Section 16-o - The community development financial institutions program1.Legislative intent. The legislature hereby finds that credit, banking services, and investment capital are vital to the revitalization of communities and neighborhoods throughout the state. The legislature further finds that many communities with the greatest potential for growth and the greatest need for jobs and investment lack access to the services and capital of traditional banking and lending institutions. The legislature further finds that access to banking services and capital can be improved through a growing network of alternative financial service providers known as community development financial institutions, hereafter referred to as CDFIs. The legislature finds that CDFIs are currently providing effective lending and financial services and fulfill a vital role in meeting the needs of New York state's low and moderate income communities. The legislature finds that the continued growth of CDFIs requires an established support structure in order to build capacity in these institutions. The legislature further finds that creation of a statewide CDFI fund will strengthen these institutions, allowing them to expand their mission of addressing the credit and banking needs of low and moderate income communities in New York state.
2.Definitions. As used in this section, the following terms shall have the meanings indicated: (a) "Community Development Financial Institution" or "CDFI" means an organization located in this state which has been certified as a community development financial institution by the federal community development financial institutions fund, as established pursuant to 12 U.S.C. 4701 et seq.(b) "Fund" means the community development financial institutions fund as established by subdivision three of this section.(c) "Investment area" means a geographic area that:(i) is economically distressed as defined in section sixteen-d of this act; and(ii) has significant unmet needs for loans or encompasses or is located in a federally designated empowerment zone or enterprise community as established pursuant to title XIII of the federal Omnibus Budget Reconciliation Act of 1993 (Pub.L. 103-66) or a designated empire zone as defined pursuant to article eighteen-B of the general municipal law.(d) "Low income" means having an income, adjusted for family size, of not more than: (i) for metropolitan areas, eighty percent of the area median income; and(ii) for non-metropolitan areas, the greater of eighty percent of the area median income or eighty percent of the statewide non-metropolitan area median income.(e) "Targeted population" means individuals or an identifiable group of individuals who are low income persons or otherwise lack adequate access to loans.3. Establishment and purposes. The corporation shall establish a fund to be known as the "community development financial institutions fund" and shall pay into such fund any monies made available to the corporation for such fund from any source. The monies held in or credited to the fund shall be expended solely for the purposes set forth in this section. The corporation shall not transfer the monies of such fund to any other fund or monies of the corporation or any monies held in trust by the corporation. The corporation is authorized, subject to available funding, including, but not limited to, available appropriations, to provide financial and technical assistance to community development financial institutions that make loans and provide development services to specific investment areas or targeted populations.4.Applications for assistance. An application for assistance shall be submitted in such form and in accordance with such procedures as the corporation shall establish. Applications submitted to the fund may include but not be limited to: (b) An analysis of the needs of the investment area or targeted population and a strategy for addressing those needs;(c) An explanation of proposed activities, and information on how they are consistent with any existing economic, community, and housing development plans adopted by or applicable to an investment area or targeted population;(d) A description of how the applicant will coordinate with community organizations and financial institutions and leverage private sector investments, including, but not limited to, loans, secondary markets, or other services to the investment area or targeted populations;(e) In the case of an applicant with a prior history of serving investment areas or targeted populations, a demonstration that the applicant: (i) has a record of success in serving investment areas or targeted populations; and(ii) will expand its operations into a new investment area or to serve a new targeted population, offer more products or services, or increase the volume of its current business;(f) A description of how the applicant will provide financial services for community businesses that employ or will create jobs for low income persons or to businesses that are owned by low income persons, or enhance the availability of products and services to low income persons; and(g) Any additional information that the corporation shall require.5.Selection of CDFIs. In the awarding of assistance, the corporation shall select from eligible CDFI applicants based on criteria that may include:(a) The likelihood of success of the applicant in meeting the goals of its strategic plan;(b) The experience and background of the CDFI's board of directors or management team;(c) The extent of need for loans and development services within the investment areas or targeted populations;(d) The extent of economic distress within the investment areas or the extent of need within the targeted populations;(e) The extent to which the proposed activities will expand economic opportunities within the investment areas or targeted populations;(f) The extent of support from the investment areas or targeted populations;(g) The extent of the applicant's current and planned community involvement;(h) The extent to which the applicant will increase its resources through coordination with other institutions or participation in a secondary market;(i) In the case of an applicant with a prior history of serving investment areas or targeted populations, the extent of success in serving such areas or populations; and(j) Other factors deemed to be appropriate by the corporation.6.Assistance provided by the corporation. The corporation may provide:(a) Financial assistance through deposits, credit union shares, loans, and grants.(b) Technical assistance and training to any CDFI regardless of whether or not it receives or has received financial assistance from the fund. Monies from the fund may be used for activities that enhance the capacity of a CDFI, such as training of management and other personnel, and development of programs, investment, or loan products. Such technical assistance and training may be provided: (iii) by contracting with organizations that possess expertise in community development finance, without regard to whether or not the organizations receive or are eligible to receive assistance under this section.7.Uses of financial assistance. A CDFI which files an application and is approved by the corporation for financial assistance may use such assistance for the following purposes: (a) the development of commercial facilities that promote revitalization, community stability, and the creation or retention of jobs;(b) the development or improvement of community facilities;(c) the provision of basic financial services;(d) housing that is principally affordable to low income people, except that assistance used to facilitate home ownership shall only be used for services and lending products that serve low income people and are not provided by other lenders in the area or that complement the services and lending products provided by other lenders in the area;(e) the development or support of businesses that:(i) provide jobs for low income people or are owned by low income people, women, or minority entrepreneurs; or(ii) enhance the availability of products and services to low income people; or(f) the development or support of other businesses and activities deemed appropriate by the corporation.8.Advisory committee. The corporation may create an advisory committee, consisting of at least five members, to advise the corporation in the promotion, implementation and administration of the community development financial institutions program. Such members shall have experience with CDFIs and shall, to the extent practical, reflect diversity in geographic location and communities served.9.Reporting requirements. The corporation shall submit a report to the governor, the speaker of the assembly and the temporary president of the senate on or before the first of October, and annually thereafter, describing the financial and technical assistance provided pursuant to this article, including: the number of CDFI applications filed and accepted; the amount and type of assistance provided; a description of projects financed or assisted by fund monies; the number of jobs created or retained through the investment of fund monies; the amount and source of funds leveraged; and such other information as the corporation may deem appropriate.10.Rules and regulations. The corporation is hereby authorized to promulgate rules and regulations in accordance with the state administrative procedure act that are necessary to fulfill the purposes of this section.N.Y. Urban Development Corporation Act Law § 16-o
Amended by New York Laws 2020, ch. 58,Sec. III-1, eff. 4/3/2020.