Bill Text: NY S04575 | 2013-2014 | General Assembly | Amended
Bill Title: Enacts the student loan linked deposit act.
Sponsorship: Partisan Bill (Republican 1)
Status: (Introduced - Dead) 2014-03-24 - PRINT NUMBER 4575A [S04575 Detail]
Download: New_York-2013-S04575-Amended.html
S T A T E O F N E W Y O R K
________________________________________________________________________
4575--A
2013-2014 Regular Sessions
I N S E N A T E
April 11, 2013
___________
Introduced by Sen. LAVALLE -- read twice and ordered printed, and when
printed to be committed to the Committee on Higher Education -- recom-
mitted to the Committee on Higher Education in accordance with Senate
Rule 6, sec. 8 -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
AN ACT to amend the education law and the state finance law, in relation
to the student loan linked deposit act
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
1 Section 1. Legislative findings and declaration of purpose. The legis-
2 lature hereby finds that the costs of completing higher education for
3 residents of the state of New York are increasing at a rate significant-
4 ly faster than the rate of inflation. Paying out of pocket has become
5 increasingly difficult for families and students seeking to improve
6 their educational and economic prospects. An affordable college educa-
7 tion has become increasingly inaccessible to large numbers of middle
8 class families in the state, for whom financial resources, including
9 state grants and scholarships, are either limited or unavailable. Many
10 families and students have no choice but to turn to the private lending
11 market in order to finance their higher education.
12 Compounding the problem is the fact that typical interest rates for
13 student loans offered through the private lending market are relatively
14 high when compared to interest rates for other purposes, such as a mort-
15 gage or automobile. Additionally, the average student loan debt upon
16 graduation is more than $26,000 per student in the state. Reducing the
17 debt burden that students endure upon graduating college has become a
18 critical public policy goal.
19 As increasing the share of the state's population that undertakes and
20 completes higher education is also a desirable public policy goal, and
21 an individual's decision to complete a program of postsecondary educa-
22 tion typically reaps economic and social rewards to the individual, the
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD09566-02-4
S. 4575--A 2
1 legislature hereby declares that it is in the best interest of the state
2 to create a student loan linked deposit program whereby the state will
3 subsidize private lenders to provide reduced-rate loans to students.
4 S 2. Paragraph c of subdivision 1 of section 680 of the education law,
5 as added by chapter 622 of the laws of 2008, is amended and a new para-
6 graph d is added to read as follows:
7 c. To enter into cooperative agreements, subject to the approval of
8 the board of trustees and the director of the budget, with other enti-
9 ties, including, but not limited to, other states, the federal govern-
10 ment, and post-secondary institutions, to establish, administer, and
11 operate federal student aid programs. Notwithstanding the provisions of
12 paragraphs a and b of this subdivision, the corporation is authorized,
13 pursuant to such cooperative agreements, to provide federal student aid
14 services to students and families who are not residents of New York
15 state[.]; AND
16 D. TO ADMINISTER AND OPERATE A STUDENT LOAN LINKED DEPOSIT PROGRAM
17 PURSUANT TO ARTICLE FIFTEEN-A OF THE STATE FINANCE LAW.
18 S 3. Subdivision 2 of section 98-a of the state finance law, as added
19 by chapter 705 of the laws of 1993, is amended to read as follows:
20 2. Notwithstanding any provision of law to the contrary, investment of
21 bond proceeds and other funds not immediately required may be invested
22 by the comptroller in linked deposits pursuant to article fifteen OR
23 ARTICLE FIFTEEN-A of this chapter. If any moneys are invested by the
24 comptroller in linked deposits pursuant to article fifteen OR ARTICLE
25 FIFTEEN-A of this chapter, the comptroller shall compute the monthly
26 earnings for all funds, other than the general fund, as if no such
27 moneys had been invested in such linked deposits.
28 S 4. The state finance law is amended by adding a new article 15-A to
29 read as follows:
30 ARTICLE 15-A
31 STUDENT LOAN LINKED DEPOSIT ACT
32 SECTION 225. SHORT TITLE.
33 226. DEFINITIONS.
