Prohibits the formation of a subsidiary of a public authority without prior approval of the legislature.

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S4690-2011 Actions

• Jun 21, 2012: referred to corporations, authorities and commissions
• Jun 21, 2012: DELIVERED TO ASSEMBLY
• Jun 21, 2012: PASSED SENATE
• Jun 18, 2012: AMENDED ON THIRD READING 4690A
• Mar 21, 2012: ADVANCED TO THIRD READING
• Mar 20, 2012: 2ND REPORT CAL.
• Mar 19, 2012: 1ST REPORT CAL.374
• Jan 4, 2012: REFERRED TO CORPORATIONS, AUTHORITIES AND COMMISSIONS
• Jun 24, 2011: COMMITTED TO RULES
• May 24, 2011: ADVANCED TO THIRD READING
• May 23, 2011: 2ND REPORT CAL.
• May 18, 2011: 1ST REPORT CAL.770
• Apr 14, 2011: REFERRED TO CORPORATIONS, AUTHORITIES AND COMMISSIONS

S4690-2011 Meetings

Corporations, Authorities and Commissions: May 18, 2011, Corporations, Authorities and Commissions: Mar 19, 2012

S4690-2011 Calendars

Floor Calendar: Mar 20, 2012 , Floor Calendar: Mar 21, 2012 , Floor Calendar: Mar 22, 2012 , Floor Calendar: Mar 26, 2012 , Floor Calendar: Mar 27, 2012 , Floor Calendar: Mar 28, 2012 , Floor Calendar: Mar 29, 2012 , Floor Calendar: Mar 30, 2012 , Floor Calendar: Apr 17, 2012 , Floor Calendar: Apr 18, 2012 , Floor Calendar: Apr 19, 2012 , Floor Calendar: Apr 25, 2012 , Floor Calendar: Apr 26, 2012 , Floor Calendar: Apr 30, 2012 , Floor Calendar: May 1, 2012 , Floor Calendar: May 2, 2012 , Floor Calendar: May 7, 2012 , Floor Calendar: May 8, 2012 , Floor Calendar: May 9, 2012 , Floor Calendar: May 14, 2012 , Floor Calendar: May 15, 2012 , Floor Calendar: May 16, 2012 , Floor Calendar: May 21, 2012 , Floor Calendar: May 22, 2012 , Floor Calendar: May 23, 2011 , Floor Calendar: May 23, 2012 , Floor Calendar: May 24, 2011 , Floor Calendar: May 25, 2011 , Floor Calendar: May 30, 2012 , Floor Calendar: May 31, 2012 , Floor Calendar: Jun 1, 2011 , Floor Calendar: Jun 2, 2011 , Floor Calendar: Jun 4, 2012 , Floor Calendar: Jun 5, 2012 , Floor Calendar: Jun 6, 2011 , Floor Calendar: Jun 6, 2012 , Floor Calendar: Jun 7, 2011 , Floor Calendar: Jun 11, 2012 , Floor Calendar: Jun 12, 2012 , Floor Calendar: Jun 13, 2011 , Floor Calendar: Jun 13, 2012 , Floor Calendar: Jun 14, 2011 , Floor Calendar: Jun 14, 2012 , Floor Calendar: Jun 15, 2011 , Floor Calendar: Jun 16, 2011 , Floor Calendar: Jun 17, 2011 , Floor Calendar: Jun 18, 2012 , Floor Calendar: Jun 21, 2011 , Floor Calendar: Jun 22, 2011 , Floor Calendar: Jun 23, 2011 , Floor Calendar: Jun 24, 2011

S4690-2011 Votes

S4690-2011 Memo

BILL NUMBER:S4690               REVISED 10/03/11

TITLE OF BILL:
An act
to amend the public authorities law, in relation
to prohibiting the formation of a subsidiary of a public authority
without prior permission of the legislature

PURPOSE OR GENERAL IDEA OF BILL:
This bill seeks to prohibit the formation of a subsidiary of a public
authority or public benefit corporation without prior permission of
the legislature.

