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

                                  10508

                          I N  A S S E M B L Y

                              May 29, 2012
                               ___________

Introduced by M. of A. PAULIN, COLTON, P. RIVERA, ROBERTS -- Multi-Spon-
  sored  by  --  M. of A.  JACOBS, McENENY, ROBINSON, SKARTADOS, THIELE,
  WRIGHT -- read once and referred  to  the  Committee  on  Governmental
  Operations

AN ACT to amend the executive law and not-for-profit corporation law, in
  relation  to  prohibiting  certain  individuals from receiving compen-
  sation from public charities; requires  reasonable  compensation  when
  allowed; establishes the state board training consortium; and to amend
  the  state  finance  law,  in relation to establishing the state board
  training consortium fund

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

  Section  1. Section 63 of the executive law is amended by adding a new
subdivision 16 to read as follows:
  16. MAKE INQUIRY INTO  ANY  DOCUMENTS  PREPARED  UNDER  SECTION  SEVEN
HUNDRED  TWENTY-SEVEN  OF THE NOT-FOR-PROFIT CORPORATION LAW FOR COMPLI-
ANCE WITH THAT SECTION, BUT NOT MORE THAN ANNUALLY, AND RESPOND  TO  ANY
INQUIRY  REFERRED TO UNDER SUCH SECTION SEVEN HUNDRED TWENTY-SEVEN OFFI-
CIALLY WITHIN NINETY DAYS OF RECEIPT.
  S 2. Subparagraph 12 of paragraph (a) of section 202 of  the  not-for-
profit corporation law is amended to read as follows:
  (12)  To  elect or appoint officers, employees and other agents of the
corporation, define their duties, fix their reasonable compensation  and
the  reasonable  compensation  of  directors, and to indemnify corporate
personnel.  Such  compensation  shall  be  commensurate  with   services
performed  AND SUBJECT, WHERE APPLICABLE, TO SECTION SEVEN HUNDRED TWEN-
TY-SEVEN OF THIS CHAPTER.
  S 3. Section 701 of the not-for-profit corporation law is  amended  by
adding a new paragraph (c) to read as follows:
  (C)  AN  EMPLOYEE  OR A SPOUSE, DOMESTIC PARTNER, SIBLING (BY WHOLE OR
HALF BLOOD), SPOUSE OR DOMESTIC PARTNER OF A SIBLING (BY WHOLE  OR  HALF
BLOOD),  CHILD,  GRANDCHILD,  GREAT-GRANDCHILD,  AND  SPOUSE OR DOMESTIC
PARTNER OF A CHILD, GRANDCHILD, AND GREAT-GRANDCHILD OF THE EMPLOYEE  AT
A  PUBLIC  CHARITY,  AS THAT TERM MAY BE DEFINED BY THE INTERNAL REVENUE