34 227. ESTABLISHMENT AND PURPOSE; STUDENT LOAN LINKED DEPOSIT
35 PROGRAM AUTHORIZATION.
36 228. RESPONSIBILITIES OF THE PRESIDENT, COMPTROLLER AND SUPER-
37 INTENDENT.
38 229. RELEASE FROM LINKED DEPOSITS.
39 230. LINKED STUDENT LOANS.
40 231. INTEREST RATE FOR LINKED LOANS; NO LENDER'S FEES.
41 232. APPLICATION PROCEDURE.
42 233. REPAYMENT PERIODS FOR LINKED STUDENT LOANS.
43 234. LIABILITY; EARLY REPAYMENT AND WITHDRAWAL.
44 234-A. MONITORING AND REPORT.
45 234-B. PROMOTION OF PROGRAM.
46 234-C. RULES AND REGULATIONS.
47 S 225. SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
48 THE "STUDENT LOAN LINKED DEPOSIT ACT".
49 S 226. DEFINITIONS. WHEN USED IN THIS ARTICLE, UNLESS A DIFFERENT
50 MEANING CLEARLY APPEARS FROM THE CONTEXT, THE FOLLOWING TERMS SHALL HAVE
51 THE FOLLOWING MEANINGS:
52 1. "AUTHORIZED DEPOSITOR" MEANS THE COMPTROLLER WITH RESPECT TO LINKED
53 DEPOSITS MADE BY THE COMPTROLLER.
54 2. "COMPTROLLER" MEANS THE COMPTROLLER OF THE STATE OF NEW YORK.
55 3. "DEPARTMENT" MEANS THE DEPARTMENT OF FINANCIAL SERVICES.
S. 4575--A 3
1 4. "ELIGIBLE RECIPIENT" MEANS AN INDIVIDUAL THAT HAS SUCCESSFULLY
2 APPLIED FOR A LINKED STUDENT LOAN AND MET ALL REQUIREMENTS PRESCRIBED BY
3 THE PRESIDENT AND A LENDING INSTITUTION FOR RECEIPT OF A LOAN.
4 5. "LENDER" MEANS:
