S T A T E O F N E W Y O R K
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8449--A
I N S E N A T E
March 2, 2022
___________
Introduced by Sen. SANDERS -- read twice and ordered printed, and when
printed to be committed to the Committee on Finance -- committee
discharged, bill amended, ordered reprinted as amended and recommitted
to said committee
AN ACT establishing a commission to determine what benefits a public
bank or network of public banks owned by the state of New York or by a
public authority constituted by the state of New York can provide;
making an appropriation therefor; and providing for the repeal of such
provisions upon expiration thereof
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. A temporary state commission, to be known as the New York
state commission on establishing a bank owned by New York state, herein-
after referred to as the commission, is hereby established to hire a
consultant to study the feasibility of establishing a bank owned by the
state of New York or by a public authority constituted by the state of
New York for the public interest.
§ 2. (a) The commission shall consist of fifteen members, to be
appointed as follows:(i) six members shall be appointed by the governor,
one of whom shall be a representative of the New York state department
of financial services, one shall be a representative from the New York
state department of taxation and finance, the remaining four governor's
appointees shall not be employees of the executive branch and at least
one member shall represent the banking and financial industries of the
state including, but not limited to, the New York bankers association,
at least one member shall represent community banking, and no more
than one member may be a representative of any financial services firm
located within the state, including, but not limited to, the New York
state small business development center;
(ii) one member shall be the New York state comptroller or the comp-
troller's designee;
(iii) three members shall be appointed by the temporary president of
the senate, one of whom shall be a member of the senate;
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11521-07-2
S. 8449--A 2
(iv) one member shall be appointed by the minority leader of the
senate;
(v) three members shall be appointed by the speaker of the assembly,
one of whom shall be a member of the assembly; and
(vi) one member shall be appointed by the minority leader of the
assembly.
(b) The majority of the members of the entire commission shall desig-
nate one of the commissioners to serve as the chair of the commission.
(c) The members of the commission shall be appointed no later than
ninety days after the effective date of this act.
(d) The commission is directed to hire a reputable consultant that has
the capacity, capability, and experience to conduct a feasibility study
to evaluate and make recommendations concerning the formation and
control of a state public bank. Consultants that have conducted a previ-
ous feasibility study of a public bank at the request of a government
entity in the United States will be given preference. Such study shall
make recommendations, with the advice of the department of financial
services, including but not limited to, on the feasability of establish-
ing a state bank in New York and may recommend legislation for the
legislature to consider in order to to create a state public bank for
New York.
§ 3. The scope of such study shall include, but shall not be limited
to:
(a) the purposes of such public bank in the public interest;
(b) an analysis of cost savings, impacts on the state's finances,
economic development and infrastructure, housing and additional needs of
the state, including but not limited to:
(i) appropriate governance structures;
(ii) minimum capitalization requirements;
(iii) appropriate insurance and risk management tools;
(iv) charter requirements;
(v) financial and operations framework;
(vi) deposits;
(vii) permitted activities;
(viii) benefits;
(ix) potential challenges that such public banks may encounter;
(x) how the lack of accessible financial services contributes to the
cycle of poverty;
(xi) barriers to small business formation and growth;
(xii) impacts of such public banks on small businesses, including
minority- and women-owned business enterprises;
(xiii) impacts of such public banks on the unbanked, the underbanked
and banking deserts; and
(xiv) how a state public bank may provide banking to the cannabis
industry.
(c) a fiscal analysis of costs associated with formation;
(d) an analysis that considers the effects of an economic recession on
the financial results of such public banks;
(e) a legal analysis of whether the proposed structure and operation
of such public bank complies with the New York state constitution;
(f) an analysis of how the proposed governance structure of such
public bank would protect such public bank from unlawful insider trans-
actions and apparent conflicts of interest;
(g) a fiscal analysis of the benefits associated with the creation of
such public bank, including, but not limited to, cost savings, jobs
S. 8449--A 3
created, jobs retained, economic activity generated and private capital
leveraged;
(h) a qualitative assessment of social and environmental benefits of
such public bank;
(i) a review of feasibility studies on public banking, including the
city of Philadelphia public bank feasibility study and the city of San
Francisco public bank feasibility study; and
(j) a review of AB-857 (2019 Cal. Stats. Ch. 442).
§ 4. No earlier than six months and no later than seven months after
the effective date of this act, the commission shall submit a report to
the governor, the temporary president of the senate, the speaker of the
assembly, the chair of the senate banks committee and the chair of the
assembly banks committee on the findings and conclusions of the study
conducted pursuant to sections two and three of this act and shall
submit any legislative recommendations deemed to be necessary. Such
report shall be contemporaneously published on the official website of
the department of financial services.
§ 5. The sum of five hundred thousand dollars ($500,000), or so much
thereof as may be available, is hereby appropriated to the department of
financial services, or from any moneys in the state treasury in the
general fund to the credit of the state purposes account, not otherwise
appropriated, and made immediately available, for the purpose of carry-
ing out the provisions of this act. Such moneys shall be payable on the
audit and warrant of the comptroller on vouchers certified or approved
by the commissioner of education in the manner prescribed by law.
§ 6. This act shall take effect immediately and shall expire and be
deemed repealed one year after such effective date.