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

                                                           LBD15839-02-2

A. 10508                            2

SERVICE FROM TIME-TO-TIME, MAY NOT QUALIFY TO SIT ON THE BOARD OF DIREC-
TORS OF THE CORPORATION WHERE THEY ARE EMPLOYED REGARDLESS OF ANY STATE-
MENT TO THE CONTRARY IN THE CERTIFICATE OF INCORPORATION  OR  BYLAWS  OF
THE  CORPORATION.  THE  CERTIFICATE  OF INCORPORATION OR THE BYLAWS MAY,
HOWEVER, PROVIDE FOR AN EMPLOYEE AT A PUBLIC CHARITY, AS THAT  TERM  MAY
BE  DEFINED  BY  THE  INTERNAL  REVENUE SERVICE FROM TIME-TO-TIME, TO BE
EX-OFFICIO, A NON-VOTING MEMBER OF THE BOARD OF DIRECTORS.
  S 4. Paragraph (a) of section 702 of  the  not-for-profit  corporation
law is amended to read as follows:
  (a)  [The]  FOR NOT-FOR-PROFIT CORPORATIONS WITH ANNUAL GROSS RECEIPTS
IN AN AMOUNT THAT WOULD TRIGGER AN AUDIT BY A CERTIFIED PUBLIC  ACCOUNT-
ANT,  THE number of directors constituting the entire board shall be not
less than  FIVE, OTHERWISE THE ENTIRE  BOARD  SHALL  NOT  BE  LESS  THAN
three.    Subject  to  such  limitation, such number may be fixed by the
by-laws or, in the case of a corporation having members,  by  action  of
the  members  or  of the board under the specific provisions of a by-law
adopted by the members. [If] FOR NOT-FOR-PROFIT CORPORATIONS WITH ANNUAL
GROSS RECEIPTS EQUAL TO OR ABOVE TWO HUNDRED FIFTY THOUSAND DOLLARS,  IF
not  otherwise  fixed  under  this paragraph, the number shall be  FIVE,
OTHERWISE IT SHALL BE three. As used in  this  article,  "entire  board"
means  the  total  number of directors entitled to vote which the corpo-
ration would have if there were no vacancies.
  S 5. Paragraph (a) of section 706 of  the  not-for-profit  corporation
law is amended to read as follows:
  (a)  Except as limited in paragraph (c) OF THIS SECTION, any or all of
the directors may be removed for cause, WHICH IS EITHER A  VIOLATION  OF
THE  BYLAWS, THE DUTY OF DIRECTORS AND OFFICERS OF SECTION SEVEN HUNDRED
SEVENTEEN OF THIS ARTICLE, OR AS OTHERWISE DEFINED IN THE BYLAWS IN  THE
WRITTEN  CONFLICT  OF INTEREST POLICY OF THE CORPORATION, by vote of the
members, or by vote of the directors provided there is a quorum  of  not
less  than  a majority present at the meeting of directors at which such
action is taken.
  S 6. Paragraph (b) of section 708 of  the  not-for-profit  corporation
law, as amended by chapter 92 of the laws of 1983, is amended to read as
follows:
  (b) Unless otherwise restricted by the certificate of incorporation or
the  by-laws,  any action required or permitted to be taken by the board
or any committee thereof may be taken without a meeting if  all  members
of  the  board  or the committee consent in writing to the adoption of a
resolution authorizing the action,  WHERE  SAID  WRITING,  OR  UNANIMOUS
CONSENT  IN  LIEU OF A MEETING, IS DELIVERED, SUBMITTED AND SIGNED SEPA-
RATELY BY ALL MEMBERS OF THE BOARD OR THE  COMMITTEE  AND  SUBMITTED  BY
ELECTRONIC-MAIL,  OR  OTHER ELECTRONIC MEANS WITH AN ELECTRONIC RETURNED
RECEIPT, OR SIMILAR MESSAGE ATTACHED, DEMONSTRATING THAT  THE  UNANIMOUS
CONSENT  IN LIEU OF A MEETING WAS INDEED DELIVERED PROPERLY.  The resol-
ution and the written consents thereto by the members of  the  board  or
committee  shall  be  filed  with  the minutes of the proceedings of the
board or committee.
  S 7. Paragraphs (b) and (d)  of  section  711  of  the  not-for-profit
corporation law are amended to read as follows:
  (b)  The by-laws may prescribe what shall constitute notice of meeting
of the board, OR WAIVER OF NOTICE, AND MAY BE DELIVERED VIA  ELECTRONIC-
MAIL,  OR OTHER ELECTRONIC MEANS WITH AN ELECTRONIC RETURNED RECEIPT, OR
SIMILAR MESSAGE ATTACHED, DEMONSTRATING THAT THE NOTICE,  OR  WAIVER  OF
NOTICE,  WAS  INDEED  DELIVERED PROPERLY. A notice, or waiver of notice,