SUMMARY OF SPECIFIC PROVISIONS:
This bill would add a new �2829 to the Public Authorities Law, to
prohibit public authorities from establishing any new subsidiary
corporation without prior statutory authority therefore; to
grandfather all legally created subsidiaries established prior to
July 1, 2012; and, to require all such previously established
subsidiaries to provide a justification report to the chairs of the
Senate and Assembly Committees on Corporations, Authorities and
Commissions on or before March 31, 2013.

JUSTIFICATION:
Public Authorities, the hybrid of a government agency and a private
corporation, were established to perform specific, focused missions
on behalf of the people of the state of New York. As finance,
contracting and operating entities, they have the flexibility and
power to accomplish great tasks. From bridge, edifice,
infrastructure, school and highway building, to the operation of
transportation systems, convention and sports centers, economic
development programs and public health and infrastructure facilities,
these entities perform an indispensable role and dramatically enhance
the quality of the daily lives of every New Yorker.

Due to their flexibility and efficiency of operation, their design for
speed, as well as their focused mission and specific purpose, New
York's public authorities have often been tasked with performing the
most challenging, difficult and controversial of state projects. From
the time they were used by Robert Moses to build the great bridges,
buildings, parks and edifices of early 20th century New York, to the
present day, there have been many questions and concerns raised
regarding their role and their lack of accountability. Without them,
however, so many of the things that make New York the Empire State,
from our Thruway, to our State University campuses, to our New York
City Transit systems, to the site for the 1980 Olympics were
America's famous Miracle on Ice
occurred, to the very housing units millions of New Yorkers now call
home, simply would not exist today.

With the immense challenges and vast revenue streams which our public
authorities have been asked to oversee, there have been many
amendments to the public authorities law, to improve public
accountability without compromising their effectiveness or mission.
These reforms include the establishment of the Public Authorities
Control Board as well as the modernization of the state statutes


governing their debt issuance, capital expenditures, contracting
procedures, and reporting requirements. As we step firmly into the
realm of the new 21st century, we have again witnessed some problems
with certain operations within select public authorities. It is
therefore incumbent upon the legislature to once again address these
issues with the same determination, and in the same manner, as to
promote increased accountability without diminishing the public
benefit which these governmentally-created corporations provide.

Financial, budget and accounting questions involving billions of
dollars of public monies, require reform. uncertainty over the
fairness and propriety of procurement contract awards must be
overcome to again regain the public's confidence and trust.
Accountability and operational soundness must be clearly demonstrated
by these entities through public disclosure and access, with the
ultimate oversight, resting with the people's elected representatives
in the State Senate and Assembly.

This bill seeks to accomplish an important and major reform by
prohibiting the formation of a subsidiary of a public authority
without prior permission of the legislature. Several public
authorities have gotten themselves into trouble due to lack of
oversight and an express set of guidelines of their subsidiaries.

This bill seeks to correct this situation, and remain true to the
spirit of �5 of Article 10 of the State constitution which requires
that only the State legislature may create a public authority. The
formation of a subsidiary by a public authority which itself must be
constitutionally created by the legislature, should not be allowed to
be created by the parent public authority. To permit otherwise not
only violates the spirit of the constitution, but also permits a
questionable delegation and abrogation of state legislative authority.

PRIOR LEGISLATIVE HISTORY:
2005-06: S.5102-A/A.6757 - Veto 369
2007:    Passed Senate/Assembly Corporations Authorities &
         Commission Committee
2008:    Passed Senate/Assembly Ways and Means Committee
2009-10: S.3919 Corporations, Authorities & Commissions Committee

FISCAL IMPLICATIONS:
None noted.

EFFECTIVE DATE:
Immediately.

