NY State Senate Bill 2009-S3997

Archive: Last Bill Status - In Senate Committee Insurance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

Please enter your contact information

First Name

Last Name

Email Address

A valid email address is required.

Home address is used to determine the senate district in which you reside. Your support or opposition to this bill is then shared immediately with the senator who represents you.

Optional services from the NY State Senate:

Create an account. An account allows you to officially support or oppose key legislation, sign petitions with a single click, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Include a custom message for your Senator? (Optional)

Enter a message to your senator. Many New Yorkers use this to share the reasoning behind their support or opposition to the bill. Others might share a personal anecdote about how the bill would affect them or people they care about.

Actions

View Actions

Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 06, 2010	referred to insurance
Apr 07, 2009	referred to insurance

2009-S3997 (ACTIVE) - Details

See Assembly Version of this Bill:: A6773
Current Committee:: Senate Insurance
Law Section:: Insurance Law
Laws Affected:: Add §1415, Ins L; amd §§2426 & 2428, Pub Auth L
Versions Introduced in 2011-2012 Legislative Session:: A4632

2009-S3997 (ACTIVE) - Summary

Creates the insurer fund for underserved neighborhood/rural area development corporation; provides that such corporation shall operate in accordance with a plan of operation; provides that the corporation shall be governed by a board of sixteen directors; requires certain insurers to invest a portion of their assets in underserved neighborhoods and rural areas of the state.

2009-S3997 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S3997

 TITLE OF BILL :

An act to amend the insurance law and the public authorities law, in
relation to the creation of the insurer fund for underserved
neighborhood/rural area development corporation


 PURPOSE :

To promote the economic health and well-being of New York State by
requiring certain insurers to invest a small portion of their assets
in New York's underserved neighborhoods and rural areas.

 SUMMARY OF PROVISIONS :

Section one adds a new section 1415 to the Insurance Law to create the
Insurer Fund for Underserved Neighborhood/Rural Area Development
Corporation ("The IFUND Corporation") to promote the economic welfare
and health and well-being of the citizens of the state through
investments in underserved areas. The section

1) defines the terms IFUND Corporation', "qualified investments," "low
and moderate income," "member,' "underserved areas," "family farm,'
"small businesses," 'operating expenses' and "investment capital," and

"health information technology;"

2) outlines membership and investment requirements for insurers in the
IFUND Corporation;

3) requires the Corporation to adopt a plan of operations to
accomplish its purpose with the approval of the superintendent

4) establishes mechanisms for the governance of the IFUND Corporation,
including election of the board of directors and appointments to the
board of directors; and

5) provides for an annual audit and annual report to the
superintendent, the Governor and legislative leaders. Sections two and
three amend subdivision 1 of section 2426 and subdivision 2 of section
2428 of the Public Authorities law to add the IFUND Corporation as an
eligible lender for projects which can be insured by the SONYMA
Mortgage Insurance Fund. Section four sets out the effective date.

 JUSTIFICATION :

The federal Community Reinvestment Act (CRA) was passed in 1977 in
response to the "redlining" of low- and moderate-income communities by
banks. New York and many other states adopted state CRA requirements
the following year. These CRA laws established that regulated
financial institutions have a continuing and affirmative obligation to
help meet the credit needs of the local communities in which they are
chartered. Banks are graded based on the lending and services they
provide in disinvested communities, and these grades are used by
regulators in exercising their discretion over applications by banks
requiring state or federal regulatory approvals. According to a 2000
Federal Reserve Report, the CRA, and state laws modeled on it have
stimulated more than $1 trillion in bans in low- and moderate-income
communities. Here in New York, many communities have been revitalized
as a result of this activity.

Like banks, insurers control vast amounts of capital. According to the
NYS Insurance Department Annual Report for 2009, New York's 141
licensed life insurers reported over $2.19 trillion in admitted assets
in the calendar year ending in 2005. Domestic insurers accounted for
over $815.4 billion of that total. Similarly, property/casualty
insurers reported almost $947 billion in admitted assets for 2005.
During the same period, life insurers maintained almost $120 billion
in capital and surplus and property/casualty insurers $347 billion in
surplus to policyholders.

Total admitted assets for the U.S. life insurance industry topped $5
trillion at year-end 2007, a 5.7% increase from a year earlier, new
data released by A.M. Best Co. shows.

