part thereof directly involved
in the controversy in which such judgment shall have been rendered.
S 15. This act shall take effect immediately.
REPEAL NOTE.--Subdivision 2 of section 237 of the banking law,
repealed by section two of this act, prohibits a savings bank from
accepting the deposits of a municipal corporation.