5 (A) ANY COMMERCIAL BANK WHICH IS OR SHALL BECOME AN APPROVED DEPOSITO-
6 RY OF STATE FUNDS UNDER THE PROVISIONS OF SECTION ONE HUNDRED FIVE OF
7 THIS CHAPTER AND WHICH AGREES TO PARTICIPATE IN THE PROGRAM; OR
8 (B) ANY THRIFT WHICH AN AUTHORIZED DEPOSITOR DETERMINES IS ELIGIBLE TO
9 ACCEPT LINKED DEPOSITS BASED UPON CRITERIA APPLIED BY THE AUTHORIZED
10 DEPOSITOR IN MAKING DETERMINATIONS UNDER SECTION ONE HUNDRED FIVE OF
11 THIS CHAPTER, AND WHICH AGREES TO PARTICIPATE IN THE PROGRAM, PROVIDED
12 THAT ANY LINKED DEPOSIT IN SUCH THRIFT SHALL BE SECURED IN THE SAME
13 MANNER AS MONEYS DEPOSITED PURSUANT TO SECTION ONE HUNDRED FIVE OF THIS
14 CHAPTER AND SUCH THRIFTS SHALL PLEDGE ASSETS OR FURNISH OTHER SECURITY
15 SATISFACTORY IN FORM AND AMOUNT TO THE AUTHORIZED DEPOSITOR FOR THE
16 REPAYMENT OF MONEYS.
17 6. "LINKED DEPOSIT" MEANS A DEPOSIT PLACED WITH A LENDER BY THE COMP-
18 TROLLER FOR A PERIOD OF FOUR YEARS AT THE LINKED DEPOSIT INTEREST RATE,
19 PROVIDED THE LENDER AGREES TO:
20 (A) LEND THE EQUIVALENT VALUE OF SUCH DEPOSIT TO AN ELIGIBLE RECIPIENT
21 AT THE INTEREST RATE PROVIDED IN SECTION TWO HUNDRED THIRTY-ONE OF THIS
22 ARTICLE; AND
23 (B) PERMIT THE DEPOSIT TO BE COMPRISED OF A SERIES OF NINETY DAY
24 DEPOSITS EACH BEARING AN INTEREST RATE EQUAL TO THE LINKED DEPOSIT
25 INTEREST RATE FIXED AT THE TIME THE ORIGINAL DEPOSIT IS PLACED.
26 THIS ARTICLE AND THE RELATED STATUTES THAT REFER TO THIS ARTICLE DO
27 NOT GRANT THRIFTS ELIGIBILITY TO ACCEPT PUBLIC FUNDS OR PUBLIC MONEYS
28 FROM PUBLIC ENTITIES FOR INVESTMENT PURPOSES. A LINKED DEPOSIT IS
29 INTENDED TO ENABLE A LENDER TO MAKE A LINKED LOAN TO AN ELIGIBLE RECIPI-
30 ENT AND SUCH DEPOSIT EARNS A YIELD LOWER THAN POSTED RATES IN ORDER TO
31 ACCOMPLISH THE GOALS OF THIS ARTICLE.
32 7. "LINKED DEPOSIT INTEREST RATE" MEANS FOR A LINKED DEPOSIT MADE IN
33 CONNECTION WITH A LINKED LOAN TO AN ELIGIBLE RECIPIENT A FIXED RATE OF
34 INTEREST WHICH IS THREE HUNDRED BASIS POINTS BELOW THE LENDER'S POSTED
35 FOUR YEAR CERTIFICATE OF DEPOSIT RATE OR, IF THE LENDER DOES NOT OFFER A
36 FOUR YEAR CERTIFICATE OF DEPOSIT, IS THREE HUNDRED BASIS POINTS BELOW
37 THE AVERAGE STATEWIDE RATE FOR FOUR YEAR CERTIFICATES OF DEPOSIT AS
38 DETERMINED BY THE SUPERINTENDENT OF FINANCIAL SERVICES. IN THE EVENT
39 THAT THE LENDER'S POSTED FOUR YEAR CERTIFICATE OF DEPOSIT RATE, OR THE
40 AVERAGE STATEWIDE RATE FOR FOUR YEAR CERTIFICATES OF DEPOSIT ARE BELOW
41 THREE HUNDRED BASIS POINTS, THE LINKED DEPOSIT INTEREST RATE SHALL NOT
42 BE LESS THAN ZERO.
43 8. "LINKED LOAN" MEANS A LOAN MADE TO AN ELIGIBLE RECIPIENT, IN AN
44 AMOUNT EQUAL TO A LINKED DEPOSIT AND BEARING INTEREST FOR THE FIRST FOUR
45 YEARS AT THE INTEREST RATE PROVIDED IN SECTION TWO HUNDRED THIRTY-ONE OF
46 THIS ARTICLE.
47 9. "PRESIDENT" MEANS THE PRESIDENT OF THE HIGHER EDUCATION SERVICES
48 CORPORATION.
49 10. "PROGRAM" MEANS THE STUDENT LOAN LINKED DEPOSIT PROGRAM.
