New York's Banking Development Districts
An Effective Practice
In 1998, New York enacted legislation to authorize the establishment of banking development districts (BDDs) across the state. The program offers incentives for mainstream ﬁnancial institutions to locate in traditionally underserved communities. Incentives can include sales and property tax exemptions, real estate assistance, favorable Community Reinvestment Act consideration, job credits, and municipal deposits at below-market rates. The New York State Banking Department is responsible for approving and overseeing new BDD designations. To receive a BDD designation, banks need to partner with a local government entity and detail the programs and amenities they will bring to the community, such as extended hours of operation, multilingual staff, special products and services tailored to the community, workforce development programs, and ﬁnancial education programs and outreach.
Goal / Mission
The goal of the program is to increase access to ﬁnancial services for low-income families as well as stimulate economic development in distressed neighborhoods.
Results / Accomplishments
Currently, there are 24 BDDs. New York is the only state to have this type of program. According to the annual report, each BDD branch made an average of more than $6 million in loans and opened an average of 920 accounts in 2005. Most ﬁnancial institutions also provided ﬁnancial literacy training and introduced new services and products in 2005, including new automated teller machines, free application assistance for the federal Earned Income Tax Credit, and extended hours.
About this Promising Practice
- Primary Contact
- New York State Banking Department
One State Street
New York, NY 10004-1417
Economy / Investment & Personal Finance
Economy / Economic Climate
- The New York State Banking Department
- Finance Project
- Date of publication
- Dec 2006
- Date of implementation
- New York
- For more details