LBD03596-01-9
S. 1778 2
274. APPLICATION OF THIS CHAPTER TO THE PRESIDENT.
275. CASH AND DEMAND DEPOSITS AVAILABLE.
276. PERMITTED INVESTMENTS.
277. SEVERABILITY.
§ 254. LEGISLATIVE INTENT. 1. THE LEGISLATURE FINDS THAT THERE ARE
SIGNIFICANT PUBLIC INFRASTRUCTURE, HIGHER EDUCATION AND BUSINESS DEVEL-
OPMENT NEEDS OF THE STATE THAT ARE UNMET. THE LEGISLATURE FURTHER FINDS
THAT THERE ARE OPPORTUNITIES TO USE THE STATE'S DEPOSITORY ASSETS TO
GENERATE ADDITIONAL BENEFIT FOR THE PEOPLE AND THE ECONOMY OF THE STATE.
THEREFORE, THE LEGISLATURE INTENDS TO CREATE THE EMPIRE STATE PUBLIC
BANK AS A LEGACY INSTITUTION THAT AMASSES SUFFICIENT CAPITAL RESERVES TO
ADDRESS OPPORTUNITIES NOW AND IN THE FUTURE.
2. THE LEGISLATURE INTENDS THAT THE PUBLIC BANK MAY:
(A) FACILITATE INVESTMENT IN, AND FINANCING OF, PUBLIC INFRASTRUCTURE
SYSTEMS THAT WILL INCREASE PUBLIC HEALTH, SAFETY, AND QUALITY OF LIFE,
IMPROVE ENVIRONMENTAL CONDITIONS, AND PROMOTE COMMUNITY VITALITY AND
ECONOMIC GROWTH;
(B) ASSIST STUDENTS WHO ARE IN NEED OF ADDITIONAL LOW-COST STUDENT
LOANS IN ORDER TO FINANCE THE COST OF HIGHER EDUCATION;
(C) PROVIDE BUSINESSES, COMMUNITIES AND LOW INCOME AREAS OF OUR STATE
ACCESS TO LOW-INTEREST CAPITAL; AND
(D) LEVERAGE NEW YORK'S FINANCIAL CAPITAL AND RESOURCES, AND WORK IN
PARTNERSHIP WITH FINANCIAL INSTITUTIONS, COMMUNITY-BASED ORGANIZATIONS,
ECONOMIC DEVELOPMENT ORGANIZATIONS, GUARANTY AGENCIES, AND OTHER SIMILAR
ORGANIZATIONS.
3. THE MISSION OF THE BANK IS TO USE NEW YORK'S DEPOSITORY ASSETS IN
WAYS THAT AFFORD MOST EFFICIENT USE OF TAXPAYER REVENUES AND PUBLIC
RESOURCES FOR THE BENEFIT OF THE PEOPLE AND ECONOMY OF THE STATE. THE
LEGISLATURE INTENDS FOR THE BANK TO APPLY BUSINESS STRATEGIES TO MANAGE
TAXPAYER REVENUES WHILE CONCURRENTLY MEETING IDENTIFIED NEEDS AND STRA-
TEGIC OPPORTUNITIES ACROSS THE STATE. IN ACHIEVING ITS PURPOSE OF
IMPROVING PUBLIC INFRASTRUCTURE AND INCREASING ACCESS TO HIGHER EDUCA-
TION, THE LEGISLATURE INTENDS FOR THE BANK TO ADHERE TO THE FOLLOWING
PRIORITIES:
(A) INSTITUTIONAL SAFETY AND SOUNDNESS;
(B) LONG-TERM VIABILITY;
(C) SOCIAL RETURN AND MONETARY RETURN ON INVESTMENTS;
(D) PRUDENT AND BEST BANKING AND BUSINESS PRACTICES;
(E) HIGHEST ETHICAL, ACCOUNTABILITY, AND TRANSPARENCY STANDARDS; AND
(F) INSULATION FROM POLITICAL INFLUENCE.
§ 255. DEFINITIONS. THE DEFINITIONS IN THIS SECTION APPLY THROUGHOUT
THIS ARTICLE UNLESS THE CONTEXT CLEARLY REQUIRES OTHERWISE.
1. "BOARD" MEANS THE ADVISORY BOARD OF THE EMPIRE STATE PUBLIC BANK.
2. "COMMISSION" MEANS THE EMPIRE STATE PUBLIC BANK COMMISSION.
3. "DEPARTMENT" MEANS THE DEPARTMENT OF FINANCIAL SERVICES.
4. "DIRECTOR" MEANS THE DIRECTOR OF THE DEPARTMENT OF FINANCIAL
SERVICES.
5."SUPERINTENDENT" MEANS THE SUPERINTENDENT OF THE DEPARTMENT OF
FINANCIAL SERVICES.
