The Eagle Has Landed; NY Passes “Big Ugly” Budget
Around 5:30pm last night, just as Sergio Garcia was making an eagle on the 15th hole during the most entertaining final round of the Masters I have ever seen, the New York State Senate was taking up consideration of S.2009C. To save you the time, you can start reviewing on Page 99 Section AAA. This bill is lovingly referred to as “the big ugly” since it contains a Hodge podge of the most highly debated issues in the state’s 2017 -2018 spending plan.
The most important news for credit unions is that the bill does authorize Transportation Network Companies (TNCs) e.g. Uber, Lyft to operate in New York State. Credit Unions had two concerns about this legislation: First, we wanted to make sure that members who become TNC drivers were adequately insuring our collateral in the event of an accident while clocked in to the network. Remember that your traditional car insurance policy contains a livery exception. Secondly, given the substantial investment of the industry in New York City taxi medallions, it seems likely that any legislation making it easier for persons to offer ride sharing services without medallions will have an impact on the value of outstanding medallion loans.
As to the first issue, the legislation mandates that TNC networks either provide physical damage protection for their drivers or make sure their drivers have such protections. They will also be responsible for putting drivers on notice that such insurance may be required.
As for the loss impact on medallion prices, the final legislation allows NYC to adopt more stringent regulations than otherwise mandated by state law. Whether this will result in any measure of stabilizing prices remains to be seen.
As we go thru the legislation, I will give you highlights of anything else that impacts credit unions.
Entry filed under: General.