Extends, until January 1, 2017, the expiration of the electronic public bond sale pilot program for the county of Westchester; and makes technical corrections to the provisions of such program.

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S6371A-2011 Actions

• Jun 12, 2012: SUBSTITUTED BY A9537
• Jun 12, 2012: ORDERED TO THIRD READING CAL.1153
• Jun 12, 2012: COMMITTEE DISCHARGED AND COMMITTED TO RULES
• Mar 2, 2012: PRINT NUMBER 6371A
• Mar 2, 2012: AMEND AND RECOMMIT TO LOCAL GOVERNMENT
• Feb 1, 2012: REFERRED TO LOCAL GOVERNMENT

S6371A-2011 Meetings

Rules: Jun 18, 2012

S6371A-2011 Calendars

Floor Calendar: Jun 12, 2012

S6371A-2011 Votes

S6371A-2011 Memo

BILL NUMBER:S6371A

TITLE OF BILL:
An act
to amend the local finance law, in relation to the electronic public
bond sale pilot program; and to amend chapter 304 of the laws of 2009,
amending the local finance law relating to the establishment of an
electronic public bond sale pilot program for Westchester county, in
relation to extending the expiration date of the provisions thereof

PURPOSE OR GENERAL IDEA OF BILL:
The purpose of this bill is to extend the statutory authority to allow
for the continuation of the ability of Westchester County to operate
a pilot program to sell municipal bonds via electronic means (as
opposed to paper bid submissions) and to assess the advantages of
selling public bonds via nationally recognized electronic securities
bidding platforms pursuant to that program.

Before the enactment of Chapter 304 of the Laws of 2009, Westchester
County had to conduct the sale of public bonds via paper bids. Under
the currently enacted pilot program, Westchester County can conduct
an open auction to sell such municipal bonds via an electronic
securities bidding service.

SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Amends Local Finance Law section, 58.10 by repositioning
terms defined within this section of law to a new definitions section
of the provision of law. This has been done for clarity within the
statute.

The bill further extends as it is written, currently existing
provisions of Local Finance law section 58.10 as follows:

- Paragraph (b) extends the effective date for the recently
established electronic public bond sale pilot program for the county
of Westchester.
- Paragraph (c) provides that electronic bidding will be conducted
through certain nationally recognized electronic securities bidding
services, and may be used for both open and closed auctions.
- Paragraph (d) states that, with certain exceptions, where the notice
of sale has specified that bids will only be accepted electronically,
the county shall not be obligated to receive paper bids.
- Paragraph (e) and (f) provides that the program shall be
administered by the County's chief fiscal officer. Paragraph (g)
provides that the County's chief fiscal officer shall continue to
review the program to ensure its functionality and profitability, and
provides certain procedures and requirements for the program's
evaluation.

Section 2: This provision extends this pilot program's effective date
from August 2012 to January 1, 2017.

JUSTIFICATION:
Electronic bidding processes have been recognized to increase the
speed and efficiency of bidding for municipal bonds as well as reduce
the administrative burden and costs of conducting a the paper bond
bidding process. This program, which was enacted by Chapter 304 of
the Laws of 2009, has enhanced the efficiency and profitability of
Westchester County's sale of public bonds by allowing them to
conduct such sales electronically. Further, it has enhanced this
process for the County by allowing them to take advantage of the
latest advances in internet bidding platforms operated by nationally
recognized electronic securities bidding firms.

According to Westchester County, not only has this new electronic bond
bidding pilot program reduced the overhead costs for sponsoring a
municipal bond offering, it has increased participation rates among
those interested in purchasing such bonds. This increased
participation rate among bidders helps to drive down the interest
rate charged for such bonds, which provides for further municipal
cost savings.

Currently, ten states, including New Jersey, Ohio and Texas, have
enacted legislation that allow municipalities to conduct public bond
sales through these nationally recognized bidding firms.

This is a non-controversial bill that merely extends this very
successful program. This bill extends the program for an additional
four years, and continues the obligation of the county to prepare
reports for the Legislature to evaluate the operation of this
program. This bill has been requested by Westchester County.

LEGISLATIVE HISTORY:
Extension of Chapter 304 of the Laws of 2009.

FISCAL IMPLICATIONS:
None to the State, but a demonstrated positive fiscal impact to
Westchester County.

EFFECTIVE DATE:
Immediately, with provisions.

S6371A-2011 Text

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

                                   6371--A

                              I N  SENATE

                              February 1, 2012
                                 ___________

  Introduced  by  Sen.  KLEIN  -- read twice and ordered printed, and when
    printed to be committed  to  the  Committee  on  Local  Government  --
    committee  discharged,  bill amended, ordered reprinted as amended and
    recommitted to said committee

  AN ACT to amend the local finance law, in  relation  to  the  electronic
    public  bond  sale pilot program; and to amend chapter 304 of the laws
    of 2009, amending the local finance law relating to the  establishment
    of  an electronic public bond sale pilot program for Westchester coun-
    ty, in relation to extending the expiration  date  of  the  provisions
    thereof

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


    Section 1. Section 58.10 of the local finance law, as added by chapter
  304 of the laws of 2009, is amended to read as follows:

    S 58.10 Electronic public bond sale pilot program. a. AS USED IN  THIS
  SECTION:

    1.  "CLOSED AUCTION" MEANS A BOND SALE PROCEDURE THAT DOES NOT ALLOW A
  BIDDER TO RECEIVE INFORMATION WITH RESPECT TO THE RANKING  OF  ITS  BIDS
  PRIOR TO THE CONCLUSION OF THE BIDDING PERIOD.
    2. "COUNTY" MEANS THE COUNTY OF WESTCHESTER.
    3. "NATIONALLY RECOGNIZED ELECTRONIC SECURITIES BIDDING SERVICE" MEANS
  A BIDDING SERVICE THAT IS RECOGNIZED NATIONALLY BY THE PREDOMINANT USERS
  OF  ELECTRONIC  SECURITIES  BIDDING  SERVICES  AS PROVIDING AN ACCURATE,
  SECURE AND RELIABLE ON-LINE BIDDING SYSTEM.
    4. "OPEN AUCTION" MEANS A BOND SALE PROCEDURE THAT ALLOWS A BIDDER  TO
  RECEIVE INFORMATION WITH RESPECT TO THE RANKING OF ITS BIDS PRIOR TO THE
  CONCLUSION  OF THE BIDDING PERIOD IN ACCORDANCE WITH THE COUNTY'S NOTICE
  OF SUCH BOND SALE CIRCULATED IN ACCORDANCE WITH APPLICABLE  REQUIREMENTS
  OF THIS CHAPTER.
    5.  "PROGRAM"  MEANS  THE  ELECTRONIC  PUBLIC  BOND SALE PILOT PROGRAM
  ESTABLISHED PURSUANT TO THIS SECTION.
    B. There is hereby established an electronic public  bond  sale  pilot
  program  [(referred to in this section as the "program")] solely for the
  county [of Westchester (referred to in this section  as  the  "county")]

   EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                        [ ] is old law to be omitted.
                                                             LBD14217-04-2

 S. 6371--A                          2

  authorizing the county to conduct public bond sales through any [bidding
  services  that  are  recognized  nationally  by the predominant users of
  electronic securities bidding services as providing an accurate,  secure
  and  reliable on-line bidding system (referred to in this section as "a]
  nationally recognized electronic securities bidding [service")] SERVICE.
    [b.] C. If the finance [board] COMMISSIONER of the county has  author-
  ized  the receipt of bids in electronic format, such electronic bids may
  be submitted in the form of open auctions or closed  auctions  conducted
  through  a  nationally  recognized electronic securities bidding service
  which shall be deemed to be  the  designated  receiving  device.  ["Open
  auction"  shall  mean  a  bond  sale  procedure  that allows a bidder to
  receive information with respect to the ranking of its bids prior to the
  conclusion of the bidding period in accordance with  the  provisions  of
  the  county's  notice  of  such  bond sale circulated in accordance with
  applicable requirements of this chapter. "Closed auction" shall  mean  a
  bond  sale procedure that does not allow a bidder to receive information
  with respect to the ranking of its bids prior to the conclusion  of  the
  bidding  period.  Such notice] NOTICE OF ANY BOND SALE shall provide for
  the manner in which the bidding period may be extended and the basis for
  determination of the winning bidder.
    [c.] D. Notwithstanding the provisions of section three  hundred  five
  of  the  state  technology  law  or any other law, if the notice of sale
  contains a provision that bids will only be accepted  electronically  in
  the  manner  provided  in  such  notice of sale, the county shall not be
  required to accept non-electronic bids in any form.
    [d.] E. The county's chief fiscal officer shall administer the program
  and shall publish its policies and procedures  for  the  procurement  of
  electronic  securities bidding services on the county's internet website
  and in a nationally recognized publication used by professionals in  the
  bond  market.  Except  as  modified  by this section, the county program
  shall comply with this chapter and all other applicable laws, rules  and
  regulations related to the sale of bonds.
    [e.]  F. The county's chief fiscal officer shall review the electronic
  bidding process to ensure that the bond sale was completed in  a  timely
  fashion; the sale was completed without errors; and the results achieved
  were  favorable  as  compared to the manual method currently used by the
  county.
    [f.] G. The county shall conduct  evaluations  of  the  pilot  program
  [annually]  BIENNIALLY  with  a summary evaluation [at] ON OR BEFORE THE
  FIRST OF APRIL PRECEDING the end of the [three year] pilot program.  The
  county will submit the evaluations to the state comptroller, the  tempo-
  rary  president  of  the  senate  and  the speaker of the assembly. Such
  report shall include, but not be limited to, any  demonstrated  evidence
  that sale of public bonds using electronic auctions is comparable to the
  cost  of  issuing  public  bonds through the current sealed bid process,
  that the use of electronic auctions resulted in an increased  number  of
  bidders and whether the results achieved for public bond sales conducted
  through electronic auctions achieved savings compared to the current bid
  process used by the county.
    S 2.  Section 2 of chapter 304 of the laws of 2009, amending the local
  finance  law  relating to the establishment of an electronic public bond
  sale pilot program  for  Westchester  county,  is  amended  to  read  as
  follows:

    S  2. This act shall take effect immediately and shall expire [3 years
  after such effective date] JANUARY 1, 2017,  when  upon  such  date  the
  provisions of this act shall be deemed repealed.

 S. 6371--A                          3

    S  3. This act shall take effect immediately; provided that the amend-
  ments to section 58.10 of the local finance law, made by section one  of
  this  act,  shall  not  affect the expiration and repeal of such section
  pursuant to section 2 of chapter 304 of the laws of  2009,  as  amended,
  and shall expire and be deemed repealed therewith.