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S01055 Summary:

BILL NOS01055
 
SAME ASNo Same As
 
SPONSORSANDERS
 
COSPNSRBENJAMIN, BIAGGI, HOYLMAN, JACKSON, RAMOS, SKOUFIS
 
MLTSPNSR
 
Add Art 17 §§254 - 277, St Fin L
 
Relates to establishing the state of New York public bank to use the state's depository assets to generate additional benefit for the people and the economy of the state.
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S01055 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          1055
 
                               2021-2022 Regular Sessions
 
                    IN SENATE
 
                                     January 6, 2021
                                       ___________
 
        Introduced  by  Sen. SANDERS -- read twice and ordered printed, and when
          printed to be committed to the Committee on Finance
 
        AN ACT to amend the state finance law, in relation to  establishing  the
          state of New York public bank; and providing for the repeal of certain
          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. The state finance law is amended by adding a new article 17
     2  to read as follows:
     3                                 ARTICLE 17
     4                      STATE OF NEW YORK PUBLIC BANK ACT
     5  Section 254. Legislative intent.
     6          255. Definitions.
     7          256. Creation.
     8          257. Commission.
     9          258. Governance.
    10          259. Deposit of public funds.
    11          260. Investment of state moneys.
    12          261. Infrastructure loans.
    13          262. Student loans.
    14          263. Business, non-profit and individual loans.
    15          264. Treasury and banking services.
    16          265. Management.
    17          266. Advisory board.
    18          267. Financial regulation.
    19          268. Reporting requirements.
    20          269. Ethical requirements.
    21          270. Fees and taxes.
    22          271. Bank records.
    23          272. Capitalization.
    24          273. Public depositary.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD06138-02-1

        S. 1055                             2
 
     1          274. Application of this chapter to the president.
     2          275. Cash and demand deposits available.
     3          276. Permitted investments.
     4          277. Severability.
     5    §  254.  Legislative  intent.  1. The legislature finds that there are
     6  significant public infrastructure, higher  education,  home  loans,  and
     7  small business development  needs,  including  those  involving   minor-
     8  ity-  and women-owned business enterprises, of the state that are unmet.
     9  The legislature further finds that there are opportunities  to  use  the
    10  state's  depository assets to generate additional benefit for the people
    11  and the economy of the state.  Therefore,  the  legislature  intends  to
    12  create  the  state  of New York public bank as a legacy institution that
    13  amasses sufficient capital reserves to address opportunities now and  in
    14  the future.
    15    2. The legislature intends that the public bank may:
    16    (a)  Facilitate investment in, and financing of, public infrastructure
    17  systems and projects that will increase public health, safety, and qual-
    18  ity of life, improve environmental conditions, including  the  retrofit-
    19  ting of homes as green homes, and promote community vitality and econom-
    20  ic growth;
    21    (b)  Assist  students  who  are in need of additional low-cost student
    22  loans in order to finance the cost of higher education;
    23    (c) Acquire and contract to acquire existing mortgages owned by  banks
    24  and  enter  into  advance  commitments to banks for the purchase of such
    25  mortgages, and to provide low-cost home loans to first time home buyers;
    26    (d) Provide access to credit for small businesses, including minority-
    27  and women-owned business enterprises and farmers; and
    28    (e) Provide banking to underserved communities and economically disad-
    29  vantaged communities of our state  to  provide  access  to  low-interest
    30  capital; and
    31    (f)  Leverage  New York's financial capital and resources, and work in
    32  partnership with financial institutions, including credit unions, commu-
    33  nity development financial institutions, independent  banks,  community-
    34  based  organizations, economic development organizations, guaranty agen-
    35  cies, and other similar organizations.
    36    3. The mission of the bank is to use New York's depository  assets  in
    37  ways  that  afford  most  efficient  use of taxpayer revenues and public
    38  resources for the benefit of the people and economy of  the  state.  The
    39  legislature  intends for the bank to apply business strategies to manage
    40  taxpayer revenues while concurrently meeting identified needs and  stra-
    41  tegic  opportunities  across  the  state.  In  achieving  its purpose of
    42  improving public infrastructure and increasing access to  higher  educa-
    43  tion, creating a pathway to home ownership and strengthening the state's
    44  economy  by  investing  in  small  businesses,  including  minority- and
    45  women-owned business enterprises, and farmers, the  legislature  intends
    46  for the bank to adhere to the following priorities:
    47    (a) Institutional safety and soundness;
    48    (b) Long-term viability;
    49    (c) Social return and monetary return on investments;
    50    (d) Prudent and best banking and business practices;
    51    (e) Highest ethical, accountability, and transparency standards; and
    52    (f) Insulation from political influence.
    53    §  255.  Definitions. The definitions in this section apply throughout
    54  this article unless the context clearly requires otherwise.
    55    1. "Board" means the advisory board of the state of  New  York  public
    56  bank.