6. "PUBLIC INFRASTRUCTURE SYSTEM" MEANS A SYSTEM OF A LOCAL GOVERNMENT
OR POLITICAL SUBDIVISION, A SPECIAL PURPOSE DISTRICT, A PUBLIC SCHOOL
DISTRICT, AN INSTITUTION OF HIGHER EDUCATION, A FEDERALLY RECOGNIZED
INDIAN TRIBE, OR THE STATE, INCLUDING BUT NOT LIMITED TO A SYSTEM
INVOLVING: WASTEWATER TREATMENT; STORM WATER MANAGEMENT; SOLID WASTE
DISPOSAL; DRINKING WATER TREATMENT; FLOOD CONTROL LEVEES; ENERGY EFFI-
CIENCY ENHANCEMENTS; ROADS, STREETS, AND BRIDGES; TRANSPORTATION INFRAS-
S. 1778 3
TRUCTURE, INCLUDING FREIGHT AND PASSENGER RAIL AND PUBLIC TRANSIT;
BROADBAND AND TELECOMMUNICATIONS INFRASTRUCTURE; OUTDOOR RECREATION AND
HABITAT PROTECTION FACILITIES; COMMUNITY, SOCIAL SERVICE, OR PUBLIC
SAFETY FACILITIES; SCHOOLS AND EDUCATIONAL FACILITIES; AND AFFORDABLE
HOUSING.
7. "STATE-CHARTERED BANK" MEANS ANY CORPORATION ORGANIZED UNDER THE
LAWS OF THIS STATE THAT IS ENGAGED IN BANKING, OTHER THAN A TRUST COMPA-
NY, SAVINGS ASSOCIATION, OR A MUTUAL SAVINGS BANK. IT DOES NOT INCLUDE
THE EMPIRE STATE PUBLIC BANK.
8. "STATE MONEYS" MEANS ALL MONEYS OR FUNDS BELONGING TO OR IN THE
CUSTODY OF THE STATE UNDER THE CONTROL OF THE STATE COMPTROLLER SHALL BE
CONSIDERED AS STATE MONEYS OR FUNDS.
9. "COMPTROLLER" MEANS THE COMPTROLLER OF THE STATE OF NEW YORK.
10. "BANK" MEANS THE EMPIRE STATE PUBLIC BANK.
§ 256. CREATION. THE EMPIRE STATE PUBLIC BANK IS CREATED.
§ 257. COMMISSION. 1. THE EMPIRE STATE PUBLIC BANK COMMISSION IS
CREATED AS THE PRIMARY GOVERNING AUTHORITY OF THE BANK. THE COMMISSION
SHALL CONSIST OF THE GOVERNOR, THE LIEUTENANT GOVERNOR, THE CHAIR OF THE
ASSEMBLY BANKING COMMITTEE, THE CHAIR OF SENATE BANKING COMMITTEE, AND
THE STATE COMPTROLLER.
2. THE COMMISSION SHALL ADOPT RULES REGARDING THE:
(A) SAFETY AND SOUNDNESS STANDARDS OF THE BANK;
(B) CRITERIA FOR EVALUATING, APPROVING, AND MONITORING LOANS;
(C) ELIGIBILITY REQUIREMENTS AND LIMITS FOR BORROWING;
(D) TRANSPARENCY REQUIREMENTS FOR BANK OPERATIONS;
(E) ETHICS AND CONFLICT OF INTEREST REQUIREMENTS FOR THE COMMISSION,
THE BOARD, AND OFFICERS AND EMPLOYEES OF THE BANK, INCLUDING RULES TO
ENSURE THAT THEY PERFORM THEIR FUNCTIONS IN COMPLIANCE WITH THE PUBLIC
OFFICERS LAW; AND
(F) OTHER TOPICS AS NEEDED FOR EFFICIENT ADMINISTRATION OF THE BANK.
3. THE COMMISSION SHALL COMMENCE BANK OPERATIONS BY APRIL FIRST, TWO
THOUSAND TWENTY.
4. THE COMMISSION MAY DELEGATE TO THE BANK PRESIDENT SUCH DUTIES AND
POWERS AS DEEMED NECESSARY TO CARRY ON THE BUSINESS OF THE BANK AND
ENFORCE THIS ARTICLE EFFICIENTLY AND EFFECTIVELY. THE COMMISSION MAY NOT
DELEGATE ITS RULE-MAKING OR POLICY-MAKING AUTHORITY.
5. THE COMMISSION SHALL ADOPT POLICIES AND PROCEDURES FOR ITS OWN
GOVERNANCE.
6. THE COMMISSION MAY ESTABLISH TECHNICAL ADVISORY COMMITTEES OR
CONSULT WITH PUBLIC AND PRIVATE SECTOR EXPERTS IN SUBSTANTIVE AREAS
RELATED TO THE BANK'S MISSION, OBJECTIVES, AND DUTIES.
§ 258. TRANSITION BOARD. 1. (A) THE BANK TRANSITION BOARD IS ESTAB-
LISHED, WITH MEMBERS AS PROVIDED IN THIS SECTION.
