Imagine if state lawmakers were considering a proposal to double fines for speeding.
A coalition of concerned drivers troops to the Capitol and asks the legislature to lower the fines, which, they might say, are extremely onerous. If we're caught doing 85 on the Thruway, the resulting fine would break our budgets.
They would be laughed out of the building, and rightly so, specifically because those fines are designed to act as deterrents to heavy-footed driving. This is why fines for speeding are higher when the violation occurs in a construction zone or near a school—it's a tool to coerce us to slow down in those areas.
But when officials from the banking industry came to Albany this week to air their concerns about a proposal to beef up regulation of financial firms, they were hardly laughed at. In fact, some lawmakers seemed to sympathize.
Gov. Andrew Cuomo wants to merge the existing Banking and Insurance Departments into an uber-regulator that, he says, would reflect the increasing complexity of the financial services industry. The new agency, known as the Department of Financial Regulation, would also include the current Consumer Protection Board.
"I believe our current organization is not effective because it is not organized the way Wall Street works any more," Cuomo said during his Jan. 5 State of the State Address. "These divisions of insurance and banking and consumer protection don’t exist in the marketplace and much of the activity is falling between the cracks of our regulatory entities."
Part of the proposal is to fine banks $5,000 per transaction—on top of any restitution—when they're found to be in violation of banking laws. This is twice the $2,500-per-transaction fines currently levied by the Banking Department. Keep in mind that in fraud cases, banks are often accused of committing the alleged violations hundreds, or even thousands, of times.
Michael Smith, the president of the New York Bankers Association, a trade group that represents a cadre of banks, told a panel of senators on Monday that the fines are "extremely onerous" and asked the lawmakers to consider lowering them.
Smith's specific opposition to the penalties is that they would be used to finance the new department's consumer protection arm. The move is a bit of poetic justice on Cuomo's part - use fines paid by fraudsters to fund further protections for bank customers. Smith says nay.
"Such a funding mechanism would create a clear conflict of interest which would result in inappropriate findings of bad deeds and inappropriate imposition of these penalties," he said, adding that the consumer agency should be funded through the state budget in the same manner as other state agencies.
In other words taxpayers, and not banks, should foot the bill for consumer protection.
None of the lawmakers on the panel questioned Smith's logic, but they did grill Cuomo aide Paul Francis on the proposed penalties. Francis, the head of the , said that lower penalties would fail to adequately deter fraud.
"We're making sure the fine is not so low that it just becomes a part of the cost of doing business," he said. "I do not believe [the penalties] will be used abusively as a 'race to the top', "in which banks are squeezed for as much money as possible.
The presidents of the seven banks in Westchester, Rockland and Putnam that are members of the Bankers Association did not return calls seeking comment.
Cuomo's proposal is part of his executive budget; the Assembly and Senate are scheduled to release their own budget proposals on March 15.
In the case of our hypothetical drivers, who presumably made it from Westchester to Albany in two hours flat, lawmakers would likely advise them simply to slow down. Perhaps they should tell banks the same.
Here's a look at what our local lawmakers were up to between March 4 and March 11:
Assemblyman Tom Abinanti (D-Greenburgh) did not introduce any bills.
Abinanti was one of 68 Assembly members who signed a March 7 letter to Assembly Speaker Sheldon Silver calling for the extension of a tax surcharge on New Yorkers who earn more than $200,000 a year. That evening, Silver released a statement expressing his support of the tax, which is opposed by Cuomo and Republican leadership in the Senate.
Assemblyman Robert Castelli (R-Goldens Bridge) did not introduce any bills.
Castelli on March 8 sent a letter to Cuomo asking him to reconsider a proposal to cut $14.7 million in funding from veterans' homes around the state. Castelli, a Vietnam veteran, said that the cuts threaten critical medical services to hundreds of veterans and could permanently shutter some of the homes.
Assemblywoman Sandy Galef (D-Ossining) introduced three bills, including a proposal to prohibit "member items," which are grants that lawmakers dole out in their districts, from the 2011-12 state budget. Cuomo has not proposed any member item spending, which normally totals about $200 million, in his executive budget; last year, about 6,700 of the grants.
Galef also introduced a sweeping proposal that would regulate the nutritional content of foods and beverages sold in schools. For example, one stipulation requires that packages of snacks do not exceed 150 calories in elementary schools, 180 calories in middle schools or 200 calories in high schools, and may not exceed 230 milligrams of sodium per serving. This is the fourth time the bill has been introduced by Galef.
Assemblywoman Ellen Jaffee (D-Suffern) did not introduce any bills.
Jaffee signed a March 7 letter to Assembly Speaker Sheldon Silver calling for the extension of a tax surcharge on New Yorkers who earn more than $200,000.
Assemblyman Steve Katz (R-Yorktown) introduced two bills, which would waive administrative fees for veterans who are starting a small business and provide tax exemptions for state residents who invest in science and technology start-ups.
Katz also announced that he would introduce a bill that would impose eight-year term limits on state lawmakers and four-year limits on leadership positions. The bill had not been formally introduced as of Friday afternoon.
Katz on March 9 came out against a proposal by Cuomo to cut about $6.5 million in funding from various agricultural programs, including a number of Cornell University initiatives that provide agricultural education and assistance to farms. Other proposed cuts include $700,000 that supports the grape and wine industries in New York and $3 million for local farmers' markets.
