Prohibits comptroller from establishing an account in a banking institution with a "community reinvestment act of 1977" rating of less than satisfactory.
TITLE OF BILL: An act to amend the state finance law, in relation to funds of the state
PURPOSE: This bill would prohibit the comptroller from establishing an account in a banking institution with a Community Reinvestment Act (CRA) rating of less than satisfactory.
SUMMARY OF PROVISIONS: Section 1 of the bill law amends Section 75 of the state finance law, as separately added by chapters 405 and 957 of the laws of 1981, to specify that notwithstanding any other provision of Section 75, the Comptroller of the State of New York shall not establish an account in a banking institution with a Community Reinvestment Act rating of less than satisfactory.
Section 2 of the bill specifies the effective date.
JUSTIFICATION: Many low- and moderate-income neighborhoods deposit funds at local institutions only to have banks invest these funds outside the community, diminishing economic opportunity. In recognition of this concern. the Community Reinvestment Act of 1977 was enacted to encourage banks to reinvest some of these funds back into the communities from which they originated. The CRA does this by rating financial institutions on how well they comply with the terms of the act.
This bill would further enhance CRA compliance by directing the comptroller to withdraw state funds from, or not deposit state funds in, those banks that do not receive a CRA rating of satisfactory or better.
LEGISLATIVE HISTORY: 2001: A.02460 (Lafayette) - Ways & Means 2002: A.02460 (Lafayette) - Rules 2003: A.02171 (Lafayette) - Third Reading
2004: A.02171 (Lafayette) - Rules 2005: A.059l5 (Lafayette) - Third Reading 2006: A.059l5 (Lafayette) - Third Reading 2007: A.00099 (Lafayette) - Third Reading 2008: A.00099 (Lafayette) - Third Reading 2009: A.6312 (Kavanagh) - Ways & Means; S.4291 (Parker) - Finance
FISCAL IMPLICATIONS: None.
EFFECTIVE DATE: This act shall take effect on the 180th day after becoming law.
STATE OF NEW YORK ________________________________________________________________________ 4291--B Cal. No. 518 2009-2010 Regular Sessions IN SENATE April 21, 2009 ___________Introduced by Sens. PARKER, KRUEGER -- read twice and ordered printed, and when printed to be committed to the Committee on Finance -- recom- mitted to the Committee on Finance in accordance with Senate Rule 6, sec. 8 -- reported favorably from said committee, ordered to first and second report, ordered to a third reading, amended and ordered reprinted, retaining its place in the order of third reading -- again amended and ordered reprinted, retaining its place in the order of third reading AN ACT to amend the state finance law, in relation to funds of the state THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 106 of the state finance law, is amended by adding a new subdivision C to read as follows: C. NOTWITHSTANDING ANY OTHER PROVISIONS OF THIS SECTION, THE COMP- TROLLER SHALL NOT DESIGNATE FOR THE DEPOSIT OF MONEYS BY STATE OFFICERS, STATE INSTITUTIONS AND CHARITABLE AND BENEVOLENT INSTITUTIONS A BANKING INSTITUTION TO WHICH THE COMMUNITY REINVESTMENT ACT OF 1977, UNITED STATES P.L. 95-128, APPLIES UNLESS SUCH INSTITUTION SHALL HAVE RECEIVED A RECORD OF PERFORMANCE NO LOWER THAN "SATISFACTORY" AS DETERMINED UNDER SUCH ACT IN ACCORDANCE WITH SECTION TWENTY-EIGHT-B OF THE BANKING LAW. S 2. This act shall take effect on the one hundred eightieth day after it shall have become a law.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD09913-04-0