        S. 1055                             3
 
     1    2. "Commission" means the state of New York public bank commission.
     2    3. "Department" means the department of financial services.
     3    4.  "Director"  means  the  director  of  the  department of financial
     4  services.
     5    5. "Economic distressed communities" means those communities where  at
     6  least  thirty  percent  of residents have incomes that are less than the
     7  national poverty level and where the unemployment rate is  greater  than
     8  the  national unemployment rate, or economic opportunity zone designated
     9  communities.
    10    6. "Superintendent" means the  superintendent  of  the  department  of
    11  financial services.
    12    7. "Public infrastructure system" means a system of a local government
    13  or  political  subdivision,  a special purpose district, a public school
    14  district, an institution of higher  education,  a  federally  recognized
    15  Indian  tribe,  or  the  state,  including  but  not limited to a system
    16  involving:  Wastewater treatment; storm water  management;  solid  waste
    17  disposal;  drinking  water treatment; flood control levees; energy effi-
    18  ciency enhancements; roads, streets, and bridges; transportation infras-
    19  tructure, including freight  and  passenger  rail  and  public  transit;
    20  broadband  and telecommunications infrastructure; outdoor recreation and
    21  habitat protection facilities;  community,  social  service,  or  public
    22  safety  facilities;  schools  and educational facilities; and affordable
    23  housing.
    24    8. "Special purpose charter" means any public bank organized under the
    25  laws of this state that is engaged in banking for  the  benefit  of  the
    26  public.
    27    9.  "State  moneys"  means  all moneys or funds belonging to or in the
    28  custody of the state under the control of the state comptroller shall be
    29  considered as state moneys or funds.
    30    10. "Comptroller" means the comptroller of the state of New York.
    31    11. "Bank" means the state of New York public bank.
    32    § 256. Creation. The state of New York public bank is created.
    33    § 257. Commission. 1. The state of New York public bank commission  is
    34  created  as the primary governing authority of the bank.  The commission
    35  shall be an independent board consisting of no less than  seven  members
    36  with  substantial  banking  and  financial  experience, with two members
    37  appointed by the governor, one member appointed by the temporary  presi-
    38  dent  of the senate, one member appointed by the senate majority leader,
    39  one member  appointed  by  the  speaker  of  the  assembly,  one  member
    40  appointed  by  the assembly majority leader, one member appointed by the
    41  chair of the senate banks committee, one member appointed by  the  chair
    42  of  the  assembly banks committee, and one member appointed by the state
    43  comptroller.
    44    2. The commission shall adopt rules regarding the:
    45    (a) Safety and soundness standards of the bank;
    46    (b) Criteria for evaluating, approving, and monitoring loans;
    47    (c) Eligibility requirements and limits for borrowing;
    48    (d) Transparency requirements for bank operations;
    49    (e) Ethics and conflict of interest requirements for  the  commission,
    50  the  board,  and  officers and employees of the bank, including rules to
    51  ensure that they perform their functions in compliance with  the  public
    52  officers law; and
    53    (f) Other topics as needed for efficient administration of the bank.
    54    3.  The  commission shall commence bank operations by April first, two
    55  thousand twenty-three.

