S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7421
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               May 19, 2023
                                ___________
 
 Introduced by M. of A. HUNTER -- read once and referred to the Committee
   on Banks
 
 AN  ACT  to amend the banking law and the state finance law, in relation
   to credit unions
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section  1.  The banking law is amended by adding a new article 2-D to
 read as follows:
                                ARTICLE 2-D
                       CREDIT UNION DEPOSIT PROGRAM
 SECTION 89. CREDIT UNION DEPOSIT PROGRAM; PURPOSE.
         90. ELIGIBILITY.
         91. DEPOSITS.
   § 89. CREDIT UNION DEPOSIT PROGRAM; PURPOSE.  IN  RECOGNITION  OF  THE
 ECONOMIC BENEFITS AND STIMULUS WHICH RESULT FROM THE PLACEMENT OF DEPOS-
 ITS  IN  LOCAL CREDIT UNIONS, THE CREDIT UNION DEPOSIT PROGRAM IS HEREBY
 CREATED TO AUTHORIZE AND ENCOURAGE THE STATE COMPTROLLER AND THE COMMIS-
 SIONER OF TAXATION AND FINANCE TO DEPOSIT A PORTION OF THE  FUNDS  UNDER
 THEIR CONTROL INTO CREDIT UNIONS.
   §  90. ELIGIBILITY. 1. TO BE ELIGIBLE TO RECEIVE DEPOSITS, OR TO RENEW
 EXISTING DEPOSITS UNDER THIS PROGRAM, A CREDIT UNION MUST  BE  CHARTERED
 UNDER THE PROVISIONS OF THIS CHAPTER AND MUST HAVE A CURRENT EXAMINATION
 RATING OF SATISFACTORY OR BETTER. THE SUPERINTENDENT SHALL, IF REQUESTED
 BY  THE  STATE  COMPTROLLER OR THE COMMISSIONER OF TAXATION AND FINANCE,
 CONFIRM WHETHER A PARTICULAR CREDIT UNION MEETS THE  CRITERIA  SPECIFIED
 IN THIS SECTION.
   2. A FEDERAL CREDIT UNION MAY ALSO BE ELIGIBLE TO RECEIVE DEPOSITS, OR
 TO  RENEW  EXISTING  DEPOSITS,  UNDER THIS PROGRAM IF: (A) ITS PRINCIPAL
 OFFICE IS LOCATED IN THIS STATE; (B) IT HAS A CURRENT EXAMINATION RATING
 OF SATISFACTORY OR BETTER; AND (C)  IT  MEETS  ANY  ADDITIONAL  CRITERIA
 ESTABLISHED  BY  THE  COMPTROLLER  AND  THE COMMISSIONER OF TAXATION AND
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD10868-03-3
              

