Bill Text: NY A03510 | 2013-2014 | General Assembly | Introduced
Bill Title: Relates to credit union memberships and membership powers; sets forth the qualifications for membership in a credit union; and amends the powers of credit unions in relation to business loans, investment activities and other powers.
Spectrum: Moderate Partisan Bill (Democrat 11-2)
Status: (Introduced - Dead) 2013-06-21 - substituted by s2089 [A03510 Detail]
Download: New_York-2013-A03510-Introduced.html
S T A T E O F N E W Y O R K
________________________________________________________________________
3510
2013-2014 Regular Sessions
I N A S S E M B L Y
January 28, 2013
___________
Introduced by M. of A. ROBINSON, WEPRIN, BRINDISI, ESPINAL, RODRIGUEZ --
Multi-Sponsored by -- M. of A. SIMANOWITZ -- read once and referred to
the Committee on Banks
AN ACT to amend the banking law, in relation to credit union memberships
and general powers
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
1 Section 1. Subdivision 2 of section 451 of the banking law, as
2 amended by chapter 660 of the laws of 2004, is amended to read as
3 follows:
4 2. The qualifications for membership.
5 [(a) Membership shall be limited to:
6 (1) persons having a common employer;
7 (2) persons and organizations who are members of the same trade,
8 industry, profession, club, union, society or other association;
9 (3) in the case of a credit union incorporated under this chapter as
10 of the effective date of this subdivision, and with the approval of the
11 superintendent, which approval shall not be given if it would be
12 destructive of competition within a municipality, more than one common
13 employer; provided, however, that an employer group with under three
14 thousand employees may be added upon receipt of a notice as provided in
15 subdivision two of section four hundred seventy-eight of this article;
16 (4) with the approval of the superintendent, and subject to the
17 provisions of paragraph (b) of this subdivision, more than one group
18 each of which has, within the group, a common bond of occupation,
19 including a common employer, or association; provided, however, that a
20 group of less than three thousand members, which is within reasonable
21 proximity to the credit union's service area or areas, may be added upon
22 receipt of a notice as provided in subdivision two of section four
23 hundred seventy-eight of this article; or
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00150-01-3
A. 3510 2
1 (5) persons and organizations within a well-defined local community,
2 neighborhood or rural district and who in the judgment of the super-
3 intendent have such a community of interest as will insure proper admin-
4 istration.
5 (b) In considering an application to add a group to a credit union
6 authorized under subparagraph four of paragraph (a) of this subdivision,
7 the superintendent shall not approve the addition unless the group is
8 within reasonable proximity to the credit union's service area or areas.
9 If the group has more than three thousand members, the superintendent
10 shall not approve such addition unless he or she determines that the
11 group could not feasibly or reasonably establish a new single common
12 bond credit union because:
13 (1) the group lacks sufficient volunteer and other resources to
14 support the efficient and effective operation of a credit union;
15 (2) the group does not meet the criteria which the superintendent has
16 determined to be important for the likelihood of success in establishing
17 and managing a new credit union, including demographic characteristics
18 such as geographical location of members, diversity of ages and income
19 levels, and other factors that may affect the financial viability and
20 stability of a credit union;
21 (3) the group would be unlikely to operate a safe and sound credit
22 union; or
23 (4) the group has been transferred from another credit union in
24 connection with a merger or consolidation recommended by a state or
25 federal regulator based on safety and soundness concerns or by the board
26 of the National Credit Union Administration in its capacity as conserva-
27 tor or liquidating agent.
28 (c) With the approval of the superintendent, a credit union may extend
29 membership to persons and organizations in an underserved local communi-
30 ty, neighborhood or rural district, where such area is determined by the
31 superintendent to be an "investment area" as defined in the federal
32 Community Development Banking and Financial Institutions Act of 1994 (12
33 U.S.C. 4703(16)) and any other requirements imposed by the superinten-
34 dent, including a requirement that the credit union establish and main-
35 tain an office or facility in such area.