        S. 1055                             4
 
     1    4. The commission may delegate to the bank president such  duties  and
     2  powers  as  deemed  necessary  to  carry on the business of the bank and
     3  enforce this article efficiently and effectively. The commission may not
     4  delegate its rule-making or policy-making authority.
     5    5.  The  commission  shall  adopt  policies and procedures for its own
     6  governance.
     7    6. The commission  may  establish  technical  advisory  committees  or
     8  consult  with  public  and  private  sector experts in substantive areas
     9  related to the bank's mission, objectives, and duties.
    10    § 258. Governance. 1.  The public bank shall be governed by  a  board.
    11  Such  board shall be composed of nine or eleven directors. Each director
    12  shall live within the jurisdictional boundaries of the sponsor.
    13    2. The state shall determine the public bank's initial  board  in  the
    14  following manner:
    15    (a)  The governor shall appoint three members, with a least one member
    16  having community banking or financial experience;
    17    (b) The temporary president of the senate shall appoint  two  members,
    18  with  at  least one member having community banking or financial experi-
    19  ence;
    20    (c) The speaker of the assembly shall appoint  two  members,  with  at
    21  least one member having community banking or financial experience;
    22    (d)  The comptroller, who shall be a permanent member of the governing
    23  board, shall appoint one member  with  community  banking  or  financial
    24  experience; and
    25    (e)  The board members selected pursuant to paragraphs (a) through (c)
    26  of this subdivision shall, pursuant to a majority vote, select at  their
    27  discretion  either seven or nine additional board members, with the sole
    28  purpose of maximizing board diversity of the state.
    29    3. At least one board member selected pursuant to each  of  paragraphs
    30  (a)  through (c) of subdivision two of this section shall be an individ-
    31  ual with experience in the finance industry or the business of community
    32  banking with an emphasis on community lending.
    33    4. At least one board member selected pursuant to each  of  paragraphs
    34  (a)  through (c) of subdivision two of this section shall be an individ-
    35  ual representative of at least one of the community stakeholders  prior-
    36  itized by the public bank's underwriting and financial policies.
    37    5.  When  a  board member resigns or leaves office for any reason, the
    38  individual selected to replace such board member shall  be  selected  in
    39  the same manner as the initial appointment.
    40    6. The sponsor and board shall take all necessary steps to ensure that
    41  the  composition of the board reflects the composition of the population
    42  in terms of people of color and women.
    43    7. A majority of the board shall be composed of independent  directors
    44  who  are  not  government  employees. The chair of the board shall be an
    45  independent director.
    46    8. The board shall set policy for the public bank; provided,  however,
    47  that  neither the board nor any director shall be involved in day-to-day
    48  operations regarding particular instruments. Management decisions  shall
    49  be  made  independently by bank management who shall be appointed by the
    50  board in a manner consistent with bank policy.
    51    9. The board may establish one or more committees to manage the public
    52  bank.
    53    10. The board shall adhere to all reporting  requirements  under  this
    54  chapter regarding the public bank's financial condition.

