Bill Text: NY A09377 | 2021-2022 | General Assembly | Introduced


Bill Title: Enacts the New York state bank act creating the New York state banking authority and New York state bank to serve New York state residents and businesses currently underserved by banking institutions.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2022-02-23 - referred to banks [A09377 Detail]

Download: New_York-2021-A09377-Introduced.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                          9377

                   IN ASSEMBLY

                                    February 23, 2022
                                       ___________

        Introduced by M. of A. CAHILL -- read once and referred to the Committee
          on Banks

        AN  ACT  to amend the state finance law, in relation to enacting the New
          York state bank act; to repeal certain  provisions  of  the  New  York
          state  urban development corporation act relating thereto; and provid-
          ing for the repeal of such provisions upon expiration thereof

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  This act shall be known and may be cited as the "New York
     2  state bank act".
     3    § 2. The state finance law is amended by adding a new  article  17  to
     4  read as follows:
     5                                 ARTICLE 17
     6                           THE NEW YORK STATE BANK
     7  Section 250. Legislative intent.
     8          251. Definitions.
     9          252. Creation of the New York state banking authority.
    10          253. Purpose.
    11          254. The New York state bank.
    12          255. Board.
    13          256. Capitalization.
    14          257. Deposit of funds.
    15          258. Investment requirements and regulations.
    16          259. Financial regulation.
    17          260. Reporting requirements.
    18          261. Ethical requirements.
    19          262. Fees and taxes.
    20          263. Bank records.
    21          264. Termination of operations.
    22          265. Severability.
    23    § 250. Legislative  intent.  1.  The  legislature  finds  that several
    24  communities within the state have been adversely affected by a  lack  of
    25  banking  services  to meet their financial needs. Low-income, inner city
    26  and rural communities are often left out of the banking system. Further-

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD14139-05-2

        A. 9377                             2

     1  more, individuals without  lawful  immigration  status  have  difficulty
     2  accessing  banking  services,  particularly  when the process requires a
     3  social security number or a form  of  government-issued  identification.
     4  The  state of New York has an interest in ensuring that communities that
     5  are underserved by banking institutions have access to banking  services
     6  such  as  low  or no cost savings and checking accounts, loans and elec-
     7  tronic banking platforms.  Providing banking services to these  communi-
     8  ties will ensure they can safely and securely store their money and have
     9  access to financing options that are legitimate alternatives to predato-
    10  ry lending practices, such as high-interest pay-day loans.
    11    2.  The  legislature  finds  that  a group with insufficient access to
    12  banking services is the cannabis industry. The federal classification of
    13  cannabis as a Schedule I drug under the  Controlled  Substances  Act  of
    14  1970  means most private banks and credit unions are unable to or refuse
    15  to service bank accounts held  by  cannabis-related  businesses  due  to
    16  federal  money  laundering  statutes  and  the  bank secrecy act.   As a
    17  result, cannabis-related  businesses  are  locked  out  of  the  banking
    18  system,  forcing  them to rely entirely on cash to conduct transactions.
    19  Being cash-oriented leaves cannabis-related businesses disproportionate-
    20  ly susceptible to burglary of their property and makes  their  employees
    21  targets  of  violent  robbery.    In addition, cash transactions are not
    22  traceable by state and federal financial regulators,  meaning  cash-only
    23  cannabis-related  businesses  can  be used to launder money derived from
    24  illegal activities.  Therefore, the legislature finds that the exclusion
    25  of cannabis-related businesses from the  banking  system  constitutes  a
    26  public safety and financial transparency issue.
    27    3.  The  legislature  finds that the establishment of a publicly owned
    28  and operated bank would alleviate issues of financial  transparency  and
    29  public safety by providing a secure depository for the storage and lend-
    30  ing  of  cannabis-related  businesses funds and deposits from low-income
    31  residents of the state.
    32    4. The legislature finds that in addition to increasing public safety,
    33  the provision of banking services to cannabis-related  businesses  would
    34  facilitate  sustainable  economic  growth  in  New York state. The legal
    35  cannabis industry is projected to grow by tens of billions of dollars in
    36  coming years. A state owned and operated bank can foster economic growth
    37  and capital investment and spur job creation in the cannabis industry by
    38  providing collateralized loans to  communities  underserved  by  banking
    39  institutions,  including  eligible and registered cannabis-related busi-
    40  nesses.
    41    5. The legislature intends to establish the  New  York  state  banking
    42  authority and the New York state bank to use a portion of the tax reven-
    43  ue received from the sales of legal adult-use cannabis products to serve
    44  low-income  communities  and cannabis-related businesses that are under-
    45  served by banking institutions.
    46    § 251. Definitions. As used in this article, the following terms shall
    47  have the following meanings:
    48    1. "Board" means the board of the New York state banking authority.
    49    2. "Authority" means the New York state banking authority.
    50    3. "Department" means the department of financial services.
    51    4. "Superintendent" means the  superintendent  of  the  department  of
    52  financial services.
    53    5.  "Cannabis"  means  all parts   of the plant of the genus cannabis,
    54  whether growing or not; the seeds thereof; the resin extracted from  any
    55  part  of  the  plant; and every compound, manufacture, salt, derivative,
    56  mixture, or preparation of the plant, its seeds or resin. It  does   not