Katz on March 10 held a town hall meeting at the Yorktown Fire House, despite breaking his leg March 3 when he slipped on ice at FDR State Park. The freshman will hold another meeting at the Patterson Town Hall on March 19 from 11 a.m. to 1 p.m. Katz will be joined by Congresswoman Nan Hayworth.
The assemblyman also launched a YouTube channel that features clips of his town hall meetings and other videos. Katz said he plans to use YouTube to keep constituents informed about his goings-on in Albany.
Assemblyman George Latimer (D-Rye) introduced one bill, which would call on local governments to fly a "Missing in Attack on Our Nation" (MIA-OON) flag on public buildings for 30 days each year, beginning on Sept. 11. The flag, which features the silhouette of a mother holding a child's hand, was created to commemorate 9/11 victims and has already been flown over the Rhode Island State Capitol.
Latimer and Westchester County Legislator Marty Rogowsky on March 12 held mobile office hours at the Port Chester Seniors Center.
Cuomo on March 8 signed a bill, co-sponsored by Latimer, that will allow villages that run their own elections to through the end of 2012.
Assemblywoman Amy Paulin (D-Scarsdale) introduced two bills, which would allow the city of White Plains to extend until Aug. 31, 2013 an additional one-percent sales tax and would allow pharmacy interns to administer immunizations under the supervision a licensed pharmacist.
Paulin on March 4 met with Metro North President Howard Permut to discuss delays and overcrowding on the network's New Haven line this past winter. The line, Paulin said, "is one of the busiest and most complex" in the country; delays and cancellations were attributed to an aging fleet of trains and delays in expensive infrastructure improvements by the state of Connecticut.
Assemblyman Ken Zebrowski (D-New City) did not introduce any bills.
Sen. Greg Ball (R-Patterson) introduced six bills, including proposals that would create a state registry of people convicted of animal abuse, similar to the existing registry for sex offenders, and increase penalties for animal cruelty. The latter proposal also would require that such convicts receive psychiatric screenings and, if necessary, treatment.
The senator also introduced a bill that would strip public officials of their pension benefits if they are convicted of a crime related to the abuse of public office. Ball's bill would give the authority to strip pensions to state courts, instead of the comptroller or other state agencies, as some lawmakers have proposed. The proposal came just days before Sen. Carl Kruger and Assemblyman William Boyland, both Brooklyn Democrats, were charged with taking bribes from lobbyists.
Ball on March 14 will hold an advocacy event for veterans at the Capitol. He also will hold a hearing on veterans' services and introduce a number of veterans-affairs bills.
Sen. David Carlucci (D-Clarkstown) did not introduce any bills.
The Senate on March 9 passed a bill, sponsored by Carlucci, that would allow Orange and Rockland Utilities to "swap" land with the town of Orangetown in order to build new electric transmission lines. The move, Carlucci said, will allow Verizon to expand its facilities in the area and save 200 jobs. The bill has been introduced in the Assembly by Ellen Jaffee (D-Suffern).
The senator and his colleagues in the Independent Democratic Conference on March 9 released a plan that they said would save the state $37 million and strengthen the role of the state Inspector General (IG) by eliminating redundant regulatory activities in state government. The IG is charged with overseeing most state agencies, but independent IGs also exist who police the MTA and the state's Medicaid and welfare programs. Carlucci's plan would fold the latter two watchdogs into the Attorney General's office.
Carlucci on March 10 announced that he would donate $5,000 from his campaign account to local charities. The announcement came after it was revealed that Sen. Carl Kruger, who is facing federal allegations that he took campaign contributions from lobbyists in return for political favors, donated $5,000 to Carlucci last year. Kruger also contributed $2,000 to the campaign of Sen. Suzi Oppenheimer (D-Port Chester) and $1,000 to Sen. Andrea Stewart-Cousins (D-Yonkers).
Sen. Suzi Oppenheimer (D-Port Chester) introduced a dozen bills, including a proposal that would allow local governments to offer property tax exemptions to police officers, firefighters and paramedics who became "fully disabled" in the line of duty. The exemptions also would extend to the widows of such workers who were killed in the line of duty.
Oppenheimer also wants the state to exempt feminine sanitary products from sales taxes and require state agencies to issue quarterly reports detailing how taxpayer money is spent for payroll purposes. Specifically, the Senate, Assembly and other agencies would be required to report payments made to anyone who did work for those entities but is not on the payroll.
The senator also introduced three local bills, which would extend to August 31, 2013 an additional one-percent sales tax in White Plains, create an Industrial Development Agency (IDA) in White Plains and allow the town of New Castle to list volunteer members of the Community Emergency Response Team (CERT) as town employees for insurance purposes. All three bills have also been introduced in the Assembly. According to White Plains officials, .
Oppenheimer on March 8 announced that she had been selected as the New York State director of the Women's Legislators Lobby (WiLL), a national network of female lawmakers. In the role, Oppenheimer will lobby the federal government on legislation that impacts the state.
Cuomo on March 8 signed a bill, co-sponsored by Oppenheimer, that will allow villages that run their own elections to through the end of 2012.
Sen. Andrea Stewart-Cousins (D-Yonkers) introduced two local bills, which would allow the village of Hastings to offer 20-year retirement plans to three police officers and allow the city of Yonkers to create a new agency tasked with overseeing enforcement of city codes and ordinances.
Stewart-Cousins and Oppenheimer both signed a March 8 letter to Cuomo calling on him to support the extension of a tax on wealthy New Yorkers. Cuomo has been a vocal opponent of the tax.