Establishes a temporary state commission to conduct a feasibility study to evaluate and make recommendations concerning the formation and control of a state public bank; provides if such study finds that the state bank is feasible, the commission may recommend legislation to create a state public bank for New York.
STATE OF NEW YORK
________________________________________________________________________
2720--B
2023-2024 Regular Sessions
IN ASSEMBLY
January 26, 2023
___________
Introduced by M. of A. PEOPLES-STOKES, LEVENBERG, MEEKS -- read once and
referred to the Committee on Banks -- committee discharged, bill
amended, ordered reprinted as amended and recommitted to said commit-
tee -- recommitted to the Committee on Banks in accordance with Assem-
bly Rule 3, sec. 2 -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
AN ACT establishing a commission to determine what 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; and
providing for the repeal of such provisions upon expiration thereof
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. A temporary state commission, to be known as the New York
2 state commission on establishing a bank owned by New York state, herein-
3 after referred to as the commission, is hereby established to hire a
4 consultant to study the feasibility of establishing a bank owned by the
5 state of New York or by a public authority constituted by the state of
6 New York for the public interest.
7 § 2. (a) The commission shall consist of eleven members, to be
8 appointed as follows:(i) five members shall be appointed by the gover-
9 nor, one of whom shall be a representative of the New York state depart-
10 ment of financial services, one shall be a representative from the New
11 York state department of taxation and finance, the remaining three
12 governor's appointees shall not be employees of the executive branch and
13 at least one member shall represent the banking and financial industries
14 of the state including, but not limited to, the New York bankers associ-
15 ation, at least one member shall represent community banking, and no
16 more than one member may be a representative of any financial services
17 firm located within the state, including, but not limited to, the New
18 York state small business development center;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD02072-07-4
A. 2720--B 2
1 (ii) three members shall be appointed by the temporary president of
2 the senate, one of whom shall be a member of the senate;
3 (iii) three members shall be appointed by the speaker of the assembly,
4 one of whom shall be a member of the assembly.
5 (b) The majority of the members of the entire commission shall desig-
6 nate one of the commissioners to serve as the chair of the commission.
7 (c) The members of the commission shall be appointed no later than
8 ninety days after the effective date of this act.
9 (d) The commission is directed to hire a reputable consultant that has
10 the capacity, capability, and experience to conduct a feasibility study
11 to evaluate and make recommendations concerning the formation and
12 control of a state public bank. Consultants that have conducted a previ-
13 ous feasibility study of a public bank at the request of a government
14 entity in the United States will be given preference. Such study shall
15 make recommendations, with the advice of the department of financial
16 services, including but not limited to, on the feasibility of establish-
17 ing a state bank in New York and may recommend legislation for the
18 legislature to consider in order to create a state public bank for New
19 York.
20 § 3. The scope of such study shall include, but shall not be limited
21 to:
22 (a) the purposes of such public bank in the public interest;
23 (b) an analysis of cost savings, impacts on the state's finances,
24 economic development and infrastructure, housing and additional needs of
25 the state, including but not limited to:
26 (i) appropriate governance structures;
27 (ii) minimum capitalization requirements;
28 (iii) appropriate insurance and risk management tools;
29 (iv) charter requirements;
30 (v) financial and operations framework;
31 (vi) deposits;
32 (vii) permitted activities;
33 (viii) benefits;
34 (ix) potential challenges that such public banks may encounter;
35 (x) how the lack of accessible financial services contributes to the
36 cycle of poverty;
37 (xi) barriers to small business formation and growth;
38 (xii) impacts of such public banks on small businesses, including
39 minority- and women-owned business enterprises;
40 (xiii) impacts of such public banks on the unbanked, the underbanked
41 and banking deserts; and
42 (xiv) how a state public bank may provide banking to the cannabis
43 industry;
44 (c) a fiscal analysis of costs associated with formation;
45 (d) an analysis that considers the effects of an economic recession on
46 the financial results of such public banks;
47 (e) a legal analysis of whether the proposed structure and operation
48 of such public bank complies with the New York state constitution;
49 (f) an analysis of how the proposed governance structure of such
50 public bank would protect such public bank from unlawful insider trans-
51 actions and apparent conflicts of interest;
52 (g) a fiscal analysis of the benefits associated with the creation of
53 such public bank, including, but not limited to, cost savings, jobs
54 created, jobs retained, economic activity generated and private capital
55 leveraged;
A. 2720--B 3
1 (h) a qualitative assessment of social and environmental benefits of
2 such public bank;
3 (i) a review of feasibility studies on public banking, including the
4 city of Philadelphia public bank feasibility study and the city of San
5 Francisco public bank feasibility study; and
6 (j) a review of AB-857 (2019 Cal. Stats. Ch. 442).
7 § 4. No earlier than six months and no later than seven months after
8 the effective date of this act, the commission shall submit a report to
9 the governor, the temporary president of the senate, the speaker of the
10 assembly, the chair of the senate banks committee and the chair of the
11 assembly banks committee on the findings and conclusions of the study
12 conducted pursuant to sections two and three of this act and shall
13 submit any legislative recommendations deemed to be necessary. Such
14 report shall be contemporaneously published on the official website of
15 the department of financial services.
16 § 5. This act shall take effect immediately and shall expire and be
17 deemed repealed one year after such effective date.
