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State Owned Financial Institutions 2010 Legis

State Owned Financial Institutions 2010 Legislation

Last Updated: November 18, 2011

NCSL Staff Contact: Heather Morton, 303.364.7700 (Denver)

With the struggling economy, state legislators are investigating state-owned banks, similar to the Bank of North Dakota, as a way to encourage economic development and generate revenue. This kind of institution is also known as a public or partnership bank. The Bank of North Dakota, formed in 1919 by the North Dakota Legislative Assembly, is the only state-owned bank operating in the United States.

In 2010, 11 bills and resolutions were introduced in six states to study the issue or to create a state bank or investment trust. Massachusetts lawmakers enacted S.B. 2582 to form a 21-member commission to study the issue and issue a report.

Related NCSL Webpages:

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STATES
BILL SUMMARIES
Alabama
none
Alaska
none
Arizona
none
Arkansas
none
California
none
Colorado
none
Connecticut
none
Delaware
none
District of Columbia
none
Florida
none
Georgia
none
Guam
Not Available
Hawaii

H.C.R. 200
Passed House 4/9/10
Requests the Legislative Reference Bureau to study the feasibility of establishing a state-owned bank.

Idaho
none
Illinois

H.B. 5476
Creates the Community Bank of Illinois Act. Provides that the Department of Financial and Professional Regulation shall operate the Community Bank of Illinois. Specifies the authority of the advisory board of directors to the Bank. Provides that the secretary is to employ a president and employees. Contains provisions concerning the removal and discharge of appointees. Provides that state funds must be deposited in the Bank. Contains provisions concerning the nonliability of officers and sureties after deposit. Specifies the powers of the Bank. Contains provisions concerning the guaranty of deposits and the Bank's role as a clearinghouse, the authorization of loans the General Revenue Fund, bank loans to farmers, limitations on loans by the Bank, the name in which business is conducted and titles taken, civil actions, surety on appeal, audits, electronic fund transfer systems, confidentiality of bank records, the sale and leasing of acquired agricultural real estate, and the Illinois higher education savings plan. Provides that the Bank is the custodian of securities. Amends the Illinois State Auditing Act to require that the Auditor General must contract with an independent certified public accounting firm for an annual audit of the Community Bank of Illinois as provided in the Community Bank of Illinois Act. Amends the Eminent Domain Act to allow the Bank to acquire property by eminent domain. Provides that the Department of Financial and Professional Regulation may in turn direct the Community Bank of Illinois to make loans to the General Revenue Fund by the purchase of the evidences of indebtedness at those rates of interest as the Department may prescribe.

Indiana
none
Iowa
none
Kansas
none
Kentucky
none
Louisiana

H.C.R. 111
Passed House 4/14/10
Requests the Office of Financial Institutions to study the creation of a state-owned bank.

Maine
none
Maryland
none
Massachusetts

S.B. 2270
Accompanied by new draft S.B. 2331 3/18/10
Establishes a commission to study the feasibility of establishing a bank owned by the commonwealth or by a public authority constituted by the commonwealth.

S.B. 2331
Accompanied by new draft S.B. 2345 4/1/10
Establishes a commission to study the feasibility of establishing a bank owned by the commonwealth or by a public authority constituted by the commonwealth.

S.B. 2345
Accompanied by new draft S.B. 2380 4/8/10
Establishes a commission to study the feasibility of establishing a bank owned by the commonwealth or by a public authority constituted by the commonwealth.

S.B. 2380
Substituted by S.B. 2582 7/30/10
Establishes a commission to study the feasibility of establishing a bank owned by the commonwealth or by a public authority constituted by the commonwealth.

S.B. 2582
Signed by governor with line item veto 8/5/10
Veto Message:
Establishes a commission to study the feasibility of establishing a bank owned by the commonwealth or by a public authority constituted by the commonwealth.

Michigan
none
Minnesota
none
Mississippi
none
Missouri
none
Montana
none
Nebraska
none
Nevada
none
New Hampshire
none
New Jersey
none
New Mexico
none
New York
none
North Carolina
none
North Dakota
none
Ohio
none
Oklahoma
none
Oregon
none
Pennsylvania
none
Puerto Rico
none
Rhode Island
none
South Carolina
none
South Dakota
none
Tennessee
none
Texas
none
Utah
none
Vermont
none
Virginia

H.J.R. 62
Establishes a joint subcommittee to study whether to establish a bank operated by the Commonwealth. The study shall consider recommendations for legislation to establish a state owned, controlled, and operated bank.

Washington

H.B. 3162
Creates a state bank overseen by the state treasurer. Allows the state treasurer to fund the bank with state funds. Provides the state bank with the same types of authority to operate as a private bank chartered by the state.

H.J.R. 4224
Proposes an amendment to the state constitution authorizing a state bank of Washington.

West Virginia
none
Wisconsin
none
Wyoming
none

 

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