A. 10508                            3

need not specify the purpose of any regular or special  meeting  of  the
board, unless required by the by-laws.
  (d)  A  majority  of the directors present, whether or not a quorum is
present, may adjourn any meeting to  another  time  and  place.  If  the
by-laws  so provide, notice of any adjournment of a meeting of the board
to another time or place shall be given to the directors  who  were  not
present   at   the   time  of  the  adjournment,  AND  MAY  BE  DONE  BY
ELECTRONIC-MAIL, OR OTHER ELECTRONIC MEANS WITH AN  ELECTRONIC  RETURNED
RECEIPT,  OR SIMILAR MESSAGE ATTACHED, DEMONSTRATING THAT THE NOTICE, OR
WAIVER OF NOTICE, WAS INDEED DELIVERED PROPERLY, and, unless  such  time
and place are announced at the meeting, to the other directors.
  S  8.  Subparagraph  3 of paragraph (a) of section 712 of the not-for-
profit corporation law is amended to read as follows:
  (3) The fixing of compensation of the directors OR OFFICERS for  serv-
ing on the board or on any committee, AND THE FIXING OF COMPENSATION FOR
KEY  EMPLOYEES,  AS  THAT  TERM  MAY  BE DEFINED BY THE INTERNAL REVENUE
SERVICE FROM TIME-TO-TIME, OR OTHER AGENTS OF  THE  CORPORATION  AT  ANY
TIME.
  S  9.  Paragraph  (a) of section 713 of the not-for-profit corporation
law is amended to read as follows:
  (a) The board may elect or appoint a president, one or more  vice-pre-
sidents,  a secretary and a treasurer, and such other officers as it may
determine, or as may be provided in the by-laws. These officers  may  be
designated  by  such  alternate titles as may be provided in the certif-
icate of incorporation or the by-laws.  [Any] NO two or more offices may
be held by the same person[, except the offices of president and  secre-
tary, or the offices corresponding thereto].
  S  10. Section 713 of the not-for-profit corporation law is amended by
adding a new paragraph (f) to read as follows:
  (F) AN OFFICER OR A SPOUSE, DOMESTIC PARTNER,  SIBLING  (BY  WHOLE  OR
HALF  BLOOD),  SPOUSE OR DOMESTIC PARTNER OF A SIBLING (BY WHOLE OR HALF
BLOOD), CHILD, GRANDCHILD,  GREAT-GRANDCHILD,  AND  SPOUSE  OR  DOMESTIC
PARTNER OF A CHILD, GRANDCHILD, AND GREAT-GRANDCHILD OF THE OFFICER AT A
PUBLIC  CHARITY,  AS  THAT  TERM  MAY BE DEFINED BY THE INTERNAL REVENUE
SERVICE FROM TIME-TO-TIME, MAY NOT RECEIVE COMPENSATION OR  REMUNERATION
OF  ANY KIND WHATSOEVER, EXCEPT TO BE REIMBURSED FOR REASONABLE EXPENSES
IN THE FULFILLMENT OF THEIR DUTIES TOWARD THE  CORPORATION,  WHERE  SAID
PROHIBITION CANNOT BE CONTRAVENED IN THE CERTIFICATE OF INCORPORATION OR
BY-LAWS OF THE CORPORATION.
  S  11.  Paragraph (e) of section 715 of the not-for-profit corporation
law, as amended by chapter 847 of the laws of 1970, is amended  to  read
as follows:
  (e)  Unless  otherwise provided in the certificate of incorporation or
the by-laws, the board shall have authority to fix the  compensation  of
directors  OF  A  PRIVATE FOUNDATION, AS THAT TERM MAY BE DEFINED BY THE
INTERNAL REVENUE SERVICE FROM TIME-TO-TIME, for services in any  capaci-
ty.  AT  NO TIME MAY THE DIRECTORS OF A PUBLIC CHARITY, AS THAT TERM MAY
BE DEFINED BY THE INTERNAL REVENUE SERVICE  FROM  TIME-TO-TIME,  RECEIVE
COMPENSATION  OR REMUNERATION OF ANY KIND WHATSOEVER, EXCEPT TO BE REIM-
BURSED FOR REASONABLE EXPENSES IN THE FULFILLMENT OF THEIR DUTIES TOWARD
THE CORPORATION, WHERE SAID PROHIBITION CANNOT  BE  CONTRAVENED  IN  THE
CERTIFICATE OF INCORPORATION OR BY-LAWS OF THE CORPORATION.
  S  12.  Paragraph (f) of section 715 of the not-for-profit corporation
law, as amended by chapter 1057 of the laws of 1971, is amended to  read
as follows:

A. 10508                            4

  (f) The fixing of salaries of officers, [if not done in or pursuant to
the  by-laws,  shall  require  the affirmative vote of a majority of the
entire board unless a higher proportion is set  by  the  certificate  of
incorporation  or  by-laws]  IN  PUBLIC  CHARITIES,  AS THAT TERM MAY BE
DEFINED  BY  THE INTERNAL REVENUE SERVICE FROM TIME-TO-TIME, IS STRICTLY
PROHIBITED.
  S 13. Paragraph (a) of section 717 of the  not-for-profit  corporation
law,  as  amended by chapter 490 of the laws of 2010, is amended to read
as follows:
  (a) Directors and officers shall discharge the duties of their respec-
tive positions in good faith and with the  care  an  ordinarily  prudent
person  in  a  like position would exercise under similar circumstances.
The factors set forth in subparagraph one of paragraph  (e)  of  section
552  (Standard  of  conduct  in  managing and investing an institutional
fund), if relevant, must be considered by a governing  board  delegating
investment  management  of  institutional  funds pursuant to section 514
(Delegation of investment management). For purposes of  this  paragraph,
the  term  institutional  fund  is defined in section 551 (Definitions).
FURTHERMORE, ANY COMPENSATION PROVIDED TO DIRECTORS, OFFICERS, EMPLOYEES
AND OTHER AGENTS OF THE CORPORATION MUST BE REASONABLE AND, WHERE APPLI-
CABLE, IS SUBJECT TO SECTION SEVEN HUNDRED TWENTY-SEVEN (COMPENSATION OF
EXECUTIVES).
  S 14. Paragraph (a) of section 719 of the  not-for-profit  corporation
law is amended by adding a new subparagraph 6 to read as follows:
  (6)  THE  PROVISION  OF EXCESSIVE COMPENSATION TO DIRECTORS, OFFICERS,
KEY EMPLOYEES, AS THAT TERM MAY  BE  DEFINED  BY  THE  INTERNAL  REVENUE
SERVICE  FROM  TIME-TO-TIME,  AND  OTHER  AGENTS  OF  THE CORPORATION IN
VIOLATION OF SECTION SEVEN HUNDRED TWENTY-SEVEN (COMPENSATION OF  EXECU-
TIVES), WHERE APPLICABLE.
  S  15.  Paragraph (d) of section 719 of the not-for-profit corporation
law is amended by adding a new subparagraph 6 to read as follows:
  (6) UPON REIMBURSEMENT TO THE CORPORATION OF THE AMOUNT OF ANY  EXCES-
SIVE  COMPENSATION  PROVIDED IN VIOLATION OF SECTION SEVEN HUNDRED TWEN-
TY-SEVEN (COMPENSATION OF EXECUTIVES), TO BE SUBROGATED TO THE RIGHTS OF
THE CORPORATION AGAINST A DIRECTOR, OFFICER, KEY EMPLOYEE, AS THAT  TERM
MAY  BE  DEFINED  BY  THE INTERNAL REVENUE SERVICE FROM TIME-TO-TIME, OR
OTHER AGENT WHO RECEIVED THE EXCESSIVE COMPENSATION.
  S 16. Clauses (A) and (B)  of  subparagraph  1  of  paragraph  (a)  of
section 720 of the not-for-profit corporation law are amended to read as
follows:
  (A)  The  neglect  of,  [or]  THE  failure  to  perform,  or ANY other
violation of his OR HER duties in  the  management  and  disposition  of
corporate assets committed to his charge.
  (B) The acquisition by himself OR HERSELF, transfer to others, loss or
waste  of  corporate  assets  due to any neglect of, [or] THE failure to
perform, or ANY other violation of his duties, INCLUDING  VIOLATIONS  OF
SECTION  SEVEN HUNDRED TWENTY-SEVEN OF THIS ARTICLE, PURSUANT TO SECTION
SEVEN HUNDRED SEVENTEEN OF THIS ARTICLE.
  S 17. The not-for-profit corporation law is amended by  adding  a  new
section 727 to read as follows:
S 727. COMPENSATION OF EXECUTIVES.
  (A)  DEFINITIONS.  FOR  THE PURPOSES OF THIS SECTION, UNLESS OTHERWISE
EXPRESSLY STATED OR CONTEXT CLEARLY REQUIRES:
  (1) "COMPENSATION" MEANS THE  AGGREGATE  VALUE  OF  ECONOMIC  BENEFITS
CONFERRED  IN EXCHANGE FOR THE PERFORMANCE OF SERVICES THAT ARE INCLUDED
FOR PURPOSES OF DETERMINING REASONABLENESS UNDER SECTION 26 U.S.C. 4958,