50 11. "QUALIFIED EDUCATIONAL EXPENSES" MEANS THE ACTUAL OR EXPECTED COST
51 OF A STUDENT'S HIGHER EDUCATION, WHICH SHALL INCLUDE THE FULL QUARTERLY,
52 SEMESTERLY OR ANNUAL COST OF TUITION, FEES, BOOKS, SUPPLIES, ROOM AND
53 BOARD.
54 12. "THRIFT" MEANS ANY SAVINGS BANK OR SAVINGS AND LOAN ASSOCIATION,
55 FEDERAL SAVINGS BANK OR FEDERAL SAVINGS AND LOAN ASSOCIATION.
S. 4575--A 4
1 S 227. ESTABLISHMENT AND PURPOSE; STUDENT LOAN LINKED DEPOSIT PROGRAM
2 AUTHORIZATION. THE STUDENT LOAN LINKED DEPOSIT PROGRAM IS HEREBY
3 CREATED. THE PURPOSE OF THE PROGRAM IS TO MAKE AVAILABLE TO RESIDENTS
4 OF NEW YORK STATE REDUCED RATE LOANS THAT WILL ASSIST IN THE FINANCING
5 OF AN IN-STATE COLLEGE EDUCATION. THE COMPTROLLER IS HEREBY AUTHORIZED
6 TO USE ANY MONEYS OF THE STATE THE COMPTROLLER IS AUTHORIZED TO INVEST
7 PURSUANT TO SECTION NINETY-EIGHT-A OF THIS CHAPTER AS LINKED DEPOSITS
8 FOR THE PROGRAM. NOT MORE THAN ONE HUNDRED MILLION DOLLARS OF SUCH
9 MONEYS SHALL BE ON DEPOSIT PURSUANT TO THE PROGRAM AT ANY GIVEN TIME.
10 S 228. RESPONSIBILITIES OF THE PRESIDENT, COMPTROLLER AND SUPERINTEN-
11 DENT. 1. THE PRESIDENT SHALL ADMINISTER THE PROGRAM PURSUANT TO SECTION
12 TWO HUNDRED THIRTY-TWO OF THIS ARTICLE, INCLUDING ALL DECISIONS WITH
13 RESPECT TO THE APPLICATION AND USE OF THE PROGRAM FOR ELIGIBLE RECIPI-
14 ENTS; MARKET AND PROMOTE THE PROGRAM PURSUANT TO SECTION TWO HUNDRED
15 THIRTY-FOUR-B OF THIS ARTICLE; AFTER CONSULTING WITH THE COMPTROLLER AND
16 THE SUPERINTENDENT OF FINANCIAL SERVICES, ISSUE RULES AND REGULATIONS
17 FOR THE OPERATION OF THE PROGRAM PURSUANT TO SECTION TWO HUNDRED THIR-
18 TY-FOUR-C OF THIS ARTICLE.
19 2. THE COMPTROLLER'S RESPONSIBILITIES FOR THE PROGRAM SHALL BE LIMITED
20 TO: PURSUANT TO SECTIONS TWO HUNDRED TWENTY-SEVEN AND TWO HUNDRED THIR-
21 TY-TWO OF THIS ARTICLE, PLACING MONEYS ON DEPOSIT AT THE REQUEST OF THE
22 PRESIDENT FOR THE PURPOSES OF THE PROGRAM AND ADMINISTERING SUCH DEPOS-
23 ITS IN ACCORDANCE WITH SECTIONS NINETY-EIGHT-A AND ONE HUNDRED FIVE OF
24 THIS CHAPTER AND WITH THE COMPTROLLER'S ESTABLISHED PROCEDURES; AND
25 ENTERING INTO DEPOSIT AGREEMENTS WITH LENDERS PURSUANT TO SECTION TWO
26 HUNDRED THIRTY-TWO OF THIS ARTICLE.
27 3. THE SUPERINTENDENT'S RESPONSIBILITIES FOR THE PROGRAM SHALL BE
28 LIMITED TO MARKETING AND PROMOTING THE PROGRAM PURSUANT TO SECTION TWO
29 HUNDRED THIRTY-FOUR-B OF THIS ARTICLE.
30 S 229. RELEASE FROM LINKED DEPOSITS. THE AUTHORIZED DEPOSITOR MAY
31 PERMIT FUNDS RELEASED FROM A LINKED DEPOSIT RELATING TO A LINKED LOAN TO
32 BE MADE AVAILABLE FOR ADDITIONAL LINKED DEPOSITS UNDER THIS PROGRAM.
33 S 230. LINKED STUDENT LOANS. LINKED STUDENT LOANS SHALL BE MADE BY
34 LENDERS PURSUANT TO THE PROGRAM ONLY TO ELIGIBLE RECIPIENTS FOR QUALI-
35 FIED EDUCATIONAL EXPENSES. A LINKED LOAN SHALL BE LIMITED TO A MAXIMUM
