S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  3510

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                            January 28, 2013
                               ___________

Introduced by M. of A. ROBINSON, WEPRIN, BRINDISI, ESPINAL, RODRIGUEZ --
  Multi-Sponsored by -- M. of A. SIMANOWITZ -- read once and referred to
  the Committee on Banks

AN ACT to amend the banking law, in relation to credit union memberships
  and general powers

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1.   Subdivision 2 of section  451  of  the  banking  law,  as
amended  by  chapter  660  of  the  laws  of 2004, is amended to read as
follows:
  2. The qualifications for membership.
  [(a) Membership shall be limited to:
  (1) persons having a common employer;
  (2) persons and organizations who  are  members  of  the  same  trade,
industry, profession, club, union, society or other association;
  (3)  in  the case of a credit union incorporated under this chapter as
of the effective date of this subdivision, and with the approval of  the
superintendent,  which  approval  shall  not  be  given  if  it would be
destructive of competition within a municipality, more than  one  common
employer;  provided,  however,  that  an employer group with under three
thousand employees may be added upon receipt of a notice as provided  in
subdivision two of section four hundred seventy-eight of this article;
  (4)  with  the  approval  of  the  superintendent,  and subject to the
provisions of paragraph (b) of this subdivision,  more  than  one  group
each  of  which  has,  within  the  group,  a common bond of occupation,
including a common employer, or association; provided, however,  that  a
group  of  less  than three thousand members, which is within reasonable
proximity to the credit union's service area or areas, may be added upon
receipt of a notice as provided  in  subdivision  two  of  section  four
hundred seventy-eight of this article; or

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD00150-01-3

              

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  (5)  persons  and organizations within a well-defined local community,
neighborhood or rural district and who in the  judgment  of  the  super-
intendent have such a community of interest as will insure proper admin-
istration.
  (b)  In  considering  an  application to add a group to a credit union
authorized under subparagraph four of paragraph (a) of this subdivision,
the superintendent shall not approve the addition unless  the  group  is
within reasonable proximity to the credit union's service area or areas.
If  the  group  has more than three thousand members, the superintendent
shall not approve such addition unless he or  she  determines  that  the
group  could  not  feasibly  or reasonably establish a new single common
bond credit union because:
  (1) the group  lacks  sufficient  volunteer  and  other  resources  to
support the efficient and effective operation of a credit union;
  (2)  the group does not meet the criteria which the superintendent has
determined to be important for the likelihood of success in establishing
and managing a new credit union, including  demographic  characteristics
such  as  geographical location of members, diversity of ages and income
levels, and other factors that may affect the  financial  viability  and
stability of a credit union;
  (3)  the  group  would  be unlikely to operate a safe and sound credit
union; or
  (4) the group has  been  transferred  from  another  credit  union  in
connection  with  a  merger  or  consolidation recommended by a state or
federal regulator based on safety and soundness concerns or by the board
of the National Credit Union Administration in its capacity as conserva-
tor or liquidating agent.
  (c) With the approval of the superintendent, a credit union may extend
membership to persons and organizations in an underserved local communi-
ty, neighborhood or rural district, where such area is determined by the
superintendent to be an "investment area"  as  defined  in  the  federal
Community Development Banking and Financial Institutions Act of 1994 (12
U.S.C.  4703(16))  and any other requirements imposed by the superinten-
dent, including a requirement that the credit union establish and  main-
tain an office or facility in such area.
  (d) To the extent not expressly prohibited by the bylaws of the credit
union:
  (1)  in each instance where a person is a member or is directly eligi-
ble for membership, members of his or her immediate family or  household
shall be eligible for membership. For the purposes of this subparagraph,
"immediate  family"  means a person's spouse, and their lineal ancestors
and descendants, including persons so  related  by  adoption,  siblings,
stepparents,  stepchildren,  and  stepsiblings;  and  "household"  means
persons living in the same residence and maintaining a  single  economic
unit;
  (2)  any employee of the credit union shall be eligible to membership;
and
  (3) any member who leaves the field of  membership  and  who  has  not
withdrawn or been expelled may retain membership.
  (e) To the extent not expressly prohibited by the bylaws of the credit
union,  any incorporated or unincorporated organization composed princi-
pally of persons eligible to membership in  the  credit  union  and  the
organization's  employees  shall be eligible to membership in the credit
union.
  (f) Any person who is eligible for membership by reason  of  the  fact
that he or she is an employee either of a common employer or of a credit

