The New York State Senate

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   3309
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 22, 2021
                                ___________
 
 Introduced  by M. of A. STECK -- Multi-Sponsored by -- M. of A. DeSTEFA-
   NO, DICKENS, EPSTEIN, FERNANDEZ, GOTTFRIED, HYNDMAN,  KIM,  MONTESANO,
   PICHARDO,  REYES,  SIMON -- read once and referred to the Committee on
   Banks
 
 AN ACT to amend the state finance law, in relation to  establishing  the
   empire  state  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:
 
   Section 1. The state finance law is amended by adding a new article 17
 to read as follows:
                                ARTICLE 17
                         EMPIRE STATE PUBLIC BANK
 SECTION 254. LEGISLATIVE INTENT.
         255. DEFINITIONS.
         256. CREATION.
         257. COMMISSION.
         258. TRANSITION BOARD.
         259. DEPOSIT OF PUBLIC FUNDS.
         260. INVESTMENT OF STATE MONEYS.
         261. INFRASTRUCTURE LOANS.
         262. STUDENT LOANS.
         263. BUSINESS, NON-PROFIT AND INDIVIDUAL LOANS.
         264. TREASURY AND BANKING SERVICES.
         265. MANAGEMENT.
         266. ADVISORY BOARD.
         267. FINANCIAL REGULATION.
         268. REPORTING REQUIREMENTS.
         269. ETHICAL REQUIREMENTS.
         270. FEES AND TAXES.
         271. BANK RECORDS.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD03702-01-1

 A. 3309                             2
 
         272. CAPITALIZATION.
         273. PUBLIC DEPOSITARY.
         274. APPLICATION OF THIS CHAPTER TO THE PRESIDENT.
         275. CASH AND DEMAND DEPOSITS AVAILABLE.
         276. PERMITTED INVESTMENTS.
         277. SEVERABILITY.
   §  254.  LEGISLATIVE  INTENT.  1. THE LEGISLATURE FINDS THAT THERE ARE
 SIGNIFICANT PUBLIC INFRASTRUCTURE, HIGHER EDUCATION AND BUSINESS  DEVEL-
 OPMENT  NEEDS OF THE STATE THAT ARE UNMET. THE LEGISLATURE FURTHER FINDS
 THAT THERE ARE OPPORTUNITIES TO USE THE  STATE'S  DEPOSITORY  ASSETS  TO
 GENERATE ADDITIONAL BENEFIT FOR THE PEOPLE AND THE ECONOMY OF THE STATE.
 THEREFORE,  THE  LEGISLATURE  INTENDS  TO CREATE THE EMPIRE STATE PUBLIC
 BANK AS A LEGACY INSTITUTION THAT AMASSES SUFFICIENT CAPITAL RESERVES TO
 ADDRESS OPPORTUNITIES NOW AND IN THE FUTURE.
   2. THE LEGISLATURE INTENDS THAT THE PUBLIC BANK MAY:
   (A) FACILITATE INVESTMENT IN, AND FINANCING OF, PUBLIC  INFRASTRUCTURE