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AS FURTHER SPECIFIED  IN  26  CFR  S53.4958-4(B)(II)(B),  OR  SUCCEEDING
PROVISIONS.
  (2) "EXECUTIVE" MEANS ANY PERSON IN A POSITION TO EXERCISE SUBSTANTIAL
INFLUENCE  OVER THE AFFAIRS OF A PROVIDER OF SERVICES, THAT DOES NOT SIT
ON THE GOVERNING BODY OF THE TAX-EXEMPT ORGANIZATION AS REFERENCED IN 26
U.S.C. S4958(F)(1)(A) AND FURTHER SPECIFIED IN 26 CFR S53.4958-3(C),  OR
SUCCEEDING PROVISIONS.
  (3)  "FAMILY  MEMBER"  MEANS  A  SPOUSE, DOMESTIC PARTNER, SIBLING (BY
WHOLE OR HALF BLOOD), SPOUSE OR DOMESTIC PARTNER OF A SIBLING (BY  WHOLE
OR  HALF  BLOOD),  CHILD,  GRANDCHILD,  GREAT-GRANDCHILD,  AND SPOUSE OR
DOMESTIC PARTNER OF A CHILD, GRANDCHILD, AND GREAT-GRANDCHILD.
  (B) COMPENSATION EXCHANGED BY A  NOT-FOR-PROFIT  CORPORATION  FOR  THE
PERFORMANCE  OF  SERVICES  BY AN EXECUTIVE MUST NOT BE EXCESSIVE AND THE
GOVERNING BODY (I.E., THE BOARD OF  DIRECTORS,  BOARD  OF  TRUSTEES,  OR
EQUIVALENT  CONTROLLING  BODY) SHALL CONSIDER FACTORS INCLUDING, BUT NOT
LIMITED TO: COMPENSATION LEVELS PAID BY SIMILARLY SITUATED  NOT-FOR-PRO-
FIT  CORPORATIONS AS DEFINED IN SECTION ONE HUNDRED TWO OF THIS CHAPTER;
THE AVAILABILITY OF SIMILAR SERVICES  IN  THE  GEOGRAPHIC  AREA  OF  THE
APPLICABLE  PROVIDER  OF SERVICES; CURRENT COMPENSATION SURVEYS COMPILED
BY INDEPENDENT FIRMS; AND ACTUAL  WRITTEN  OFFERS  FROM  SIMILAR  INSTI-
TUTIONS COMPETING FOR THE SERVICES OF THE APPLICABLE EXECUTIVE.
  FOR THE PURPOSES OF THIS SECTION, WHETHER AN ORGANIZATION IS SIMILARLY
SITUATED SHALL BE DETERMINED BASED ON FACTORS INCLUDING, BUT NOT LIMITED
TO:  GROSS  ANNUAL  REVENUE;  GEOGRAPHIC LOCATION; AND THE DIVERSITY AND
COMPLEXITY OF PROGRAMS.
  (C) ANNUAL COMPENSATION EXCHANGED BY A NOT-FOR-PROFIT CORPORATION  FOR
THE  PERFORMANCE OF SERVICES BY AN EXECUTIVE SHALL BE CONSIDERED REASON-
ABLE IF IT FALLS AT OR BELOW THE LEVEL I  OF  THE  FEDERAL  GOVERNMENT'S
RATES  OF BASIC PAY FOR THE EXECUTIVE SCHEDULE PROMULGATED BY THE UNITED
STATES OFFICE OF PERSONNEL MANAGEMENT AND NO  OTHER  ACTION  UNDER  THIS
SECTION NEEDS TO BE TAKEN.
  (D)  ANNUAL COMPENSATION EXCHANGED BY A NOT-FOR-PROFIT CORPORATION FOR
THE PERFORMANCE OF SERVICES BY AN EXECUTIVE THAT DOES EXCEED LEVEL I  OF
THE  FEDERAL  GOVERNMENT'S RATES OF BASIC PAY FOR THE EXECUTIVE SCHEDULE
SHALL BE PRESUMED TO NOT BE EXCESSIVE IF  EACH  OF  THE  FOLLOWING  FOUR
CONDITIONS OCCUR:
  (1)  THE  COMPENSATION  IS  APPROVED  IN ADVANCE BY THE GOVERNING BODY
(I.E., THE BOARD OF DIRECTORS, BOARD OF TRUSTEES, OR EQUIVALENT CONTROL-
LING BODY) OF THE NOT-FOR-PROFIT CORPORATION THAT IS  COMPOSED  ENTIRELY
OF  INDIVIDUALS  WHO  DO NOT HAVE A CONFLICT OF INTEREST WITH RESPECT TO
THE COMPENSATION ARRANGEMENT.
  (A) FOR THE PURPOSES OF DETERMINING WHETHER THE REQUIREMENTS  OF  THIS
PARAGRAPH HAVE BEEN MET WITH RESPECT TO A SPECIFIC COMPENSATION ARRANGE-
MENT,  AN  INDIVIDUAL  IS  NOT INCLUDED IN THE GOVERNING BODY WHEN IT IS
REVIEWING A TRANSACTION IF THAT INDIVIDUAL MEETS WITH OTHER MEMBERS ONLY
TO ANSWER QUESTIONS, AND OTHERWISE RECUSES HIMSELF OR HERSELF  FROM  THE
MEETING  AND IS NOT PRESENT DURING DEBATE AND VOTING ON THE COMPENSATION
ARRANGEMENT.
  (B) A MEMBER OF THE GOVERNING BODY DOES NOT HAVE A CONFLICT OF  INTER-
EST WITH RESPECT TO A COMPENSATION ARRANGEMENT ONLY IF THE MEMBER:
  (I)  IS  NOT AN EXECUTIVE PARTICIPATING IN, OR ECONOMICALLY BENEFITING
FROM, THE COMPENSATION ARRANGEMENT;
  (II) IS NOT IN AN EMPLOYMENT RELATIONSHIP SUBJECT TO THE DIRECTION  OR
CONTROL OF ANY EXECUTIVE, OR THE FAMILY MEMBER OF ANY EXECUTIVE, PARTIC-
IPATING IN OR ECONOMICALLY BENEFITING FROM THE COMPENSATION ARRANGEMENT;

