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New Session in Albany, New Challenges for Community Banks

Public Affairs Update  |  By Stephen W. Rice

The 2016 state legislative session has begun, as Gov. Andrew Cuomo has delivered his combined 2016 State of the State message and 2016-17 state budget presentation to members of the Legislature, statewide elected officials, cabinet agency heads and public and private sector leaders.

He declared the state to be ”stronger than at any point in recent history.” He called his $145 billion state spending plan “an ambitious agenda” and promised it will be under the state’s flexible 2 percent cap. The budget includes five different tax cuts, which would cost $444 million and later escalate to $594 million by the 2017-18 fiscal year.
It would divide up over $2 billion in settlement relief funds to a variety of areas, provide $640 million for affordable housing and to combat homelessness and $225 million for economic development. It would divide up over $2 billion in settlement relief funds to a variety of areas, provide $640 million for affordable housing and to combat homelessness and $225 million for economic development.
The governor also proposed an ethics reform package that includes closure of the LLC loophole and caps outside income for legislators. The governor again strongly called for a $15 minimum wage for all state workers, noting: “We can show this nation what real economic justice means.”
Among the governor’s other proposals:
Establishing a five-year plan to spend $20 billion on affordable and supportive housing, plus other services to benefit the homeless.
Supporting the Dream Act, which would allow undocumented immigrants to apply for state financial aid.
Enacting 12 weeks of paid leave for workers with a new child or sick relative.
Reviving proposed public financing of political campaigns, which Senate Republicans have said they will not pass.

Senate Majority Leader John Flanagan (R-LI) gave the official Republican response to the governor’s State of the State and budget presentation, saying the Senate’s top priority would be “Jobs, jobs, jobs.” He also called for making permanent a 2 percent cap on state spending increases in the budget, noting: “It’s so important the Senate has already acted this year to establish a spending cap in law. By doing so, we can shore up the state’s finances for the long haul and protect the families of tomorrow by the over spending of the past.” Senate Republicans indicated they don’t see how the governor plans to fund his proposals in the context of the budget he proposed.
The governor also has selected a new superintendent of financial services, pending Senate confirmation. Maria Vullo was a partner at the law firm of Paul, Weiss, Rifkind, Wharton & Garrison LLP, and previously oversaw the Economic Justice Division in the Office of the New York State Attorney General.
IBANYS will once again have a busy session:
We’ll be defending against renewed efforts by credit unions to expand their fields of membership, powers and authorities.
We’ll continue to aggressively seek regulatory relief for New York’s community banks, which have been dramatically impacted by compliance burdens, often at the expense of pursuing their lending and development opportunities.
We’ll seek to expand the examination cycle from 12 to 18 months for high-rated community banks, as well as the elimination of duplicative state CRA exams for community banks that have received positive ratings from their primary federal regulators.
We’ll also be pushing for the creation of community bank service corporations to provide cost efficiencies and enhanced products and services.
As always, we’ll monitor the activities and initiatives on the regulatory and legislative fronts to protect the interests of community banks, and the customers and communities we serve.
And, working closely with the Independent Community Bankers of America, we’ll provide the input and support necessary to work with our New York congressional delegation and with the regulatory agencies.

All in all, a challenging and exciting year awaits. We look forward to continuing to work hard on behalf of New York community bankers.■

Steve Rice coordinates government relations and communications for the Independent Bankers Association of New York State. He has worked in the New York banking industry and New York state government for more than three decades.

Posted on Tuesday, February 23, 2016 (Archive on Monday, May 23, 2016)
Posted by Scott  Contributed by Scott


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