 SYSTEMS  THAT  WILL INCREASE PUBLIC HEALTH, SAFETY, AND QUALITY OF LIFE,
 IMPROVE ENVIRONMENTAL CONDITIONS, AND  PROMOTE  COMMUNITY  VITALITY  AND
 ECONOMIC GROWTH;
   (B)  ASSIST  STUDENTS  WHO  ARE IN NEED OF ADDITIONAL LOW-COST STUDENT
 LOANS IN ORDER TO FINANCE THE COST OF HIGHER EDUCATION;
   (C) PROVIDE BUSINESSES, COMMUNITIES AND LOW INCOME AREAS OF OUR  STATE
 ACCESS TO LOW-INTEREST CAPITAL; AND
   (D)  LEVERAGE  NEW YORK'S FINANCIAL CAPITAL AND RESOURCES, AND WORK IN
 PARTNERSHIP WITH FINANCIAL INSTITUTIONS, COMMUNITY-BASED  ORGANIZATIONS,
 ECONOMIC DEVELOPMENT ORGANIZATIONS, GUARANTY AGENCIES, AND OTHER SIMILAR
 ORGANIZATIONS.
   3.  THE  MISSION OF THE BANK IS TO USE NEW YORK'S DEPOSITORY ASSETS IN
 WAYS THAT AFFORD MOST EFFICIENT USE  OF  TAXPAYER  REVENUES  AND  PUBLIC
 RESOURCES  FOR  THE  BENEFIT OF THE PEOPLE AND ECONOMY OF THE STATE. THE
 LEGISLATURE INTENDS FOR THE BANK TO APPLY BUSINESS STRATEGIES TO  MANAGE
 TAXPAYER  REVENUES WHILE CONCURRENTLY MEETING IDENTIFIED NEEDS AND STRA-
 TEGIC OPPORTUNITIES ACROSS  THE  STATE.  IN  ACHIEVING  ITS  PURPOSE  OF
 IMPROVING  PUBLIC  INFRASTRUCTURE AND INCREASING ACCESS TO HIGHER EDUCA-
 TION, THE LEGISLATURE INTENDS FOR THE BANK TO ADHERE  TO  THE  FOLLOWING
 PRIORITIES:
   (A) INSTITUTIONAL SAFETY AND SOUNDNESS;
   (B) LONG-TERM VIABILITY;
   (C) SOCIAL RETURN AND MONETARY RETURN ON INVESTMENTS;
   (D) PRUDENT AND BEST BANKING AND BUSINESS PRACTICES;
   (E) HIGHEST ETHICAL, ACCOUNTABILITY, AND TRANSPARENCY STANDARDS; AND
   (F) INSULATION FROM POLITICAL INFLUENCE.
   §  255.  DEFINITIONS. THE DEFINITIONS IN THIS SECTION APPLY THROUGHOUT
 THIS ARTICLE UNLESS THE CONTEXT CLEARLY REQUIRES OTHERWISE.
   1. "BOARD" MEANS THE ADVISORY BOARD OF THE EMPIRE STATE PUBLIC BANK.
   2. "COMMISSION" MEANS THE EMPIRE STATE PUBLIC BANK COMMISSION.
   3. "DEPARTMENT" MEANS THE DEPARTMENT OF FINANCIAL SERVICES.
   4. "DIRECTOR" MEANS  THE  DIRECTOR  OF  THE  DEPARTMENT  OF  FINANCIAL
 SERVICES.
   5."SUPERINTENDENT"  MEANS  THE  SUPERINTENDENT  OF  THE  DEPARTMENT OF
 FINANCIAL SERVICES.
   6. "PUBLIC INFRASTRUCTURE SYSTEM" MEANS A SYSTEM OF A LOCAL GOVERNMENT
 OR POLITICAL SUBDIVISION, A SPECIAL PURPOSE DISTRICT,  A  PUBLIC  SCHOOL
 DISTRICT,  AN  INSTITUTION  OF  HIGHER EDUCATION, A FEDERALLY RECOGNIZED
 INDIAN TRIBE, OR THE STATE,  INCLUDING  BUT  NOT  LIMITED  TO  A  SYSTEM
 INVOLVING:    WASTEWATER  TREATMENT; STORM WATER MANAGEMENT; SOLID WASTE