(I) THE TEMPORARY PRESIDENT OF THE SENATE SHALL APPOINT ONE MEMBER
FROM EACH OF THE TWO LARGEST CAUCUSES OF THE SENATE.
(II) THE SPEAKER OF THE ASSEMBLY SHALL APPOINT ONE MEMBER FROM EACH OF
THE TWO LARGEST CAUCUSES OF THE ASSEMBLY.
(III) THE TEMPORARY PRESIDENT OF THE SENATE AND THE SPEAKER OF THE
ASSEMBLY JOINTLY SHALL APPOINT SEVEN CITIZEN MEMBERS WITH A SUBSTANTIAL
BACKGROUND IN BANKING OR FINANCIAL ISSUES.
(B) THE TEMPORARY PRESIDENT OF THE SENATE AND THE SPEAKER OF THE
ASSEMBLY JOINTLY SHALL SELECT THE CHAIR FROM AMONG THE CITIZEN MEMBER-
SHIP. THE CHAIR SHALL CONVENE THE INITIAL MEETING OF THE BANK TRANSITION
BOARD WITHIN FORTY-FIVE DAYS AFTER THE EFFECTIVE DATE OF THIS SECTION.
2. THE BANK TRANSITION BOARD SHALL DEVELOP AND RECOMMEND THE FOLLOWING
TO THE COMMISSION WITHIN THE TIMELINE ESTABLISHED BY THE COMMISSION:
S. 1778 4
(A) A START-UP BUSINESS PLAN FOR THE BANK THAT INCLUDES PLANS AND
TIMELINES FOR FUNCTIONS THAT ARE NEW AND FUNCTIONS TRANSITIONING TO THE
BANK THAT WERE PREVIOUSLY PERFORMED BY ANOTHER ENTITY;
(B) INITIAL CAPITAL REQUIREMENTS OF THE BANK;
(C) OPTIONS FOR CAPITALIZING THE BANK; AND
(D) OTHER ITEMS REQUESTED BY THE COMMISSION IN ORDER TO COMMENCE BANK
OPERATIONS BY APRIL FIRST, TWO THOUSAND TWENTY.
3. LEGISLATIVE MEMBERS OF THE BANK TRANSITION BOARD MUST BE REIMBURSED
FOR TRAVEL EXPENSES IN ACCORDANCE WITH THE RULES OF THEIR RESPECTIVE
HOUSES. NON-LEGISLATIVE MEMBERS ARE ENTITLED TO BE REIMBURSED FOR
EXPENSES INCURRED IN THE DISCHARGE OF THEIR DUTIES UNDER THIS ARTICLE.
4. THE BANK TRANSITION BOARD MAY APPOINT AN INTERIM PRESIDENT AND
OTHER NECESSARY STAFF WHO ARE EXEMPT FROM THE PROVISIONS OF THIS CHAP-
TER, AND WHO SERVE AT THE BOARD'S PLEASURE ON SUCH TERMS AND CONDITIONS
AS THE BOARD DETERMINES. THE DEPARTMENT MUST PROVIDE TECHNICAL ASSIST-
ANCE TO THE BANK TRANSITION BOARD. THE BOARD MAY ALSO CONTRACT WITH
ADDITIONAL PERSONS WHO HAVE SPECIFIC TECHNICAL EXPERTISE IF THE EXPER-
TISE IS NECESSARY TO CARRY OUT THE REQUIREMENTS OF THIS SECTION.
§ 259. DEPOSIT OF PUBLIC FUNDS. 1. (A) THE BANK SHALL SERVE AS THE
DEPOSITORY FOR STATE MONEYS ONCE THE BANK HAS BUILT SUFFICIENT CAPACITY
TO ACCEPT AND MANAGE STATE MONEYS, AS DETERMINED BY THE COMMISSION. THE
COMMISSION SHALL ESTABLISH A PROCESS AND TIME FRAME FOR THE DEPOSIT OF
STATE MONEYS INTO THE BANK.
(B) THE COMPTROLLER SHALL DEPOSIT STATE MONEYS IN THE BANK IN ACCORD-
ANCE WITH THE TIME FRAME AND GUIDELINES DETERMINED BY THE COMMISSION
UNDER THIS SECTION.
2. ALL DEPOSITS IN THE BANK ARE GUARANTEED BY THE STATE.
3. ALL INCOME EARNED BY THE BANK ON STATE MONEYS THAT ARE DEPOSITED IN
OR INVESTED WITH THE BANK MUST BE CREDITED TO AND BECOME A PART OF THE
REVENUES AND INCOME OF THE BANK.
4. THE BANK MAY ACCEPT DEPOSITS OF PUBLIC FUNDS, BUT IS EXEMPT FROM
THE REQUIREMENTS OF SECTION ONE HUNDRED FIVE OF THIS CHAPTER.
5. THE BANK MAY ACCEPT FUNDS FROM ANY SOURCE, INCLUDING FEDERAL FUNDS
OR OTHER PUBLIC FUNDS.