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  (III)  DOES  NOT  RECEIVE  COMPENSATION  OR  OTHER  PAYMENT SUBJECT TO
APPROVAL BY ANY EXECUTIVE,  OR  THE  FAMILY  MEMBER  OF  ANY  EXECUTIVE,
PARTICIPATING  IN  OR  ECONOMICALLY  BENEFITING  FROM  THE  COMPENSATION
ARRANGEMENT;
  (IV)  HAS  NO MATERIAL FINANCIAL INTEREST AFFECTED BY THE COMPENSATION
ARRANGEMENT; AND
  (V) DOES NOT APPROVE A TRANSACTION PROVIDING ECONOMIC BENEFITS TO  ANY
EXECUTIVE,  OR  THE FAMILY MEMBER OF ANY EXECUTIVE, PARTICIPATING IN THE
COMPENSATION ARRANGEMENT, WHO IN TURN HAS APPROVED  OR  WILL  APPROVE  A
TRANSACTION PROVIDING ECONOMIC BENEFITS TO THE MEMBER.
  (2) THE GOVERNING BODY OBTAINED AND RELIED UPON APPROPRIATE DATA AS TO
COMPARABILITY  PRIOR TO MAKING ITS DETERMINATION AND GIVEN THE KNOWLEDGE
AND EXPERTISE OF ITS MEMBERS, IT HAS INFORMATION SUFFICIENT TO DETERMINE
WHETHER THE COMPENSATION ARRANGEMENT  IN  ITS  ENTIRETY  IS  REASONABLE.
RELEVANT  INFORMATION  INCLUDES,  BUT  IS  NOT  LIMITED TO: COMPENSATION
LEVELS PAID BY SIMILARLY SITUATED NOT-FOR-PROFIT CORPORATIONS AS DEFINED
IN SECTION ONE HUNDRED TWO OF THIS CHAPTER; THE AVAILABILITY OF  SIMILAR
SERVICES  IN THE GEOGRAPHIC AREA OF THE APPLICABLE PROVIDER OF SERVICES;
CURRENT COMPENSATION SURVEYS COMPILED BY INDEPENDENT FIRMS;  AND  ACTUAL
WRITTEN  OFFERS  FROM SIMILAR INSTITUTIONS COMPETING FOR THE SERVICES OF
THE APPLICABLE EXECUTIVE.
  (A) FOR PURPOSES OF THIS PARAGRAPH, CONTROL BY AN APPLICABLE  NOT-FOR-
PROFIT CORPORATION MEANS:
  (I)  IN  THE CASE OF A STOCK CORPORATION, OWNERSHIP (BY VOTE OR VALUE)
OF MORE THAN FIFTY PERCENT OF THE STOCK IN SUCH CORPORATION;
  (II) IN THE CASE OF  A  PARTNERSHIP,  OWNERSHIP  OF  MORE  THAN  FIFTY
PERCENT  OF  THE  PROFITS INTERESTS OR CAPITAL INTERESTS IN THE PARTNER-
SHIP;
  (III) IN THE CASE OF A NONSTOCK ORGANIZATION (I.E., AN ENTITY IN WHICH
NO PERSON HOLDS A PROPRIETARY INTEREST), THAT AT LEAST FIFTY PERCENT  OF
THE  DIRECTORS  OR TRUSTEES OF THE NOT-FOR-PROFIT CORPORATION ARE EITHER
REPRESENTATIVES (INCLUDING TRUSTEES, DIRECTORS,  AGENTS,  OR  EMPLOYEES)
OF,  OR  DIRECTLY  OR INDIRECTLY CONTROLLED BY, AN APPLICABLE TAX-EXEMPT
ORGANIZATION; OR
  (IV) IN THE CASE OF ANY OTHER ENTITY, OWNERSHIP  OF  MORE  THAN  FIFTY
PERCENT OF THE BENEFICIAL INTEREST IN THE ENTITY.
  (3)  THE GOVERNING BODY ADEQUATELY DOCUMENTED THE BASIS FOR ITS DETER-
MINATION CONCURRENTLY WITH MAKING THAT DETERMINATION.
  (A) FOR A DECISION TO BE DOCUMENTED ADEQUATELY, THE WRITTEN  OR  ELEC-
TRONIC RECORDS OF THE GOVERNING BODY MUST NOTE:
  (I)  THE  TERMS  OF THE TRANSACTION THAT WAS APPROVED, AND THE DATE IT
WAS APPROVED;
  (II) THE MEMBERS OF THE GOVERNING BODY WHO WERE PRESENT DURING  DEBATE
ON THE TRANSACTION THAT WAS APPROVED, AND THOSE WHO VOTED ON IT;
  (III) THE COMPARABILITY DATA OBTAINED AND RELIED UPON BY THE GOVERNING
BODY, AND HOW THE DATA WAS OBTAINED; AND
  (IV)  ANY  ACTIONS  TAKEN  WITH RESPECT TO CONSIDERATION OF THE TRANS-
ACTION BY ANYONE WHO IS OTHERWISE A MEMBER OF THE GOVERNING BODY BUT WHO
HAD A CONFLICT OF INTEREST WITH RESPECT TO THE TRANSACTION.
  (B) IF THE GOVERNING BODY DETERMINES THAT THE EXECUTIVE'S COMPENSATION
FOR A SPECIFIC ARRANGEMENT IS HIGHER OR LOWER THAN THE RANGE OF  COMPAR-
ABILITY  DATA OBTAINED, THE GOVERNING BODY MUST RECORD THE BASIS FOR ITS
DETERMINATION. FOR A DECISION TO BE DOCUMENTED CONCURRENTLY RECORDS MUST
BE PREPARED BEFORE THE LATER OF THE NEXT MEETING OF THE  GOVERNING  BODY
OR  SIXTY  DAYS  AFTER THE FINAL ACTION OR ACTIONS OF THE GOVERNING BODY
ARE TAKEN. RECORDS MUST BE REVIEWED AND APPROVED BY THE  GOVERNING  BODY