        A. 9377                             3

     1  include  the mature stalks of the plant, fiber produced from the stalks,
     2  oil  or cake made from the seeds of the plant, any other compound, manu-
     3  facture, salt, derivative,   mixture,   or  preparation  of  the  mature
     4  stalks (except the resin extracted therefrom), fiber, oil, or  cake,  or
     5  the   sterilized seed of the plant which is incapable of germination. It
     6  does not include hemp, cannabinoid hemp or hemp extract as defined    by
     7  section  three  of the cannabis law or any drug products approved by the
     8  federal food and drug administration.
     9    6. "State-chartered banking institution" means any bank, trust  compa-
    10  ny,  private banker, savings bank, savings and loan association, foreign
    11  banking corporation, or credit union. It does not include the  New  York
    12  state bank.
    13    7. "Comptroller" means the comptroller of the state of New York.
    14    8. "Bank" means the New York state bank.
    15    9. "Bank president" means the president of the New York state bank.
    16    10. "Low-interest capital" means funds that are loaned by the New York
    17  state bank to eligible and registered cannabis-related businesses.
    18    11.  "Low-interest  loans" means funds that are loaned by the New York
    19  state bank to qualifying low-income individuals.
    20    12. "Low-income individual" means a resident  of  the  state  with  an
    21  income  that  does not exceed two hundred percent of the federal poverty
    22  level.
    23    13. "Cannabis-related businesses" are New York state registered  busi-
    24  nesses  that  contribute  to the growth, production, transportation, and
    25  distribution of products containing cannabis.
    26    § 252. Creation of the New York state banking authority. 1.  There  is
    27  hereby created the New York state banking authority. The authority shall
    28  be  a  body  corporate  and politic constituting a public benefit corpo-
    29  ration.  The authority shall be governed by five trustees. One shall  be
    30  appointed by the speaker of the assembly, one by the temporary president
    31  of  the  senate,  one by the governor, one by the comptroller and one by
    32  the attorney general. The trustees shall serve the following terms:
    33    (a) The trustees appointed by the  legislature  shall  each  serve  an
    34  initial term of five years.
    35    (b)  The trustee appointed by the governor shall serve an initial term
    36  of four years.
    37    (c) The trustee appointed by the comptroller shall  serve  an  initial
    38  term of three years.
    39    (d)  The  trustee  appointed  by  the  attorney general shall serve an
    40  initial term of two years.
    41    (e) After the initial terms of the trustees have been  completed,  all
    42  trustees thereafter shall serve four year terms.
    43    2.  Each appointed trustee shall be a citizen of the United States and
    44  a resident of the state.
    45    3. Each trustee shall hold office until a successor has been appointed
    46  and qualified. At the expiration of the term of each trustee and of each
    47  succeeding trustee, a new trustee shall be appointed by the party  which
    48  appointed the outgoing trustee.
    49    4. In the event of a vacancy occurring in the office of the trustee by
    50  death,  resignation  or otherwise, a successor shall be appointed within
    51  forty-five days for the  remainder  of  the  term  by  the  party  which
    52  appointed.
    53    5. Three trustees shall constitute a quorum.
    54    6.  The  trustees of the authority shall serve without salary or other
    55  compensation, but each member shall be  entitled  to  reimbursement  for