Investments from these large sums of capital raised from premiums
generate significant returns. According to the 2006 report by the
Superintendent of Insurance, the 2005 investment income for the life
insurance industry was $79 billion, over 26% of their total income.
MetLife, New York's largest domestic life insurer earned $19.0 billion
from investments in the 2007 fiscal year, according to company's 10-K
filings with the SEC.

The passage of the Gramm-Leach-Bliley Financial Services Modernization
Act (GLBA), which allows the creation of insurance, banking and
financial services conglomerates within the same holding company
system, has sparked renewed interest in insurers' investment
practices. Federal legislation anticipating federal chartering of
insurers is pending requiring CRA-type investments for insurers. Arid
several states have taken action to require or encourage community
investments by insurers:

* The California Insurance Department promotes investments by insurers
in affordable housing and other areas through the California Organized
Investment Network (COIN) program. Some of the COIN investments are
eligible for special tax treatment. Some 170 investments by insurers
were facilitated totaling S477 million in California's low-income
communities by the end of 2000;

* Twelve insurers in California have formed the IMPACT Community
Capital Program to invest in California's low and moderate income
communities;

* Massachusetts created the Life and Property & Casualty Initiatives
programs in 1998, under which the life and property/casualty
industries are encouraged to make $200 million available for CRA-type
investments in exchange for tax reductions; and

* Various other bills regarding insurer investments are pending in
California, Rhode Island, Pennsylvania and other states.

New York's Insurance Law prescribes in some detail the types of
investments insurers may make and these laws are updated from time to
time. Life insurers, for example, have sought and have received
significantly increased authority to invest In foreign countries twice
in the past six years.  Almost 20 years ago, Chapter 567 of the Laws
of 1983 made sweeping changes in the law governing investments for
life insurers, and increased the amount of equity investments insurers
could make in exchange for New York investments in new and high tech
business enterprises, minority-owned businesses or businesses located
in depressed areas and low-income housing. More recently, Chapter 610
of the Laws of 1995, which dramatically increased amounts that
insurers could invest in foreign countries, requires life insurers to
submit a statement along with their annual reports, which details
investments in real estate, including affordable housing, government
obligations, small businesses, commercial enterprises in depressed
areas and charitable activities. The law requires the superintendent
to report annually to the Legislature and the Governor on the
investments.


This legislation, recognizing New York's pressing capital needs in a
number of areas, would create a new for-profit investment company
owned and managed by insurers, the insurer Fund for Underserved
Neighborhood/Rural Area Development Corporation (the 'FUND
Corporation"), Insurers would participate in the operating expenses
and investments of the IFUND Corporation based an their premium volume
and profitability. Qualified investments would include: 1) loans and
purchases of loans or equity to or from Community Development
Corporations, nonprofit intermediaries qualified under section
501(c)(3) of the Internal Revenue code which package loans and
administer loan funds and qualified community development entities as
defined in section 450(e) of the IRS code; 2) the financing of single-
or multi-family housing affordable to low and moderate-income persons,
family farms, small businesses and other community development
activities approved by the superintendent that revitalize or stabilize
underserved areas, certified capital companies as defined in section
eleven of the tax law, community service facilities, including child
care, educational, health or social services targeting underserved
areas and the environmental cleanup or redevelopment of industrial
sites in underserved areas; and 3) purchases of NYS and local
government agency bonds that primarily benefit underserved areas, with
certain limitations.

The legislation prescribes required investment activity for the IFUND
Corp. of 5100 million in 2007 and $250 million in 2008. For the years
following, the board of directors of the IFUND Corp. will have the
discretion to set investment capital limits, but in no event would the
capital investment amount exceed one percent of aggregate net direct
premiums written by the members or five one-hundredths of one percent
of the capital and surplus or surplus to policyholders of New York
licensed insurers. Since capital and surplus/surplus to policyholders
are generally reflective of the profitability of the insurance
industry, the FUND Corp. would not be burdened with the static
investment requirements that don't take into account the business
cycles of the insurance industry. The legislation would also allow the
superintendent to credit insurers for investments made on their own or
through similar mechanisms in other states.

In order to make it easier for the IFUND Corporation to make safe and
sound investments called for under the statute. The bill also
authorizes the State of New York Mortgage Agency (SONYMA) to provide
credit enhancements for FUND investments through the Mortgage
Insurance Fund. This will both limit the risk insurers face in making
qualified investments, and increase the yield.