6. THE COMMISSION SHALL REVIEW STATE ACCOUNTS THAT CONTAIN PUBLIC
FUNDS THAT ARE NOT STATE MONEYS, SUCH AS THE STATE INSURANCE FUND, AND
MAKE RECOMMENDATIONS TO THE GOVERNOR AND THE APPROPRIATE COMMITTEES OF
THE LEGISLATURE AS TO WHICH ACCOUNTS SHOULD BE DEPOSITED IN THE BANK.
7. THE BANK SHALL MAKE DISBURSEMENTS TO THE STATE FUNDS AS NECESSARY
FOR THE FUNCTION OF STATE GOVERNMENT.
§ 260. INVESTMENT OF STATE MONEYS. THE BANK MAY INVEST STATE MONEYS
DEPOSITED IN THE BANK THAT ARE NOT REASONABLY EXPECTED TO BE NECESSARY
TO MEET THE SHORT OR INTERMEDIATE-TERM LIQUIDITY NEEDS OF THE STATE. THE
STATE COMPTROLLER RETAINS AUTHORITY TO MANAGE AND INVEST THE AMOUNT OF
FUNDS NECESSARY TO MEET THE OPERATIONAL NEEDS OF STATE GOVERNMENT.
§ 261. INFRASTRUCTURE LOANS. THE BANK IS AUTHORIZED TO FACILITATE
INVESTMENT IN, AND FINANCING OF, CONSTRUCTION, REHABILITATION, REPLACE-
MENT, AND IMPROVEMENT OF NEW AND EXISTING PUBLIC INFRASTRUCTURE SYSTEMS.
BEFORE INITIATING OPERATIONS, THE COMMISSION MUST PRESENT AN IMPLEMENTA-
TION PLAN AND ANY NECESSARY LEGISLATION TO THE GOVERNOR AND APPROPRIATE
LEGISLATIVE COMMITTEES, THAT:
1. IDENTIFIES THE PUBLIC INFRASTRUCTURE SYSTEMS THAT THE BANK PLANS TO
TARGET INITIALLY;
2. IDENTIFIES ANY EXISTING STATE PROGRAMS THAT THE BANK RECOMMENDS BE
TRANSFERRED UNDER ITS UMBRELLA, AND THE STEPS AND TIMELINES FOR THE
TRANSITIONS;
S. 1778 5
3. DESCRIBES ADDITIONAL FINANCING PRODUCTS AND SERVICES THE BANK PLANS
TO OFFER, THE TARGET MARKETS, ANTICIPATED RATES, TERMS, AND CONDITIONS;
4. DEMONSTRATES HOW BANK PRODUCTS AND SERVICES WILL INCREASE ACCESS TO
CAPITAL FOR PUBLIC INFRASTRUCTURE SYSTEMS AND COMPLEMENT THOSE OF EXIST-
ING PUBLIC AND PRIVATE SOURCES; AND
5. DEMONSTRATES HOW THE BANK PLANS TO MAXIMIZE REVENUES AND PUBLIC
BENEFIT.
§ 262. STUDENT LOANS. THE BANK IS AUTHORIZED TO ADMINISTER A STATE
GUARANTEE LOAN PROGRAM TO ASSIST STUDENTS IN NEED OF LOW-COST STUDENT
LOANS AND RELATED LOAN BENEFITS TO ADDRESS EDUCATIONAL NEEDS AS NECES-
SARY TO SUPPORT STUDENT SUCCESS. THE COMMISSION SHALL DEVELOP AN IMPLE-
MENTATION PLAN THAT:
1. IDENTIFIES THE NEEDS AND BENEFITS TO SELECTED STUDENTS THAT THE
PROGRAM WILL TARGET INITIALLY;
2. DEMONSTRATES HOW THE BANK PLANS TO MAXIMIZE REVENUES AND PUBLIC
BENEFIT WHILE MINIMIZING PUBLIC RISK;
3. DEMONSTRATES HOW THE BANK WILL COORDINATE WITH THE OFFICE OF
STUDENT FINANCIAL ASSISTANCE; AND
4. IDENTIFIES THE WAYS THAT THE PROGRAM WILL ADDRESS THE FOLLOWING
ISSUES RELATED TO LOANS:
(A) QUALIFICATION CRITERIA FOR STUDENTS;
(B) OBLIGATIONS AND OPTIONS FOR LOAN REPAYMENT;
(C) REQUIREMENTS FOR LOAN GUARANTEES AND RESERVES;
(D) FEE AND INTEREST RATE STRUCTURE;
(E) MAXIMUM LOAN AMOUNTS; AND
(F) ENSURING STUDENT AWARENESS OF GRANTS, FEDERAL LOANS, AND OTHER
FINANCIAL AID PROGRAMS.
