STATE OF NEW YORK ________________________________________________________________________ 4811 2025-2026 Regular Sessions IN ASSEMBLY February 6, 2025 ___________ Introduced by M. of A. VANEL, LUNSFORD -- 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: 1 Section 1. The banking law is amended by adding a new article 2-D to 2 read as follows: 3 ARTICLE 2-D 4 CREDIT UNION DEPOSIT PROGRAM 5 Section 89. Credit union deposit program; purpose. 6 90. Eligibility. 7 91. Deposits. 8 § 89. Credit union deposit program; purpose. In recognition of the 9 economic benefits and stimulus which result from the placement of depos- 10 its in local credit unions, the credit union deposit program is hereby 11 created to authorize and encourage the state comptroller and the commis- 12 sioner of taxation and finance to deposit a portion of the funds under 13 their control into credit unions. 14 § 90. Eligibility. 1. To be eligible to receive deposits, or to renew 15 existing deposits under this program, a credit union must be chartered 16 under the provisions of this chapter and must have a current examination 17 rating of satisfactory or better. The superintendent shall, if requested 18 by the state comptroller or the commissioner of taxation and finance, 19 confirm whether a particular credit union meets the criteria specified 20 in this section. 21 2. A federal credit union may also be eligible to receive deposits, or 22 to renew existing deposits, under this program if: (a) its principal 23 office is located in this state; (b) it has a current examination rating 24 of satisfactory or better; and (c) it meets any additional criteria 25 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. LBD08926-01-5

A. 4811 2 1 finance to determine eligibility for participation in the program. Such 2 criteria may include a credit union's loan to deposit ratio, its record 3 of small business lending, and the impact such deposits would have on an 4 area's economic activity. 5 § 91. Deposits. 1. Notwithstanding any provisions of law to the 6 contrary, the state comptroller and the commissioner of taxation and 7 finance shall, for the purposes of administering moneys in accordance 8 with the provisions of sections ninety-eight-a and one hundred five of 9 the state finance law, give consideration to depositing funds into those 10 credit unions which are deemed eligible to receive deposits pursuant to 11 section ninety of this article. 12 2. The maximum amount of funds which the state comptroller and the 13 commissioner of taxation and finance may deposit under this program 14 shall not exceed two hundred fifty million dollars in aggregate for each 15 eligible credit union pursuant to this section. 16 3. Notwithstanding any provision of law to the contrary, any deposits 17 made pursuant to this article shall be made at rates, and for such peri- 18 ods of time, as may be agreed to by the state comptroller or the commis- 19 sioner of taxation and finance and the eligible credit union. 20 4. Any deposits made pursuant to this article may be secured by an 21 irrevocable letter of credit issued by a federal home loan bank. 22 § 2. The banking law is amended by adding a new section 454-a to read 23 as follows: 24 § 454-a. Deposits of public money with credit unions. A credit union 25 may accept deposits of public money in accordance with the provisions of 26 section ninety-one of this chapter and sections ninety-eight-a and one 27 hundred five of the state finance law. 28 § 3. The opening paragraph of subdivision 1 of section 98-a of the 29 state finance law, as amended by chapter 545 of the laws of 2005, is 30 amended to read as follows: 31 Except as otherwise provided in subdivision two of this section, any 32 moneys in the general fund of the state or moneys received from the sale 33 of any bonds or notes issued by the state, any moneys in any fund or 34 account of the state, heretofore or hereafter established, the invest- 35 ment of which is not otherwise authorized and which are not immediately 36 required may be invested by the comptroller. Such moneys may be 37 invested only in obligations of the categories specified in subdivisions 38 one to five, both inclusive, and subdivision seven, subdivision four- 39 teen, as added by chapters seven hundred ninety-seven and nine hundred 40 thirty-two of the laws of nineteen hundred sixty-three, respectively, 41 subdivisions fifteen, sixteen and seventeen of section ninety-eight of 42 this article, maturing or redeemable at the option of the holder within 43 twelve years of the date of such investment, subdivisions two-a, eigh- 44 teen, nineteen and twenty of section ninety-eight of this article or in 45 a certificate of deposit of a bank [or], trust company or credit union 46 in this state. Any certificate of deposit shall be fully secured by the 47 issuer thereof depositing with the comptroller stocks, bonds, or notes 48 of any county, town, city, village, fire district or school district of 49 this state issued pursuant to law and maturing within five years from 50 the date of issuance of such certificate of deposit, bonds or notes or 51 direct or guaranteed obligation of the United States of America or its 52 agencies or of the state of New York or bonds and notes issued for any 53 of the corporate purposes of the municipal assistance corporation for 54 the city of New York in an amount equal to the amount of such certif- 55 icate of deposit. Any bonds, notes or certificates of deposit purchased 56 with moneys of the general fund shall be available always to pay any

