NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5526A
SPONSOR: Abbate TITLE OF BILL: An act to amend the state finance law, in relation to
the direct deposit of certain salaries
PURPOSE:
To require the payment of salaries by direct deposit for state employees
hired after January 1, 2017.
SUMMARY OF PROVISIONS:
Section 1 of this bill amends Paragraph a of Subdivision 4 of Section
200 of the State Finance Law to provide that a state employee hired on
or after January 1, 2017 shall be paid by direct deposit.
Section 2 of this bill provides for an effective date of January 1,
2016.
PRIOR LEGISLATIVE HISTORY:
New bill.
JUSTIFICATION:
As of May 1, 2011, the United States Department of the Treasury requires
recipients of federal nontax payments, including social security
payments, to receive payment by electronic funds transfer (EFT) collo-
quially referred to as "direct deposit". Additionally, many states
already require the direct deposit of salaries.
For persons who may not have access to a bank account, this legislation
authorizes payment of funds by means of a debit card. The recipient
would be able to access his or her funds through an automatic teller
machine or other device that accepts debit cards.
Because of the financial advantages and added convenience, almost 86
percent of New York State employees currently use direct deposit. In
recognition of the fact that there may be certain situations where a
paper check is warranted, this legislation allows an employee to submit
a request for a waiver from the requirement to be paid by direct depos-
it.
The State Comptroller urges the passage of this proposed legislation.
FISCAL IMPLICATIONS FOR STATE:
This bill would result in financial savings to New York State.
EFFECTIVE DATE:
This act shall take effect on January 1, 2017 and shall only apply to
state employees hired on and after such date.