§ 263. BUSINESS, NON-PROFIT AND INDIVIDUAL LOANS. THE BANK IS AUTHOR-
IZED TO LEVERAGE ITS FINANCIAL CAPITAL AND RESOURCES TO PROVIDE ACCESS
TO LOW-COST CAPITAL TO BUSINESSES, ENTREPRENEURS, NON-PROFIT COMMUNITY-
BASED ORGANIZATIONS, START-UP BUSINESSES AND BELOW AVERAGE INCOME AREAS
AND INDIVIDUALS OF THIS STATE TO FURTHER ECONOMIC GROWTH, CREATE JOBS
AND BUILD AND SUSTAIN AFFORDABLE HOUSING FOR THE RESIDENTS OF THIS STATE
AS PROVIDED FOR BY THIS SECTION. THE BANK IS ALSO AUTHORIZED TO LEVERAGE
ITS FINANCIAL CAPITAL AND RESOURCES TO PROVIDE ACCESS TO LOW-COST CAPI-
TAL TO BRING FISCALLY SOUND AND FINANCIALLY SUCCESSFUL BUSINESSES INTO
THIS STATE AS PROVIDED FOR BY THIS SECTION. THE BANK IS ALSO AUTHORIZED
TO LEVERAGE ITS FINANCIAL CAPITAL AND RESOURCES TO PROVIDE ACCESS TO
LOW-COST CAPITAL TO ESTABLISHED BUSINESSES IN THIS STATE FOR THE PURPOSE
OF PROVIDING FINANCIAL STABILITY FOR THE BANK AS PROVIDED FOR BY THIS
SECTION.
1. PURCHASE, GUARANTEE OR HOLD LOANS MADE BY PRIVATE BANKS, CREDIT
UNIONS OR OTHER FINANCIAL INSTITUTIONS DOING BUSINESS IN THIS STATE.
2. MAKE LOANS IN THE FORM OF PARTICIPATION LOANS WITH COMMUNITY BANKS
IN THIS STATE TO QUALIFIED INDIVIDUALS AND BUSINESSES RESIDING OR DOING
BUSINESS IN THIS STATE WHEN THE ORIGINATOR OF THE LOAN IS A PRIVATE
BANK, CREDIT UNION OR OTHER FINANCIAL INSTITUTION.
3. SERVE AS A BANKER'S BANK FOR CHARTERED BANKS IN THIS STATE BY
PROVIDING CORRESPONDENT BANKING SERVICES AND OTHER RELATED SERVICES IN
KEEPING WITH ITS MISSION.
4. ACCEPT DEPOSITS RELATED TO SUCH TRANSACTIONS FROM BANKS AND OTHER
FINANCIAL INSTITUTIONS.
5. BE AUTHORIZED TO ISSUE BANK STOCK LOANS TO STATE-CHARTED BANKS.
§ 264. TREASURY AND BANKING SERVICES. 1. FOR FINANCIAL INSTITUTIONS
THAT MAKE THE BANK A RESERVE DEPOSITORY, THE BANK MAY SERVE AS A CLEAR-
S. 1778 6
INGHOUSE, INCLUDING ALL FACILITIES FOR PROVIDING DOMESTIC AND FOREIGN
EXCHANGE, AND MAY REDISCOUNT PAPER, ON TERMS THE COMMISSION PROVIDES.
2. THE BANK MAY PROVIDE CORPORATE TRUST SERVICES FOR THE STATE AND ITS
POLITICAL SUBDIVISIONS INCLUDING TRUSTEE, ESCROW AGENT, PAYING AGENT,
BOND REGISTRAR, AND TRANSFER AGENT.
3. THE BANK MAY BUY AND SELL FEDERAL FUNDS; ISSUE LETTERS OF CREDIT
FOR PUBLIC DEPOSITS; AND PROVIDE A SAFEKEEPING SERVICE FOR UNITED STATES
TREASURY SECURITIES, FEDERAL AGENCY SECURITIES, CORPORATE BONDS, TAX-
FREE BONDS, MONEY MARKET INVESTMENTS, AND MORTGAGE-BACKED SECURITIES.
4. THE BANK MAY PERFORM SERVICES CURRENTLY CONTRACTED OUT BY THE
OFFICE OF TEMPORARY DISABILITY SERVICES REGARDING ELECTRONIC BENEFITS
TRANSFER CARDS.
§ 265. MANAGEMENT. 1. THE COMMISSION SHALL APPOINT A BANK PRESIDENT
WITH DEMONSTRATED AND SUBSTANTIAL EXPERIENCE IN BANKING. THE PRESIDENT
SHALL SERVE AT THE COMMISSION'S PLEASURE, ON SUCH TERMS AND CONDITIONS
AS THE COMMISSION DETERMINES.
2. THE PRESIDENT SHALL PROVIDE SUPPORT TO THE COMMISSION AND THE ADVI-
SORY BOARD, CARRY OUT BANK POLICIES AND PROGRAMS, AND EXERCISE ADDI-
TIONAL AUTHORITY AS MAY BE DELEGATED BY THE COMMISSION.