A. 4811 3 1 lawful appropriation in force. Any bonds, notes or certificates of 2 deposit purchased with moneys received from the sale of any bonds or 3 notes issued by the state shall be available always for the purposes or 4 purpose for which such bonds or notes were issued. Any bonds, notes or 5 certificates of deposit purchased with moneys of any other funds shall 6 be available always for the purpose for which such fund was created. 7 Unless otherwise required by law, income received on any moneys invested 8 pursuant to this section shall be credited to the fund or funds from 9 which such moneys were invested, provided, however, the comptroller is 10 hereby precluded from crediting interest earnings to funds/accounts 11 which: 12 § 4. Subdivisions 1 and 2 of section 105 of the state finance law, 13 subdivision 1 as amended by section 1 of part W of chapter 59 of the 14 laws of 2023, subdivision 2 as amended by chapter 154 of the laws of 15 1953, and paragraph b of subdivision 2 as amended by chapter 345 of the 16 laws of 2005, are amended to read as follows: 17 1. All moneys received by the commissioner of taxation and finance on 18 account of the state, excepting such moneys as are required by law to be 19 deposited to the credit of the comptroller, but including such moneys as 20 are thereafter paid into the state treasury by the comptroller, shall be 21 deposited by the commissioner of taxation and finance within three busi- 22 ness days after the receipt thereof, either as a demand deposit or an 23 interest-bearing time deposit (other than a time certificate of depos- 24 it), as the commissioner and the comptroller may determine, in such 25 banks, trust companies [~~and~~], industrial banks and credit unions as in 26 the opinion of the commissioner and the opinion of the comptroller are 27 secure. The moneys so deposited shall be placed to the account of the 28 commissioner of taxation and finance. The commissioner shall keep a 29 bankbook in which shall be entered their account of deposit in and 30 moneys drawn from the banks [~~and~~], trust companies [~~and~~], industrial 31 banks and credit unions in which deposits are made by the commissioner, 32 which they shall exhibit to the comptroller for inspection on the first 33 Tuesday of every month and oftener if required. The commissioner shall 34 not draw any moneys from such banks, trust companies [or], industrial 35 banks or credit unions unless by checks signed and countersigned in the 36 manner prescribed by section one hundred one, unless otherwise provided 37 by law. No moneys shall be paid by any such bank, trust company [or], 38 industrial bank or credit union out of any such deposit except upon such 39 checks. Moneys may be paid through electronic transfer in accordance 40 with procedures developed by the commissioner of taxation and finance 41 and the comptroller and consistent with the requirements of this section 42 for recording payments. Such payments through electronic transfer shall 43 be considered, for purposes of this chapter, to be moneys drawn by 44 check. Every such bank, trust company [or], industrial bank or credit 45 union shall transmit to the comptroller monthly statements of all moneys 46 received and paid by it on account of the commissioner of taxation and 47 finance. 48 2. Every bank, trust company [~~and~~], industrial bank and credit union 49 designated for the deposit of state moneys under the provisions of this 50 section shall, before deposits are made: 51 a. Execute and file with the commissioner of taxation and finance a 52 bond to the state in such form and with such surety or sureties for such 53 sums as may be prescribed and approved by the commissioner of taxation 54 and finance and comptroller, for the safekeeping and prompt payment of 55 such moneys on legal demand therefor with interest, if any; or

A. 4811 4 1 b. In lieu of such surety bond, with the permission of the comptroller 2 and the commissioner of taxation and finance, deposit with the comp- 3 troller outstanding unmatured: 4 (1) bonds or notes of the United States of America, or obligations, 5 the payment of which is guaranteed by the United States of America, 6 (2) bonds or notes of the state of New York, 7 (3) bonds or notes of any county, town, city, village, fire district 8 or school districts in the state of New York authorized to be issued by 9 law, 10 (4) bonds of the Port of New York Authority of any year, 11 (5) bonds of the Buffalo and Fort Erie Public Bridge Authority, 12 (6) bonds of the Triborough bridge and tunnel authority, 13 (7) bonds or notes of the New York state thruway authority, 14 (8) bonds, notes or other obligations of any municipal housing author- 15 ity in the state of New York authorized to be issued by law, provided 16 such bonds, notes or other obligations qualify under the provisions of 17 section forty-nine of the public housing law, 18 (9) bonds or notes of the Power Authority of the state of New York, 19 (10) bonds or notes of the Niagara Frontier Port Authority, 20 (11) bonds or notes of the Dormitory Authority of the state of New 21 York, 22 (12) bonds or notes of the New York state bridge authority, 23 (13) bonds or notes issued for any of the corporate purposes of the 24 New York state housing finance agency, 25 (14) bonds or notes of the Metropolitan Commuter Transportation 26 Authority, 27 (15) bonds or notes of the New York State Pure Waters Authority, for 28 which the commissioner of taxation and finance and the comptroller shall 29 deliver a certificate of deposit containing the conditions of such 30 deposit, 31 (16) bonds or notes of the Niagara Frontier Transportation Authority, 32 (17) bonds or notes of the Rochester-Genesee Regional Transportation 33 Authority, 34 (18) bonds or notes of the Capital District Transportation Authority, 35 (19) bonds or notes of the Central New York Regional Transportation 36 Authority, 37 [20] (20) Bonds or notes of the New York state project finance agency, 38 (21) Bonds or notes of the municipal assistance corporation for the 39 city of New York, 40 (22) bonds or notes issued for any of the corporate purposes of the 41 New York state medical care facilities finance agency, for which the 42 commissioner of taxation and finance and the comptroller shall deliver a 43 certificate of deposit containing the conditions of such deposit, or 44 (23) irrevocable letters of credit issued by a federal home loan bank. 45 c. With the permission of the comptroller and commissioner of taxation 46 and finance execute and file with the commissioner of taxation and 47 finance an undertaking to the effect that such bank, trust company [or], 48 industrial bank or credit union will safely keep and promptly pay over 49 all such deposits on legal demand therefor with interest, if any, and as 50 collateral to such undertaking deposit with the comptroller a certified 51 check or checks drawn on and certified by the federal reserve bank with- 52 in the state payable to [~~his~~] the order of the comptroller in such 53 amount or amounts as shall be agreed upon by the comptroller and the 54 depositary. 55 § 5. This act shall take effect immediately.

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