S T A T E   O F   N E W   Y O R K
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                                  1554

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                               (PREFILED)

                             January 7, 2009
                               ___________

Introduced by M. of A. GIANARIS, NOLAN, MARKEY, ROSENTHAL, FIELDS, MILL-
  MAN,  PHEFFER,  COOK, ROBINSON, DIAZ, BENEDETTO, JAFFEE -- Multi-Spon-
  sored by -- M. of A. BING,  BOYLAND,  CYMBROWITZ,  DESTITO,  DINOWITZ,
  GOTTFRIED, McENENY, PERRY, REILLY, SAYWARD, SWEENEY, TOWNS, WEISENBERG
  --  read  once and referred to the Committee on Corporations, Authori-
  ties and Commissions

AN ACT to amend the public service law, in relation  to  the  management
  and operations audits of certain utilities

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

  Section 1. Subdivision 19 of section 66 of the public service law,  as
added  by  chapter  556 of the laws of 1976 and the closing paragraph as
added by chapter 586 of the laws of 1986, is amended to read as follows:
  19. The commission shall have power  to  provide  for  management  and
operations  audits  of  gas corporations and electric corporations. Such
audits shall be performed AT SUCH TIMES AS THE COMMISSION SHALL  DIRECT,
BUT  AN  AUDIT  SHALL BE PERFORMED at least once every [five years] YEAR
for combination gas and electric companies, as well as for straight  gas
corporations  having  annual  gross  revenues  in  excess of two hundred
million dollars. WHEN ANY SUCH CORPORATION ALSO OPERATES A STEAM  CORPO-
RATION  PURSUANT TO ARTICLE FOUR-A OF THIS CHAPTER, THE COMMISSION SHALL
PROVIDE FOR A MANAGEMENT AND OPERATIONS AUDIT OF THE  STEAM  CORPORATION
IN  THE  TIME  AND  MANNER  SPECIFIED IN THIS SECTION.   The audit shall
include, but not be  limited  to,  an  investigation  of  the  company's
construction  program,  planning [in relation], SECURITY AND MAINTENANCE
OPERATIONS AS THEY RELATE to the needs of  its  customers  for  reliable
service and an evaluation of the efficiency of the company's operations.
THE  AUDIT  SHALL  INCLUDE  INDEPENDENT  VERIFICATION OF THE INFORMATION
PROVIDED BY THE COMPANY. The commission shall have  discretion  to  have
such  audits  performed  by its staff, or by independent auditors.  UPON

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

                                                           LBD03840-01-9

A. 1554                             2

COMPLETION, COPIES OF THE AUDITS SHALL  BE  PROVIDED  TO  THE  GOVERNOR,
SPEAKER  OF  THE  ASSEMBLY,  THE  TEMPORARY PRESIDENT OF THE SENATE, THE
CHAIR OF THE SENATE FINANCE COMMITTEE, THE CHAIR OF  THE  ASSEMBLY  WAYS
AND  MEANS COMMITTEE, THE CHAIR OF THE ASSEMBLY ENERGY COMMITTEE AND THE
CHAIR OF THE SENATE ENERGY AND TELECOMMUNICATIONS COMMITTEE.
  In every case in which  the  commission  chooses  to  have  the  audit
provided  for  in this subdivision performed by independent auditors, it
shall have authority to select the auditors, and to require the  company
being  audited  to enter into a contract with the auditors providing for
their payment by the company. Such contract shall provide  further  that
the  auditors  shall  work for and under the direction of the commission
according to such terms as the commission may  determine  are  necessary
and reasonable.
  The commission shall have authority to direct the company to implement
any  recommendations  resulting  from  such  audits  that it finds to be
necessary and reasonable.
  Upon the application of a gas or  electric  corporation  for  a  major
change in rates as defined in subdivision twelve of this section OR OF A
STEAM  CORPORATION FOR A MAJOR CHANGE IN RATES AS DEFINED IN SUBDIVISION
TEN OF SECTION EIGHTY OF THIS CHAPTER, the commission shall review  that
corporation's  compliance  with  the directions and recommendations made
previously by the commission, as a result of the most recently completed
management and operations audit.  The commission shall  incorporate  the
findings of such review in its opinion or order.
  S 2. This act shall take effect on the one hundred twentieth day after
it shall have become a law. Provided, that the public service commission
is  immediately  authorized  and  directed  to take any and all actions,
including but not limited to the promulgation of  any  necessary  rules,
necessary to fully implement the provisions of this act on its effective
date.