36 AMOUNT OF SEVEN THOUSAND FIVE HUNDRED DOLLARS PER ACADEMIC YEAR. AN
37 ELIGIBLE RECIPIENT MAY RECEIVE NO MORE THAN ONE LINKED LOAN PER ACADEMIC
38 YEAR. DURING THE LIFE OF THE LINKED LOAN PROGRAM, THE TOTAL AMOUNT OF
39 MONEY THAT AN ELIGIBLE RECIPIENT CAN BORROW FROM THE LINKED STUDENT LOAN
40 PROGRAM SHALL BE THIRTY THOUSAND DOLLARS. THE CREDIT DECISION FOR MAKING
41 A LINKED LOAN SHALL BE MADE SOLELY BY THE LENDER, PROVIDED HOWEVER THAT
42 SUCH LENDER SHALL ENSURE THAT AN ELIGIBLE RECIPIENT COMPLIES WITH THE
43 PROVISIONS OF THIS ARTICLE, INCLUDING ANY RULES OR REGULATIONS ISSUED BY
44 THE PRESIDENT. NOTWITHSTANDING THE LENGTH OF THE TERM OF A LINKED LOAN,
45 THE LINKED DEPOSIT RELATING TO THE LINKED LOAN SHALL BE FOR A PERIOD OF
46 NOT MORE THAN FOUR YEARS.
47 S 231. INTEREST RATE FOR LINKED LOANS; NO LENDER'S FEES. 1. LINKED
48 LOANS MADE TO ELIGIBLE RECIPIENTS SHALL BEAR INTEREST AT A FIXED RATE
49 EQUAL TO THREE PERCENTAGE POINTS BELOW THE FIXED INTEREST RATE THE LEND-
50 ER WOULD HAVE CHARGED FOR THE LOAN IN THE ABSENCE OF A LINKED DEPOSIT
51 BASED ON ITS USUAL CREDIT CONSIDERATIONS. LENDERS SHALL CERTIFY TO THE
52 PRESIDENT THAT THE RATE TO BE CHARGED ON A LINKED LOAN IS THREE PERCENT-
53 AGE POINTS BELOW THE INTEREST RATE THE LENDER WOULD HAVE CHARGED FOR THE
54 LOAN IN THE ABSENCE OF A LINKED DEPOSIT.
55 2. LENDERS WHO MAKE LOANS PURSUANT TO THE PROGRAM SHALL NOT BE ENTI-
56 TLED TO CHARGE ANY DISCOUNT, POINTS, ORIGINATION FEES, HANDLING FEES,
S. 4575--A 5
1 SERVICE CHARGES, REFINANCING FEES OR PENALTIES OR ANY CHARGE OTHER THAN
2 THOSE NORMALLY CHARGED AND IN SUCH AMOUNTS NORMALLY CHARGED BY THE LEND-
3 ER FOR LOANS OF THE TYPE BEING MADE WITHOUT REGARD TO THE PROGRAM.
4 S 232. APPLICATION PROCEDURE. 1. THE PRESIDENT, WITH THE ASSISTANCE OF
5 THE SUPERINTENDENT OF THE DEPARTMENT, SHALL ESTABLISH PROCEDURES AND
6 OTHER REQUIREMENTS FOR PARTICIPATION IN THE PROGRAM, AND SHALL PROVIDE A
7 SIMPLIFIED APPLICATION FORM TO THE PARTICIPATING LENDERS FOR LINKED
8 DEPOSITS. SUCH FORM SHALL REFLECT THE QUALIFYING INFORMATION REQUIRED
9 BY THIS ARTICLE FOR ELIGIBLE LOAN RECIPIENTS. UPON COMPLETION OF ANY
10 APPLICATION FOR A LINKED DEPOSIT, THE LENDER SHALL SEND THE APPLICATION,
11 TOGETHER WITH THE INTEREST RATE CERTIFICATION REQUIRED PURSUANT TO
12 SECTION TWO HUNDRED THIRTY-ONE OF THIS ARTICLE, TO THE PRESIDENT WHO
13 SHALL EITHER APPROVE OR REJECT THE APPLICATION WITHIN TWENTY-EIGHT DAYS.
14 THE PRESIDENT SHALL EVALUATE EACH APPLICATION BASED UPON THE FOLLOWING
15 CRITERIA:
16 (A) THE EXTENT TO WHICH SUCH LOAN WOULD REDUCE THE LONG-TERM COST OF
17 FINANCING A STUDENT'S HIGHER EDUCATION;
18 (B) THE LIKELIHOOD OF THE STUDENT SUCCESSFULLY COMPLETING HIS OR HER
19 HIGHER EDUCATION AND REPAYING THE LOAN WITHIN A TIMELY MANNER; AND
20 (C) SUCH OTHER CRITERIA AS THE PRESIDENT DEEMS RELEVANT.