36 (d) To the extent not expressly prohibited by the bylaws of the credit
37 union:
38 (1) in each instance where a person is a member or is directly eligi-
39 ble for membership, members of his or her immediate family or household
40 shall be eligible for membership. For the purposes of this subparagraph,
41 "immediate family" means a person's spouse, and their lineal ancestors
42 and descendants, including persons so related by adoption, siblings,
43 stepparents, stepchildren, and stepsiblings; and "household" means
44 persons living in the same residence and maintaining a single economic
45 unit;
46 (2) any employee of the credit union shall be eligible to membership;
47 and
48 (3) any member who leaves the field of membership and who has not
49 withdrawn or been expelled may retain membership.
50 (e) To the extent not expressly prohibited by the bylaws of the credit
51 union, any incorporated or unincorporated organization composed princi-
52 pally of persons eligible to membership in the credit union and the
53 organization's employees shall be eligible to membership in the credit
54 union.
55 (f) Any person who is eligible for membership by reason of the fact
56 that he or she is an employee either of a common employer or of a credit
A. 3510 3
1 union shall not become ineligible, after the termination of such employ-
2 ment, as long as he or she receives a pension or annuity from, or under,
3 a plan or other arrangement established by such common employer or cred-
4 it union.
5 (g) The provisions of this subdivision shall not apply to a corporate
6 credit union.] SUCH QUALIFICATIONS FOR MEMBERSHIP SHALL BE ESTABLISHED
7 IN ACCORDANCE WITH THE PROVISIONS OF SECTION FOUR HUNDRED FIFTY-ONE-A OF
8 THIS ARTICLE, EXCEPT THAT SUCH SECTION SHALL NOT APPLY TO A CORPORATE
9 CREDIT UNION.
10 S 2. The banking law is amended by adding a new section 451-a to read
11 as follows:
12 S 451-A. QUALIFICATIONS FOR MEMBERSHIP. 1. THE MEMBERSHIP OF A CREDIT
13 UNION SHALL BE DETERMINED BY THE BOARD OF DIRECTORS OF SUCH CREDIT UNION
14 AND SHALL CONSIST OF PERSONS WITHIN THE CREDIT UNION'S FIELD OF MEMBER-
15 SHIP WHO HAVE BEEN DULY ADMITTED MEMBERS.
16 2. A CREDIT UNION'S FIELD OF MEMBERSHIP SHALL INCLUDE ONE OR MORE OF
17 THE FOLLOWING CATEGORIES:
18 (A) PERSONS:
19 (1) WITHIN THE SAME OCCUPATION OR FROM MULTIPLE GROUPS EACH REPRESENT-
20 ING A DIFFERENT OCCUPATION;
21 (2) WITHIN THE SAME ASSOCIATION OR INTEREST OR FROM MULTIPLE GROUPS
22 EACH REPRESENTING A DIFFERENT ASSOCIATION OR INTEREST;
23 (3) WHO RESIDE, WORK, WORSHIP OR ATTEND SCHOOL WITHIN A WELL-DEFINED
24 GEOGRAPHIC AREA, IDENTIFIABLE NEIGHBORHOOD, COMMUNITY OR RURAL DISTRICT
25 AND WHO, IN THE JUDGMENT OF THE SUPERINTENDENT, HAVE SUCH A COMMUNITY OF
26 INTEREST AS WILL ENSURE PROPER ADMINISTRATION; OR
27 (4) WITHIN A COMBINATION OF THESE THREE CATEGORIES DESCRIBED IN THIS
28 SUBDIVISION; OR
29 (B) BUSINESSES, ASSOCIATIONS OR ORGANIZATIONS LOCATED WITHIN A
30 WELL-DEFINED GEOGRAPHIC AREA AND WHICH, IN THE JUDGMENT OF THE SUPER-
31 INTENDENT, HAVE SUCH A COMMUNITY OF INTEREST AS WILL ENSURE PROPER
32 ADMINISTRATION; OR
33 (C) FAMILY MEMBERS OF SUCH PERSONS DESCRIBED IN PARAGRAPH (A) OF THIS
34 SUBDIVISION. FOR THE PURPOSES OF THIS PARAGRAPH, "FAMILY MEMBER" MEANS A
35 PERSON RELATED BY BLOOD, MARRIAGE OR LIVING IN THE SAME HOUSEHOLD WITH A
36 PERSON WITHIN THE FIELD OF MEMBERSHIP AND THEIR LINEAL ANCESTORS AND
37 DESCENDANTS INCLUDING PERSONS SO RELATED BY ADOPTION, SIBLINGS, STEPPAR-
38 ENTS, STEPCHILDREN AND STEPSIBLINGS; AND "HOUSEHOLD" MEANS PERSONS
39 LIVING IN THE SAME RESIDENCE AND MAINTAINING A SINGLE ECONOMIC UNIT; OR
40 (D) ANY EMPLOYEE OF THE CREDIT UNION; OR
41 (E) ANY MEMBER WHO LEAVES THE FIELD OF MEMBERSHIP AND WHO HAS NOT
42 WITHDRAWN OR BEEN EXPELLED MAY RETAIN MEMBERSHIP; OR
43 (F) ANY INCORPORATED OR UNINCORPORATED ORGANIZATION COMPOSED PRINCI-
44 PALLY OF PERSONS ELIGIBLE TO MEMBERSHIP IN THE CREDIT UNION AND THAT
45 ORGANIZATION'S EMPLOYEES.
46 3. ANY PERSON WHO IS ELIGIBLE FOR MEMBERSHIP BY REASON OF THE FACT
47 THAT HE OR SHE IS AN EMPLOYEE OF A COMMON EMPLOYER OR OF A CREDIT UNION
48 SHALL NOT BECOME INELIGIBLE, AFTER THE TERMINATION OF SUCH EMPLOYMENT,
49 AS LONG AS HE OR SHE RECEIVES A PENSION OR ANNUITY FROM, OR UNDER, A
50 PLAN OR OTHER ARRANGEMENT ESTABLISHED BY SUCH COMMON EMPLOYER OR CREDIT
51 UNION.
52 4. A CREDIT UNION MAY EXTEND MEMBERSHIP TO PERSONS AND ORGANIZATIONS
53 IN AN UNDERSERVED LOCAL COMMUNITY, NEIGHBORHOOD OR RURAL DISTRICT WHERE
54 SUCH AREA IS CONSIDERED AN "INVESTMENT AREA" AS DEFINED IN THE FEDERAL
55 COMMUNITY DEVELOPMENT BANKING AND FINANCIAL INSTITUTIONS ACT OF 1994 (12
56 U.S.C. 4703(16)).
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1 S 3. Subparagraph (i) of paragraph (a) of subdivision 18 of section
2 454 of the banking law, as amended by chapter 679 of the laws of 2003,
3 is amended to read as follows:
4 (i) Those securities authorized as permissible investments for savings
5 banks by subdivisions one, two, three, four, SIX, SUBPARAGRAPH FIVE OF
6 PARAGRAPH (A) OF SUBDIVISION NINE, twelve, [paragraph] PARAGRAPHS (a)
7 AND (B) of subdivision twelve-a, [and] subdivisions fifteen, seventeen,
8 PARAGRAPH (A) OF SUBDIVISION TWENTY, SUBPARAGRAPHS ONE AND ONE-A OF
9 PARAGRAPH (A) OF SUBDIVISION TWENTY-ONE, AND SUBDIVISIONS TWENTY-FOUR-D,
10 twenty-seven [and], TWENTY-EIGHT, twenty-eight-a, TWENTY-NINE AND THIRTY
11 of section two hundred thirty-five of this chapter AND SUCH OTHER
12 INVESTMENTS AS THE SUPERINTENDENT DEEMS PERMISSIBLE.
13 S 4. Subdivision 21 of section 454 of the banking law, as amended by
14 chapter 679 of the laws of 2003, is amended to read as follows:
15 21. To purchase, hold, lease and convey a plot whereon there is or may
16 be erected a building suitable for the transaction of its business, from
17 portions of which not required for its own use a revenue may be derived,
18 and a plot whereon parking accommodations are or are to be provided,
19 with or without charge, primarily for its members or employees or both;
20 provided that the net aggregate of all investments of any credit union
21 in such plots and building shall be limited to [six] FIFTEEN per centum
22 of the capital and retained earnings of such credit union, except with
23 the approval of the superintendent.
24 S 5. Section 454 of the banking law is amended by adding a new subdi-
25 vision 37 to read as follows:
26 37. TO EXERCISE INCIDENTAL POWERS APPROVED BY THE NATIONAL CREDIT
27 UNION ADMINISTRATION AS SET FORTH IN 12 C.F.R. 721.
28 S 6. This act shall take effect on the ninetieth day after it shall
29 have become a law.