This legislation puts the insurance industry's capital to work in
under-served areas In New York at a time when such capital is
desperately needed. Funneling the capital through the IFUND
Corporation owned and controlled by insurers will 1) allow the
industry to continue to manage the funds in a way that is prudent for
their policyholders; 2) relieve small insurers without the needed
expertise of making investment decisions; arid 3) combine insurance
capital from many companies to create economies of scaled and massed
amounts of capital that can really have an impact. Such investment
capital is sorely needed at a time when the slate and local
governments are facing the most significant budget deficits in
decades.

The IFUND also makes good business sense for insurers. Sound, prudent
IFUND investments offer attractive yields and less risk at a time when
marry insurers incurred sharply lower returns on their investments.
Contributing to the prosperity of the state's economy will make it
more likely that New York consumers purchase insurance products. The
industry's image with the public, never outstanding but lately
tarnished with churning scandals, settlement of unfair sales practices
class action snits and other matters, would improve immeasurably with
the activities of the IFUND. Finally, experts agree that future
premium growth will come from new markets; investing in underserved
areas will help insurers access these markets.

 LEGISLATIVE HISTORY :

A.10302 of 2009.

 FISCAL IMPLICATIONS :

None.

 EFFECTIVE DATE :
Immediately.

2009-S3997 (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  3997

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                              April 7, 2009
                               ___________

Introduced  by  Sen.  ESPADA -- read twice and ordered printed, and when
  printed to be committed to the Committee on Insurance

AN ACT to amend the insurance law and the  public  authorities  law,  in
  relation   to  the  creation  of  the  insurer  fund  for  underserved
  neighborhood/rural area development corporation

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  The insurance law is amended by adding a new section 1415
to read as follows:
  S 1415. INSURER FUND FOR UNDERSERVED NEIGHBORHOOD/RURAL AREA  DEVELOP-
MENT. (A) FOR THE PURPOSES OF THIS SECTION:
  (1)  "IFUND  CORPORATION",  "CORPORATION"  OR  "IFUND"  SHALL MEAN THE
INSURER FUND FOR UNDERSERVED NEIGHBORHOOD/RURAL AREA DEVELOPMENT  CORPO-
RATION;
  (2) "QUALIFIED INVESTMENT" SHALL INCLUDE ANY LOAN, THE PURCHASE OF ANY
LOAN,  THE  PURCHASE  OF  ANY  ASSET,  THE  EXTENSION  OF CREDIT AND THE
PURCHASES OF EQUITY:
  (A) TO OR FROM COMMUNITY DEVELOPMENT CORPORATIONS, NON-PROFIT INTERME-
DIARIES QUALIFIED UNDER SECTION 501(C)(3) OF THE INTERNAL  REVENUE  CODE
WHICH  PACKAGE  LOANS  AND ADMINISTER LOAN FUNDS AND QUALIFIED COMMUNITY
DEVELOPMENT ENTITIES AS DEFINED IN SECTION 450(A) OF THE INTERNAL REVEN-
UE CODE AND REGULATIONS HEREUNDER;
  (B) TO FINANCE OR FACILITATE THE FINANCING OF SINGLE- OR  MULTI-FAMILY
HOUSING  AFFORDABLE TO PERSONS OF LOW AND MODERATE INCOME, FAMILY FARMS,
SMALL BUSINESSES AND OTHER COMMUNITY DEVELOPMENT ACTIVITIES APPROVED  BY
THE  SUPERINTENDENT  THAT  REVITALIZE  OR  STABILIZE  UNDERSERVED AREAS,
CERTIFIED CAPITAL COMPANIES AS DEFINED IN SECTION ELEVEN OF THE TAX LAW,
COMMUNITY SERVICE FACILITIES, INCLUDING CHILD CARE, EDUCATIONAL,  HEALTH
OR  SOCIAL SERVICES TARGETING UNDERSERVED AREAS, THE DEVELOPMENT, ESTAB-
LISHMENT OR OPERATION OF HEALTH INFORMATION TECHNOLOGY, AND THE ENVIRON-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD03663-03-9