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union shall not become ineligible, after the termination of such employ-
ment, as long as he or she receives a pension or annuity from, or under,
a plan or other arrangement established by such common employer or cred-
it union.
  (g)  The provisions of this subdivision shall not apply to a corporate
credit union.] SUCH QUALIFICATIONS FOR MEMBERSHIP SHALL  BE  ESTABLISHED
IN ACCORDANCE WITH THE PROVISIONS OF SECTION FOUR HUNDRED FIFTY-ONE-A OF
THIS  ARTICLE,  EXCEPT  THAT SUCH SECTION SHALL NOT APPLY TO A CORPORATE
CREDIT UNION.
  S 2. The banking law is amended by adding a new section 451-a to  read
as follows:
  S  451-A. QUALIFICATIONS FOR MEMBERSHIP. 1. THE MEMBERSHIP OF A CREDIT
UNION SHALL BE DETERMINED BY THE BOARD OF DIRECTORS OF SUCH CREDIT UNION
AND SHALL CONSIST OF PERSONS WITHIN THE CREDIT UNION'S FIELD OF  MEMBER-
SHIP WHO HAVE BEEN DULY ADMITTED MEMBERS.
  2.  A  CREDIT UNION'S FIELD OF MEMBERSHIP SHALL INCLUDE ONE OR MORE OF
THE FOLLOWING CATEGORIES:
  (A) PERSONS:
  (1) WITHIN THE SAME OCCUPATION OR FROM MULTIPLE GROUPS EACH REPRESENT-
ING A DIFFERENT OCCUPATION;
  (2) WITHIN THE SAME ASSOCIATION OR INTEREST OR  FROM  MULTIPLE  GROUPS
EACH REPRESENTING A DIFFERENT ASSOCIATION OR INTEREST;
  (3)  WHO  RESIDE, WORK, WORSHIP OR ATTEND SCHOOL WITHIN A WELL-DEFINED
GEOGRAPHIC AREA, IDENTIFIABLE NEIGHBORHOOD, COMMUNITY OR RURAL  DISTRICT
AND WHO, IN THE JUDGMENT OF THE SUPERINTENDENT, HAVE SUCH A COMMUNITY OF
INTEREST AS WILL ENSURE PROPER ADMINISTRATION; OR
  (4)  WITHIN  A COMBINATION OF THESE THREE CATEGORIES DESCRIBED IN THIS
SUBDIVISION; OR
  (B)  BUSINESSES,  ASSOCIATIONS  OR  ORGANIZATIONS  LOCATED  WITHIN   A
WELL-DEFINED  GEOGRAPHIC  AREA  AND WHICH, IN THE JUDGMENT OF THE SUPER-
INTENDENT, HAVE SUCH A COMMUNITY  OF  INTEREST  AS  WILL  ENSURE  PROPER
ADMINISTRATION; OR
  (C)  FAMILY MEMBERS OF SUCH PERSONS DESCRIBED IN PARAGRAPH (A) OF THIS
SUBDIVISION. FOR THE PURPOSES OF THIS PARAGRAPH, "FAMILY MEMBER" MEANS A
PERSON RELATED BY BLOOD, MARRIAGE OR LIVING IN THE SAME HOUSEHOLD WITH A
PERSON WITHIN THE FIELD OF MEMBERSHIP AND  THEIR  LINEAL  ANCESTORS  AND
DESCENDANTS INCLUDING PERSONS SO RELATED BY ADOPTION, SIBLINGS, STEPPAR-
ENTS,  STEPCHILDREN  AND  STEPSIBLINGS;  AND  "HOUSEHOLD"  MEANS PERSONS
LIVING IN THE SAME RESIDENCE AND MAINTAINING A SINGLE ECONOMIC UNIT; OR
  (D) ANY EMPLOYEE OF THE CREDIT UNION; OR
  (E) ANY MEMBER WHO LEAVES THE FIELD OF  MEMBERSHIP  AND  WHO  HAS  NOT
WITHDRAWN OR BEEN EXPELLED MAY RETAIN MEMBERSHIP; OR
  (F)  ANY  INCORPORATED OR UNINCORPORATED ORGANIZATION COMPOSED PRINCI-
PALLY OF PERSONS ELIGIBLE TO MEMBERSHIP IN THE  CREDIT  UNION  AND  THAT
ORGANIZATION'S EMPLOYEES.
  3.  ANY  PERSON  WHO  IS ELIGIBLE FOR MEMBERSHIP BY REASON OF THE FACT
THAT HE OR SHE IS AN EMPLOYEE OF A COMMON EMPLOYER OR OF A CREDIT  UNION
SHALL  NOT  BECOME INELIGIBLE, AFTER THE TERMINATION OF SUCH EMPLOYMENT,
AS LONG AS HE OR SHE RECEIVES A PENSION OR ANNUITY  FROM,  OR  UNDER,  A
PLAN  OR OTHER ARRANGEMENT ESTABLISHED BY SUCH COMMON EMPLOYER OR CREDIT
UNION.
  4. A CREDIT UNION MAY EXTEND MEMBERSHIP TO PERSONS  AND  ORGANIZATIONS
IN  AN UNDERSERVED LOCAL COMMUNITY, NEIGHBORHOOD OR RURAL DISTRICT WHERE
SUCH AREA IS CONSIDERED AN "INVESTMENT AREA" AS DEFINED IN  THE  FEDERAL
COMMUNITY DEVELOPMENT BANKING AND FINANCIAL INSTITUTIONS ACT OF 1994 (12
U.S.C. 4703(16)).