 A. 7421                             2
 
 FINANCE TO DETERMINE ELIGIBILITY FOR PARTICIPATION IN THE PROGRAM.  SUCH
 CRITERIA  MAY INCLUDE A CREDIT UNION'S LOAN TO DEPOSIT RATIO, ITS RECORD
 OF SMALL BUSINESS LENDING, AND THE IMPACT SUCH DEPOSITS WOULD HAVE ON AN
 AREA'S ECONOMIC ACTIVITY.
   §  91.  DEPOSITS.  1.  NOTWITHSTANDING  ANY  PROVISIONS  OF LAW TO THE
 CONTRARY, THE STATE COMPTROLLER AND THE  COMMISSIONER  OF  TAXATION  AND
 FINANCE  SHALL,  FOR  THE PURPOSES OF ADMINISTERING MONEYS IN ACCORDANCE
 WITH THE PROVISIONS OF SECTIONS NINETY-EIGHT-A AND ONE HUNDRED  FIVE  OF
 THE STATE FINANCE LAW, GIVE CONSIDERATION TO DEPOSITING FUNDS INTO THOSE
 CREDIT  UNIONS WHICH ARE DEEMED ELIGIBLE TO RECEIVE DEPOSITS PURSUANT TO
 SECTION NINETY OF THIS ARTICLE.
   2. THE MAXIMUM AMOUNT OF FUNDS WHICH THE  STATE  COMPTROLLER  AND  THE
 COMMISSIONER  OF  TAXATION  AND  FINANCE  MAY DEPOSIT UNDER THIS PROGRAM
 SHALL NOT EXCEED TWO HUNDRED FIFTY MILLION DOLLARS IN AGGREGATE FOR EACH
 ELIGIBLE CREDIT UNION PURSUANT TO THIS SECTION.
   3. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, ANY  DEPOSITS
 MADE PURSUANT TO THIS ARTICLE SHALL BE MADE AT RATES, AND FOR SUCH PERI-
 ODS OF TIME, AS MAY BE AGREED TO BY THE STATE COMPTROLLER OR THE COMMIS-
 SIONER OF TAXATION AND FINANCE AND THE ELIGIBLE CREDIT UNION.
   4.  ANY  DEPOSITS  MADE  PURSUANT TO THIS ARTICLE MAY BE SECURED BY AN
 IRREVOCABLE LETTER OF CREDIT ISSUED BY A FEDERAL HOME LOAN BANK.
   § 2. The banking law is amended by adding a new section 454-a to  read
 as follows:
   §  454-A.  DEPOSITS OF PUBLIC MONEY WITH CREDIT UNIONS. A CREDIT UNION
 MAY ACCEPT DEPOSITS OF PUBLIC MONEY IN ACCORDANCE WITH THE PROVISIONS OF
 SECTION NINETY-ONE OF THIS CHAPTER AND SECTIONS NINETY-EIGHT-A  AND  ONE
 HUNDRED FIVE OF THE STATE FINANCE LAW.
   §  3.  The  opening  paragraph of subdivision 1 of section 98-a of the
 state finance law, as amended by chapter 545 of the  laws  of  2005,  is
 amended to read as follows:
   Except  as  otherwise provided in subdivision two of this section, any
 moneys in the general fund of the state or moneys received from the sale
 of any bonds or notes issued by the state, any moneys  in  any  fund  or
 account  of  the state, heretofore or hereafter established, the invest-
 ment of which is not otherwise authorized and which are not  immediately
 required  may  be  invested  by  the  comptroller.    Such moneys may be
 invested only in obligations of the categories specified in subdivisions
 one to five, both inclusive, and subdivision  seven,  subdivision  four-
 teen,  as  added by chapters seven hundred ninety-seven and nine hundred
 thirty-two of the laws of nineteen  hundred  sixty-three,  respectively,
 subdivisions  fifteen,  sixteen and seventeen of section ninety-eight of
 this article, maturing or redeemable at the option of the holder  within
 twelve  years  of the date of such investment, subdivisions two-a, eigh-
 teen, nineteen and twenty of section ninety-eight of this article or  in
 a  certificate  of deposit of a bank [or], trust company OR CREDIT UNION
 in this state. Any certificate of deposit shall be fully secured by  the
 issuer  thereof  depositing with the comptroller stocks, bonds, or notes
 of any county, town, city, village, fire district or school district  of
 this  state  issued  pursuant to law and maturing within five years from
 the date of issuance of such certificate of deposit, bonds or  notes  or
 direct  or  guaranteed obligation of the United States of America or its
 agencies or of the state of New York or bonds and notes issued  for  any
 of  the  corporate  purposes of the municipal assistance corporation for
 the city of New York in an amount equal to the amount  of  such  certif-
 icate  of deposit. Any bonds, notes or certificates of deposit purchased
 with moneys of the general fund shall be available  always  to  pay  any
 A. 7421                             3
 