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AS  REASONABLE,  ACCURATE  AND  COMPLETE WITHIN A REASONABLE TIME PERIOD
THEREAFTER.
  (4)  THE  COMPENSATION PROVIDED TO THE EXECUTIVE BY THE GOVERNING BODY
DOES NOT EXCEED THE HIGHEST COMPENSATION PROVIDED BY A  SIMILARLY  SITU-
ATED ORGANIZATION FOR SIMILAR SERVICES, AS IDENTIFIED IN THE COMPARABIL-
ITY DATA, BY MORE THAN TWENTY PERCENT.
  (E) IF THE FOUR CONDITIONS OF PARAGRAPH (D) OF THIS SECTION ARE SATIS-
FIED,  THEN  THE PERSON OR ENTITY BRINGING AN ACTION FOR RELIEF PURSUANT
TO SECTION SEVEN HUNDRED TWENTY-SEVEN OF  THIS  ARTICLE  MAY  REBUT  THE
PRESUMPTION  THAT  ARISES UNDER PARAGRAPH (D) OF THIS SECTION ONLY IF IT
DEVELOPS SUFFICIENT CONTRARY EVIDENCE TO REBUT THE  PROBATIVE  VALUE  OF
THE  COMPARABILITY  DATA RELIED UPON BY THE GOVERNING BODY. WITH RESPECT
TO ANY FIXED PAYMENT, REBUTTAL EVIDENCE IS LIMITED TO EVIDENCE  RELATING
TO  FACTS  AND CIRCUMSTANCES EXISTING ON THE DATE THE PARTIES ENTER INTO
THE CONTRACT PURSUANT TO WHICH THE PAYMENT IS MADE (EXCEPT IN THE  EVENT
OF  SUBSTANTIAL  NONPERFORMANCE).  WITH  RESPECT  TO ALL OTHER PAYMENTS,
REBUTTAL EVIDENCE MAY INCLUDE FACTS AND CIRCUMSTANCES UP TO AND  INCLUD-
ING THE DATE OF PAYMENT.
  (F)  A  NOT-FOR-PROFIT IS PROHIBITED FROM, AND MAY THUS BE REFERRED TO
THE ATTORNEY GENERAL FOR FURTHER INQUIRY TO BE OFFICIALLY  RESPONDED  TO
WITHIN  NINETY  DAYS  OF  RECEIPT,  BY  THE PERSON OR ENTITY BRINGING AN
ACTION FOR RELIEF PURSUANT TO SECTION SEVEN HUNDRED TWENTY-SEVEN OF THIS
ARTICLE: (1) ENGAGING IN ANY  ACT  THAT  THE  INTERNAL  REVENUE  SERVICE
DETERMINES  CONSTITUTES  AN  "EXCESS  BENEFIT TRANSACTION" UNDER SECTION
4958 OF THE INTERNAL REVENUE CODE; OR (2) ENGAGING IN ANY ACT THAT WOULD
CONSTITUTE AN  "EXCESS  BENEFIT  TRANSACTION"  UNDER  THE  STANDARDS  OF
SECTION 4958 OF THE INTERNAL REVENUE CODE.
  S 18. Section 104-A of the not-for-profit corporation law, as added by
chapter  591  of  the  laws of 1982, paragraphs (a), (c), (d), (e), (g),
(l), (m), (n) and (p) as amended by chapter 166 of the laws of 1991  and
paragraph  (r) as amended by chapter 198 of the laws of 1984, is amended
to read as follows:
S 104-A. Fees.
  Except as otherwise provided, the department of  state  shall  collect
the following fees pursuant to this chapter:
  (a)  For  filing  a  certificate of type of not-for-profit corporation
pursuant to  section  one  hundred  thirteen  of  this  chapter,  thirty
dollars.
  (b) For the reservation of a corporate name pursuant to  section three
hundred three of this chapter, ten dollars.
  (c)  For  the resignation of a registered agent for service of process
pursuant to section three hundred five of this chapter, thirty dollars.
  (d) For service of process on  the  secretary  of  state  pursuant  to
section  three hundred six or three hundred seven of this chapter, forty
dollars. If the service is in an action brought solely to recover a  sum
of  money  not  in  excess  of two hundred dollars and the process is so
endorsed, or the process is served on behalf of a county, city, town  or
village or other subdivision of the state, ten dollars.
  (e) For filing a certificate of incorporation pursuant to section four
hundred two of this chapter, [seventy-five] EIGHTY-FIVE dollars.
  (f)  For  filing  a certificate of amendment pursuant to section eight
hundred three of this chapter, [thirty] FORTY dollars.
  (g) For filing a certificate  of  change  pursuant  to  section  eight
hundred three-A of this chapter, [twenty] THIRTY dollars.
  (h)  For  filing  a  restated certificate of incorporation pursuant to
section eight hundred five of this chapter, [thirty] FORTY dollars.