        A. 9377                             4

     1  actual and necessary expenses incurred in the performance of their offi-
     2  cial duties.
     3    § 253. Purpose. The New York state banking authority shall charter the
     4  New York state bank.
     5    §  254.  The New York state bank. 1. The mission of the New York state
     6  bank is to serve low-income individuals and cannabis-related  businesses
     7  that  are  underserved  by  private sector banking institutions. To this
     8  effect, the bank shall be required to:
     9    (a) Create banking opportunities for  low-income  individuals  in  the
    10  state. This includes but is not limited to:
    11    (i)  offering  eligible  low-income  individuals access to savings and
    12  checking account services with nominal or zero minimum balance  require-
    13  ments and multiple options for proving identification; and
    14    (ii)  providing  banking services to low-income individuals who do not
    15  have access to bank accounts or products due to immigration status, lack
    16  of literacy, high banking fees, or criminal records;
    17    (b) Loan a portion of state tax revenue received  from  the  sales  of
    18  legal adult-use cannabis products, pursuant to paragraph (c) of subdivi-
    19  sion  three of section ninety-nine-ii of this chapter, and deposits into
    20  the bank from low-income individuals to provide eligible cannabis-relat-
    21  ed businesses and low-income individuals access to low-interest  capital
    22  and loans;
    23    (c) Do business with:
    24    (i) businesses licensed and regulated in New York state;
    25    (ii)  businesses licensed outside of New York state only if the bank's
    26  dealing with such entities does not violate federal and state  financial
    27  rules and regulations; and
    28    (iii)  state  chartered  and/or  licensed  financial institutions that
    29  comply with paragraph (d) of this subdivision;
    30    (d) Comply with the federal bank  secrecy  and  anti-money  laundering
    31  acts, also known as the currency and foreign transactions reporting act,
    32  and regulations and guidance relating to the cannabis industry issued by
    33  the  United  States  department of justice and federal regulatory bodies
    34  including the financial crimes  enforcement  network  or  any  successor
    35  body.  This includes, but is not limited to:
    36    (i)  establishing  an  effective  anti-money laundering act compliance
    37  program as prescribed by rule 3310 of the financial regulatory  authori-
    38  ty;
    39    (ii)  complying  with  customer  due diligence obligations in a manner
    40  prescribed by the financial crimes enforcement network;
    41    (iii) reporting certain currency transaction reports to the  financial
    42  crimes  enforcement  network  in a manner prescribed by its regulations;
    43  and
    44    (iv) filing quarterly suspicious activity reports with  the  financial
    45  crimes enforcement network in a manner prescribed by its regulations;
    46    (e)  Comply  with  state  regulations,  including regulations from the
    47  department of financial services, the office  of  the  comptroller,  the
    48  office of cannabis management, and the authorities budget office; and
    49    (f)  Comply with all state laws, including the banking law, the public
    50  authorities law, the cannabis law and the provisions of this chapter.
    51    2. In achieving its objectives, the New York state bank  shall  adhere
    52  to the following priorities:
    53    (a) vigorous ethical, accountability and transparency standards;
    54    (b) institutional robustness;
    55    (c) prudent financial and business practices;
    56    (d) long-term solvency;