21 2. IF THE DEPOSIT APPLICATION IS APPROVED BY THE PRESIDENT, HE OR SHE
22 SHALL NOTIFY AN AUTHORIZED DEPOSITOR THAT A DETERMINATION HAS BEEN MADE
23 THAT THE APPLICATION SATISFIES THE REQUIREMENTS OF THIS ARTICLE, AND THE
24 PRESIDENT SHALL REQUEST THE AUTHORIZED DEPOSITOR TO DEPOSIT FUNDS WITH
25 THE LENDER IN ACCORDANCE WITH SECTION NINETY-EIGHT-A OF THIS CHAPTER AND
26 WITH THE AUTHORIZED DEPOSITOR'S ESTABLISHED PROCEDURES. SUCH DEPOSITS
27 SHALL BE SECURED IN ACCORDANCE WITH THE PROVISIONS OF SECTION ONE
28 HUNDRED FIVE OF THIS CHAPTER, AND LENDERS RECEIVING SUCH DEPOSITS SHALL
29 SATISFY, IN THE SOLE JUDGMENT OF THE AUTHORIZED DEPOSITOR, ALL COLLAT-
30 ERAL AND OTHER REQUIREMENTS GENERALLY APPLIED BY THE AUTHORIZED DEPOS-
31 ITOR TO FUNDS INVESTED BY IT. THE NOTIFIED AUTHORIZED DEPOSITOR AND THE
32 LENDER SHALL ENTER INTO A WRITTEN DEPOSIT AGREEMENT. IN NO EVENT SHALL
33 ANY DEFECT IN ANY SUCH AGREEMENT BE ASSERTED AS A DEFENSE BY A BORROWER
34 ON A LINKED LOAN MADE PURSUANT TO THE PROGRAM.
35 S 233. REPAYMENT PERIODS FOR LINKED STUDENT LOANS. THE PRESIDENT SHALL
36 REQUIRE THAT LINKED STUDENT LOANS ISSUED THROUGH THE PROGRAM OFFER FLEX-
37 IBLE REPAYMENT OPTIONS, INCLUDING THE OPTION OF AN INCOME-BASED REPAY-
38 MENT PLAN. SUCH REPAYMENT OPTIONS MAY, IF THE PRESIDENT DEEMS IT ADVIS-
39 ABLE, BE CONSISTENT WITH THE REPAYMENT TERMS STIPULATED BY THE WILLIAM
40 D. FORD FEDERAL DIRECT LOAN PROGRAM AUTHORIZED PURSUANT TO 20 USC CHAP-
41 TER 28, SUBCHAPTER IV, PART C.
42 S 234. LIABILITY; EARLY REPAYMENT AND WITHDRAWAL. NOTHING CONTAINED IN
43 THIS ARTICLE SHALL IMPOSE LIABILITY ON THE STATE OR ANY OF ITS DEPART-
44 MENTS OR EMPLOYEES FOR PAYMENT OR DELAYS IN PAYMENT OF THE PRINCIPAL OR
45 INTEREST OF A LINKED LOAN. ANY DELAY IN PAYMENTS OR ANY DEFAULT ON A
46 LINKED LOAN SHALL IN NO WAY AFFECT THE LINKED DEPOSIT AGREEMENT BETWEEN
47 THE LENDER AND THE AUTHORIZED DEPOSITOR. HOWEVER, IN THE EVENT THE
48 INTEREST RATE OF THE LINKED LOAN SHALL BE INCREASED AS A CONSEQUENCE OF
49 DEFAULT OR RENEGOTIATION, OR THE LOAN SHALL BE CHARGED OFF, THE LENDER
50 SHALL GIVE THE AUTHORIZED DEPOSITOR PROMPT NOTICE OF SUCH EVENT, AND THE
51 AUTHORIZED DEPOSITOR SHALL THEREAFTER WITHDRAW THE LINKED DEPOSIT UPON
52 NOT LESS THAN SEVEN DAYS' PRIOR WRITTEN NOTICE TO THE LENDER. UPON EARLY
53 REPAYMENT OF A LINKED LOAN, THE LENDER SHALL WITHIN THIRTY DAYS GIVE THE
54 AUTHORIZED DEPOSITOR NOTICE OF SUCH EARLY REPAYMENT, AND THE AUTHORIZED
55 DEPOSITOR SHALL THEREAFTER WITHDRAW THE LINKED DEPOSIT UPON NOT LESS
56 THAN SEVEN DAYS' PRIOR WRITTEN NOTICE TO THE LENDER, AND THE INTEREST