        S. 1055                             5
 
     1    11.  A  public bank shall form one or more advisory boards in order to
     2  provide advice and carry out any other  duties,  as  determined  by  the
     3  public bank, including but not limited to, the following:
     4    (a)  Provide  input  to  the  board  regarding  ways to accomplish its
     5  mission;
     6    (b) Ensure that the board follows strict ethical standards  as  deter-
     7  mined  by  the sponsor in the public bank's governing documents, through
     8  the approval of bylaws, to govern the board's management;
     9    (c) Provide technical advice as needed; and
    10    (d) Provide an annual report to the public and the sponsor  evaluating
    11  the  public  bank's  performance in relation to its mission, its ethical
    12  standards and its financial soundness.
    13    12. The state shall determine the initial advisory  board  membership,
    14  the  term  of  its members, the qualifications of members and the method
    15  for replacing its members, provided that a  majority  of  each  advisory
    16  board  is  made up of independent members who are not government employ-
    17  ees. Such advisory board shall be composed of no fewer than five members
    18  and no more than eleven members. All advisory  board  members  shall  be
    19  residents of the state.
    20    13.  Any  action  required or permitted by this chapter to be taken by
    21  the board, or an advisory board, may be taken at a duly  called  meeting
    22  of  such  board  in accordance with its governing documents or without a
    23  meeting if the action taken is evidenced by one or more written consents
    24  describing the action taken and signed by each member of such board.
    25    14. The department shall provide technical assistance  to  the  board.
    26  The  board  may  also contract with additional persons who have specific
    27  technical expertise if such expertise is  necessary  to  carry  out  the
    28  requirements  of  this section. When seeking technical assistance and/or
    29  advice, the board shall also consult minority-owned or women-owned busi-
    30  nesses when applicable.
    31    § 259. Deposit of public funds. 1. (a) The bank  shall  serve  as  the
    32  depository  for state moneys once the bank has built sufficient capacity
    33  to accept and manage state moneys, as determined by the commission.  The
    34  commission  shall  establish a process and time frame for the deposit of
    35  state moneys into the bank.
    36    (b) The comptroller shall deposit state moneys in the bank in  accord-
    37  ance  with  the  time  frame and guidelines determined by the commission
    38  under this section.
    39    2. All deposits in the bank are guaranteed by the state.
    40    3. All income earned by the bank on state moneys that are deposited in
    41  or invested with the bank must be credited to and become a part  of  the
    42  revenues and income of the bank.
    43    4. The bank may accept deposits of public funds.
    44    5.  The bank may accept funds from any source, including federal funds
    45  or other public funds, including but not limited to, twenty percent of a
    46  cannabis revenue fund as part of the state's social and economic  equity
    47  plan.  Specifically,  fifty percent of all public deposits made into the
    48  public bank shall prioritize lending in unbanked and underserved  commu-
    49  nities  that  have  an  income  lower  than eighty percent of the median
    50  income of the county in which the applicant  resides,  has  a  minority-
    51  owned or women-owned business or is a disadvantaged farmer.
    52    6.  The  commission  shall  review  state accounts that contain public
    53  funds that are not state moneys, such as the state insurance  fund,  and
    54  make  recommendations  to the governor and the appropriate committees of
    55  the legislature as to which accounts should be deposited in the bank.

        S. 1055                             6
 
     1    7. The bank shall make disbursements to the state funds  as  necessary
     2  for the function of state government.
     3    8.  The  bank  is  authorized  to  establish a master account with the
     4  federal reserve to enhance its liquidity.
     5    § 260. Investment of state moneys. The bank may  invest  state  moneys
     6  deposited  in  the bank that are not reasonably expected to be necessary
     7  to meet the short or intermediate-term liquidity needs of the state. The
     8  state comptroller retains authority to manage and invest the  amount  of
     9  funds necessary to meet the operational needs of state government.
    10    §  261.  Infrastructure  loans.  The  bank is authorized to facilitate
    11  investment in, and financing of, construction, rehabilitation,  replace-
    12  ment, and improvement of new and existing public infrastructure systems.
    13  Before  initiating operations, the commission shall present an implemen-
    14  tation plan and any necessary legislation to the governor and  appropri-
    15  ate legislative committees, that:
    16    1. Identifies the public infrastructure systems that the bank plans to
    17  target initially;
    18    2.  Identifies any existing state programs that the bank recommends be
    19  transferred under its umbrella, and the  steps  and  timelines  for  the
    20  transitions;
    21    3. Describes additional financing products and services the bank plans
    22  to offer, the target markets, anticipated rates, terms, and conditions;
    23    4. Demonstrates how bank products and services will increase access to
    24  capital for public infrastructure systems and complement those of exist-
    25  ing public and private sources; and
    26    5.  Demonstrates  how  the  bank plans to maximize revenues and public
    27  benefit.
    28    § 262. Student loans. The bank, in partnership with independent commu-
    29  nity banks, credit unions  or  community  development  institutions,  is
    30  authorized  to  administer  a  state  guarantee  loan  program to assist
    31  students in need of low-cost student loans and related loan benefits  to
    32  address  educational  needs  as  necessary  to  support student success,
    33  including the refinancing of an existing student debt.   The  commission
    34  shall develop an implementation plan that:
    35    1.  Identifies  the  needs  and benefits to selected students that the
    36  program will target initially;
    37    2. Demonstrates how the bank plans to  maximize  revenues  and  public
    38  benefit while minimizing public risk;
    39    3.  Demonstrates  how  the  bank  will  coordinate  with the office of
    40  student financial assistance; and
    41    4. Identifies the ways that the program  will  address  the  following
    42  issues related to loans:
    43    (a) Qualification criteria for students;
    44    (b) Obligations and options for loan repayment;
    45    (c) Requirements for loan guarantees and reserves;
    46    (d) Establishing criterion for refinancing an existing debt;
    47    (e) Fee and interest rate structure;
    48    (f) Maximum loan amounts; and
    49    (g)  Ensuring  student  awareness  of grants, federal loans, and other
    50  financial aid programs.
    51    § 263. Business, non-profit and individual loans. The bank,  in  part-
    52  nership  with  independent  community  banks, credit unions or community
    53  development financial institutions, is  authorized  to  leverage  thirty
    54  percent of public deposits as financial capital and resources to provide
    55  access  to low-cost capital and/or credit to small businesses, minority-
    56  and women-owned  business  enterprises,  entrepreneurs,  start-up  busi-

