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Annual Assessment Charges: Banking Division

Table of Contents

Billing
Payment Information
Assessment Calculations
Assessment Calculations Chart with Industry Examples

Frequently Asked Questions (FAQs)

General
Mortgage Bankers
Mortgage Brokers

BILLING:

In accordance with Section 17 of the New York State Banking Law, all expenses (compensation, lease costs and other overhead) of the Department in connection with the regulation and supervision (including examination), of any person or entity licensed, registered, incorporated or otherwise formed pursuant to New York State Banking Laws, shall be charged to and paid by them (the Institution).

The New York State fiscal year begins April 1 and ends March 31.

Each institution is billed five times for a fiscal year: four estimated quarterly assessments (approximately 25% of the annual amount) based on the Department’s estimated annual budget at the time of the billing, and a final assessment, or true-up, based on the Department’s actual expenses for the fiscal year.

If an institution’s estimated quarterly payments exceed their final annual assessed amount, a refund will be issued to the institution. If the quarterly estimated charges are less than the final annual assessed amount, the institution will be billed the difference.

1st quarter billing is based on the Department’s annual budget approved by the Governor. The 2nd through 4th quarter bills are adjusted to reflect the best estimate of actual annual expenses during the course of the fiscal year, so that the final bill or refund is minimized. Billing schedule and payment due dates are as follows:

F/Y April 1 to March 31

Billing Date

Due Date

Period Covered

1st Quarter

February 10

March 10

April 1 to June 30

2nd Quarter

May 10

June 10

July 1 to September 30

3rd Quarter

August 10

September 10

October 1 to December 31

4th Quarter

November 10

December 10

January 1 to March 31

Final*

August 15

September 15

April 1 to March 31

*Estimated billing date - Final expenses determined in July each year.

Bills are computed as follows:

Estimated Quarterly Bills – Each quarter, the first step is to compute the estimated annual amount.

The estimated annual amount is the sum of the Supervisory charge and the estimated Regulatory charge. The supervisory charge is computed by multiplying the number of hours for institutions of similar type and size (“buckets” found on the assessment calculations chart) by the hourly rate for the institution type. The supervisory hours and rates are established in January, prior to the 1st quarter (February 10) billing, and remain the same throughout the fiscal year. The total regulatory charges are allocated to each institution in proportion to their financial basis (a measure of volume, e.g. assets, gross income, NY loans, etc.) divided by the total financial basis for the industry group.

Once the estimated annual amount is determined, the quarterly bills are computed as follows:

  • 1st Quarter = estimated annual amount divided by 4.
  • 2nd quarter = estimated annual amount, less the amount billed to date, divided
  • by 3.
  • 3rd quarter = estimated annual amount, less the amount billed to date, divided
  • by 2.
  • 4th quarter = estimated annual amount, less the amount billed to date.
  • Final Assessment (true-up) = actual annual assessment amount less the estimated amount billed to date.

Examination Bills – There are no separate bills for regular examination activity. Only in the case of special examinations, and at the direction of the Superintendent, will separate examination bills be issued.

New Depository Institutions are billed based on their opening assets and the date their charter became effective.

Newly licensed institutions are billed supervisory charges only, until the following fiscal year when they report their volume (financial basis).

Financial Basis: The financial basis is a measure of the size or volume of a business, and is used to pro-rate the regulatory charges to each institution within an industry group. The basis used to calculate the actual final assessment is the amount from the previous calendar year, e.g. December 31, 2008, for the 2009-10 state fiscal year. The basis for the 1st quarter, billed February 10, will differ until the December 31 figures are reported.

Payment Information

Payment Options: In addition to mailing a check, electronic payments may be initiated by the institution via wire transfer, or by the Banking Department via ACH debit on the due date. Please contact the Finance Office at (518) 474-2395 for more information on electronic payment options.

Failure to Pay: Payment must be received in the Albany Finance Office by the due date. Failure to pay will result in additional interest and regulatory action described on the bill and accompanying letter.


ASSESSMENT CALCULATION

The initial step in the assessment calculation is to identify the percentage of total charges applicable to each industry, and apply those percentages to the total budget to arrive at the respective assessment charges for each industry. Percentages are developed based on the industry’s respective staffing costs. Once industry assessment costs are known, supervisory and regulatory costs for each industry are determined, as described below. The sum of the supervisory and regulatory assessment for each industry equals that industry’s respective assessment charges.

