BILL NUMBER:S5322

TITLE OF BILL:
An act
to amend the economic development law, in relation to directing the
department of economic development to provide information to developers
and financial institutions on banks which have made commitments to
community reinvestment and emerging domestic markets

PURPOSE OR GENERAL IDEA OF BILL:
Directs the department of economic
development to identify and make available to the public a list of
banks committed to community reinvestment.

SPECIFIC PROVISIONS:
To amend Section 1. Section 100 of the economic
development law by adding a new subdivision 44-a to identify, in
consultation with the division of housing and community renewal and
the banking department, those state or federally chartered banking
organizations which have made significant commitments to community
reinvestment. The department shall make such information available to
the public in written form and on its department internet website.
The department shall conduct an outreach program to proactively
provide such information to regional and local economic developers
and financial institutions.

              

EXISTING PROVISIONS:
Section 1. Section 100 of the economic
development law.

JUSTIFICATION:
Incorporating a new subdivision to the current
economic development law which would allow for State Agencies to
direct prospective emerging domestic markets candidates to state or
federally charted banking organizations with proven significant
commitments to community reinvestment will streamline the process of
identifying these markets and the likelihood of funding of
prospective EDM's by streamlining access to proven capital flows.
Making existing capital funding opportunities more readily understood
and available to entrepreneurs would benefit the State, as well as
local businesses.

In the last 10 years, there has been a renewed interest by
institutional investors in identifying businesses and real estate
opportunities in emerging domestic markets. This growth in investor
interest is driven, in part, by the recognition that changing
demographics in the United States has resulted in a significant
increase in minority purchasing power and business development by
minority owned firms. Over the next 40 years, 85% of the U.S.
population growth will come from non-white ethnic groups. In addition
The current size of the United States Hispanic and African-American
consumer market is larger than the GDP of all but nine countries in
the world. Minority firms' sales are growing 34% per year more than
twice the rate of all other firms.


In 2006, $130 billion was raised by private equity venture funds;
approximately $25.5 billion was invested in 3,416 deals. The
composition of EDM venture portfolios differ from mainstream
portfolios. EDM venture portfolios are typically comprised of
retailers, financial and business service entities, makers and
distributors of consumer products, and computer software companies.
These types of companies comprise only 10% of mainstream venture
capita.l investments. NYS must act now to capitalize on the EDM or
risk losing these future revenues to other states.

PRIOR LEGISLATIVE HISTORY:
2009-2010: A.8416- Referred to Economic Development

FISCAL IMPACT:
None.

EFFECTIVE DATE:
This act shall take effect immediately.