3. SUBJECT TO AVAILABLE FUNDING AND CONSISTENT WITH COMMISSION DIREC-
TION, THE BANK PRESIDENT:
(A) MAY EMPLOY SUCH ADDITIONAL PERSONNEL AS ARE NECESSARY TO THE
BANK'S OPERATIONS. THIS EMPLOYMENT SHALL BE IN ACCORDANCE WITH THE
STATE CIVIL SERVICE LAW; AND
(B) MAY CONTRACT WITH PERSONS WHO HAVE THE TECHNICAL EXPERTISE NEEDED
TO CARRY OUT A SPECIFIC, TIME-LIMITED PROJECT.
§ 266. ADVISORY BOARD. 1. (A) A PUBLIC BANK ADVISORY BOARD CONSISTING
OF ELEVEN MEMBERS IS CREATED TO REVIEW THE BANK'S OPERATIONS AND MAKE
RECOMMENDATIONS RELATING TO THE BANK'S MANAGEMENT, SERVICES, POLICIES,
AND PROCEDURES.
(B) THE GOVERNOR SHALL APPOINT MEMBERS OF THE ADVISORY BOARD, SUBJECT
TO CONFIRMATION BY THE SENATE. THE MEMBERS OF THE ADVISORY BOARD MUST BE
KNOWLEDGEABLE IN BANKING OR FINANCE AND MUST REPRESENT A DIVERSITY OF
EXPERIENCE RELEVANT TO ACTIVITIES OF THE BANK. SIX OR MORE OF THE
MEMBERS MUST HAVE EXPERTISE IN BANKING OR FINANCE. TWO MEMBERS MUST BE
FROM A CONSUMER ADVOCACY OR SOCIAL JUSTICE ORGANIZATION OR HAVE A BACK-
GROUND IN THE AREA OF CONSUMER ADVOCACY OR SOCIAL JUSTICE. ADVISORY
BOARD MEMBERS SERVE AT THE PLEASURE OF THE GOVERNOR.
(C) THE BOARD SHALL CHOOSE ITS CHAIR FROM AMONG ITS MEMBERSHIP.
2. THE TERM OF THE MEMBERS IS THREE YEARS. FIVE OF THE INITIAL BOARD
MEMBERS MUST BE APPOINTED TO SERVE AN INITIAL TERM OF THREE YEARS, THREE
MUST BE APPOINTED TO SERVE AN INITIAL TERM OF TWO YEARS, AND THE THREE
REMAINING MEMBERS MUST BE APPOINTED TO SERVE AN INITIAL TERM OF ONE
YEAR. ALL SUBSEQUENT TERMS ARE THREE YEARS. TO ENSURE THAT THE BOARD CAN
CONTINUE TO ACT, A MEMBER WHOSE TERM EXPIRES SHALL CONTINUE TO SERVE
UNTIL HIS OR HER REPLACEMENT IS APPOINTED. IN THE CASE OF ANY VACANCY ON
THE BOARD FOR ANY REASON, THE GOVERNOR SHALL APPOINT A NEW MEMBER TO
SERVE OUT THE TERM OF THE PERSON WHOSE POSITION HAS BECOME VACANT. A
BOARD MEMBER MAY BE REMOVED FOR MISCONDUCT INCONSISTENT WITH THE MISSION
OF THE BANK BY THE GOVERNOR.
3. MEMBERS OF THE ADVISORY BOARD ARE ENTITLED TO REIMBURSEMENT FOR
EXPENSES INCURRED IN THE DISCHARGE OF THEIR DUTIES UNDER THIS ARTICLE.
§ 267. FINANCIAL REGULATION. 1. THE BANK MUST MAINTAIN CAPITAL ADEQUA-
CY AND OTHER STANDARD INDICATORS OF SAFETY AND SOUNDNESS AS IS APPROPRI-
ATE FOR A PUBLICLY OWNED FINANCIAL INSTITUTION.
S. 1778 7
2. THE SUPERINTENDENT MAY EXAMINE THE BANK IN THE SAME MANNER AS A
STATE-CHARTERED FINANCIAL INSTITUTION. THE SUPERINTENDENT SHALL TAKE
INTO CONSIDERATION THE UNIQUE CIRCUMSTANCES OF A PUBLICLY OWNED FINAN-
CIAL INSTITUTION WHEN EXAMINING THE BANK. THE BANK SHALL PAY THE DIREC-
TOR FOR THE REASONABLE COSTS OF EXAMINATIONS.
3. THE BANK MUST UNDERGO INDEPENDENT AUDITS ON THE SAME BASIS AS
STATE-CHARTERED BANKS.
§ 268. REPORTING REQUIREMENTS. 1. THE BANK SHALL SUBMIT QUARTERLY
REPORTS TO THE COMMISSION IN A MANNER AND FORM PRESCRIBED BY THE COMMIS-
SION. LATE REPORTS ARE NOT PERMISSIBLE AND SHALL BE CAUSE FOR REMOVAL
OF THE PERSON OR PERSONS RESPONSIBLE.
