What's happening
This bill requires that 10% of fines from banking and insurance penalties be deposited into New York’s community development financial institution fund.
Why it matters
Directs a portion of regulatory fines to community development. By earmarking 10% of fines from banking and insurance violations for the community development financial institution (CDFI) fund, the bill ensures that money from industry misconduct is used to support local economic development and financial access.
Potentially increases funding for underserved communities. CDFIs typically provide loans and financial services to small businesses, nonprofits, and individuals in low-income or underserved areas. This bill could increase the resources available for such initiatives, potentially expanding economic opportunities where they are most needed.
Creates a new, ongoing revenue stream for CDFIs. Instead of relying solely on state budgets or federal grants, the fund would now receive a continuous flow of money tied to enforcement actions, making support for community finance less vulnerable to annual budget negotiations or political changes.
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Who cares
Headline styles
Fund Community Finance With Fines
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Referred to banks
- Referred to rules
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
6560
2017-2018 Regular Sessions
IN SENATE
June 2, 2017
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 and the insurance law, in relation to dedicating ten percent of the fines and penalties imposed by the superintendent of financial services for deposit into the community development financial institution fund
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Section 44 of the banking law is amended by adding a new subdivision 10 to read as follows:
10. Notwithstanding any provision of law to the contrary, ten percent of all penalties imposed and collected pursuant to this section shall be dedicated to and deposited into the community development financial institution fund established pursuant to subdivision three of section sixteen-o of the New York state urban development corporation act.
§ 2. Section 109 of the insurance law is amended by adding a new subsection (e) to read as follows:
(e) Notwithstanding any provision of law to the contrary, ten percent of all penalties imposed and collected pursuant to this section shall be dedicated to and deposited into the community development financial institution fund established pursuant to subdivision three of section sixteen-o of the New York state urban development corporation act.
§ 3. This act shall take effect September 1, 2017.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11997-01-7
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 and the insurance law, in relation to dedicating ten percent of the fines and penalties imposed by the superintendent of financial services for deposit into the community development financial institution fund
Purpose
To dedicate ten percent of the fines assessed by the New York State Department of Financial Services to the NYS community development financial institution fund
Summary of provisions
Section 1 adds a new Subdivision (10)to Section 44 of the banking law, which provides for ten percent of all penalties imposed and collected pursuant to this section be deposited into the community development financial institution fund that was established pursuant to subdivision three of section 16-0 of the New York state urban development act.
Section 2 amends Section 109 of the Insurance law to provide that ten percent of all penalties imposed and collected pursuant to this section be deposited into the community development financial institution fund that was established pursuant to subdivision three of section 16-0 of the New York state urban development act.
Justification
Penalties imposed by the New York State Department of Financial Services should be returned used to benefit new Yorkers who have been victimized either by illegal practices or to those who do not have adequate access to financial services or capital. We would like ten percent of the monies recovered dedicated to the community development financial institution fund. Monies generated because of fines and penalties should go benefit those you New Yorkers who lack access to financial capital & services. The Community Development Financial Institution Assistance Program bolsters institutions providing microloans to small businesses that often do not qualify for bank loans, as well as provide one-on-one counseling and business development assistance to facilitate credit readiness. Consumers are forced to pay higher rates because of access to credit is limited, by funding this groups we attempt to make it easier for small business to access capital.
Legislative history
This is a new bill.
Fiscal implications
No Cost to the State
Effective date
This act shall take effect September 1, 2016
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.