New York State is encouraging banks to loan up to $3.2 billion for superstorm Sandy rebuilding projects by giving them "priority" credits for serving disaster-scarred communities, Gov. Andrew M. Cuomo announced Wednesday.
The new lending would be in addition to $500 million in U.S. Department of Housing and Urban Development community block grants previously announced for recovery plans across New York City and Long Island.
The state Department of Financial Services says it will offer incentives to private banks if they issue loans for Sandy projects in 102 neighborhoods that are part of the publicly funded New York Rising Community Reconstruction Program.
The new program aims to rebuild storm-damaged homes, businesses and infrastructure -- and safeguard them against future natural disasters.
Cuomo also directed five state agencies to jump-start Sandy recovery by speeding approval of required permits and prioritizing rebuilding projects.
"We must adapt to the new norm of extreme weather," Cuomo said in a statement. "Many families and businesses are continuing to face the challenges brought about by these storms, but together we can build our communities back stronger than ever before."
"This action will spark billions of dollars in lending and private investment in communities that were hit hard by these devastating natural disasters," said Benjamin Lawsky, Financial Services superintendent.
Banks with good performance records will be given priority when the state reviews their applications for new branches or for mergers and acquisitions.
Financial Services will help link banks that wish to make qualifying loans with approved rebuilding projects, Lawsky said.
The incentives are being offered through the federal Community Reinvestment Act, which requires banks to serve their entire community, including poor and minority neighborhoods, and areas affected by disaster.