        A. 9377                             5

     1    (e) sustained monetary returns on investments; and
     2    (f) insulation from political influence.
     3    §  255.  Board.  1.    The  New  York state banking authority board is
     4  created as the primary governing authority of the bank. The board  shall
     5  consist  of  eleven members. The temporary president of the senate shall
     6  appoint one member from each of the two largest caucuses of the  senate.
     7  The  speaker  of  the assembly shall appoint one member from each of the
     8  two largest caucuses of the  assembly.  The  comptroller  shall  appoint
     9  three  members  to  the  board with substantial managerial experience in
    10  banking and finance operations. The  trustees  of  the  authority  shall
    11  jointly  appoint  four  members  with  substantial community development
    12  banking experience.
    13    (a) The board members appointed by  the  temporary  president  of  the
    14  senate and the speaker of the assembly shall each serve initial terms of
    15  two years.
    16    (b)  The  board  members appointed by the comptroller shall each serve
    17  initial terms of three years.
    18    (c) The board members appointed by the trustees of the authority shall
    19  each serve initial terms of four years.
    20    (d) After the initial terms of the board members have been  completed,
    21  all board members thereafter shall serve four year terms.
    22    (e)  Each board member shall hold their position until a successor has
    23  been appointed. At the expiration of the term of each board  member  and
    24  of  each  succeeding board member, a new board member shall be appointed
    25  by the party which appointed the outgoing board member.
    26    (f) In the event of a vacancy occurring on the board by death,  resig-
    27  nation  or  otherwise,  a successor shall be appointed within forty-five
    28  days for the remainder of the term by  the  party  which  appointed  the
    29  vacated board member.
    30    2. Members of the board shall select the chair of the board from among
    31  the  members whom do not hold political office.  The chair shall convene
    32  the initial meeting of the board within sixty days after  the  effective
    33  date of this section.
    34    3.  Members  of  the  board shall be citizens of the United States and
    35  residents of the state.
    36    4.  Members of the board that are appointed by the comptroller or  the
    37  trustees  shall not hold elected office at the time of their appointment
    38  to the board or have held elected  office  during  the  preceding  three
    39  years at the time of their appointment to the board.
    40    5. The board shall develop and implement the following:
    41    (a) A business plan for the bank that includes timelines for beginning
    42  new  functions  and processes that transition functions and responsibil-
    43  ities to the bank that were previously performed by other entities;
    44    (b) Initial capitalization requirements of the bank using a portion of
    45  the tax revenue from the sale  of  legal  adult-use  cannabis  products,
    46  pursuant to section two hundred fifty-six of this article;
    47    (c)  A  plan  to  offer  low  or  no cost access to checking accounts,
    48  savings accounts and low-interest loans to low-income individuals;
    49    (d) A plan to engage in community outreach and education necessary  to
    50  encourage low-income individuals to open accounts with the bank;
    51    (e)  A  plan  to  explore and develop means of electronic banking that
    52  comply with the requirements of paragraph  (d)  of  subdivision  one  of
    53  section two hundred fifty-four of this article;
    54    (f)  A  plan to commence bank operations by September first, two thou-
    55  sand twenty-three; and

