NY State Senate Bill 2017-S9094

Archive: Last Bill Status - In Senate Committee Rules Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 15, 2018	referred to rules

co-Sponsors

2017-S9094 (ACTIVE) - Details

See Assembly Version of this Bill:: A6949
Current Committee:: Senate Rules
Law Section:: Banking Law
Laws Affected:: Amd §96-d, Bank L; amd §4, Chap 526 of 1998
Versions Introduced in 2019-2020 Legislative Session:: S2120, A3320

2017-S9094 (ACTIVE) - Summary

Relates to the banking development district program.

2017-S9094 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S9094

SPONSOR: HAMILTON
 
TITLE OF BILL:

An act to amend the banking law, in relation to the banking development
district program; and to amend chapter 526 of the laws of 1998, amending
the banking law relating to participation in the banking development
districts program, in relation to the effectiveness thereof

 
PURPOSE OF THE BILL:

This bill would amend the Banking Law to expand access to banking
services in communities where there is a demonstrated need for addi-
tional products and services.

 
SUMMARY OF PROVISIONS:

Section 1 of the bill would limit the designation of a banking develop-
ment district to fourteen years, yet allow for additional extensions ins
or 10 year increments.

Section 3 of the bill would amend Banking Law § 96-d (5) to allow feder-
al and state credit unions to participate in the banking development
district program.

Sections 2 and 4 of the bill would set forth the effective dates.

 
LEGISLATIVE HISTORY:

New bill.

 
JUSTIFICATION:

Many communities in New York State lack consumer-banking services. In
1997, the Banking Development District (BDD) program was enacted to
incentive banks to locate branches in communities designated as under-
served by the Department of Financial. Services. Such communities either
have no available financial service options, or only offer alternative
(and often problematic) financial service options like check cashers and
Pawn shops.

Under the BDD program, banks that open branches in underserved communi-
ties are eligible to receive below market-rate deposits. Such deposits
lower the financial risk the branches may incur when opening in an
underserved community.

Currently, however, credit unions are currently ineligible to partic-
ipate in the BDD program. Because banks and other eligible financial
institutions have submitted a modest number of applications over the
past twenty years, the program should be expanded to include credit
unions to encourage additional banking services in underserved communi-
ties.

At the same time, it is also appropriate to restrict the unlimited dura-
tion of a BDD designation. Once a banking deficit in an underserved
community is corrected, the incentives provided under the BDD program
are no longer needed. A fourteen year designation limit (with unlimited

extensions as necessary) would make the BDD program more efficient and
allow for the allocation of resources to other communities.

 
FISCAL IMPLICATIONS:

None directly to the state.

 
EFFECTIVE DATE:
This Act shall take effect immediately, however, that the amendments to
subdivision 5 of Section 96-D of the banking law by section three of
this act shall not affect the repeal of such subdivisions and shall be
deemed repealed therewith

2017-S9094 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   9094
 
                             I N  S E N A T E
 
                               June 15, 2018
                                ___________
 
 Introduced  by Sen. HAMILTON -- read twice and ordered printed, and when
   printed to be committed to the Committee on Rules
 
 AN ACT to amend the banking law, in relation to the banking  development
   district program; and to amend chapter 526 of the laws of 1998, amend-
   ing  the banking law relating to participation in the banking develop-
   ment districts program, in relation to the effectiveness thereof

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. Subdivision 2 of section 96-d of the banking law, as added
 by chapter 204 of the laws of 1997, is amended to read as follows:
   2. A local government, in conjunction with a bank,  trust  company  or
 national  bank,  may submit an application to the superintendent for the
 designation of a banking development district. The superintendent  shall
 issue  a  determination  on  such  an  application  within sixty days of
 receiving such application. If an application is  approved,  the  super-
 intendent shall transmit notification of [such approval] THE DESIGNATION
 OF  A  BANKING  DEVELOPMENT  DISTRICT to the local government, the bank,
 trust company or national bank, the state comptroller, the  commissioner
 of  taxation and finance, the commissioner of the department of economic
 development, the temporary president of the senate and  the  speaker  of
 the assembly. THE DESIGNATION OF A BANKING DEVELOPMENT DISTRICT SHALL BE
 VALID  FOR FOURTEEN YEARS. PRIOR TO THE EXPIRATION OF A BANKING DEVELOP-
 MENT DISTRICT DESIGNATION, THE SUPERINTENDENT MAY EXTEND THE DESIGNATION
 FOR ONE OR MORE ADDITIONAL FIVE OR TEN YEAR PERIODS.
   § 2. Section 4 of chapter 526 of the laws of 1998, amending the  bank-
 ing  law  relating to participation in the banking development districts
 program, as amended by chapter 46 of the laws of  2016,  is  amended  to
 read as follows:
   §  4.  This  act  shall  take  effect on the first day of January next
 succeeding the date on which it shall have  become  a  law  and  SECTION
 THREE OF THIS ACT shall remain in effect until January 1, 2023 when upon
 such  date it shall expire and be deemed repealed; provided however that
 any branch established prior to the expiration  and  repeal  of  SECTION
 THREE  OF  this  act  by  a  savings bank, savings and loan association,
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD16330-01-8

