S114

The New York State Senate passed legislation prohibiting state-chartered banks from investing in or financing private correctional facilities, extending the state's existing ban on private prisons. Senate Bill 114 passed 36-22 on a roll call vote. Sponsor Sen. Cleare argued the measure establishes a moral principle preventing state banks from profiting from institutions New York deems impermissible, citing poor conditions in private facilities and increased federal detention activity under the Trump administration's rescission of the Biden directive limiting private prison use. Sen. Borrello opposed the bill, contending it regulates interstate commerce and private investment decisions without practical impact, as no state-chartered banks currently invest in private prisons and the state has lost 40 percent of its state-chartered banks during his tenure. He warned the measure sets a dangerous precedent for government control over private financial decisions. Sen. Sanders noted for the record that a private prison operates in his district, contradicting earlier statements that none exist in New York. The bill has been introduced multiple times over six years without advancing in the Assembly.

The New York State Senate passed legislation Tuesday that would prohibit state-chartered banks from investing in or financing private correctional facilities, extending the state's existing ban on private prisons. Senate Bill 114 passed 37-22 on a roll call vote. Sponsor Sen. Cleare argued the bill is a logical extension of New York's prohibition on private prisons and cited safety concerns at private facilities, including high staff turnover rates of 43 percent, increased violence, and poor accountability. "New York banks should not be allowed to profit from institutions that the state itself deems impermissible to even exist," Cleare said. Sen. Borrello opposed the measure, arguing it unfairly targets state-chartered community banks and sets a dangerous precedent by dictating investment decisions. He also contended that New York State, facing its own prison crisis with rising inmate violence and low morale, should not lecture other states on prison operations. Sen. Krueger supported the bill, noting that federal regulation of bank investments is not unprecedented and that research shows disturbing outcomes at many private prisons nationwide.