2. THE COMMISSION SHALL MAKE A REPORT TO THE LEGISLATURE ON THE
AFFAIRS OF THE BANK BY DECEMBER FIRST OF EACH YEAR.
§ 269. ETHICAL REQUIREMENTS. THE BANK MAY NOT MAKE A LOAN TO ANY ADVI-
SORY BOARD MEMBER, THE PRESIDENT, PUBLIC OFFICERS OR EMPLOYEES OF THE
BANK. ADVISORY BOARD MEMBERS, THE PRESIDENT, AND EMPLOYEES OF THE BANK
MUST FOLLOW ANY APPLICABLE ETHICAL REQUIREMENTS IN RULES, POLICIES, AND
PROCEDURES ADOPTED BY THE COMMISSION.
§ 270. FEES AND TAXES. THE BANK IS EXEMPT FROM PAYMENT OF ALL FEES AND
TAXES LEVIED BY THE STATE OR ANY OF ITS SUBDIVISIONS.
§ 271. BANK RECORDS. 1. CERTAIN BANK BUSINESS RECORDS AND RECORDS OF
THE DEPARTMENT RELATING TO THE BANK ARE EXEMPT FROM PUBLIC DISCLOSURE AS
AUTHORIZED BY THE DEPARTMENT OF FINANCIAL SERVICES.
2. FINANCIAL AND COMMERCIAL INFORMATION AND RECORDS SUBMITTED TO
EITHER THE DEPARTMENT OR THE COMMISSION FOR THE PURPOSE OF ADMINISTERING
THIS ARTICLE MAY BE SHARED BETWEEN THE DEPARTMENT AND THE COMPTROLLER.
THESE RECORDS MAY ALSO BE USED IN ANY SUIT OR ADMINISTRATIVE HEARING
INVOLVING ANY PROVISION OF THIS CHAPTER.
3. THIS SECTION DOES NOT PROHIBIT:
(A) THE ISSUANCE OF GENERAL STATEMENTS BASED ON THE REPORTS OF PERSONS
SUBJECT TO THIS ARTICLE AS LONG AS THE STATEMENTS DO NOT IDENTIFY THE
INFORMATION FURNISHED BY ANY PERSON; OR
(B) THE PUBLICATION BY THE DIRECTOR OR THE COMMISSION OF THE NAME OF
ANY PERSON VIOLATING THIS ARTICLE AND A STATEMENT OF THE MANNER OF THE
VIOLATION BY THAT PERSON.
§ 272. CAPITALIZATION. THE COMMISSION MUST MAKE RECOMMENDATIONS TO THE
APPROPRIATE FISCAL COMMITTEES OF THE LEGISLATURE ON OPTIONS FOR CAPITAL-
IZATION OF THE BANK. ANY RECOMMENDATIONS MUST INCLUDE DRAFT LEGISLATION
FOR CONSIDERATION BY THE LEGISLATURE.
§ 273. PUBLIC DEPOSITARY. THE EMPIRE STATE PUBLIC BANK CREATED IN
SECTION TWO HUNDRED FIFTY-SIX OF THIS ARTICLE MAY ACCEPT DEPOSITS OF
PUBLIC FUNDS, BUT IS NOT A PUBLIC DEPOSITARY.
§ 274. APPLICATION OF THIS CHAPTER TO THE PRESIDENT. THE PROVISIONS OF
THIS CHAPTER OUTSIDE THIS ARTICLE DO NOT APPLY TO THE PRESIDENT AS
DEFINED IN SECTION TWO HUNDRED SIXTY-FIVE OF THIS ARTICLE.
§ 275. CASH AND DEMAND DEPOSITS AVAILABLE. THE STATE COMPTROLLER SHALL
MAINTAIN AT ALL TIMES CASH, OR DEMAND DEPOSITS IN THE EMPIRE STATE
PUBLIC BANK OR QUALIFIED PUBLIC DEPOSITARIES IN AN AMOUNT NEEDED TO MEET
THE OPERATIONAL NEEDS OF STATE GOVERNMENT. THE STATE COMPTROLLER SHALL
NOT BE CONSIDERED TO BE IN VIOLATION OF UNLAWFUL ISSUANCE OF CHECKS OR
DRAFTS IF HE OR SHE MAINTAINS DEMAND ACCOUNTS IN PUBLIC DEPOSITARIES IN
AN AMOUNT LESS THAN ALL TREASURY WARRANTS ISSUED AND OUTSTANDING.
