BILL NUMBER: S1996
SPONSOR: SANDERS
 
TITLE OF BILL:
An act establishing a New York state public bank commission to study the
benefits of a public bank or network of public banks owned by the state
of New York or by a public authority constituted by the state of New
York; making an appropriation therefor; and providing for the repeal of
such provisions upon expiration thereof
 
PURPOSE OR GENERAL IDEA OF BILL:
This bill would establish a temporary state commission, to be known as
the New York state public bank commission, hereinafter referred to as
the commission, to conduct a study of the benefits a public bank or
network of public banks owned by the state of New York or by a public
authority constituted by the state of New York can provide.
 
SUMMARY OF PROVISIONS:
-Establish a temporary state commission, to be known as the New York
state commission on establishing a bank owned by New York state,
herein-after referred to as the commission, is hereby established to
hire a consultant to study the feasibility of establishing a bank owned
by the state of New York or by a public authority constituted by the
state of New York for the public interest.
-The commission shall consist of thirteen members, to be appointed as
follows:
*six members shall be appointed by the governor, one of whom shall be a
representative of the New York state department of financial services,
one shall be a representative from the New York state department of
taxation and finance, the remaining four governor's appointees shall not
be employees of the executive branch and at least one member shall
represent the banking and financial industries of the state including,
but not limited to, the New York bankers association, at least one
member shall represent community banking, and no more than one member
may be a representative of any financial services firm located within
the state, including, but not limited to, the New York state small busi-
ness development center;
*three members shall be appointed by the temporary president of the
senate, one of whom shall be a member of the senate;
*three members shall be appointed by the speaker of the assembly, one of
whom shall be a member of the assembly;
*and the state comptroller or a proxy.
-The majority of the members of the entire commission shall designate
one of the commissioners to serve as the chair of the commission.
-The members of the commission shall be appointed no later than ninety
days after the effective date of this act.
-The commission is directed to hire a reputable consultant that has the
capacity, capability, and experience to conduct a feasibility study to
evaluate and make recommendations concerning the formation and control
of a state public bank. Consultants that have conducted a previous
feasibility study of a public bank at the request of a government entity
in the United States will be given preference. Such study shall make
recommendations, with the advice of the department of financial
services, including but not limited to, on the feasability of establish-
ing a state bank in New York and may recommend legislation for the
legislature to consider in order to to create a state public bank for
New York.
 
JUSTIFICATION:
A public bank is a financial institution created by the state for a
"public benefit" of the community. Who benefits from a Public Bank?
Taxpayers will benefit from both: (a) the profits the bank makes that
return to the general fund of the state to hold the line on taxes; and
(b) the provide banking services to economic disadvantaged communities.
The state will benefit by financing public projects at a reduced cost.
Public banks help local businesses and MWBEs by providing them access to
credit lines, loans, and other forms of financing to help them grow and
succeed. The community benefits because the public bank could provide
affordable loans for students to attend college. Homebuyers seeking
reasonable mortgage loans with reasonable terms and rates also would
benefit.
The Bank of North Dakota, founded in 1919, is currently the only public
bank that exists in the United States. Since 2010, 28 States in the
United States have passed legislation to establish a public banking
taskforce or to create a public bank in their state. The State of Cali-
fornia enacted a law in 2019 allowing municipalities to form a public
bank.
 
PRIOR LEGISLATIVE HISTORY:
New bill
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
$500,000 to the State
 
EFFECTIVE DATE:
This act shall take effect on the thirtieth day after it shall have
become a law and shall expire and be deemed repealed one year after such
effective date.