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     1    (g) Procedures that comply with all regulations and guidance issued by
     2  federal and state regulatory bodies regarding the provision of financial
     3  services to cannabis-related businesses, pursuant to  paragraph  (d)  of
     4  subdivision one of section two hundred fifty-four of this article.
     5    6.  The board shall make requests to the appropriate committees of the
     6  legislature regarding any other items necessary to fulfill its  require-
     7  ments  pursuant  to section two hundred fifty-four of this article.  Any
     8  request shall include draft legislation for consideration by the  legis-
     9  lature.
    10    7.  Pursuant  to  subdivision two of section two hundred fifty-four of
    11  this article, the board shall adopt rules regarding:
    12    (a) Safety and soundness standards of the bank;
    13    (b) Criteria for approving, monitoring and evaluating loans;
    14    (c) Eligibility requirements for borrowing;
    15    (d) Eligibility requirements for individuals who  apply  for  checking
    16  and savings accounts;
    17    (e)  Transparency requirements for bank operations including a plan to
    18  issue quarterly reports to the comptroller and superintendent  beginning
    19  after September first, two thousand twenty-three;
    20    (f)  Ethics  and  conflict  of interest requirements for the board and
    21  officers and employees of the bank, including rules to ensure that  they
    22  perform their functions in compliance with the public officers law; and
    23    (g)  Other rules and procedures as needed for efficient administration
    24  of the bank.
    25    8. The board shall commence bank operations by  September  first,  two
    26  thousand twenty-three.
    27    9.  The  board shall appoint a bank president with substantial experi-
    28  ence in banking. The bank president shall serve at the pleasure  of  the
    29  board, on such terms and conditions as the board determines.
    30    (a)  The  bank president shall provide support to the board, carry out
    31  bank policies and programs, and exercise additional authority as may  be
    32  delegated by the board.
    33    (b) The bank president shall serve a term of five years.
    34    (c)  The  bank  president shall hold office until a successor has been
    35  appointed and qualified by the board. At the expiration of the  term  of
    36  each  bank  president  and of each succeeding bank president, a new bank
    37  president shall be appointed by the board.
    38    (d) In the event of a vacancy occurring in  the  office  of  the  bank
    39  president  by  death,  resignation  or  otherwise,  a successor shall be
    40  appointed within forty-five days for the remainder of the  term  by  the
    41  board.
    42    (e) Subject to available funding and consistent with the rules adopted
    43  by the board, the bank president may:
    44    (i)  employ  such  additional  personnel as are necessary to the oper-
    45  ations of the bank.  Such employment shall be  in  accordance  with  the
    46  civil service law; and
    47    (ii)  establish  advisory  committees  and  contract  with  public and
    48  private sector experts who  have  special  technical  expertise  if  the
    49  expertise  is  necessary to fulfill the requirements of this section and
    50  section two hundred fifty-four of this article.
    51    (f) The bank president shall, at their discretion, have the  authority
    52  to hire and terminate the employment of bank employees.
    53    10. The board shall set policy for the bank; provided that neither the
    54  board  nor  any  board  member shall be involved in day to day decisions
    55  regarding the functioning of the bank.  Management  decisions  shall  be
    56  made  independently  by the bank president. The bank president may dele-

        A. 9377                             7

     1  gate at their discretion management decisions to bank managers and other
     2  employees.
     3    11.  Board  members  shall serve without salary or other compensation,
     4  but they shall be entitled to reimbursement for the expenses incurred in
     5  discharge of their duties under this article.
     6    12. The trustees of the authority, pursuant to a unanimous vote  which
     7  all  trustees  are  present for, may remove any board member or the bank
     8  president for neglect or violation of  the  provisions  of  section  two
     9  hundred  fifty-four  of this article, or general misconduct in office as
    10  defined by the trustees, after giving such member a copy of the  charges
    11  against  them,  and an opportunity to be heard, in person or by counsel,
    12  in their defense, upon not less than  ten  days'  notice.  If  any  such
    13  member  shall  be  removed, the trustees shall file in the office of the
    14  department of state a complete statement of charges  made  against  such
    15  member,  and  their findings thereon, together with a complete record of
    16  the proceedings.
    17    13. The bank president and the board members shall be exempt from  the
    18  provisions of title seven of article fifteen of the banking law.
    19    14.  Six members of the board shall constitute a quorum for the trans-
    20  action of any business or the exercise of any power or function  of  the
    21  authority.
    22    § 256. Capitalization. The bank shall be capitalized with a portion of
    23  the  tax  revenue  derived  from  the  sale  of legal adult-use cannabis
    24  products, pursuant to section ninety-nine-ii of this chapter,  and  with
    25  deposits from low-income individuals whom open a savings and/or checking
    26  account with the bank.
    27    § 257. Deposit of funds. 1. (a) The bank shall serve as the depository
    28  for  the  portion of the state tax revenue from the sale of legal adult-
    29  use cannabis products that is necessary for the  initial  capitalization
    30  of  the  bank.  In  addition, the bank shall serve as the depository for
    31  deposits from cannabis-related  businesses  and  low-income  individuals
    32  whom open a savings and/or checking account with the bank.
    33    (b)  The  comptroller shall deposit into the bank the tax revenue from
    34  the sale of legal adult-use cannabis products that is required  for  the
    35  initial capitalization of the bank.
    36    2.  All  deposits  in the bank are guaranteed by the state of New York
    37  and shall not be insured through the federal  deposit  insurance  corpo-
    38  ration.
    39    3. All income earned by the bank on tax revenue from the sale of legal
    40  adult-use  cannabis products and other deposits that are deposited in or
    41  invested with the bank shall be credited to and become  a  part  of  the
    42  revenues and income of the bank.
    43    § 258. Investment  requirements and regulations. 1.  Before initiating
    44  operations, the bank president shall present an implementation plan  and
    45  any necessary items to the board, that:
    46    (a)  identifies the cannabis-related businesses that the bank plans to
    47  target initially;
    48    (b) identifies any existing state programs that the bank recommends be
    49  transferred under its umbrella, and the  steps  and  timelines  for  the
    50  transitions;
    51    (c)  describes  additional  financing  products  and services the bank
    52  plans to offer, the target markets, anticipated rates, terms and  condi-
    53  tions; and
    54    (d)  demonstrates how the bank plans to maximize revenues while accom-
    55  plishing its requirements pursuant to section two hundred fifty-five  of
    56  this article.