S. 3997                             2

MENTAL CLEANUP OR REDEVELOPMENT OF INDUSTRIAL SITES  IN  AN  UNDERSERVED
AREA; AND
  (C) IN NEW YORK STATE AND LOCAL GOVERNMENT AGENCY BONDS THAT PRIMARILY
BENEFIT  UNDERSERVED AREAS IN AN AMOUNT THAT, IN THE AGGREGATE, DOES NOT
EXCEED TEN PERCENT OF THE INVESTMENT CAPITAL OF THE CORPORATION;
  (3) "LOW AND MODERATE INCOME" SHALL MEAN  PERSONS  OR  FAMILIES  WHICH
HAVE  INCOMES THAT DO NOT EXCEED EIGHTY PERCENT OF THE MEDIAN INCOME FOR
THE METROPOLITAN STATISTICAL AREA, IF A PERSON OR FAMILY IS  LOCATED  IN
SUCH  AN  AREA,  OR THE STATEWIDE NONMETROPOLITAN STATISTICAL AREA, IF A
PERSON OR FAMILY IS LOCATED OUTSIDE A METROPOLITAN STATISTICAL AREA;
  (4) "MEMBER" SHALL MEAN A MEMBER OF THE CORPORATION;
  (5) "UNDERSERVED AREAS" SHALL MEAN: (A) AREAS OF THE STATE WHICH QUAL-
IFY AS "DISTRESSED" OR  "HIGHLY  DISTRESSED"  PURSUANT  TO  THE  GENERAL
MUNICIPAL LAW; OR (B) AREAS OF THE STATE WITH A MAJORITY OF RESIDENTS OF
LOW OR MODERATE INCOME;
  (6)  "FAMILY  FARM"  SHALL  MEAN A FARM WHICH IS THE PRIMARY SOURCE OF
INCOME FOR INDIVIDUALS RESIDING AT  THE  SAME  ADDRESS  AND  RELATED  BY
CONSANGUINITY,  AFFINITY  OR  ADOPTION AND WHICH HAS GROSS SALES OF FARM
PRODUCTS OF LESS THAN FIVE HUNDRED THOUSAND DOLLARS ANNUALLY;
  (7) "SMALL BUSINESSES" SHALL HAVE THE SAME  MEANING  AS  DESCRIBED  IN
SECTION ONE HUNDRED THIRTY-ONE OF THE ECONOMIC DEVELOPMENT LAW;
  (8)  "OPERATING  EXPENSES"  SHALL  MEAN  THE  EXPENSES THE CORPORATION
INCURS IN THE ACCOMPLISHMENT OF ITS PURPOSE;
  (9) "INVESTMENT CAPITAL" SHALL  MEAN  THE  FUNDS  CONTRIBUTED  TO  THE
CORPORATION BY ITS MEMBERS IN ORDER TO MAKE QUALIFIED INVESTMENTS PURSU-
ANT TO ITS PLAN OF OPERATIONS; AND
  (10)  "HEALTH  INFORMATION  TECHNOLOGY" SHALL MEAN TECHNOLOGY USED TO:
ELECTRONICALLY SHARE PATIENT  INFORMATION;  IMPROVE  CARE  COORDINATION;
PROMOTE  EFFICIENCIES  IN  THE  DELIVERY  OF,  OR  PAYMENT FOR, CARE; OR
ENHANCE OUTCOMES, PATIENT SELF-MANAGEMENT AND/OR QUALITY, OR OTHER MEANS
OF IMPROVING INTEROPERABILITY AND/OR INTERCONNECTEDNESS OF  HEALTH  CARE
PROVIDERS, CONSUMERS AND/OR PAYERS.
  (B)(1) THE INSURER FUND FOR UNDERSERVED NEIGHBORHOOD/RURAL AREA DEVEL-
OPMENT  CORPORATION  IS  HEREBY  ESTABLISHED  CONSISTING OF ALL INSURERS
AUTHORIZED TO WRITE AND ENGAGED IN WRITING,  WITHIN  THIS  STATE,  ON  A
DIRECT  BASIS, ANY OF THE TYPES OF INSURANCE DESCRIBED IN PARAGRAPHS ONE
THROUGH TEN, TWELVE THROUGH SEVENTEEN AND  NINETEEN  THROUGH  THIRTY  OF
SUBSECTION  (A)  OF  SECTION  ONE  THOUSAND ONE HUNDRED THIRTEEN OF THIS
CHAPTER. EVERY SUCH INSURER SHALL BE AND SHALL REMAIN A  MEMBER  OF  THE
CORPORATION AS A CONDITION OF ITS AUTHORITY TO CONTINUE TO TRANSACT SUCH
TYPES  OF  INSURANCE IN THIS STATE AND SHALL CONTRIBUTE ITS PROPORTIONAL
SHARE OF THE INVESTMENT CAPITAL AND OPERATING  EXPENSES  OF  THE  CORPO-
RATION.
  (2)  THE  CORPORATION SHALL BE A FOR-PROFIT CORPORATION CONSTITUTING A
LEGAL ENTITY SEPARATE AND DISTINCT  FROM  ITS  MEMBERS.  ALL  FUNDS  AND
RESERVES  OF  THE  CORPORATION SHALL BE SEPARATELY HELD AND INVESTED. IT
SHALL MAINTAIN COMPLETE ACCOUNTS OF ALL MONIES RECEIVED AND  ALL  LOSSES
AND EXPENSES INCURRED IN CONNECTION WITH ITS OPERATIONS.
  (3)  THE  PURPOSE  OF THE CORPORATION SHALL BE TO PROMOTE THE ECONOMIC
WELFARE AND HEALTH AND WELL-BEING OF THE CITIZENS OF THIS STATE  THROUGH
QUALIFIED INVESTMENTS IN UNDERSERVED AREAS OF THE STATE.
  (C)  (1)  THE  CORPORATION  SHALL OPERATE IN ACCORDANCE WITH A PLAN OF
OPERATION, WHICH PROVIDES FOR THE ACCOMPLISHMENT OF ITS PURPOSE.  ON  OR
BEFORE  APRIL FIRST, TWO THOUSAND TEN, THE CORPORATION SHALL SUBMIT SUCH
PLAN OF OPERATIONS FOR APPROVAL BY THE SUPERINTENDENT.
  (2) SUCH PLAN SHALL INCLUDE:

S. 3997                             3

  (A) A PRELIMINARY ASSESSMENT OF  ALL  MEMBERS  FOR  INITIAL  OPERATING
EXPENSES  NECESSARY  TO COMMENCE OPERATIONS, ESTABLISH NECESSARY FACILI-
TIES AND MANAGE THE AFFAIRS OF THE CORPORATION;
  (B)  ONGOING  MECHANISMS  FOR THE ASSESSMENT AND COLLECTION OF PROPOR-
TIONAL MEMBER CONTRIBUTIONS TOWARDS THE OPERATING EXPENSES  AND  INVEST-
MENT CAPITAL OF THE CORPORATION PURSUANT TO PARAGRAPHS THREE AND FOUR OF
THIS  SUBSECTION  AND  THE  PAYMENT  OR  DISTRIBUTION  OF INCOME ON SUCH
INVESTMENTS TO MEMBERS;
  (C) A METHOD FOR THE SOLICITATION, REVIEW AND SELECTION  OF  QUALIFIED
INVESTMENTS  BY  THE CORPORATION WHICH SHALL INCLUDE, BUT NOT BE LIMITED
TO:
  (I) THE CONVENING OF SIX MEETINGS ANNUALLY IN LOCAL COMMUNITIES,
  (II) THE DEVELOPMENT OF AN INFRASTRUCTURE TO EFFECTIVELY DISPERSE  AND
DEPLOY INVESTMENT CAPITAL THROUGHOUT THE STATE,
  (III)  THE  HIRING  OF STAFF TO WORK WITH COMMUNITY GROUPS TO IDENTIFY
LOCAL INVESTMENT OPPORTUNITIES, AND
  (IV) THE IDENTIFICATION OF UNMET INSURANCE NEEDS IN UNDERSERVED  AREAS
AND  THE  DEVELOPMENT OF STRATEGIES TO DELIVER, PROVIDE, DEVELOP, MARKET
OR TAILOR INSURANCE PRODUCTS TO MEET THOSE NEEDS THROUGH THE EFFORTS  OF
THE MEMBERS OF THE CORPORATION;
  (D)  A  PROCESS,  SUBJECT  TO APPROVAL BY THE SUPERINTENDENT, BY WHICH
MEMBERS MAY APPLY FOR AND RECEIVE A CREDIT AGAINST  REQUIRED  INVESTMENT
CAPITAL  CONTRIBUTIONS  FOR  QUALIFIED  INVESTMENTS MADE DIRECTLY RATHER
THAN THROUGH THE CORPORATION;
  (E) ANNUAL GOALS FOR THE COMMITMENT OF A SIGNIFICANT AMOUNT OF INVEST-
MENT CAPITAL;
  (F) A PROCESS, SUBJECT TO APPROVAL BY THE SUPERINTENDENT, UNDER  WHICH
FOREIGN  MEMBERS  OF  THE CORPORATION MAY APPLY FOR AND RECEIVE A CREDIT
AGAINST  REQUIRED  INVESTMENT  CAPITAL  CONTRIBUTIONS  FOR  A  QUALIFIED
INVESTMENT  IT  MADE IN ITS STATE OF DOMICILE EITHER DIRECTLY OR THROUGH
AN ENTITY FORMED FOR THE PURPOSE OF MAKING QUALIFIED INVESTMENTS;
  (G) A MEANS TO PUBLICIZE THE PURPOSE OF THE CORPORATION IN UNDERSERVED
AREAS AND AMONG ENTITIES WHICH INVEST IN  UNDERSERVED  AREAS,  AND  WITH
FEDERAL  AND STATE AGENCIES ENGAGED IN AFFORDABLE HOUSING PRODUCTION AND
ECONOMIC REVITALIZATION ACTIVITIES; AND
  (H) A CORPORATE FISCAL YEAR THAT COMMENCES ON JULY FIRST OF EACH YEAR.
  (3) EVERY MEMBER OF THE CORPORATION SHALL PARTICIPATE IN ITS OPERATING
EXPENSES IN THE PROPORTION THAT THE NET DIRECT PREMIUMS  OF  THE  MEMBER
WRITTEN  DURING  THE  PRECEDING CALENDAR YEAR BEARS TO THE AGGREGATE NET
DIRECT PREMIUMS WRITTEN IN THIS STATE BY ALL MEMBERS OF THE CORPORATION.
EACH MEMBER'S PARTICIPATION IN THE CORPORATION SHALL BE DETERMINED ANNU-
ALLY ON THE BASIS OF SUCH NET DIRECT PREMIUMS WRITTEN DURING THE PRECED-
ING CALENDAR YEAR, AS  REPORTED  IN  THE  ANNUAL  STATEMENTS  AND  OTHER
REPORTS FILED BY THE MEMBER WITH THE SUPERINTENDENT.
  (4)  (A)  FOR THE FISCAL YEAR OF THE CORPORATION BEGINNING JULY FIRST,
TWO THOUSAND TEN, EACH MEMBER SHALL CONTRIBUTE TO THE INVESTMENT CAPITAL
OF THE CORPORATION AN AMOUNT NOT  LESS  THAN  AN  AMOUNT  EQUAL  TO  ONE
HUNDRED MILLION DOLLARS MULTIPLIED BY A FRACTION, THE NUMERATOR OF WHICH
IS  THE  CAPITAL  AND  SURPLUS OR SURPLUS TO POLICYHOLDERS MAINTAINED BY
SUCH MEMBER FOR THE PRECEDING CALENDAR YEAR AND THE DENOMINATOR OF WHICH
IS THE AGGREGATE CAPITAL AND SURPLUS OR SURPLUS TO  POLICYHOLDERS  MAIN-
TAINED BY ALL OF THE MEMBERS OF THE CORPORATION FOR THE PRECEDING CALEN-
DAR YEAR.
  (B)  FOR THE FISCAL YEAR OF SUCH CORPORATION BEGINNING JULY FIRST, TWO
THOUSAND ELEVEN, EACH MEMBER SHALL CONTRIBUTE TO THE INVESTMENT  CAPITAL
OF  THE  CORPORATION  AN  AMOUNT NOT LESS THAN TWO HUNDRED FIFTY MILLION