        S. 1055                             7
 
     1  nesses, farmers  and below average income communities and individuals of
     2  this state to further economic growth, create jobs and build and sustain
     3  affordable  housing  for  the residents of this state as provided for by
     4  this  section.  The  bank  is  also authorized to leverage its financial
     5  capital and resources to provide access to  low-cost  capital  to  bring
     6  fiscally  sound and financially successful businesses into this state as
     7  provided for by this section.  The bank is also authorized  to  leverage
     8  its  financial capital and resources to provide access to low-cost capi-
     9  tal and/or credit to  established  businesses  in  this  state  for  the
    10  purpose of providing financial stability for the bank as provided for by
    11  this section.
    12    1.  The bank, in partnership with the state of New York mortgage agen-
    13  cy, may purchase, guarantee or hold loans made by private banks,  credit
    14  unions or other financial institutions doing business in this state.
    15    2.  The  bank  may  make loans in the form of participation loans with
    16  community banks,  credit  unions  and  community  development  financial
    17  institutions  in  this  state  to  qualified  individuals and businesses
    18  residing or doing business in this state when the originator of the loan
    19  is a private bank, credit union or other financial institution.
    20    3. The bank may serve as a banker's bank for chartered banks  in  this
    21  state  by  providing  correspondent  banking  services and other related
    22  services in keeping  with  its  mission  to  create  regional  banks  in
    23  unbanked and underserved communities. The bank and regional banks estab-
    24  lished  pursuant  to  this statute shall not compete with private banks,
    25  particularly in unbanked and underserved communities.
    26    4. The bank may accept deposits  related  to  such  transactions  from
    27  banks and other financial institutions.
    28    § 264. Treasury  and  banking  services. 1. For financial institutions
    29  that make the bank a reserve depository, the bank may serve as a  clear-
    30  inghouse,  including  all  facilities for providing domestic and foreign
    31  exchange, and may rediscount paper, on terms the commission provides.
    32    2. The bank may provide corporate trust services for the state and its
    33  political subdivisions including trustee, escrow  agent,  paying  agent,
    34  bond registrar, and transfer agent.
    35    3.  The  bank  may buy and sell federal funds; issue letters of credit
    36  for public deposits; and provide a safekeeping service for United States
    37  treasury securities, federal agency securities,  corporate  bonds,  tax-
    38  free bonds, money market investments, and mortgage-backed securities.
    39    4.  The  bank  may  perform  services  currently contracted out by the
    40  office of temporary disability services  regarding  electronic  benefits
    41  transfer cards.
    42    §  265.  Management.  1. The commission shall appoint a bank president
    43  with demonstrated and substantial experience in community  banking.  The
    44  president  shall  serve  at the commission's pleasure, on such terms and
    45  conditions as the commission determines.
    46    2. The president shall provide support to the commission and the advi-
    47  sory board, carry out bank policies and  programs,  and  exercise  addi-
    48  tional authority as may be delegated by the commission.
    49    3.  Subject to available funding and consistent with commission direc-
    50  tion, the bank president:
    51    (a) May employ such additional  personnel  as  are  necessary  to  the
    52  bank's  operations.    This  employment  shall be in accordance with the
    53  state civil service law; and
    54    (b) May contract with persons who have the technical expertise  needed
    55  to carry out a specific, time-limited project.

