ALBANY, 03/29/11 – State Senator James L. Seward (R/C/I–Oneonta) today announced the first budget bills for the 2011-2012 fiscal year received approval in the state senate including a measure merging the New York State Insurance Department and the New York State Banking Department into the newly created Department of Financial Services. “As the state senate begins passing a responsible budget plan that will set the state on the proper fiscal course, I am extremely pleased to see the merger of the New York State Insurance Department and New York State Banking Department included as one of the first items approved,” said Senator Seward. “As chairman of the Senate Insurance Committee, I was able to shepherd this sensible plan through the legislature, creating the Department of Financial Services and signaling a new era of cooperation among state agencies.”
The merger of insurance and banking will result in administrative savings of $2.5 million and is a first step towards transforming and modernizing the regulation of insurance, banking and other financial products in New York State.
The legislation approved by the senate also merges the Foundation for Science, Technology and Innovation (NYSTAR) into the Department of Economic Development, and the Department of Correctional Services and the Division of Parole into a new Department of Corrections and Community Supervision.
“I have long advocated for the merger and consolidation of several state agencies and departments as a method of providing cost savings and more efficient service. Combining the insurance and banking departments under one umbrella, along with the additional mergers, successfully accomplishes both goals,” Seward added.
The legislation also recognizes the importance of the financial services industry as a major economic engine in the state and requires the governor to create a working group, in consultation with industry experts, to examine the effectiveness of the merger going forward. The 51st senate district alone is home to a number of major insurance and banking employers constituting thousands of jobs.
“The newly merged Department of Financial Services is just one piece of an overall budget that reduces state spending, holds the line on taxes, and offers private sector job creation tools. I look forward to finalizing the entire budget and meeting the April 1 deadline," Seward concluded.