§ 276. PERMITTED INVESTMENTS. SUBJECT TO THE LIMITATIONS IN SECTION
TWO HUNDRED SIXTY OF THIS ARTICLE, WHEREVER THERE IS IN ANY FUND OR IN
CASH BALANCES IN THE STATE TREASURY MORE THAN SUFFICIENT TO MEET THE
CURRENT EXPENDITURES PROPERLY PAYABLE THEREFROM, THE BANK MAY INVEST OR
S. 1778 8
REINVEST SUCH PORTION OF SUCH FUNDS OR BALANCES AS THE BANK DEEMS EXPE-
DIENT IN THE FOLLOWING DEFINED SECURITIES OR CLASSES OF INVESTMENTS:
1. CERTIFICATES, NOTES, OR BONDS OF THE UNITED STATES, OR OTHER OBLI-
GATIONS OF THE UNITED STATES OR ITS AGENCIES, OR OF ANY CORPORATION
WHOLLY OWNED BY THE GOVERNMENT OF THE UNITED STATES;
2. IN STATE, COUNTY, MUNICIPAL, OR SCHOOL DISTRICT BONDS, OR IN
WARRANTS OF TAXING DISTRICTS OF THE STATE. SUCH BONDS AND WARRANTS SHALL
BE ONLY THOSE FOUND TO BE WITHIN THE LIMIT OF INDEBTEDNESS PRESCRIBED BY
LAW FOR THE TAXING DISTRICT ISSUING THEM AND TO BE GENERAL OBLIGATIONS.
THE STATE COMPTROLLER MAY PURCHASE SUCH BONDS OR WARRANTS DIRECTLY FROM
THE TAXING DISTRICT OR IN THE OPEN MARKET AT SUCH PRICES AND UPON SUCH
TERMS AS IT MAY DETERMINE, AND MAY SELL THEM AT SUCH TIMES AS IT DEEMS
ADVISABLE;
3. IN MOTOR VEHICLE FUND WARRANTS WHEN AUTHORIZED BY AGREEMENT BETWEEN
THE STATE COMPTROLLER AND THE DEPARTMENT OF TRANSPORTATION REQUIRING
REPAYMENT OF INVESTED FUNDS FROM ANY MONEYS IN THE MOTOR VEHICLE FUND
AVAILABLE FOR STATE HIGHWAY CONSTRUCTION;
4. IN FEDERAL HOME LOAN BANK NOTES AND BONDS, FEDERAL LAND BANK BONDS
AND FEDERAL NATIONAL MORTGAGE ASSOCIATION NOTES, DEBENTURES AND GUARAN-
TEED CERTIFICATES OF PARTICIPATION, OR THE OBLIGATIONS OF ANY OTHER
GOVERNMENT SPONSORED CORPORATION WHOSE OBLIGATIONS ARE OR MAY BECOME
ELIGIBLE AS COLLATERAL FOR ADVANCES TO MEMBER BANKS AS DETERMINED BY THE
BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM;
5. BANKERS' ACCEPTANCES PURCHASED ON THE SECONDARY MARKET;
6. NEGOTIABLE CERTIFICATES OF DEPOSIT OF ANY NATIONAL OR STATE COMMER-
CIAL OR MUTUAL SAVINGS BANK OR SAVINGS AND LOAN ASSOCIATION DOING BUSI-
NESS IN THE UNITED STATES, PROVIDED, THE COMPTROLLER SHALL FOLLOW THE
INVESTMENT POLICIES AND PROCEDURES ADVISED BY THE INVESTMENT ADVISORY
COMMITTEE PURSUANT TO SUBDIVISION B OF SECTION FOUR HUNDRED TWENTY-THREE
OF THE RETIREMENT AND SOCIAL SECURITY LAW;
7. COMMERCIAL PAPER, PROVIDED THAT THE COMPTROLLER SHALL FOLLOW THE
INVESTMENT POLICIES AND PROCEDURES ADVISED BY THE INVESTMENT ADVISORY
COMMITTEE PURSUANT TO SUBDIVISION B OF SECTION FOUR HUNDRED TWENTY-THREE
OF THE RETIREMENT AND SOCIAL SECURITY LAW.
§ 277. SEVERABILITY. IF ANY CLAUSE, SENTENCE, PARAGRAPH, SUBDIVISION,
SECTION OR PART OF THIS ARTICLE SHALL BE ADJUDGED BY A COURT OF COMPE-
TENT JURISDICTION TO BE INVALID, SUCH JUDGMENT SHALL NOT AFFECT, IMPAIR
OR INVALIDATE THE REMAINDER THEREOF, BUT SHALL BE CONFINED IN ITS OPERA-
TION TO THE CLAUSE, SENTENCE, PARAGRAPH, SUBDIVISION, SECTION OR PART OF
THIS ARTICLE DIRECTLY INVOLVED IN THE CONTROVERSY IN WHICH SUCH JUDGMENT
SHALL HAVE BEEN RENDERED.
§ 2. This act shall take effect immediately; provided, however, that
section 258 of the state finance law, as added by section one of this
act shall be deemed repealed on April 1, 2020. Effective immediately,
the addition, amendment and/or repeal of any rule or regulation neces-
sary for the implementation of this act on its effective date are
authorized to be made and completed on or before such effective date.