S. 3997                             4

DOLLARS MULTIPLIED BY THE FRACTION DESCRIBED IN SUBPARAGRAPH (A) OF THIS
PARAGRAPH. FOR ALL FISCAL YEARS COMMENCING AFTER JULY FIRST,  TWO  THOU-
SAND  TWELVE,  EACH  MEMBER SHALL CONTRIBUTE AN AMOUNT NOT LESS THAN THE
SAME FRACTION DESCRIBED IN SUBPARAGRAPH (A) OF THIS PARAGRAPH MULTIPLIED
BY,  AT THE DISCRETION OF THE BOARD OF DIRECTORS OF THE CORPORATION, (I)
FIVE HUNDRED MILLION DOLLARS; OR (II) ONE PERCENT OF THE  AGGREGATE  NET
DIRECT  PREMIUMS WRITTEN BY ALL OF THE MEMBERS OF THE CORPORATION IN THE
PRECEDING CALENDAR YEAR; OR (III) FIVE ONE-HUNDREDTHS OF ONE PERCENT  OF
THE  CAPITAL  AND  SURPLUS  OR  SURPLUS  TO  POLICYHOLDERS OF ALL OF THE
MEMBERS OF THE CORPORATION IN THE PRECEDING CALENDAR  YEAR.  THE  CORPO-
RATION  MAY  REQUEST  FROM  THE  SUPERINTENDENT,  AND IF APPROVED BY THE
SUPERINTENDENT, MAY ADOPT IN ITS BY-LAWS AND PLAN OF OPERATIONS,  STAND-
ARDS  WHICH ESTABLISH A MINIMUM AMOUNT OF CAPITAL AND SURPLUS OR SURPLUS
TO POLICYHOLDERS FOR PARTICIPATION IN THE CORPORATION.  THE  SUPERINTEN-
DENT  MAY ALSO WAIVE PARTICIPATION FOR AN INSURER OTHERWISE OBLIGATED TO
PARTICIPATE AS A MEMBER OF THE CORPORATION, IF THE SUPERINTENDENT DETER-
MINES THAT THE FINANCIAL CONDITION OF THE INSURER IS SUCH  THAT  PARTIC-
IPATION  IN THE CORPORATION WOULD BE DETRIMENTAL TO THE POLICYHOLDERS OF
THE INSURER.
  (D) (1) THE CORPORATION SHALL BE GOVERNED BY A BOARD OF SIXTEEN DIREC-
TORS. THE GOVERNOR, OR HIS OR HER DESIGNEE, THE SPEAKER OF THE ASSEMBLY,
OR HIS OR HER DESIGNEE, AND THE TEMPORARY PRESIDENT OF  THE  SENATE,  OR
HIS OR HER DESIGNEE, SHALL SERVE AS EX-OFFICIO MEMBERS. EIGHT DIRECTORS,
FOUR REPRESENTING INSURERS ENGAGED IN TRANSACTING THE TYPES OF INSURANCE
DESCRIBED  IN  PARAGRAPHS  ONE  AND TWO OF SUBSECTION (A) OF SECTION ONE
THOUSAND ONE HUNDRED THIRTEEN OF  THIS  CHAPTER  AND  FOUR  REPRESENTING
INSURERS  ENGAGED  IN  TRANSACTING OTHER TYPES OF INSURANCE DESCRIBED IN