 A. 3309                             3
 
 DISPOSAL; DRINKING WATER TREATMENT; FLOOD CONTROL LEVEES;  ENERGY  EFFI-
 CIENCY ENHANCEMENTS; ROADS, STREETS, AND BRIDGES; TRANSPORTATION INFRAS-
 TRUCTURE,  INCLUDING  FREIGHT  AND  PASSENGER  RAIL  AND PUBLIC TRANSIT;
 BROADBAND  AND TELECOMMUNICATIONS INFRASTRUCTURE; OUTDOOR RECREATION AND
 HABITAT PROTECTION FACILITIES;  COMMUNITY,  SOCIAL  SERVICE,  OR  PUBLIC
 SAFETY  FACILITIES;  SCHOOLS  AND EDUCATIONAL FACILITIES; AND AFFORDABLE
 HOUSING.
   7. "STATE-CHARTERED BANK" MEANS ANY CORPORATION  ORGANIZED  UNDER  THE
 LAWS OF THIS STATE THAT IS ENGAGED IN BANKING, OTHER THAN A TRUST COMPA-
 NY,  SAVINGS  ASSOCIATION, OR A MUTUAL SAVINGS BANK. IT DOES NOT INCLUDE
 THE EMPIRE STATE PUBLIC BANK.
   8. "STATE MONEYS" MEANS ALL MONEYS OR FUNDS BELONGING  TO  OR  IN  THE
 CUSTODY OF THE STATE UNDER THE CONTROL OF THE STATE COMPTROLLER SHALL BE
 CONSIDERED AS STATE MONEYS OR FUNDS.
   9. "COMPTROLLER" MEANS THE COMPTROLLER OF THE STATE OF NEW YORK.
   10. "BANK" MEANS THE EMPIRE STATE PUBLIC BANK.
   § 256. CREATION. THE EMPIRE STATE PUBLIC BANK IS CREATED.
   §  257.  COMMISSION.  1.  THE  EMPIRE  STATE PUBLIC BANK COMMISSION IS
 CREATED AS THE PRIMARY GOVERNING AUTHORITY OF THE BANK.  THE  COMMISSION
 SHALL CONSIST OF THE GOVERNOR, THE LIEUTENANT GOVERNOR, THE CHAIR OF THE
 ASSEMBLY  BANKING  COMMITTEE, THE CHAIR OF SENATE BANKING COMMITTEE, AND
 THE STATE COMPTROLLER.
   2. THE COMMISSION SHALL ADOPT RULES REGARDING THE:
   (A) SAFETY AND SOUNDNESS STANDARDS OF THE BANK;
   (B) CRITERIA FOR EVALUATING, APPROVING, AND MONITORING LOANS;
   (C) ELIGIBILITY REQUIREMENTS AND LIMITS FOR BORROWING;
   (D) TRANSPARENCY REQUIREMENTS FOR BANK OPERATIONS;
   (E) ETHICS AND CONFLICT OF INTEREST REQUIREMENTS FOR  THE  COMMISSION,
 THE  BOARD,  AND  OFFICERS AND EMPLOYEES OF THE BANK, INCLUDING RULES TO
 ENSURE THAT THEY PERFORM THEIR FUNCTIONS IN COMPLIANCE WITH  THE  PUBLIC
 OFFICERS LAW; AND
   (F) OTHER TOPICS AS NEEDED FOR EFFICIENT ADMINISTRATION OF THE BANK.
   3.  THE  COMMISSION SHALL COMMENCE BANK OPERATIONS BY APRIL FIRST, TWO
 THOUSAND TWENTY-TWO.
   4. THE COMMISSION MAY DELEGATE TO THE BANK PRESIDENT SUCH  DUTIES  AND
 POWERS  AS  DEEMED  NECESSARY  TO  CARRY ON THE BUSINESS OF THE BANK AND
 ENFORCE THIS ARTICLE EFFICIENTLY AND EFFECTIVELY. THE COMMISSION MAY NOT
 DELEGATE ITS RULE-MAKING OR POLICY-MAKING AUTHORITY.
   5. THE COMMISSION SHALL ADOPT POLICIES  AND  PROCEDURES  FOR  ITS  OWN
 GOVERNANCE.
   6.  THE  COMMISSION  MAY  ESTABLISH  TECHNICAL  ADVISORY COMMITTEES OR
 CONSULT WITH PUBLIC AND PRIVATE  SECTOR  EXPERTS  IN  SUBSTANTIVE  AREAS
 RELATED TO THE BANK'S MISSION, OBJECTIVES, AND DUTIES.
   §  258.  TRANSITION  BOARD. 1. (A) THE BANK TRANSITION BOARD IS ESTAB-
 LISHED, WITH MEMBERS AS PROVIDED IN THIS SECTION.
   (I) THE TEMPORARY PRESIDENT OF THE SENATE  SHALL  APPOINT  ONE  MEMBER
 FROM EACH OF THE TWO LARGEST CAUCUSES OF THE SENATE.
   (II) THE SPEAKER OF THE ASSEMBLY SHALL APPOINT ONE MEMBER FROM EACH OF
 THE TWO LARGEST CAUCUSES OF THE ASSEMBLY.
   (III)  THE  TEMPORARY  PRESIDENT  OF THE SENATE AND THE SPEAKER OF THE
 ASSEMBLY JOINTLY SHALL APPOINT SEVEN CITIZEN MEMBERS WITH A  SUBSTANTIAL
 BACKGROUND IN BANKING OR FINANCIAL ISSUES.
   (B)  THE  TEMPORARY  PRESIDENT  OF  THE  SENATE AND THE SPEAKER OF THE
 ASSEMBLY JOINTLY SHALL SELECT THE CHAIR FROM AMONG THE  CITIZEN  MEMBER-
 SHIP. THE CHAIR SHALL CONVENE THE INITIAL MEETING OF THE BANK TRANSITION
 BOARD WITHIN FORTY-FIVE DAYS AFTER THE EFFECTIVE DATE OF THIS SECTION.

