Gov. Vetoes Prize-Linked Savings Bill

September 30, 2013 at 7:48 am Leave a comment

On Friday evening, the Cuomo Administration announced that it was vetoing legislation supported by the Association and others that would have permitted credit unions to offer prizes to individuals who agree to open savings accounts.  The bill would have also cleared away state level hurdles to banks wishing to offer the same time of products.

With the exception of the New York State Lottery and certain specific charitable activities, state law prohibits requiring individuals to pay something in return for entering a lottery.  This is why those McDonald’s commercials always remind you at the very end of their game promotions that no purchase is necessary.  The bill vetoed by the Governor is similar to proposals adopted in other states that seek to encourage savings by both satiating people’s desire to participate in games of chance and encouraging people to save for a rainy day.  Under this bill, credit unions could have held a raffle, for example, for individuals who opened savings accounts.  Although lotteries are popular, they also are among the most regressive form of state revenue enhancement since research indicates that those with lower incomes are more likely to spend a disproportionate share of their money trading a dollar for a dream.

The bill (S.5145-Senator Lanza/A. 7341-Assemblywoman Robinson) was one of a swath of legislative vetoes made by the Governor on Friday, which the Albany Times Union has dubbed the Friday Night Massacre.  It was veto memo number 229.

Entry filed under: New York State, Political. Tags: , , .

I’ve Seen The Enemy And It Is Us And The Band Played On

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Authored By:

Henry Meier, Esq., General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association.

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