 S. 9094                             2
 
 federal savings bank or federal savings and loan association in a  bank-
 ing  development district pursuant to this act shall continue to operate
 in accordance with this act and remain eligible for all the  rights  and
 privileges authorized by this act.
   § 3. Subdivisions 5 and 6 of section 96-d of the banking law, subdivi-
 sion  5  as  added  by chapter 526 of the laws of 1998, paragraph (a) of
 subdivision 5 as amended by chapter 328 of the laws of  1999,  paragraph
 (b)  of  subdivision  5  as  further amended by section 104 of part A of
 chapter 62 of the laws of 2011 and subdivision 6 as amended  by  chapter
 330 of the laws of 2009, are amended to read as follows:
   5.  (a)  Notwithstanding  the provisions of subdivision two of section
 two hundred thirty-seven of this  chapter;  for  the  purposes  of  this
 section,  paragraph  c  of subdivision two of section ten of the general
 municipal law, subdivision six of section one hundred five of the  state
 finance  law and section four hundred eighty-five-f of the real property
 tax law, any reference to a bank, trust company or national  bank  shall
 be  deemed  to  include  a  savings  bank, savings and loan association,
 federal savings and loan association [or], federal savings bank,  CREDIT
 UNION,  OR FEDERAL CREDIT UNION; provided, however, that such provisions
 of law do not grant a savings bank, savings and loan association, feder-
 al savings and loan  association  [or],  federal  savings  bank,  CREDIT
 UNION, OR FEDERAL CREDIT UNION eligibility to accept municipal or public
 funds  or  municipal  or  public  moneys  other  than  for  the [limited
 purposes] SOLE PURPOSE of the establishment of a  branch  in  a  banking
 development  district  pursuant  to  this section; PROVIDED, HOWEVER, NO
 CREDIT UNION OR FEDERAL CREDIT  UNION  MAY  ACCEPT  MUNICIPAL  FUNDS  OR
 MONEYS  FROM  A  MUNICIPAL  CORPORATION  IN EXCESS OF THE STANDARD SHARE
 INSURANCE AMOUNT PER SHARE OWNER AS SET BY  THE  NATIONAL  CREDIT  UNION
 ADMINISTRATION.    Any such municipal or public funds or moneys shall be
 deposited only at the branch established pursuant to this  section,  and
 any  municipal  funds  or moneys may be deposited only by the sponsoring
 municipality in which the branch and banking  development  district  are
 located;  provided  further  that  any such municipal or public funds or
 moneys shall be subject to the same requirements which apply to  munici-
 pal  or  public  funds  or  moneys deposited in a bank, trust company or
 national bank and shall also be subject to the provisions of section one
 hundred five of the state finance law or  section  ten  of  the  general
 municipal law relating to such deposits.
   (b)  Notwithstanding any other provision of law, the superintendent of
 financial services shall promulgate rules and regulations  to  authorize
 the  participation  of  savings  banks,  savings  and loan associations,
 federal savings banks [and],  federal  savings  and  loan  associations,
 CREDIT  UNIONS,  AND  FEDERAL  CREDIT  UNIONS in the program established
 pursuant to this section.
   6. For the purposes of this section, nothing shall  preclude  a  bank,
 trust company or national bank from seeking approval to establish one or
 more  branches  in  an existing banking development district where it or
 another bank has or is authorized to have a branch. The department shall
 have the authority to approve any bank, trust company or  national  bank
 for  participation  in the banking development district program, and any
 branch approved pursuant to this section  shall  operate  in  accordance
 with  this  section  and  is  eligible for all the rights and privileges
 authorized by this section; PROVIDED HOWEVER, AN APPLICATION FOR PARTIC-
 IPATION IN THE BANKING DEVELOPMENT DISTRICT PROGRAM SUBMITTED BY A CRED-
 IT UNION OR FEDERAL CREDIT UNION MAY BE APPROVED BY  THE  SUPERINTENDENT
 ONLY  UPON A FINDING THAT: (A) THE APPLICATION MEETS THE CRITERIA ESTAB-

 S. 9094                             3
 
 LISHED HEREIN AND BY RULE, (B)  THE  BANKING  DEVELOPMENT  DISTRICT  FOR
 WHICH  THE  APPLICATION  IS  SUBMITTED  HAS  AN UNMET NEED FOR FINANCIAL
 SERVICES AS DETERMINED BY THE SUPERINTENDENT, AND (C) THAT  NO  APPLICA-
 TION  BY  A  BANK,  TRUST  COMPANY OR NATIONAL BANK, OTHER THAN A CREDIT
 UNION OR FEDERAL CREDIT UNION  HAS  A  PENDING  APPLICATION  BEFORE  THE
 SUPERINTENDENT  THAT, IN THE OPINION OF THE SUPERINTENDENT, WILL FULFILL
 THE UNMET NEED FOR SUCH SERVICES.
   § 4. This act shall take effect immediately; provided,  however,  that
 the  amendments to subdivision 5 of section 96-d of the banking law made
 by section three of this act shall not affect the repeal of such  subdi-
 vision and shall be deemed repealed therewith.

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Senate Bill S9094

Sponsored By

Archive: Last Bill Status - In Senate Committee Rules Committee

co-Sponsors

2017-S9094 (ACTIVE) - Details

2017-S9094 (ACTIVE) - Summary

2017-S9094 (ACTIVE) - Sponsor Memo

2017-S9094 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S9094

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Sponsored By

Jesse Hamilton

Archive: Last Bill Status - In Senate Committee Rules Committee

co-Sponsors

Velmanette Montgomery

2017-S9094 (ACTIVE) - Details

2017-S9094 (ACTIVE) - Summary

2017-S9094 (ACTIVE) - Sponsor Memo

2017-S9094 (ACTIVE) - Bill Text download pdf

Comments