 A. 3309                             4
 
   2. THE BANK TRANSITION BOARD SHALL DEVELOP AND RECOMMEND THE FOLLOWING
 TO THE COMMISSION WITHIN THE TIMELINE ESTABLISHED BY THE COMMISSION:
   (A)  A  START-UP  BUSINESS  PLAN  FOR THE BANK THAT INCLUDES PLANS AND
 TIMELINES FOR FUNCTIONS THAT ARE NEW AND FUNCTIONS TRANSITIONING TO  THE
 BANK THAT WERE PREVIOUSLY PERFORMED BY ANOTHER ENTITY;
   (B) INITIAL CAPITAL REQUIREMENTS OF THE BANK;
   (C) OPTIONS FOR CAPITALIZING THE BANK; AND
   (D)  OTHER ITEMS REQUESTED BY THE COMMISSION IN ORDER TO COMMENCE BANK
 OPERATIONS BY APRIL FIRST, TWO THOUSAND TWENTY-TWO.
   3. LEGISLATIVE MEMBERS OF THE BANK TRANSITION BOARD MUST BE REIMBURSED
 FOR TRAVEL EXPENSES IN ACCORDANCE WITH THE  RULES  OF  THEIR  RESPECTIVE
 HOUSES.    NON-LEGISLATIVE  MEMBERS  ARE  ENTITLED  TO BE REIMBURSED FOR
 EXPENSES INCURRED IN THE DISCHARGE OF THEIR DUTIES UNDER THIS ARTICLE.
   4. THE BANK TRANSITION BOARD MAY  APPOINT  AN  INTERIM  PRESIDENT  AND
 OTHER  NECESSARY  STAFF WHO ARE EXEMPT FROM THE PROVISIONS OF THIS CHAP-
 TER, AND WHO SERVE AT THE BOARD'S PLEASURE ON SUCH TERMS AND  CONDITIONS
 AS  THE  BOARD DETERMINES. THE DEPARTMENT MUST PROVIDE TECHNICAL ASSIST-
 ANCE TO THE BANK TRANSITION BOARD. THE  BOARD  MAY  ALSO  CONTRACT  WITH
 ADDITIONAL  PERSONS  WHO HAVE SPECIFIC TECHNICAL EXPERTISE IF THE EXPER-
 TISE IS NECESSARY TO CARRY OUT THE REQUIREMENTS OF THIS SECTION.
   § 259. DEPOSIT OF PUBLIC FUNDS. 1. (A) THE BANK  SHALL  SERVE  AS  THE
 DEPOSITORY  FOR STATE MONEYS ONCE THE BANK HAS BUILT SUFFICIENT CAPACITY
 TO ACCEPT AND MANAGE STATE MONEYS, AS DETERMINED BY THE COMMISSION.  THE
 COMMISSION  SHALL  ESTABLISH A PROCESS AND TIME FRAME FOR THE DEPOSIT OF
 STATE MONEYS INTO THE BANK.
   (B) THE COMPTROLLER SHALL DEPOSIT STATE MONEYS IN THE BANK IN  ACCORD-
 ANCE  WITH  THE  TIME  FRAME AND GUIDELINES DETERMINED BY THE COMMISSION
 UNDER THIS SECTION.
   2. ALL DEPOSITS IN THE BANK ARE GUARANTEED BY THE STATE.
   3. ALL INCOME EARNED BY THE BANK ON STATE MONEYS THAT ARE DEPOSITED IN
 OR INVESTED WITH THE BANK MUST BE CREDITED TO AND BECOME A PART  OF  THE
 REVENUES AND INCOME OF THE BANK.
   4.  THE  BANK  MAY ACCEPT DEPOSITS OF PUBLIC FUNDS, BUT IS EXEMPT FROM
 THE REQUIREMENTS OF SECTION ONE HUNDRED FIVE OF THIS CHAPTER.
   5. THE BANK MAY ACCEPT FUNDS FROM ANY SOURCE, INCLUDING FEDERAL  FUNDS
 OR OTHER PUBLIC FUNDS.
   6.  THE  COMMISSION  SHALL  REVIEW  STATE ACCOUNTS THAT CONTAIN PUBLIC
 FUNDS THAT ARE NOT STATE MONEYS, SUCH AS THE STATE INSURANCE  FUND,  AND
 MAKE  RECOMMENDATIONS  TO THE GOVERNOR AND THE APPROPRIATE COMMITTEES OF
 THE LEGISLATURE AS TO WHICH ACCOUNTS SHOULD BE DEPOSITED IN THE BANK.
   7. THE BANK SHALL MAKE DISBURSEMENTS TO THE STATE FUNDS  AS  NECESSARY
 FOR THE FUNCTION OF STATE GOVERNMENT.
   §  260.  INVESTMENT  OF STATE MONEYS. THE BANK MAY INVEST STATE MONEYS
 DEPOSITED IN THE BANK THAT ARE NOT REASONABLY EXPECTED TO  BE  NECESSARY
 TO MEET THE SHORT OR INTERMEDIATE-TERM LIQUIDITY NEEDS OF THE STATE. THE
 STATE  COMPTROLLER  RETAINS AUTHORITY TO MANAGE AND INVEST THE AMOUNT OF
 FUNDS NECESSARY TO MEET THE OPERATIONAL NEEDS OF STATE GOVERNMENT.
   § 261. INFRASTRUCTURE LOANS. THE  BANK  IS  AUTHORIZED  TO  FACILITATE
 INVESTMENT  IN, AND FINANCING OF, CONSTRUCTION, REHABILITATION, REPLACE-
 MENT, AND IMPROVEMENT OF NEW AND EXISTING PUBLIC INFRASTRUCTURE SYSTEMS.
 BEFORE INITIATING OPERATIONS, THE COMMISSION MUST PRESENT AN IMPLEMENTA-
 TION PLAN AND ANY NECESSARY LEGISLATION TO THE GOVERNOR AND  APPROPRIATE
 LEGISLATIVE COMMITTEES, THAT:
   1. IDENTIFIES THE PUBLIC INFRASTRUCTURE SYSTEMS THAT THE BANK PLANS TO
 TARGET INITIALLY;