S. 4575--A 6
1 RATE PAYABLE ON THE LINKED DEPOSIT FROM THE DATE OF EARLY REPAYMENT OF
2 THE LINKED LOAN TO THE DATE OF WITHDRAWAL OF THE LINKED DEPOSIT SHALL BE
3 THE INTEREST RATE UPON WHICH THE LINKED DEPOSIT INTEREST RATE WAS CALCU-
4 LATED WITHOUT REGARD TO THE APPLICABLE BASIS POINT REDUCTION.
5 S 234-A. MONITORING AND REPORT. 1. THE PRESIDENT SHALL MONITOR THE
6 ACTIVITIES OF PARTICIPATING LENDERS AND LOAN RECIPIENTS AND MAY REQUIRE
7 PERIODIC REPORTS OR OTHER INFORMATION THE PRESIDENT DEEMS NECESSARY FROM
8 PARTICIPATING LENDERS AND LOAN RECIPIENTS ON THE STATUS OF THE LINKED
9 LOANS TO ENSURE COMPLIANCE WITH THE PROVISIONS AND THE INTENT OF THIS
10 ARTICLE.
11 2. ON OR BEFORE DECEMBER FIRST, TWO THOUSAND SIXTEEN, AND ANNUALLY
12 THEREAFTER THE PRESIDENT SHALL SUBMIT TO THE GOVERNOR, THE TEMPORARY
13 PRESIDENT OF THE SENATE AND THE SPEAKER OF THE ASSEMBLY A REPORT REGARD-
14 ING THE ACTIVITIES OF THE PROGRAM. SUCH REPORT SHALL CONTAIN A STATEMENT
15 OF THE COST OF THE PROGRAM TO THE STATE, CONSIDERED AS A WHOLE, BECAUSE
16 OF REDUCED RATES ON FUNDS INVESTED IN LINKED DEPOSITS. SUCH REPORT SHALL
17 ALSO INCLUDE, BUT SHALL NOT BE LIMITED TO, THE NUMBER AND TYPE OF LINKED
18 LOANS UNDER THE PROGRAM AND THE AMOUNT THEREOF; THE NUMBER AND TYPES OF
19 LENDERS MAKING LINKED LOANS AND OF INDIVIDUALS RECEIVING LINKED LOANS;
20 THE GEOGRAPHIC DISTRIBUTION OF SUCH LENDERS AND RECIPIENTS, INCLUDING
21 THE STEPS TAKEN TO ENSURE GEOGRAPHIC DIVERSITY AMONG PARTICIPATING LEND-
22 ERS, AS WELL AS ANY INFORMATION THE PRESIDENT DETERMINES USEFUL IN EVAL-
23 UATING THE BENEFITS OF THE PROGRAM.
24 S 234-B. PROMOTION OF PROGRAM. THE DEPARTMENT, WITH THE ASSISTANCE OF
25 OTHER APPROPRIATE STATE AGENCIES, SHALL ACTIVELY MARKET AND PROMOTE
26 AWARENESS OF THE PROGRAM IN ALL GEOGRAPHICAL AREAS OF THE STATE AMONG
27 COMMERCIAL BANKS, THRIFTS AND OTHER APPROPRIATE BANKING ORGANIZATIONS.
28 S 234-C. RULES AND REGULATIONS. THE PRESIDENT SHALL, IN CONSULTATION
29 WITH THE COMPTROLLER AND THE SUPERINTENDENT OF FINANCIAL SERVICES,
30 PROMULGATE RULES AND REGULATIONS NECESSARY AND REASONABLE FOR THE OPERA-
31 TION OF THE PROGRAM.
32 S 5. This act shall take effect on the one hundred eightieth day after
33 it shall have become a law, provided however that effective immediately,
34 the addition, amendment and/or repeal of any rules or regulations neces-
35 sary for implementation of the foregoing sections of this act on its
36 effective date is authorized and directed to be made and completed on or
37 before such effective date.
