Senate Bill S575A

                                 BILL NUMBER:  S575A

 TITLE OF BILL :

An act in relation to requiring a study and report on banking products
and services offered in low income communities and the impact of
traditional banks, credit unions and check casher services serving low
income communities; and providing for the repeal of such provisions
upon expiration thereof

 PURPOSE OR GENERAL IDEA OF THE BILL :

A long history of discriminatory banking policies and practices has
left low income communities with limited financial service options,
costly banking fees, and a proliferation of financial services with
exorbitant fees and interest rates. A review of the current state of
banking and financial services in low income communities is needed in
order to access overall impact on the residents of these communities.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1: 1. The superintendent of financial services shall study and
issue a comprehensive report on banking products and services offered
in low income communities and the impact of traditional banks, credit
unions and check casher services serving low income communities.

              

2. Such study and report carried out pursuant to this section shall
address the following issues:

(a) which products and services are offered in low income communities
versus which products and services are offered in higher income
communities;

(b) review of whether different fees are charged by financial service
providers for products and services in low income communities and in
higher income communities, including but not limited to, use of
automated teller machine (ATM) fees, checking account fees, and
overdraw fees;

(c) review of whether different interest rates are instituted by
financial service providers for products and services in low income
communities and higher income communities;

(d) The impact of payday loans within low income communities, the
prevalence of such loans and the interest rates charged for such
loans; and

(e)The current impact and outcome of the State's 1977 Community
Reinvestment Act and federal CRA.

3. Such report shall be made to the governor, the speaker of the
assembly and the temporary president of the senate no later than
January 1, 2017.

4. The superintendent of financial services may request, and is
authorized to receive, any information from any state agencies that is
relevant and material to the completion of this study and report.
Such information shall be subject to the same requirements for
confidentiality and limitations of use, if any, as are applicable to
such state agencies use of such information.

Section 2: This act shall take effect immediately and shall expire and
be deemed repealed January 1, 2018.

 JUSTIFICATION :

A long history of discriminatory banking policies and practices has
left low income communities with limited financial service options,
costly banking fees, and a proliferation of financial services with
exorbitant fees and interest rates. A review of the current state of
banking and financial services in low income communities is needed in
order to access overall impact on the residents of these communities,
The study will also help shape future public policy that will improve
banking and financial services available in low income communities.

 PRIOR LEGISLATIVE HISTORY :

2014: S659B/A5175C - REFERRED TO BANKS/passed assembly
2013: S4659/A5175 - REFERRED TO BANKS/reported referred to ways and
means

 FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENT :

None, the New York State Department of Financial Services has all the
data from banking and financial institutions to make the comparisons
required in this legislation. DFS staff that has oversight
responsibilities over banking rules and regulations is able to compile
this data.

 EFFECTIVE DATE :
This act shall take effect immediately and shall expire and be deemed
repealed January 1, 2018.