 A. 3309                             5
 
   2.  IDENTIFIES ANY EXISTING STATE PROGRAMS THAT THE BANK RECOMMENDS BE
 TRANSFERRED UNDER ITS UMBRELLA, AND THE  STEPS  AND  TIMELINES  FOR  THE
 TRANSITIONS;
   3. DESCRIBES ADDITIONAL FINANCING PRODUCTS AND SERVICES THE BANK PLANS
 TO OFFER, THE TARGET MARKETS, ANTICIPATED RATES, TERMS, AND CONDITIONS;
   4. DEMONSTRATES HOW BANK PRODUCTS AND SERVICES WILL INCREASE ACCESS TO
 CAPITAL FOR PUBLIC INFRASTRUCTURE SYSTEMS AND COMPLEMENT THOSE OF EXIST-
 ING PUBLIC AND PRIVATE SOURCES; AND
   5.  DEMONSTRATES  HOW  THE  BANK PLANS TO MAXIMIZE REVENUES AND PUBLIC
 BENEFIT.
   § 262. STUDENT LOANS. THE BANK IS AUTHORIZED  TO  ADMINISTER  A  STATE
 GUARANTEE  LOAN  PROGRAM  TO ASSIST STUDENTS IN NEED OF LOW-COST STUDENT
 LOANS AND RELATED LOAN BENEFITS TO ADDRESS EDUCATIONAL NEEDS  AS  NECES-
 SARY TO SUPPORT STUDENT SUCCESS.  THE COMMISSION SHALL DEVELOP AN IMPLE-
 MENTATION PLAN THAT:
   1.  IDENTIFIES  THE  NEEDS  AND BENEFITS TO SELECTED STUDENTS THAT THE
 PROGRAM WILL TARGET INITIALLY;
   2. DEMONSTRATES HOW THE BANK PLANS TO  MAXIMIZE  REVENUES  AND  PUBLIC
 BENEFIT WHILE MINIMIZING PUBLIC RISK;
   3.  DEMONSTRATES  HOW  THE  BANK  WILL  COORDINATE  WITH THE OFFICE OF
 STUDENT FINANCIAL ASSISTANCE; AND
   4. IDENTIFIES THE WAYS THAT THE PROGRAM  WILL  ADDRESS  THE  FOLLOWING
 ISSUES RELATED TO LOANS:
   (A) QUALIFICATION CRITERIA FOR STUDENTS;
   (B) OBLIGATIONS AND OPTIONS FOR LOAN REPAYMENT;
   (C) REQUIREMENTS FOR LOAN GUARANTEES AND RESERVES;
   (D) FEE AND INTEREST RATE STRUCTURE;
   (E) MAXIMUM LOAN AMOUNTS; AND
   (F)  ENSURING  STUDENT  AWARENESS  OF GRANTS, FEDERAL LOANS, AND OTHER
 FINANCIAL AID PROGRAMS.
   § 263. BUSINESS, NON-PROFIT AND INDIVIDUAL LOANS. THE BANK IS  AUTHOR-
 IZED  TO  LEVERAGE ITS FINANCIAL CAPITAL AND RESOURCES TO PROVIDE ACCESS
 TO LOW-COST CAPITAL TO BUSINESSES, ENTREPRENEURS, NON-PROFIT  COMMUNITY-
 BASED  ORGANIZATIONS, START-UP BUSINESSES AND BELOW AVERAGE INCOME AREAS
 AND INDIVIDUALS OF THIS STATE TO FURTHER ECONOMIC  GROWTH,  CREATE  JOBS
 AND BUILD AND SUSTAIN AFFORDABLE HOUSING FOR THE RESIDENTS OF THIS STATE
 AS PROVIDED FOR BY THIS SECTION. THE BANK IS ALSO AUTHORIZED TO LEVERAGE
 ITS  FINANCIAL CAPITAL AND RESOURCES TO PROVIDE ACCESS TO LOW-COST CAPI-
 TAL TO BRING FISCALLY SOUND AND FINANCIALLY SUCCESSFUL  BUSINESSES  INTO
 THIS STATE AS PROVIDED FOR BY THIS SECTION.  THE BANK IS ALSO AUTHORIZED
 TO  LEVERAGE  ITS  FINANCIAL  CAPITAL AND RESOURCES TO PROVIDE ACCESS TO
 LOW-COST CAPITAL TO ESTABLISHED BUSINESSES IN THIS STATE FOR THE PURPOSE
 OF PROVIDING FINANCIAL STABILITY FOR THE BANK AS PROVIDED  FOR  BY  THIS
 SECTION.
   1.  PURCHASE,  GUARANTEE  OR  HOLD LOANS MADE BY PRIVATE BANKS, CREDIT
 UNIONS OR OTHER FINANCIAL INSTITUTIONS DOING BUSINESS IN THIS STATE.
   2. MAKE LOANS IN THE FORM OF PARTICIPATION LOANS WITH COMMUNITY  BANKS
 IN  THIS STATE TO QUALIFIED INDIVIDUALS AND BUSINESSES RESIDING OR DOING
 BUSINESS IN THIS STATE WHEN THE ORIGINATOR OF  THE  LOAN  IS  A  PRIVATE
 BANK, CREDIT UNION OR OTHER FINANCIAL INSTITUTION.
   3.  SERVE  AS  A  BANKER'S  BANK  FOR CHARTERED BANKS IN THIS STATE BY
 PROVIDING CORRESPONDENT BANKING SERVICES AND OTHER RELATED  SERVICES  IN
 KEEPING WITH ITS MISSION.
   4.  ACCEPT  DEPOSITS RELATED TO SUCH TRANSACTIONS FROM BANKS AND OTHER
 FINANCIAL INSTITUTIONS.
   5. BE AUTHORIZED TO ISSUE BANK STOCK LOANS TO STATE-CHARTED BANKS.