        S. 1055                             8
 
     1    § 266. Advisory  board. 1. (a) A public bank advisory board consisting
     2  of eleven members is created to review the bank's  operations  and  make
     3  recommendations  relating  to the bank's management, services, policies,
     4  and procedures.
     5    (b)  The governor shall appoint members of the advisory board, subject
     6  to confirmation by the senate. The members of the advisory  board  shall
     7  be  knowledgeable  in community banking or finance and shall represent a
     8  diversity of experience relevant to activities of the bank. Six or  more
     9  of the members shall have expertise in community banking or finance. Two
    10  members shall be from a consumer advocacy or social justice organization
    11  or have a background in the area of consumer advocacy or social justice.
    12  Advisory board members serve at the pleasure of the governor.
    13    (c) The board shall choose its chair from among its membership.
    14    2.  The  term of the members is three years. Five of the initial board
    15  members shall be appointed to serve an  initial  term  of  three  years,
    16  three  shall be appointed to serve an initial term of two years, and the
    17  three remaining members shall be appointed to serve an initial  term  of
    18  one year. All subsequent terms are three years. To ensure that the board
    19  can continue to act, a member whose term expires shall continue to serve
    20  until his or her replacement is appointed. In the case of any vacancy on
    21  the  board  for  any  reason, the governor shall appoint a new member to
    22  serve out the term of the person whose position  has  become  vacant.  A
    23  board member may be removed for misconduct inconsistent with the mission
    24  of the bank by the governor.
    25    §  267.  Financial  regulation.  1.  The  bank  shall maintain capital
    26  adequacy and other standard indicators of safety  and  soundness  as  is
    27  appropriate for a publicly owned financial institution.
    28    2.  The  superintendent  may  examine the bank in the same manner as a
    29  state-chartered financial institution.  The  superintendent  shall  take
    30  into  consideration  the unique circumstances of a publicly owned finan-
    31  cial institution when examining the bank. The bank shall pay the  direc-
    32  tor for the reasonable costs of examinations.
    33    3.  The  bank  must  undergo  independent  audits on the same basis as
    34  state-chartered banks.
    35    § 268. Reporting requirements. 1.  The  bank  shall  submit  quarterly
    36  reports to the commission in a manner and form prescribed by the commis-
    37  sion.    Late reports are not permissible and shall be cause for removal
    38  of the person or persons responsible.
    39    2. The commission shall make  a  report  to  the  legislature  on  the
    40  affairs of the bank by December first of each year.
    41    § 269. Ethical requirements. The bank may not make a loan to any advi-
    42  sory  board  member,  the president, public officers or employees of the
    43  bank. Advisory board members, the president, and employees of  the  bank
    44  must  follow any applicable ethical requirements in rules, policies, and
    45  procedures adopted by the commission.
    46    § 270. Fees and taxes. The bank is exempt from payment of all fees and
    47  taxes levied by the state or any of its subdivisions.
    48    § 271. Bank records. 1. Certain bank business records and  records  of
    49  the department relating to the bank are exempt from public disclosure as
    50  authorized by the department of financial services.
    51    2.  Financial  and  commercial  information  and  records submitted to
    52  either the department or the commission for the purpose of administering
    53  this article may be shared between the department and  the  comptroller.
    54  These  records  may  also  be used in any suit or administrative hearing
    55  involving any provision of this chapter.
    56    3. This section does not prohibit:

        S. 1055                             9

     1    (a) The issuance of general statements based on the reports of persons
     2  subject to this article as long as the statements do  not  identify  the
     3  information furnished by any person; or
     4    (b)  The  publication by the director or the commission of the name of
     5  any person violating this article and a statement of the manner  of  the
     6  violation by that person.
     7    §  272.  Capitalization.  The commission shall make recommendations to
     8  the appropriate fiscal committees of  the  legislature  on  options  for
     9  capitalization  of  the  bank.  Any  recommendations shall include draft
    10  legislation for consideration by the legislature.
    11    § 273. Public depositary. The state of New York public bank created in
    12  section two hundred fifty-six of this article  may  accept  deposits  of
    13  public funds, but is not a public depositary.
    14    § 274. Application of this chapter to the president. The provisions of
    15  this  chapter  outside  this  article  do  not apply to the president as
    16  defined in section two hundred sixty-five of this article.
    17    § 275. Cash and demand deposits available. The state comptroller shall
    18  maintain at all times cash, or demand deposits in the state of New  York
    19  public bank or qualified public depositaries in an amount needed to meet
    20  the  operational  needs of state government. The state comptroller shall
    21  not be considered to be in violation of unlawful issuance of  checks  or
    22  drafts  if he or she maintains demand accounts in public depositaries in
    23  an amount less than all treasury warrants issued and outstanding.
    24    § 276. Permitted investments. Subject to the  limitations  in  section
    25  two  hundred  sixty of this article, wherever there is in any fund or in
    26  cash balances in the state treasury more than  sufficient  to  meet  the
    27  current  expenditures properly payable therefrom, the bank may invest or
    28  reinvest such portion of such funds or balances as the bank deems  expe-
    29  dient in the following defined securities or classes of investments:
    30    1.  Certificates, notes, or bonds of the United States, or other obli-
    31  gations of the United States or its  agencies,  or  of  any  corporation
    32  wholly owned by the government of the United States;
    33    2.  In  state,  county,  municipal,  or  school  district bonds, or in
    34  warrants of taxing districts of the state. Such bonds and warrants shall
    35  be only those found to be within the limit of indebtedness prescribed by
    36  law for the taxing district issuing them and to be general  obligations.
    37  The  state comptroller may purchase such bonds or warrants directly from
    38  the taxing district or in the open market at such prices and  upon  such
    39  terms  as  it may determine, and may sell them at such times as it deems
    40  advisable;
    41    3. In motor vehicle fund warrants when authorized by agreement between
    42  the state comptroller and the  department  of  transportation  requiring
    43  repayment  of  invested  funds from any moneys in the motor vehicle fund
    44  available for state highway construction;
    45    4. In federal home loan bank notes and bonds, federal land bank  bonds
    46  and  federal national mortgage association notes, debentures and guaran-
    47  teed certificates of participation, or  the  obligations  of  any  other
    48  government  sponsored  corporation  whose  obligations are or may become
    49  eligible as collateral for advances to member banks as determined by the
    50  board of governors of the federal reserve system;
    51    5. Negotiable certificates of deposit of any national or state commer-
    52  cial or mutual savings bank or savings and loan association doing  busi-
    53  ness  in  the  United States, provided, the comptroller shall follow the
    54  investment policies and procedures advised by  the  investment  advisory
    55  committee pursuant to subdivision b of section four hundred twenty-three
    56  of the retirement and social security law;

        S. 1055                            10
 
     1    6.  Commercial  paper,  provided that the comptroller shall follow the
     2  investment policies and procedures advised by  the  investment  advisory
     3  committee pursuant to subdivision b of section four hundred twenty-three
     4  of the retirement and social security law.
     5    §  277. Severability. If any clause, sentence, paragraph, subdivision,
     6  section or part of this article shall be adjudged by a court  of  compe-
     7  tent  jurisdiction to be invalid, such judgment shall not affect, impair
     8  or invalidate the remainder thereof, but shall be confined in its opera-
     9  tion to the clause, sentence, paragraph, subdivision, section or part of
    10  this article directly involved in the controversy in which such judgment
    11  shall have been rendered.
    12    § 2. This act shall take effect immediately; provided,  however,  that
    13  section  258  of  the state finance law, as added by section one of this
    14  act shall be deemed repealed on April 1, 2022.   Effective  immediately,
    15  the  addition,  amendment and/or repeal of any rule or regulation neces-
    16  sary for the implementation of  this  act  on  its  effective  date  are
    17  authorized to be made and completed on or before such effective date.
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