NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A6601
TITLE OF BILL:
An act to amend the banking law, in relation to prohibiting state char-
tered banking institutions from investing in and providing financing for
PURPOSE OR GENERAL IDEA OF BILL::
This bill prohibits New York state-chartered banks from financing
SUMMARY OF PROVISIONS::
This bill adds a new section 12 to the State Banking Law to prohibit New
York State chartered banking institutions from financing private
New York State has prohibited private prisons since 2007, but state law
does not yet prohibit their financing.
Private prisons are already prohibited in New York state. New York
passed this law because it was widely recognized that it was neither a
human practice nor in the public interest. And yet the indirect profi-
teering from the same activity is still permitted because banks and
other investors can still earn income from that activity. Incarceration
is a necessary public function that serves the public, and it be driven
by motives of public service, public safety and rehabilitation, not
PRIOR LEGISLATIVE HISTORY::
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS::
This act shall take effect immediately.
STATE OF NEW YORK
2023-2024 Regular Sessions
April 24, 2023
Introduced by M. of A. REYES, ANDERSON, RIVERA, DINOWITZ, GALLAGHER,
CRUZ, SEAWRIGHT, ZINERMAN, FORREST, SIMON, L. ROSENTHAL, MITAYNES,
LAVINE -- read once and referred to the Committee on Banks
AN ACT to amend the banking law, in relation to prohibiting state char-
tered banking institutions from investing in and providing financing
for private prisons
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The banking law is amended by adding a new section 12 to
2 read as follows:
3 § 12. Investments in private prisons by state chartered banking insti-
4 tutions. 1. No state chartered banking institution shall provide financ-
5 ing for or invest in the stocks, securities, or other obligations of any
6 entity that owns or operates a private correctional facility for housing
7 inmates that would be prohibited under section one hundred twenty-one of
8 the correction law if such facility were located in this state.
9 2. For purposes of this section "banking institution" shall have the
10 same meaning as defined in paragraph (b) of subdivision three of section
11 nine-f of this chapter.
12 § 2. This act shall take effect immediately and shall apply to all
13 contracts entered into, renewed, modified or amended on or after such
14 effective date.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 is old law to be omitted.