 A. 3309                             6
 
   § 264. TREASURY AND BANKING SERVICES. 1.  FOR  FINANCIAL  INSTITUTIONS
 THAT  MAKE THE BANK A RESERVE DEPOSITORY, THE BANK MAY SERVE AS A CLEAR-
 INGHOUSE, INCLUDING ALL FACILITIES FOR PROVIDING  DOMESTIC  AND  FOREIGN
 EXCHANGE, AND MAY REDISCOUNT PAPER, ON TERMS THE COMMISSION PROVIDES.
   2. THE BANK MAY PROVIDE CORPORATE TRUST SERVICES FOR THE STATE AND ITS
 POLITICAL  SUBDIVISIONS  INCLUDING  TRUSTEE, ESCROW AGENT, PAYING AGENT,
 BOND REGISTRAR, AND TRANSFER AGENT.
   3. THE BANK MAY BUY AND SELL FEDERAL FUNDS; ISSUE  LETTERS  OF  CREDIT
 FOR PUBLIC DEPOSITS; AND PROVIDE A SAFEKEEPING SERVICE FOR UNITED STATES
 TREASURY  SECURITIES,  FEDERAL  AGENCY SECURITIES, CORPORATE BONDS, TAX-
 FREE BONDS, MONEY MARKET INVESTMENTS, AND MORTGAGE-BACKED SECURITIES.
   4. THE BANK MAY PERFORM  SERVICES  CURRENTLY  CONTRACTED  OUT  BY  THE
 OFFICE  OF  TEMPORARY  DISABILITY SERVICES REGARDING ELECTRONIC BENEFITS
 TRANSFER CARDS.
   § 265. MANAGEMENT. 1. THE COMMISSION SHALL APPOINT  A  BANK  PRESIDENT
 WITH  DEMONSTRATED  AND SUBSTANTIAL EXPERIENCE IN BANKING. THE PRESIDENT
 SHALL SERVE AT THE COMMISSION'S PLEASURE, ON SUCH TERMS  AND  CONDITIONS
 AS THE COMMISSION DETERMINES.
   2. THE PRESIDENT SHALL PROVIDE SUPPORT TO THE COMMISSION AND THE ADVI-
 SORY  BOARD,  CARRY  OUT  BANK POLICIES AND PROGRAMS, AND EXERCISE ADDI-
 TIONAL AUTHORITY AS MAY BE DELEGATED BY THE COMMISSION.
   3. SUBJECT TO AVAILABLE FUNDING AND CONSISTENT WITH COMMISSION  DIREC-
 TION, THE BANK PRESIDENT:
   (A)  MAY  EMPLOY  SUCH  ADDITIONAL  PERSONNEL  AS ARE NECESSARY TO THE
 BANK'S OPERATIONS.   THIS EMPLOYMENT SHALL BE  IN  ACCORDANCE  WITH  THE
 STATE CIVIL SERVICE LAW; AND
   (B)  MAY CONTRACT WITH PERSONS WHO HAVE THE TECHNICAL EXPERTISE NEEDED
 TO CARRY OUT A SPECIFIC, TIME-LIMITED PROJECT.
   § 266. ADVISORY BOARD. 1. (A) A PUBLIC BANK ADVISORY BOARD  CONSISTING
 OF  ELEVEN  MEMBERS  IS CREATED TO REVIEW THE BANK'S OPERATIONS AND MAKE
 RECOMMENDATIONS RELATING TO THE BANK'S MANAGEMENT,  SERVICES,  POLICIES,
 AND PROCEDURES.
   (B)  THE GOVERNOR SHALL APPOINT MEMBERS OF THE ADVISORY BOARD, SUBJECT
 TO CONFIRMATION BY THE SENATE. THE MEMBERS OF THE ADVISORY BOARD MUST BE
 KNOWLEDGEABLE IN BANKING OR FINANCE AND MUST REPRESENT  A  DIVERSITY  OF
 EXPERIENCE  RELEVANT  TO  ACTIVITIES  OF  THE  BANK.  SIX OR MORE OF THE
 MEMBERS MUST HAVE EXPERTISE IN BANKING OR FINANCE.  TWO MEMBERS MUST  BE
 FROM  A CONSUMER ADVOCACY OR SOCIAL JUSTICE ORGANIZATION OR HAVE A BACK-
 GROUND IN THE AREA OF CONSUMER ADVOCACY OR  SOCIAL  JUSTICE.    ADVISORY
 BOARD MEMBERS SERVE AT THE PLEASURE OF THE GOVERNOR.
   (C) THE BOARD SHALL CHOOSE ITS CHAIR FROM AMONG ITS MEMBERSHIP.
   2.  THE  TERM OF THE MEMBERS IS THREE YEARS. FIVE OF THE INITIAL BOARD
 MEMBERS MUST BE APPOINTED TO SERVE AN INITIAL TERM OF THREE YEARS, THREE
 MUST BE APPOINTED TO SERVE AN INITIAL TERM OF TWO YEARS, AND  THE  THREE
 REMAINING  MEMBERS  MUST  BE  APPOINTED  TO SERVE AN INITIAL TERM OF ONE
 YEAR. ALL SUBSEQUENT TERMS ARE THREE YEARS. TO ENSURE THAT THE BOARD CAN
 CONTINUE TO ACT, A MEMBER WHOSE TERM EXPIRES  SHALL  CONTINUE  TO  SERVE
 UNTIL HIS OR HER REPLACEMENT IS APPOINTED. IN THE CASE OF ANY VACANCY ON
 THE  BOARD  FOR  ANY  REASON, THE GOVERNOR SHALL APPOINT A NEW MEMBER TO
 SERVE OUT THE TERM OF THE PERSON WHOSE POSITION  HAS  BECOME  VACANT.  A
 BOARD MEMBER MAY BE REMOVED FOR MISCONDUCT INCONSISTENT WITH THE MISSION
 OF THE BANK BY THE GOVERNOR.
   3.  MEMBERS  OF  THE  ADVISORY BOARD ARE ENTITLED TO REIMBURSEMENT FOR
 EXPENSES INCURRED IN THE DISCHARGE OF THEIR DUTIES UNDER THIS ARTICLE.