S4690-2011 Text

                      S T A T E   O F   N E W   Y O R K
  ________________________________________________________________________

                                    4690

                         2011-2012 Regular Sessions

                              I N  SENATE

                               April 14, 2011
                                 ___________

  Introduced  by Sen. FLANAGAN -- read twice and ordered printed, and when
    printed to be committed to the Committee on Corporations,  Authorities
    and Commissions

  AN  ACT  to amend the public authorities law, in relation to prohibiting
    the formation of a subsidiary of  a  public  authority  without  prior
    permission of the legislature

    THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
  BLY, DO ENACT AS FOLLOWS:


    Section 1. The public authorities law  is  amended  by  adding  a  new
  section 2829 to read as follows:

    S  2829.  SUBSIDIARIES  OF PUBLIC AUTHORITIES.  1. NOTWITHSTANDING ANY
  OTHER PROVISION OF LAW TO THE CONTRARY, NO  PUBLIC  BENEFIT  CORPORATION
  SHALL ESTABLISH A SUBSIDIARY CORPORATION WITHOUT STATUTORY CODIFICATION.
    2.  NOTWITHSTANDING THE PROVISIONS OF SUBDIVISION ONE OF THIS SECTION,
  ANY SUBSIDIARY OF A PUBLIC AUTHORITY DULY AND LAWFULLY FORMED  PRIOR  TO
  THE  FIRST  DAY  OF  JULY,  TWO THOUSAND TWELVE, SHALL BE DEEMED TO BE A
  PUBLIC AUTHORITY UNDER THE TERMS OF THIS  CHAPTER,  AND  NOTWITHSTANDING
  ANY  OTHER PROVISION OF LAW TO THE CONTRARY, SHALL BE SUBJECT TO ALL THE
  REQUIREMENTS, DUTIES AND RESPONSIBILITIES PROVIDED IN THIS CHAPTER.
    3. ON OR BEFORE THE THIRTY-FIRST DAY OF MARCH, TWO THOUSAND  THIRTEEN,
  ANY  SUBSIDIARY  PUBLIC  BENEFIT  CORPORATION,  IN  COOPERATION WITH ITS
  PARENT PUBLIC BENEFIT CORPORATION, SHALL PROVIDE  TO  THE  CHAIRMAN  AND
  RANKING MINORITY MEMBER OF THE SENATE FINANCE COMMITTEE AND THE CHAIRMAN
  AND  RANKING MINORITY MEMBER OF THE ASSEMBLY WAYS AND MEANS COMMITTEE, A
  REPORT ON THE SUBSIDIARY PUBLIC BENEFIT CORPORATION. SUCH  REPORT  SHALL
  INCLUDE FOR EACH SUBSIDIARY:

    (A)  THE  COMPLETE  LEGAL NAME, ADDRESS AND CONTACT INFORMATION OF THE
  SUBSIDIARY;
    (B) THE STRUCTURE OF THE ORGANIZATION OF THE SUBSIDIARY, INCLUDING THE
  NAMES AND TITLES OF EACH OF ITS MEMBERS, DIRECTORS AND OFFICERS, AS WELL
  AS A CHART OF ITS ORGANIZATIONAL STRUCTURE;

   EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                        [ ] is old law to be omitted.
                                                             LBD07376-01-1

 S. 4690                             2

    (C) THE COMPLETE BYLAWS AND LEGAL ORGANIZATION PAPERS OF  THE  SUBSID-
  IARY;
    (D) A COMPLETE REPORT OF THE PURPOSE, OPERATIONS, MISSION AND PROJECTS
  OF  THE SUBSIDIARY, INCLUDING A STATEMENT OF JUSTIFICATION AS TO WHY THE
  SUBSIDIARY IS NECESSARY TO CONTINUE ITS OPERATIONS FOR THE PUBLIC  BENE-
  FIT FOR THE PEOPLE OF THE STATE OF NEW YORK; AND
    (E)  ANY  OTHER  INFORMATION THE SUBSIDIARY PUBLIC BENEFIT CORPORATION
  DEEMS IMPORTANT TO INCLUDE IN SUCH REPORT.
    S 2. This act shall take effect immediately.