        A. 9377                             8

     1    2.  Wherever there is in any fund or in cash balances in the bank more
     2  than sufficient to meet the current expenditures properly payable there-
     3  from, the bank president is authorized to:
     4    (a)  Provide  low-interest capital for the financing of, construction,
     5  rehabilitation, and improvement of new and existing operations of eligi-
     6  ble cannabis-related businesses.  Before providing low-interest  capital
     7  to  a  cannabis-related  business,  the  bank  shall  engage in rigorous
     8  customer due diligence to evaluate the risks  associated  with  offering
     9  particular  financial  products  and  services  and whether the bank has
    10  sufficient capacity to manage such risks effectively.
    11    (b) Provide low-income individuals access to low-interest loans pursu-
    12  ant to paragraph (c) of subdivision five of section two  hundred  fifty-
    13  five of this article; and
    14    (c)  Offer low or zero cost checking and savings bank accounts to low-
    15  income individuals pursuant to paragraph  (d)  of  subdivision  five  of
    16  section two hundred fifty-five of this article.
    17    3.  When  investing  available funds, the bank president is prohibited
    18  from:
    19    (a) Buying, selling and/or accepting deposits of federal funds;  issu-
    20  ing  letters  of  credit for public deposits; or providing a safekeeping
    21  service for the United States treasury securities, federal agency  secu-
    22  rities,  corporate  bonds,  tax-free bonds, money market investments, or
    23  mortgage backed securities.
    24    (b) Investing in certificates, notes, or bonds of the  United  States,
    25  or  other  obligations  of  the  United States or its agencies or of any
    26  corporation wholly owned by the government of the United States.
    27    § 259. Financial regulation.   1.  The  bank  shall  maintain  capital
    28  adequacy  and  other  standard  indicators  of  safety  and soundness as
    29  mandated by the board and the superintendent.
    30    2. The superintendent shall examine the bank in the same manner  as  a
    31  state-chartered banking institution.  The bank shall pay the superinten-
    32  dent for reasonable costs of examinations.
    33    3.  The  bank  shall  undergo  independent audits on the same basis as
    34  state-charted banks.
    35    § 260. Reporting requirements.   1. The bank  president  shall  submit
    36  quarterly  reports  to  the  board,  comptroller and superintendent in a
    37  manner and form prescribed by the board.   Late reports shall  be  cause
    38  for removal of the president of the bank.
    39    2.  The  board, in conjunction with the bank president, shall make and
    40  submit a report to the legislature on the affairs of the bank by  Decem-
    41  ber  first of each year.  Such report shall be made available for public
    42  viewing and analysis on the website of the office  of  the  comptroller.
    43  The  report  shall  be  posted in a conspicuous place on the website and
    44  shall be easy to access and shall be downloadable in  several  different
    45  formats.
    46    § 261. Ethical  requirements.    The bank shall not make a loan to any
    47  board member, bank president, public officer or employee  of  the  bank.
    48  The bank president and employees of the bank shall follow any applicable
    49  ethical  requirements  in  rules, policies and procedures adopted by the
    50  board.
    51    § 262. Fees and taxes.  The bank is exempt from  the  payment  of  all
    52  fees and taxes levied by the state or any of its subdivisions.
    53    § 263. Bank  records. 1.  Certain bank business records and records of
    54  the department relating to the bank are exempt  from  public  disclosure
    55  pursuant  to article six of the public officers law as authorized by the
    56  department.