 A. 3309                             7
 
   § 267. FINANCIAL REGULATION. 1. THE BANK MUST MAINTAIN CAPITAL ADEQUA-
 CY AND OTHER STANDARD INDICATORS OF SAFETY AND SOUNDNESS AS IS APPROPRI-
 ATE FOR A PUBLICLY OWNED FINANCIAL INSTITUTION.
   2.  THE  SUPERINTENDENT  MAY  EXAMINE THE BANK IN THE SAME MANNER AS A
 STATE-CHARTERED FINANCIAL INSTITUTION.  THE  SUPERINTENDENT  SHALL  TAKE
 INTO  CONSIDERATION  THE UNIQUE CIRCUMSTANCES OF A PUBLICLY OWNED FINAN-
 CIAL INSTITUTION WHEN EXAMINING THE BANK. THE BANK SHALL PAY THE  DIREC-
 TOR FOR THE REASONABLE COSTS OF EXAMINATIONS.
   3.  THE  BANK  MUST  UNDERGO  INDEPENDENT  AUDITS ON THE SAME BASIS AS
 STATE-CHARTERED BANKS.
   § 268. REPORTING REQUIREMENTS. 1.  THE  BANK  SHALL  SUBMIT  QUARTERLY
 REPORTS TO THE COMMISSION IN A MANNER AND FORM PRESCRIBED BY THE COMMIS-
 SION.    LATE REPORTS ARE NOT PERMISSIBLE AND SHALL BE CAUSE FOR REMOVAL
 OF THE PERSON OR PERSONS RESPONSIBLE.
   2. THE COMMISSION SHALL MAKE  A  REPORT  TO  THE  LEGISLATURE  ON  THE
 AFFAIRS OF THE BANK BY DECEMBER FIRST OF EACH YEAR.
   § 269. ETHICAL REQUIREMENTS. THE BANK MAY NOT MAKE A LOAN TO ANY ADVI-
 SORY  BOARD  MEMBER,  THE PRESIDENT, PUBLIC OFFICERS OR EMPLOYEES OF THE
 BANK. ADVISORY BOARD MEMBERS, THE PRESIDENT, AND EMPLOYEES OF  THE  BANK
 MUST  FOLLOW ANY APPLICABLE ETHICAL REQUIREMENTS IN RULES, POLICIES, AND
 PROCEDURES ADOPTED BY THE COMMISSION.
   § 270. FEES AND TAXES. THE BANK IS EXEMPT FROM PAYMENT OF ALL FEES AND
 TAXES LEVIED BY THE STATE OR ANY OF ITS SUBDIVISIONS.
   § 271. BANK RECORDS. 1. CERTAIN BANK BUSINESS RECORDS AND  RECORDS  OF
 THE DEPARTMENT RELATING TO THE BANK ARE EXEMPT FROM PUBLIC DISCLOSURE AS
 AUTHORIZED BY THE DEPARTMENT OF FINANCIAL SERVICES.
   2.  FINANCIAL  AND  COMMERCIAL  INFORMATION  AND  RECORDS SUBMITTED TO
 EITHER THE DEPARTMENT OR THE COMMISSION FOR THE PURPOSE OF ADMINISTERING
 THIS ARTICLE MAY BE SHARED BETWEEN THE DEPARTMENT AND  THE  COMPTROLLER.
 THESE  RECORDS  MAY  ALSO  BE USED IN ANY SUIT OR ADMINISTRATIVE HEARING
 INVOLVING ANY PROVISION OF THIS CHAPTER.
   3. THIS SECTION DOES NOT PROHIBIT:
   (A) THE ISSUANCE OF GENERAL STATEMENTS BASED ON THE REPORTS OF PERSONS
 SUBJECT TO THIS ARTICLE AS LONG AS THE STATEMENTS DO  NOT  IDENTIFY  THE
 INFORMATION FURNISHED BY ANY PERSON; OR
   (B)  THE  PUBLICATION BY THE DIRECTOR OR THE COMMISSION OF THE NAME OF
 ANY PERSON VIOLATING THIS ARTICLE AND A STATEMENT OF THE MANNER  OF  THE
 VIOLATION BY THAT PERSON.
   § 272. CAPITALIZATION. THE COMMISSION MUST MAKE RECOMMENDATIONS TO THE
 APPROPRIATE FISCAL COMMITTEES OF THE LEGISLATURE ON OPTIONS FOR CAPITAL-
 IZATION  OF THE BANK. ANY RECOMMENDATIONS MUST INCLUDE DRAFT LEGISLATION
 FOR CONSIDERATION BY THE LEGISLATURE.
   § 273. PUBLIC DEPOSITARY. THE EMPIRE  STATE  PUBLIC  BANK  CREATED  IN
 SECTION  TWO  HUNDRED  FIFTY-SIX  OF THIS ARTICLE MAY ACCEPT DEPOSITS OF
 PUBLIC FUNDS, BUT IS NOT A PUBLIC DEPOSITARY.
   § 274. APPLICATION OF THIS CHAPTER TO THE PRESIDENT. THE PROVISIONS OF
 THIS CHAPTER OUTSIDE THIS ARTICLE DO  NOT  APPLY  TO  THE  PRESIDENT  AS
 DEFINED IN SECTION TWO HUNDRED SIXTY-FIVE OF THIS ARTICLE.
   § 275. CASH AND DEMAND DEPOSITS AVAILABLE. THE STATE COMPTROLLER SHALL
 MAINTAIN  AT  ALL  TIMES  CASH,  OR  DEMAND DEPOSITS IN THE EMPIRE STATE
 PUBLIC BANK OR QUALIFIED PUBLIC DEPOSITARIES IN AN AMOUNT NEEDED TO MEET
 THE OPERATIONAL NEEDS OF STATE GOVERNMENT. THE STATE  COMPTROLLER  SHALL
 NOT  BE  CONSIDERED TO BE IN VIOLATION OF UNLAWFUL ISSUANCE OF CHECKS OR
 DRAFTS IF HE OR SHE MAINTAINS DEMAND ACCOUNTS IN PUBLIC DEPOSITARIES  IN
 AN AMOUNT LESS THAN ALL TREASURY WARRANTS ISSUED AND OUTSTANDING.

