ALBANY, N.Y. (6/28/10)--The Credit Union Association of New York (CUANY) Friday called on the State Legislature to support a new compromise bill on municipal depository choice that will allow New York’s local government entities to deposit funds into credit unions. The compromise “same as” bills, sponsored by Sen. Kevin Parker (S.8296-A) and Assemblyman Harvey Weisenberg (A.11538-A), are similar to previous versions but would now cap municipal deposits in credit unions at the federally insured limit of $250,000 per deposit. “We support this compromise legislation, which is a reasonable approach to ensuring local government leaders have a choice in where they are allowed to deposit our tax dollars and have a new way to find savings in these tight fiscal times,” said William J. Mellin, president/CEO of the association. Municipal depository choice allows local government entities such as cities, towns, counties, school districts, fire districts and public libraries the option of depositing tax dollars in local credit unions or community savings banks. The law already allows deposits in commercial banks, which currently have a monopoly on municipal tax deposits, said the association. The proposed flexibility for local government and free market approach will result in the best possible rates of return and lower fees for municipalities, which could save state taxpayers millions of dollars, said CUANY. Local government organizations throughout New York State continue to support municipal depository choice. These include the New York State Conference of Mayors and Municipal Officials (NYCOM), the Association of Towns of the State of New York, New York State Association of Counties (NYSAC), the Fireman’s Association of New York (FASNY), the New York School Boards Association, and the New York Library Association (NYLA). Supporters have included Gov. David Paterson, key state legislators, New York City Mayor Michael Bloomberg and other state and city officials throughout the state. Credit unions play a significant role in communities throughout the state by investing locally and paying property taxes to the same local governments that would benefit from municipal depository choice, said CUANY. “Municipal depository choice is about reforming a nearly century-old antiquated law, which fails to reflect current financial conditions or offer local governments the flexibility they need to manage declining revenues and growing deficits,” said Mellin. “This much-needed reform allows local governments something they don’t currently have--the freedom to deposit their tax dollars where they can save revenue, encourage more local investment, and create more opportunities for New Yorkers.” A 2006 study by former Assembly economic advisor Brian P. O’Connor indicated that allowing credit unions to work with local governments could save taxpayers $18 million to $24 million. “The savings for taxpayers is clear and significant and the time for municipal deposit reform is now," Mellin said.