Sponsored by:
Senator NIA H. GILL
District 34 (Essex and Passaic)
SYNOPSIS
"State Bank of New Jersey Act."
CURRENT VERSION OF TEXT
As introduced.
An Act creating a State bank and supplementing Title 17 of the Revised Statutes.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. This act shall be known and may be cited as the "State Bank of New Jersey Act."
2. The Legislature finds and declares that:
a. Access to capital is vitally important for the health, security, and well-being of all individuals and businesses in our State. They are the economic drivers that help New Jerseys commerce run smoothly. The lack of accessible capital, as currently experienced due to the economic downturn, is exacerbating the economic hardships being faced by working families and businesses;
b. By creating a State bank, the State is able to direct economic development policy initiatives in a responsive and efficient manner to benefit citizens of New Jersey;
c. The mission of the State Bank of New Jersey shall be to promote small businesses, fair educational lending, housing, infrastructure improvements, community development, economic development, commerce, and industry in New Jersey. In this role, the bank shall act as a funding resource in partnership with other financial institutions, economic development groups, and guaranty agencies;
d. Accuracy of financial reporting and compliance with all applicable laws and regulations shall be an integral part of the State Bank of New Jerseys overall risk management strategy; and
e. It is the intent of the Legislature that State funds and funds of State institutions may be deposited at the State Bank of New Jersey and guaranteed by the State. Other deposits may be accepted from any public source. The State Bank of New Jersey shall be operated to benefit the citizens of New Jersey.
3. As used in this act:
"Board" means the board of directors of the State Bank of New Jersey.
"Commissioner" means the Commissioner of Banking and Insurance.
"Department" means the Department of Banking and Insurance.
"President" means the President of the State Bank of New Jersey.
"Public source" means the State of New Jersey, any of its political subdivisions, any authority created by the Legislature of the State of New Jersey and any instrumentality or agency of the State of New Jersey or of any of its political subdivisions.
"State Bank of New Jersey," State bank or bank refers to the State-owned financial institution established pursuant to section 4 of this act.
"State moneys" or State funds mean all moneys or funds belonging to or in the custody of the State under the control of the State Treasurer.
"State Treasurer" means the Treasurer of the State of New Jersey.
4. a. There is established the State Bank of New Jersey.
b. Notwithstanding any other law to the contrary, as soon as practicable, the State Treasurer may deposit State moneys in the bank. Any State funds not under the direct control of the State Treasurer may be deposited in the bank by the person in control of these funds.
c. All income earned by the bank for its own account on State moneys that are deposited in or invested with the bank to the credit of the State shall be credited to and become a part of the revenues and income of the bank.
5. a. The State bank may make loans subject to the limitations in this act and any rules adopted by the State Treasurer.
b. The bank shall be permitted to charge the same rate of interest and provide for the same terms for a loan or extension of credit as a State-chartered bank, consistent with The State Bank Parity Act," P.L.1981, c.4 (C.17:13B-1 et seq.), and to exercise any other power or authority permissible to a State-chartered bank.
c. The bank shall invest State moneys in any manner that ensures appropriate cash management and may establish a cash management fund, separate from the banks general fund for investment purposes. The bank shall not make a loan to any board member, the president, or any officer of the bank, including any immediate family member of that person, or any entity with which that person is associated or in which he has an interest.
d. The bank may:
(1) Buy and sell federal funds;
(2) Lease, assign, sell, exchange, transfer, convey, grant, pledge, or mortgage all real and personal property, title to which has been acquired in any manner;
(3) Acquire real or personal property or property rights by purchase, lease, or the exercise of the right of eminent domain and may construct, remodel, and repair buildings;
(4) Receive deposits from any public source and deposit its funds in any bank or other financial institution;
(5) Perform all acts and do all things necessary, advisable, or desirable to carry out the powers expressly granted or necessarily implied in this section through or by means of its president, officers, agents, or employees or by contracts with any person, firm, or corporation;
(6) Provide loans or other assistance to public or private entities or consortia thereof for the purpose of financing all or a portion of the costs incurred for the planning, acquisition, engineering, construction, reconstruction, repair and rehabilitation of a transportation project;
(7) Coordinate with the Higher Education Student Assistance Authority to further access to postsecondary education, whether by loans, grants, scholarships, savings programs, or other means and shall have the authority enumerated in section 1 of P.L.1999, c.46 (C.18A:71A-9), as appropriate;
(8) Purchase mortgage loans on residential real property originated by financial institutions; and
(9) Provide loans or other assistance to small businesses.
6. a. The State bank shall be governed by a board of directors consisting of 13 members as follows:
(1) the State Treasurer, or the State Treasurers designee, as an ex officio member; and
(2) twelve members, who are residents of this State, to be appointed by the Governor with the advice and consent of the Senate, including: one person who shall have experience in bank administration; one person who shall have experience in credit union administration; one person who shall have experience in consumer financial advocacy; one person who shall have experience in public administration; two additional public members; and of the six other persons, two shall be appointed upon the recommendation of the President of the Senate, two shall be appointed upon the recommendation of the Speaker of the General Assembly, one shall be appointed upon the recommendation of the Minority Leader of the Senate, and one shall be appointed upon the recommendation of the Minority Leader of the General Assembly.
Each public member of the board shall have demonstrated expertise in at least one of the following areas and be appointed in such a manner as to ensure that the public membership of the board includes individuals who have demonstrated expertise in the followi