 A. 3309                             8
 
   §  276.  PERMITTED  INVESTMENTS. SUBJECT TO THE LIMITATIONS IN SECTION
 TWO HUNDRED SIXTY OF THIS ARTICLE, WHEREVER THERE IS IN ANY FUND  OR  IN
 CASH  BALANCES  IN  THE  STATE TREASURY MORE THAN SUFFICIENT TO MEET THE
 CURRENT EXPENDITURES PROPERLY PAYABLE THEREFROM, THE BANK MAY INVEST  OR
 REINVEST  SUCH PORTION OF SUCH FUNDS OR BALANCES AS THE BANK DEEMS EXPE-
 DIENT IN THE FOLLOWING DEFINED SECURITIES OR CLASSES OF INVESTMENTS:
   1. CERTIFICATES, NOTES, OR BONDS OF THE UNITED STATES, OR OTHER  OBLI-
 GATIONS  OF  THE  UNITED  STATES  OR ITS AGENCIES, OR OF ANY CORPORATION
 WHOLLY OWNED BY THE GOVERNMENT OF THE UNITED STATES;
   2. IN STATE, COUNTY,  MUNICIPAL,  OR  SCHOOL  DISTRICT  BONDS,  OR  IN
 WARRANTS OF TAXING DISTRICTS OF THE STATE. SUCH BONDS AND WARRANTS SHALL
 BE ONLY THOSE FOUND TO BE WITHIN THE LIMIT OF INDEBTEDNESS PRESCRIBED BY
 LAW  FOR THE TAXING DISTRICT ISSUING THEM AND TO BE GENERAL OBLIGATIONS.
 THE STATE COMPTROLLER MAY PURCHASE SUCH BONDS OR WARRANTS DIRECTLY  FROM
 THE  TAXING  DISTRICT OR IN THE OPEN MARKET AT SUCH PRICES AND UPON SUCH
 TERMS AS IT MAY DETERMINE, AND MAY SELL THEM AT SUCH TIMES AS  IT  DEEMS
 ADVISABLE;
   3. IN MOTOR VEHICLE FUND WARRANTS WHEN AUTHORIZED BY AGREEMENT BETWEEN
 THE  STATE  COMPTROLLER  AND  THE DEPARTMENT OF TRANSPORTATION REQUIRING
 REPAYMENT OF INVESTED FUNDS FROM ANY MONEYS IN THE  MOTOR  VEHICLE  FUND
 AVAILABLE FOR STATE HIGHWAY CONSTRUCTION;
   4.  IN FEDERAL HOME LOAN BANK NOTES AND BONDS, FEDERAL LAND BANK BONDS
 AND FEDERAL NATIONAL MORTGAGE ASSOCIATION NOTES, DEBENTURES AND  GUARAN-
 TEED  CERTIFICATES  OF  PARTICIPATION,  OR  THE OBLIGATIONS OF ANY OTHER
 GOVERNMENT SPONSORED CORPORATION WHOSE OBLIGATIONS  ARE  OR  MAY  BECOME
 ELIGIBLE AS COLLATERAL FOR ADVANCES TO MEMBER BANKS AS DETERMINED BY THE
 BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM;
   5. BANKERS' ACCEPTANCES PURCHASED ON THE SECONDARY MARKET;
   6. NEGOTIABLE CERTIFICATES OF DEPOSIT OF ANY NATIONAL OR STATE COMMER-
 CIAL  OR MUTUAL SAVINGS BANK OR SAVINGS AND LOAN ASSOCIATION DOING BUSI-
 NESS IN THE UNITED STATES, PROVIDED, THE COMPTROLLER  SHALL  FOLLOW  THE
 INVESTMENT  POLICIES  AND  PROCEDURES ADVISED BY THE INVESTMENT ADVISORY
 COMMITTEE PURSUANT TO SUBDIVISION B OF SECTION FOUR HUNDRED TWENTY-THREE
 OF THE RETIREMENT AND SOCIAL SECURITY LAW;
   7. COMMERCIAL PAPER, PROVIDED THAT THE COMPTROLLER  SHALL  FOLLOW  THE
 INVESTMENT  POLICIES  AND  PROCEDURES ADVISED BY THE INVESTMENT ADVISORY
 COMMITTEE PURSUANT TO SUBDIVISION B OF SECTION FOUR HUNDRED TWENTY-THREE
 OF THE RETIREMENT AND SOCIAL SECURITY LAW.
   § 277. SEVERABILITY. IF ANY CLAUSE, SENTENCE, PARAGRAPH,  SUBDIVISION,
 SECTION  OR  PART OF THIS ARTICLE SHALL BE ADJUDGED BY A COURT OF COMPE-
 TENT JURISDICTION TO BE INVALID, SUCH JUDGMENT SHALL NOT AFFECT,  IMPAIR
 OR INVALIDATE THE REMAINDER THEREOF, BUT SHALL BE CONFINED IN ITS OPERA-
 TION TO THE CLAUSE, SENTENCE, PARAGRAPH, SUBDIVISION, SECTION OR PART OF
 THIS ARTICLE DIRECTLY INVOLVED IN THE CONTROVERSY IN WHICH SUCH JUDGMENT
 SHALL HAVE BEEN RENDERED.
   §  2.  This act shall take effect immediately; provided, however, that
 section 258 of the state finance law, as added by section  one  of  this
 act  shall  be deemed repealed on April 1, 2022.  Effective immediately,
 the addition, amendment and/or repeal of any rule or  regulation  neces-
 sary  for  the  implementation  of  this  act  on its effective date are
 authorized to be made and completed on or before such effective date.