A00837 Summary:
BILL NO | A00837 |
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SAME AS | No Same As |
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SPONSOR | Kim |
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COSPNSR | Davila, Sayegh, Brown K, Taylor, Brook-Krasny |
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MLTSPNSR | |
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Add §4-b, St Fin L; amd §301, Fin Serv L; amd §5, UDC Act | |
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Enacts the "the empire state enhanced public payment system act" directing the department of financial services to develop, establish, and maintain a value storage and payment platform consisting of a digital master account and coordinate a system of individual wallets that enable payments to move between such individual wallets or payment accounts for use of New York residents. |
A00837 Memo:
Go to topNEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)   BILL NUMBER: A837 SPONSOR: Kim
  TITLE OF BILL: An act to amend the state finance law, the financial services law and the New York state urban development corporation act, in relation to establishing the empire state enhanced public payment system act   PURPOSE OR GENERAL IDEA OF BILL: The bill seeks to establish the Empire State Enhanced Public. Payment System (EPP) for short, as a solution for providing a publicly-run, not-for-profit means for value-creating activities to be remunerated and for un- and underbanked New Yorkers to be included in the broader state economy.   SUMMARY OF PROVISIONS: Section 1 provides the short title and citation of the bill as the "Enhanced Public Payment System Act." Section 2 is the legislative intent. In New York State, many residents lack basic, non-extractive, and safe public payment services that serve as a means for the accumulation, storage, and transaction of value. Consequently, far too many individuals and households in the state are excluded from participating in the formal economy. A workable definition for money and currency, namely, that "which counts in a system of value accounting, storage, and payment" is also provided. This definition enables one to see the material consequences of shortages in aggregate currency supplies in states and local municipalities, in which the remuneration of activities that add value to a community and the invest- ment in public goods is made more difficult. The solution lies in estab- lishing a publicly-run, not-for-profit system of digital wallets, all of which are connected to a master account that facilitates peer-to-peer transactions between individual payment accounts. In this manner, the fifty-five billion dollars in New York State tax credits and social benefits and thirty billion dollars of home and community care services can be rendered fungible for disbursement to New Yorkers' accounts; conversely, payments from the individual to the state (such as paying taxes) can be done easily through such a payments infrastructure. Section 3 amends the state finance law with a new section 4-b. The terms "master account," "individual wallet," "resident," "value ledger," "state entity," and "payment service provider" are defined. The section tasks the Department of Financial Services, the Department of Taxation and Finance, the Office of the New York State Comptroller, the New York State and Local Retirement System, the Department of Health, the Depart- ment of Labor, and the Department of Social Services with the establish- ment of the Enhanced Public Payment system, and directs state entities to disburse funds to residents' digital wallets. The Department of Taxa- tion and Finance is tasked with the promotion of the use of the Enhanced Public Payment system, with the objective of banking the unbanked popu- lation in New York and maximizing inclusivity for the state's most marginalized residents for the endeavors of value creation, wealth accu- mulation, and commercial exchange. Lastly, the Department of Financial Services is obligated to develop a smartphone app for the Enhanced Public Payment, ensuring compliance by private financial institutions, compliance with state and federal banking, privacy, and regulatory laws, and to prohibit the for-profit extractive activities by private entities on the Inclusive Value Ledger. Section 4 amends section 301 of the financial services law with the addition of a new subsection (d) that directs the superintendent of financial services of the state to coordinate with corresponding agen- cies in other states and territories of the United States to resolve any extant regulatory concerns. Section 5 amends section 5 of section 1 of chapter 174 of the laws of 1968, colloquially known as the New York State Urban Development Corpo- ration Act, by adding three new subdivisions that mandate the Empire State Development Corporation, in conjunction with the aforementioned agencies, to clarify the privacy regime of the Enhanced Public Payment infrastructure. Specifically, activities and data on the Enhanced Public Payment are not to be sold to nongovernmental entities, with such infor- mation being cryptographically anonymized whenever possible. Moreover, personal data is to be shared with law enforcement only on the strict condition of compliance with the Fourth Amendment of the Constitution of the United States of America. The Corporation is also responsible for the exploration of the creation of potential value ledgers in other states, as well as a pilot program of a nationwide value ledger in consultation with the Federal Reserve Bank of New York, the Federal Reserve Board of the United States, and the Department of Treasury of the United States. Section 6 provides the conditions for severability. Section 7 provides the effective date.   DIFFERENCE BETWEEN ORIGINAL AND AMENDED VERSION (IF APPLICABLE):   JUSTIFICATION: The Empire State Enhanced Public Payment is a transformational new savings and payments platform that will massively accelerate value creation and commerce in the State of New York by steadily growing the health and wealth of New York State citizens, businesses, and communi- ties. The digital technology that undergirds it enables New Yorkers to generate, capture, and exchange value that has gone untapped for centu- ries. Presently we, our state, and our communities leave untold wealth, health, and value potential "on the table," by denying ourselves the means of being rewarded in spendable form for much of the value we add in our day-to-day lives. This is especially true of so-called "soft work" - educating and mentoring our youth, environmental cleanup and preservation, community service and infrastructure provision, care of the ailing and elderly, and more that now goes monetarily uncompensated, especially when done by women, young people, retirees, and other concerned citizens. The Enhanced Public Payment will capture and mone- tize the work of a stay-at-home, parent taking care of the family, a mentor looking after a distressed youth, a volunteer cleaning up public parks, etc., and transform it into spendable foam by crediting those who do such work with "care points" on a secure, smartphone-accessible digital ledger. These points can then be liquidated for other credits, services, or needed products on the same platform; or can be "cashed in" for end-of-year tax and other state remittance credits. The new technol- ogy underlying this "Public Venmo" is a universally trusted digital debit-credit ledger system through which citizens can accumulate and trade tax and other state remittance credits with businesses and one another for the products and services that make up the day-to-day busi- ness of life. This will amount to a "complementary currency" system that fills all the gaps left by dollar scarcity in presently overlooked regions and sectors of New York and its economy. This will in turn massively boost commerce, productive activity, and wealth generation, throughout our state.   PRIOR LEGISLATIVE HISTORY: 2023-2024: A9561/Kim, Referred to Banks   FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: None.   EFFECTIVE DATE: This act shall take effect immediately.