Supervisory
The supervisory component of the assessment calculation considers the time it takes to supervise institutions of similar size and type (supervisory hours by institution size) and the overall hourly cost of examining staff overseeing that particular industry (hourly rate). The calculation is as follows:

Annual Average Supervisory Hours by Institution Size and Type

Supervised institutions are grouped by industry type and size, then broken into “buckets” of logical groupings. The number of hours of supervision for all institutions within that industry is identified based on a three-year “look back,” then averaged for the group in each bucket.

x Hourly Rate

Determined by averaging the salaries and fringe costs of all examiners supervising each type of entity. Hourly rates are derived from staff assignments. These rates are updated annually.

= Supervisory Portion of General Assessment

 

Regulatory
The regulatory component of the assessment calculation is derived by taking the specific industry’s total assessment cost minus the Supervisory portion of the General Assessment and any miscellaneous revenues (such as investigation fees) for that industry. The calculation follows:

$ General Regulatory Costs
 (for an industry)

Total general regulatory costs are determined by subtracting supervisory costs and miscellaneous revenues (such as investigation fees) from that industry’s portion of the General Assessment.

/ Industry Size

Each industry has an identified financial basis for assessment purposes. The “Industry Size” is the sum of the individual financial basis for each regulated institution in the respective industry. Total regulatory costs (derived in the step above) are divided by the “Industry Size” to arrive at that industry’s assessment rate.

= Rate

The calculation above results in an assessment rate for the particular industry.

* Institution Financial Basis

The rate is then multiplied by the Institution Financial Basis to arrive at the regulatory portion of the General Assessment for the institution.

= Total Regulatory Costs for a Particular Institution.

Quarterly assessment calculations are estimated based on year-to-date actual expenses, plus estimated expenses for the balance of the fiscal year. After the close of the fiscal year, a Final Assessment is computed based on the Department’s actual expenses.


Frequently Asked Questions Of the General Assessment

What is the “General Assessment”?
The General Assessment is the mechanism for billing regulated industries to collect the operating funds of the New York State Department of Financial Service Banking Institutions. The statutory authority for the General Assessment is derived from Section 17 of the New York State Banking Law.

General Assessment is billed in four quarterly estimated bills. Once the fiscal year is closed, a Final Assessment is computed. This generally occurs in August of the following fiscal year. At that time, the Final Assessment for each institution is calculated, payments made are subtracted, and the amount due the Department or refund due the institution is identified. Our goal is to make the estimated bills very close to the final so there is a small amount due or refunded.

When do I Pay?
The Department’s fiscal year runs from April 1 to March 31 and the General Assessment is billed in advance each quarter. Assessment bills are due on the following dates: March 10 of the previous fiscal year; and, June 10, September 10, and December 10 of the current fiscal year. Each quarterly payment is roughly 25% of the estimated annual amount due. Bills are mailed at least 30 days before the due date. Interest is added for late payment of an assessment. Additionally, by statute, mortgage brokers are subject to a $100 late fee if payment is not received by the due date. Bills deemed uncollectible are subject to collection by the Office of the New York State Attorney General, or, for some institutions, the Department will collect against the institution’s bond or pledged asset.

How do I Pay?
Payment is accepted by check, money order, bank check, wire, or electronic transfer by an ACH debit from your checking account on the due date . (Advance registration is required for electronic transfer). Payments can be made either quarterly or pre-paid annually.

Do I still get Examined and Billed for the Exam?
Prior to the implementation of the new General Assessment in the 2005-06 fiscal year, entities were billed for examination fees after an exam was performed. Under the new system entities are no longer billed for routine exams. Special examinations, however, may be billed to an institution, at the discretion of the Superintendent. Now that routine examinations are not billed to regulated institutions, those institutions are better able to project and plan for their annual assessment expenditures.

Where do I Find the Online Chart Which Shows how my Bill is Computed Every Quarter?
After every quarterly billing a chart is posted here that shows how bills were computed. (link to Assessment Calculator Charts at top right of this page ) It shows the sizes of institutions, the average number of hours spent supervising each level, the hourly rate, and explains how to compute your supervisory and regulatory amounts.

What Financial Basis is my Assessment Based on?