        A. 9377                             9

     1    2. Financial and  commercial  information  and  records  submitted  to
     2  either the department or the board for the purpose of administering this
     3  article  may be shared between the department and the comptroller.  Such
     4  records may also be used in any suit or administrative hearing involving
     5  any provision of this chapter.
     6    3. The provisions of this section shall not prohibit:
     7    (a) The issuance of general statements based on the reports of persons
     8  subject  to  this article if the statements do not identify the informa-
     9  tion furnished by any person; or
    10    (b) The publication by the superintendent or the board of the name  of
    11  any  person  violating this article and a statement of the manner of the
    12  violation of such person.
    13    § 264. Termination of operations. Upon the determination by the  board
    14  that  the  private banking industry can adequately service the financial
    15  needs of cannabis-related  businesses  and  communities  underserved  by
    16  banking  institutions,  it  shall  develop  and  execute  a plan for the
    17  dissolution of the New York state bank and the New  York  state  banking
    18  authority.  In the event of the dissolution of these entities, the board
    19  shall transfer all outstanding assets and liabilities of the bank to the
    20  comptroller.
    21    § 265. Severability. If any clause, sentence, paragraph,  subdivision,
    22  section  or  part of this article shall be adjudged by a court of compe-
    23  tent jurisdiction to be invalid, such judgment shall not affect,  impair
    24  or invalidate the remainder thereof, but shall be confined in its opera-
    25  tion to the clause, sentence, paragraph, subdivision, section or part of
    26  this article directly involved in the controversy in which such judgment
    27  shall have been rendered.
    28    §  3.  Paragraph  (c)  of  subdivision 3 of section 99-ii of the state
    29  finance law, as added by chapter 92 of the laws of 2021, is  amended  to
    30  read as follows:
    31    (c)  Actual  and  necessary  costs  incurred by the office of cannabis
    32  management [and], the cannabis control board, [and the urban development
    33  corporation,] the New York state banking authority,  and  the  New  York
    34  state  bank related to the administration of incubators and other finan-
    35  cial assistance to qualified [social  and  economic  equity]  applicants
    36  including  the administration, capitalization, and provision of low [and
    37  zero] interest loans to such applicants pursuant to section  [sixteen-ee
    38  of  the urban development corporation act] two hundred fifty-six of this
    39  chapter. Such costs shall be paid out of revenues  received,  including,
    40  but not limited to, from special one-time fees paid by registered organ-
    41  izations pursuant to section sixty-three of the cannabis law.
    42    §  4.  Section  16-ee of section 1 of chapter 174 of the laws of 1968,
    43  constituting the New York state urban development  corporation  act,  is
    44  REPEALED.
    45    §  5.  This  act shall take effect immediately and shall expire and be
    46  deemed repealed upon the dissolution of the New York state bank and  the
    47  New  York  state  banking authority pursuant to section 264 of the state
    48  finance law as added by section two of this act; provided that the state
    49  comptroller shall notify the legislative bill drafting  commission  upon
    50  the  occurrence  of  such  dissolution  in order that the commission may
    51  maintain an accurate and timely effective data base of the official text
    52  of the laws of the state of New York in furtherance of effectuating  the
    53  provisions  of section 44 of the legislative law and section 70-b of the
    54  public officers law.   Effective immediately,  the  addition,  amendment
    55  and/or repeal of any rule or regulation necessary for the implementation

        A. 9377                            10

     1  of  this  act  on  its  effective  date  are  authorized  to be made and
     2  completed on or before such effective date.
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