BILL NUMBER: S6355A
SPONSOR: ADDABBO
 
TITLE OF BILL:
An act to amend the banking law and the state finance law, in relation
to credit unions
 
PURPOSE:
To create the credit union deposit program.
 
SUMMARY OF PROVISIONS:
This bill amends Article 2 and section 454 of the Banking Law and
section 98-a and 105 of the State Finance Law to create the credit union
deposit program.
 
JUSTIFICATION:
This legislation creates the credit union deposit program which seeks to
encourage the State Comptroller and the Commissioner of Taxation and
Finance to consider placing State funds into local credit unions. This
program recognizes that local credit unions are well- positioned to use
their deposits to support economic activities in their communities.
By encouraging the placement of State deposits in local credit unions,
this program creates an opportunity for New York State to help stimulate
local economic development. Currently, much of the State's funds may be
placed in brokerage firms or in large banking institutions, many of
which may be head quartered in another state. In either of those cases,
the economic benefits of the State deposits may flow out of the state,
and the resulting local economic benefit can be minimal.
In contrast, deposits in local credit unions can have a significant
impact within that particular community. The placement of state deposits
would help enable these community banking institutions to meet the
economic needs of their local communities. Because many small communi-
ties are home to credit unions, creating the program would be of benefit
to the economies of these small communities.
The intent of this legislation is to encourage the State to consider
placing a portion of its funds in local credit unions. While the Comp-
troller and the Commissioner are not required to make such deposits,
they are encouraged to consider the benefits of such an approach. This
would enhance the ability of credit unions to support the economies of
their communities by making loans to their members.
 
LEGISLATIVE HISTORY:
2019 : S3028 Referred to Banks
 
FISCAL IMPLICATIONS:
None.
 
EFFECTIVE DATE:
Immediately.