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  S  3.   Subparagraph (i) of paragraph (a) of subdivision 18 of section
454 of the banking law, as amended by chapter 679 of the laws  of  2003,
is amended to read as follows:
  (i) Those securities authorized as permissible investments for savings
banks  by  subdivisions one, two, three, four, SIX, SUBPARAGRAPH FIVE OF
PARAGRAPH (A) OF SUBDIVISION NINE, twelve,  [paragraph]  PARAGRAPHS  (a)
AND  (B) of subdivision twelve-a, [and] subdivisions fifteen, seventeen,
PARAGRAPH (A) OF SUBDIVISION TWENTY,  SUBPARAGRAPHS  ONE  AND  ONE-A  OF
PARAGRAPH (A) OF SUBDIVISION TWENTY-ONE, AND SUBDIVISIONS TWENTY-FOUR-D,
twenty-seven [and], TWENTY-EIGHT, twenty-eight-a, TWENTY-NINE AND THIRTY
of  section  two  hundred  thirty-five  of  this  chapter AND SUCH OTHER
INVESTMENTS AS THE SUPERINTENDENT DEEMS PERMISSIBLE.
  S 4. Subdivision 21 of section 454 of the banking law, as  amended  by
chapter 679 of the laws of 2003, is amended to read as follows:
  21. To purchase, hold, lease and convey a plot whereon there is or may
be erected a building suitable for the transaction of its business, from
portions of which not required for its own use a revenue may be derived,
and  a  plot  whereon  parking accommodations are or are to be provided,
with or without charge, primarily for its members or employees or  both;
provided  that  the net aggregate of all investments of any credit union
in such plots and building shall be limited to [six] FIFTEEN per  centum
of  the  capital and retained earnings of such credit union, except with
the approval of the superintendent.
  S 5. Section 454 of the banking law is amended by adding a new  subdi-
vision 37 to read as follows:
  37.  TO  EXERCISE  INCIDENTAL  POWERS  APPROVED BY THE NATIONAL CREDIT
UNION ADMINISTRATION AS SET FORTH IN 12 C.F.R. 721.
  S 6. This act shall take effect on the ninetieth day  after  it  shall
have become a law.