BILL NUMBER: S2898               Revised 1/7/2020

SPONSOR: THOMAS
 
TITLE OF BILL:

An act to amend the general business law, in relation to adverse infor-
mation in credit reports of certain furloughed federal government
employees

 
PURPOSE OR GENERAL IDEA OF BILL:

Prohibit credit reporting agencies from reporting or filing any new
adverse information on furloughed or non-pay federal employees.

 
SUMMARY OF PROVISIONS:

Section one of the bill amends the general business law by adding a new
Section, 380-v.

- Section 380-v prohibits credit reporting agencies from filing or
reporting any new adverse information on furloughed or non-pay federal
              

employees. Such new negative credit reporting for furloughed employees
is allowed once ninety days have passed since the end of the furlough
period, provided that the information used in the determination is not
related to the furlough or derived during the furlough.

- Section 380-v requires New York residents to prove their residency,
federal employee status, and that they have been impacted by the
furlough. New Yorkers can prove residency by presenting a utility bill
or NYS driver's license, and prove federal employment by presenting a
recent paystub.

Section two states the bill's effective date, which is immediately when
this bill becomes a law.

 
JUSTIFICATION:

The partial Federal Government shutdown that began in December of 2018
and ended in January of 2019 was the longest government shutdown to
date. This shutdown affected 800,000 federal employees nationwide, and
14,000 New York residents who are federal employees. These individuals
worked without pay (or not work at all) for several weeks.

Fortunately, many of these employees were able to meet financial obli-
gations by withdrawing savings, borrowing from family, and in some cases
taking out zero-interest loans from their banks. However, not all New
York residents that are federal employees were able to meet these obli-
gations, and many were forced to miss payments on bills for rent, mort-
gage, credit card, car loans, and other financial obligations. Since
late payments are often accompanied by fees, many of our residents were
unfairly levied with additional costs, as they had no control over their
employment situation. This was not the only cost that furloughed employ-
ees faced. Missed payments are often included in credit reports for
about seven years, potentially hurting the credit scores of some of the
14,000 New Yorkers that were affected by the furlough.  Clearly, because
the shutdown was not predictable and has no bearing on the creditworthi-
ness of these New Yorkers, it is unfair for unanticipated situation to
negatively impact the financial futures of these New Yorkers. This bill
will provide assurance to our public servants during furlough periods,
allowing them to be confident that, at least for their credit scores,
they will not be financially penalized for actions beyond their control.

 
PRIOR LEGISLATIVE HISTORY:

New Bill.

 
FISCAL IMPLICATIONS TO STATE AND LOCAL GOVERNMENTS:

No cost to the state.

 
EFFECTIVE DATE:
This act shall take effect immediately.