SUCH SUBSECTION, SHALL BE  ELECTED  BY  CUMULATIVE  VOTING  BY  ALL  THE
MEMBERS  OF THE CORPORATION, WHOSE VOTES SHALL BE WEIGHTED IN ACCORDANCE
WITH EACH MEMBER'S NET DIRECT  PREMIUMS  WRITTEN  DURING  THE  PRECEDING
CALENDAR  YEAR.  FIVE DIRECTORS SHALL REPRESENT CONSUMERS AND SHALL HAVE
DEMONSTRATED EXPERTISE IN  COMMUNITY  DEVELOPMENT  AND  INVESTMENTS.  OF
THESE  FIVE DIRECTORS, ONE SHALL BE APPOINTED BY THE GOVERNOR, TWO SHALL
BE APPOINTED BY THE TEMPORARY PRESIDENT OF THE SENATE AND TWO  SHALL  BE
APPOINTED BY THE SPEAKER OF THE ASSEMBLY.
  (2)  THE DIRECTORS SHALL SERVE WITHOUT COMPENSATION BUT SHALL BE REIM-
BURSED FOR THEIR ACTUAL AND NECESSARY EXPENSES INCURRED IN THE  PERFORM-
ANCE OF THEIR DUTIES UNDER THIS ARTICLE.
  (E)  (1) THE CORPORATION SHALL ANNUALLY FILE A STATEMENT IN THE OFFICE
OF THE SUPERINTENDENT AND WITH THE GOVERNOR, THE SPEAKER OF THE ASSEMBLY
AND THE TEMPORARY PRESIDENT OF THE SENATE ON OR BEFORE THE FIRST DAY  OF
SEPTEMBER.    THE  STATEMENT  SHALL BE IN A FORM APPROVED BY AND CONTAIN
INFORMATION PRESCRIBED BY THE SUPERINTENDENT WITH RESPECT TO ITS  TRANS-
ACTIONS, CONDITION, OPERATIONS AND AFFAIRS DURING THE PRECEDING YEAR AND
SHALL  BE  MADE  AVAILABLE TO THE PUBLIC ELECTRONICALLY AND IN PUBLISHED
FORM AT NO COST.
  (2) THE SUPERINTENDENT MAY, AT ANY TIME, REQUIRE  THE  CORPORATION  TO
FURNISH  ADDITIONAL INFORMATION WITH RESPECT TO ITS TRANSACTIONS, CONDI-
TION OR ANY MATTER CONNECTED THEREWITH WHICH HE OR SHE CONSIDERS  TO  BE
MATERIAL AND WHICH WILL ASSIST HIM OR HER IN EVALUATING THE SCOPE, OPER-
ATION  AND IMPACT OF THE CORPORATION'S INVESTMENTS AND SHALL PERFORM, OR
ARRANGE FOR THE PERFORMANCE OF, AN AUDIT OF THE CORPORATION'S AFFAIRS ON
AN ANNUAL BASIS.
  S 2. Subdivision 1 of section 2426 of the public authorities  law,  as
amended  by  chapter  354  of  the  laws  of 1984, is amended to read as
follows:

S. 3997                             5

  1. "Financial institution". Any bank, trust  company,  national  bank,
savings bank, state or federal savings and loan association, or state or
federal  credit  union,  insurance  company,  pension fund or retirement
system of any corporation, association, OR any  other  entity  which  is
owned  or  controlled by any one or more of the above, provided the same
is supervised by or responsible to any agency of the federal government,
the state, any department thereof or the governing  body  of  any  city,
town  or village of the state or any other entity approved by the agency
or any one or more of the above when lawfully acting  as  a  trustee  or
otherwise  in  a  fiduciary  capacity.  The term "financial institution"
shall also include the New York state housing finance agency and the New
York state urban development corporation,  the  New  York  city  housing
development corporation, the New York city department of housing preser-
vation    and    development,   THE   INSURER   FUND   FOR   UNDERSERVED
NEIGHBORHOOD/RURAL AREA DEVELOPMENT CORPORATION and any  person  who  is
approved  as a mortgage lender by the federal housing administration for
purposes of insurance issued by such administration or licensed  by  the
state of New York as a mortgage banker.
  S  3.  The  opening  paragraph of subdivision 2 of section 2428 of the
public authorities law, as amended by chapter 354 of the laws  of  1984,
is amended to read as follows:
  The  agency shall limit its insurance on a rehabilitation or preserva-
tion loan to an amount  not  in  excess  of  fifty  per  centum  of  the
outstanding  principal  indebtedness, provided, however, that the agency
may insure an amount not in excess of seventy-five  per  centum  of  the
outstanding  principal indebtedness of a rehabilitation loan if it shall
find, pursuant to rules or regulations which it shall establish that the
extent of rehabilitation is sufficient to justify such additional insur-
ance, provided further, however, that the agency may  insure  an  amount
equal  to  the full outstanding principal indebtedness when the loan has
been made by a public benefit corporation of the state of New York which
public benefit corporation has issued or will issue bonds or notes, some
or all of the proceeds of which bonds or notes were used or will be used
to make such loan, or when the loan has been made by a  public  employee
pension  fund OR WHEN A QUALIFIED INVESTMENT IS MADE BY THE INSURER FUND
FOR UNDERSERVED NEIGHBORHOOD/RURAL AREA DEVELOPMENT CORPORATION.
  S 4. This act shall take effect immediately.

Comments

Open Legislation is a forum for New York State legislation. All comments are subject to review and community moderation is encouraged.

Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity, hate or toxic speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Attempts to intimidate and silence contributors or deliberately deceive the public, including excessive or extraneous posting/posts, or coordinated activity, are prohibited and may result in the temporary or permanent banning of the user. Comment moderation is generally performed Monday through Friday. By contributing or voting you agree to the Terms of Participation and verify you are over 13.

Create an account. An account allows you to sign petitions with a single click, officially support or oppose key legislation, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Find your Senator and share your views on important issues.

Do you support this bill?

Senate Bill S3997

Sponsored By

Archive: Last Bill Status - In Senate Committee Insurance Committee

Actions

2009-S3997 (ACTIVE) - Details

2009-S3997 (ACTIVE) - Summary

2009-S3997 (ACTIVE) - Sponsor Memo

2009-S3997 (ACTIVE) - Bill Text download pdf

Comments

Do you support this bill?

Get Status Alerts for 2009-S3997

Senate Bill S3997

Share this bill

Sponsored By

Pedro Espada Jr.

Archive: Last Bill Status - In Senate Committee Insurance Committee

Actions

2009-S3997 (ACTIVE) - Details

2009-S3997 (ACTIVE) - Summary

2009-S3997 (ACTIVE) - Sponsor Memo

2009-S3997 (ACTIVE) - Bill Text download pdf

Comments