Depository Institution

Total Assets

Budget Planner

Number of customers

Check Cashers

Dollar amount of New York checks cashed

Licensed Lenders

New York assets

Money Transmitters

New York transactions

Premium Finance Companies

New York loans

Sales Finance

New York loans

Mortgage Bankers and Brokers

Gross New York income

Why is my Current Assessment based on assets or volume from a Previous Year?
The assessment is based on the most current financial basis information on file with the Department. This allows for a stable financial basis providing relative size information for all institutions within each industry, and minimizes fluctuation in bills from quarter to quarter. Essentially, for the 1st quarter bill, mailed February 10, we use the prior year’s basis for institutions that file an annual report. For depository institutions and Money Transmitter’s, who file quarterly reports, we use the basis as of September 30 of the previous year. For the 2nd through 4th quarter and final assessment, we update to the basis as of December 31 of the previous year. The December 31 data is the final basis for the full fiscal year.

How do you Compute the Supervisory Charge?
The supervisory portion of the assessment considers the average time it takes to supervise an entity of a given size and industry type, and the average hourly cost of the examining staff overseeing that particular industry. The calculation is as follows:

Annual Average
Supervisory
Hours
by Institution Size

x

Hourly
Rate

=

Supervisory Portion
of General
Assessment

How do you Compute the Regulatory Charge?
The regulatory portion of the assessment calculation is made up of the total operating budget of the Department minus the supervisory portion of the General Assessment. Total regulatory costs are then distributed among each industry based on the staffing costs for each industry as a percentage of the total Department’s staffing costs. A regulatory rate is then derived by dividing the regulatory costs to be collected from each industry by the industry’s total financial basis.

General
Regulatory Costs
per Industry

/

Industry
Financial
Basis

=

Regulatory Rate

Then, an institution’s regulatory cost is calculated as follows:

Institutions’
Financial Basis

*

Regulatory
Rate

=

Regulatory Portion of General Assessment

Questions Specific to Mortgage Bankers and Brokers

What is a VOOR?
VOOR stands for Volume of Operations Report. You are responsible for filing one every year with the Banking Department whether you are active or not. The usual filing date is by the end of March, and may be filed online. You will receive a letter with your password from the Mortgage Banking Division along with detailed instructions on how to access the VOOR reporting system and file.

Can I Still Submit a Paper Copy of the VOOR?
If you are unable to file online, a paper filing will be accepted.

What if my bill shows a Financial Basis that is incorrect, or was reported incorrectly? How do I correct it?
To dispute a bill and request a revision of your financial basis, you must submit a letter within 30 days of receipt of your bill. The letter must be sent to:

New York State Department of Financial Services
Banking Division, Budget & Finance Office
Alfred E. Smith Building
80 South Swan Street, Suite 1157
Albany, New York 12210-8003

Entities requesting a revision to their financial basis should be aware that they may be subject to a special examination based on erroneous information reported on their VOOR. At the discretion of the Superintendent, examination fees for special examinations may be charged directly to the institution. In addition, other penalties may apply.

Questions Specific to Mortgage Brokers

I am an Inactive Broker; must I still pay this General Assessment?
Yes, you are still billed for the General Assessment. As with all industries, your regulatory portion of the General Assessment is based on your business volume as reported on your Volume of Operation Report (VOOR). If your business volume reported on the VOOR is zero, you will not be assessed a regulatory portion of the General Assessment. You will, however, be assessed the supervisory portion of the general assessment.

Why was I charged a $100 late fee? I mailed my payment before the due date.
Section 592(a) of the Banking Law mandates a $100 late fee if payment is not received in the Albany Finance office by the due date. If payment of the assessment plus late fee is not received within 30 days of the due date, then your registration will expire. Additional interest is charged during the 60-day period after expiration, when you can automatically reinstate your registration by paying the assessment plus the late fee and interest. Once your registration has expired, payment must be by certified check, bank check, money order, or by wire. If payment is not received during the 60- day reinstatement period, the expiration becomes permanent and a new application is required to conduct business in New York State.

Can I pay with a Credit Card?
Payment by credit card are not available at this time. We currently offer the option to sign up for the Automated Clearing House (ACH) debit, where we will deduct the assessment fee from your checking account on the due date. You still receive a billing notice, but you don’t have to mail us a check.

 

Assessment Calculations Charts

FY 2011-2012

FY 2010-2011

FY 2009-2010

 

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