 lawful  appropriation  in  force.  Any  bonds,  notes or certificates of
 deposit purchased with moneys received from the sale  of  any  bonds  or
 notes  issued by the state shall be available always for the purposes or
 purpose  for which such bonds or notes were issued.  Any bonds, notes or
 certificates of deposit purchased with moneys of any other  funds  shall
 be  available  always  for  the purpose for which such fund was created.
 Unless otherwise required by law, income received on any moneys invested
 pursuant to this section shall be credited to the  fund  or  funds  from
 which  such  moneys were invested, provided, however, the comptroller is
 hereby precluded from  crediting  interest  earnings  to  funds/accounts
 which:
   §  4.  Subdivisions  1  and 2 of section 105 of the state finance law,
 subdivision 1 as amended by section 1 of part W of  chapter  59  of  the
 laws  of  2023,  subdivision  2 as amended by chapter 154 of the laws of
 1953, and paragraph b of subdivision 2 as amended by chapter 345 of  the
 laws of 2005, 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 busi-
 ness days after the receipt thereof, either as a demand  deposit  or  an
 interest-bearing  time  deposit (other than a time certificate of depos-
 it), as the commissioner and the  comptroller  may  determine,  in  such
 banks,  trust  companies [and], industrial banks AND CREDIT UNIONS as in
 the opinion of the commissioner 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.  The  commissioner  shall  keep  a
 bankbook  in  which  shall  be  entered  their account of deposit in and
 moneys drawn from the banks [and],  trust  companies  [and],  industrial
 banks  AND CREDIT UNIONS in which deposits are made by the commissioner,
 which they shall exhibit to the comptroller for inspection on the  first
 Tuesday  of every month and oftener if required.  The commissioner shall
 not draw any moneys from such banks, trust  companies  [or],  industrial
 banks  OR CREDIT UNIONS unless by checks signed and countersigned in the
 manner prescribed by section one hundred one, unless otherwise  provided
 by  law.  No  moneys shall be paid by any such bank, trust company [or],
 industrial bank OR CREDIT UNION out of any such deposit except upon such
 checks.  Moneys may be paid through electronic  transfer  in  accordance
 with  procedures  developed  by the commissioner 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  OR  CREDIT
 UNION shall transmit to the comptroller monthly statements of all moneys
 received  and  paid by it on account of the commissioner of taxation and
 finance.
   2. Every bank, trust company [and], industrial bank AND  CREDIT  UNION
 designated  for the deposit of state moneys under the provisions of this
 section shall, before deposits are made:
   a. Execute and file with the commissioner of taxation  and  finance  a
 bond to the state in such form and with such surety or sureties for such
 sums  as  may be prescribed and approved by the commissioner of taxation
 and finance and comptroller, for the safekeeping and prompt  payment  of
 such moneys on legal demand therefor with interest, if any; or
 A. 7421                             4
 
   b. In lieu of such surety bond, with the permission of the comptroller
 and  the  commissioner  of  taxation and finance, deposit with the comp-
 troller outstanding unmatured:
   (1)  bonds  or  notes of the United States of America, or obligations,
 the payment of which is guaranteed by the United States of America,
   (2) bonds or notes of the state of New York,
   (3) bonds or notes of any county, town, city, village,  fire  district
 or  school districts in the state of New York authorized to be issued by
 law,
   (4) bonds of the Port of New York Authority of any year,
   (5) bonds of the Buffalo and Fort Erie Public Bridge Authority,
   (6) bonds of the Triborough bridge and tunnel authority,
   (7) bonds or notes of the New York state thruway authority,
   (8) bonds, notes or other obligations of any municipal housing author-
 ity in the state of New York authorized to be issued  by  law,  provided
 such  bonds,  notes or other obligations qualify under the provisions of
 section forty-nine of the public housing law,
   (9) bonds or notes of the Power Authority of the state of New York,
   (10) bonds or notes of the Niagara Frontier Port Authority,
   (11) bonds or notes of the Dormitory Authority of  the  state  of  New
 York,
   (12) bonds or notes of the New York state bridge authority,
   (13)  bonds  or  notes issued for any of the corporate purposes of the
 New York state housing finance agency,
   (14) bonds  or  notes  of  the  Metropolitan  Commuter  Transportation
 Authority,
   (15)  bonds  or notes of the New York State Pure Waters Authority, for
 which the commissioner of taxation and finance and the comptroller shall
 deliver a certificate of  deposit  containing  the  conditions  of  such
 deposit,
   (16) bonds or notes of the Niagara Frontier Transportation Authority,
   (17)  bonds  or notes of the Rochester-Genesee Regional Transportation
 Authority,
   (18) bonds or notes of the Capital District Transportation Authority,
   (19) bonds or notes of the Central New  York  Regional  Transportation
 Authority,
   [20] (20) Bonds or notes of the New York state project finance agency,
   (21)  Bonds  or  notes of the municipal assistance corporation for the
 city of New York,
   (22) bonds or notes issued for any of the corporate  purposes  of  the
 New  York  state  medical  care facilities finance agency, for which the
 commissioner of taxation and finance and the comptroller shall deliver a
 certificate of deposit containing the conditions of such deposit, or
   (23) irrevocable letters of credit issued by a federal home loan bank.
   c. With the permission of the comptroller and commissioner of taxation
 and finance execute and file  with  the  commissioner  of  taxation  and
 finance an undertaking to the effect that such bank, trust company [or],
 industrial  bank  OR CREDIT UNION will safely keep and promptly pay over
 all such deposits on legal demand therefor with interest, if any, and as
 collateral to such undertaking deposit with the comptroller a  certified
 check or checks drawn on and certified by the federal reserve bank with-
 in  the state payable to his order in such amount or amounts as shall be
 agreed upon by the comptroller and the depositary.
   § 5. This act shall take effect immediately.