What's happening
This bill allows credit unions and federal credit unions to participate in New York's banking development district program and accept municipal deposits under certain conditions.
Why it matters
Expands banking options for local governments and public entities. by allowing them to deposit municipal funds in credit unions and federal credit unions, but only at branches specifically established in banking development districts, potentially increasing access to banking services in underserved areas.
Enables credit unions to serve new community segments. , including individuals and organizations within designated communities, neighborhoods, or rural districts that show a demonstrated need for banking services—subject to approval by the superintendent—thereby supporting financial inclusion.
Maintains regulatory safeguards and deposit requirements. by ensuring that municipal deposits in credit unions are subject to the same rules and protections as those placed in traditional banks, helping to protect public funds while broadening institutional participation.
Could encourage more financial institutions to participate in development districts. , potentially increasing competition and improving access to affordable financial services in communities that have historically been underserved by traditional banks.
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Who cares
Headline styles
Include Credit Unions in Program
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to banks
- Referred to banks
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Let Credit Unions Join Program
In Assembly Committee · Banks · Sponsor Kenneth Zebrowski
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
5187
2017-2018 Regular Sessions
IN SENATE
March 13, 2017
Introduced by Sens. MONTGOMERY, BROOKS, COMRIE, DILAN, HAMILTON, HOYL- MAN, PARKER, SANDERS, STAVISKY -- read twice and ordered printed, and when printed to be committed to the Committee on Banks
AN ACT to amend the banking law, in relation to including credit unions and federal credit unions within provisions regarding banking development district program
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subdivision 5 of section 96-d of the banking law, as added by chapter 526 of the laws of 1998, paragraph (a) as amended by chapter 328 of the laws of 1999, paragraph (b) as further amended by section 104 of part A of chapter 62 of the laws of 2011, is 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, federal savings and loan association [or], federal savings bank, a credit union or a federal credit union eligibility to accept municipal or public funds or municipal or public moneys other than for the limited purposes of the establishment of a branch in a banking development district pursuant to this section. 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
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01054-01-7
S. 5187 2
district are located; provided further that any such municipal or public funds or moneys shall be subject to the same requirements which apply to municipal 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.
§ 2. Paragraph (f) of subdivision 1 of section 451-a of the banking law, as amended by chapter 153 of the laws of 2015, is amended and a new paragraph (g) is added to read as follows:
(f) Any incorporated or unincorporated organization composed principally of persons eligible to membership in the credit union and that organization's employees[.]; or
(g) Any person or organization located within a local community, neighborhood, or rural district where there is a demonstrated need for banking services as determined by the superintendent.
§ 3. This act shall take effect January 1, 2019; provided, that the amendments to subdivision 5 of section 96-d of the banking law made by section one of this act shall not affect the repeal of such subdivision and shall be deemed to be repealed therewith as provided in section 4 of chapter 526 of the laws of 1998, as amended.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the banking law, in relation to including credit unions and federal credit unions within provisions regarding banking development district program
Purpose or general idea of bill
To include credit unions and federal credit unions within the definition of bank or trust company for the purpose of provisions regarding banking development districts.
Summary of specific provisions
Section 1. Amends subdivision 5 of section 96-d of the banking law, as added by chapter 526 of the laws of 1998, to include credit unions and federal credit unions in the definition of a bank, trust company, or national bank.
Section 2. Subdivision 1 of section 451-a of the banking law, as added by chapter 153 of the laws of 2015 , is amended to state that for the purposes of section 96-d of this chapter, the credit union may include in its membership any person or organization located within a local community, neighborhood or rural district where there is a demonstrated need for banking services as determined by the superintendent.
Section 3. Effective Date
Justification
Chapter 204 of the laws of 1997 authorized the creation of a banking development district program, which enables municipalities and New York State to offer certain economic incentives to encourage the establishment of commercial bank branches in areas where there is a demonstrated need for banking services. Chapter 526 of the laws of 1998 incorporated savings and loans into this program. This legislation includes credit unions within the economic development program.
Credit unions will be able to offer small business services, such as member business lending, similar to those currently offered by commercial banks and savings and loans. By enabling credit unions to participate in this program there will be more opportunities for municipalities to work with different types of banking institutions to encourage better banking services in developing areas.
Prior legislative history
A3134 of 2008-2009. A9352 of 2009-2010. A2549 of 2013-2014 (enacting clause stricken) A8693 of 2014
Fiscal implications
None to the State
Effective date
This act shall take effect January 1, 2019.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.