A. 10508                            8

  (i) For filing a certificate of merger or  consolidation  pursuant  to
section nine hundred four of this chapter, [thirty] FORTY  dollars.
  (j)  For  filing  a certificate of merger or consolidation of domestic
and foreign corporations pursuant to section nine hundred  six  of  this
chapter, [thirty] FORTY dollars.
  (k)  For  filing    a  certified  copy  of an order of approval of the
supreme court pursuant to section nine hundred seven  of  this  chapter,
thirty dollars.
  (l)  For  filing  a certificate of dissolution pursuant to section one
thousand three of this chapter, thirty dollars.
  (m) For filing a certificate of annulment of dissolution  pursuant  to
section one thousand twelve of this chapter, [thirty] FORTY dollars.
  (n)  For  filing an application by a foreign corporation for authority
to do business in New York state pursuant to  section  thirteen  hundred
four of this chapter, one hundred [thirty-five] FORTY-FIVE dollars.
  (o)  For  filing  a  certificate  of  amendment  of an application for
authority by a foreign corporation pursuant to section thirteen  hundred
nine of this chapter, [thirty] FORTY dollars.
  (p) For filing a certificate of change of application for authority by
a  foreign  corporation pursuant to section thirteen hundred ten of this
chapter, [twenty] THIRTY dollars.
  (q) For filing a certificate of surrender  of  authority  pursuant  to
section thirteen hundred eleven of this chapter, thirty dollars.
  (r)  For  filing  a  statement  of  the  termination of existence of a
foreign corporation pursuant to section thirteen hundred twelve of  this
chapter,  thirty  dollars.  There  shall  be no fee for the filing by an
authorized officer of the jurisdiction of  incorporation  of  a  foreign
corporation  of  a  certificate  that  the  foreign corporation has been
dissolved or its authority or existence has been otherwise terminated or
cancelled in the jurisdiction of its incorporation.
  (s) For filing any other certificate or instrument, thirty dollars.
  S 19. The not-for-profit corporation law is amended by  adding  a  new
section 116 to read as follows:
S 116. STATE BOARD TRAINING CONSORTIUM.
  (A)  NOT-FOR-PROFIT  BOARD  MEMBERS  ARE  ENTRUSTED  WITH  THE OVERALL
MANAGEMENT AND OVERSIGHT OF NON-PROFITS AND HAVE LEGAL AND ETHICAL OBLI-
GATIONS TO KEEP THEMSELVES FULLY INFORMED REGARDING THEIR  ORGANIZATION,
ITS  FINANCES  AND  ITS  OVERALL  OPERATION AND IN ASSURING THAT PROGRAM
STAFF  AND  ADMINISTRATION  EFFECTIVELY  CARRY  OUT  THE  ORGANIZATION'S
MISSION.  THE  STATE  BOARD  TRAINING  CONSORTIUM IS INTENDED TO EMPOWER
BOARD MEMBERS OF NOT-FOR-PROFIT  ORGANIZATIONS  WHO  CONTRACT  WITH  THE
STATE  OF NEW YORK WITH THE INFORMATION AND TOOLS NECESSARY TO CARRY OUT
THEIR VERY IMPORTANT RESPONSIBILITIES, ROLES AND OBLIGATIONS. THE  STATE
BOARD  TRAINING  CONSORTIUM  WILL BE A COMPREHENSIVE STATE-WIDE TRAINING
EFFORT, DELIVERED REGIONALLY,  IN-PERSON,  TOGETHER  WITH  A  NUMBER  OF
TAILORED  AGENCY  SPECIFIC  ONSITE TRAININGS, SOME VIRTUAL WEBINARS, AND
THE LIKE, AND STATE WORKFORCE TRAININGS ON THE SAME OR SIMILAR SUBJECTS.
ANY TRAINING CONDUCTED UNDER THE AUSPICES OF THE  STATE  BOARD  TRAINING
CONSORTIUM  WILL BE FREE TO VERIFIED MEMBERS OF NOT-FOR-PROFIT BOARDS OF
DIRECTORS WHO CONTRACT WITH THE STATE OF NEW YORK.
  1. FEES GENERATED FROM THE TEN DOLLAR  INCREASE  IN  THE  FILING  FEES
ASSOCIATED WITH CERTIFICATES OF INCORPORATION, AMENDMENT, CHANGE, MERGER
OR  CONSOLIDATION,  ANNULMENT  OF  DISSOLUTION,  AUTHORITY  BY A FOREIGN
CORPORATION, AN AMENDMENT OF SAME OR A CHANGE  IN  THE  AUTHORITY  OF  A
FOREIGN  CORPORATION PROMULGATED BY A CHAPTER OF THE LAWS OF 2012, SHALL
BE USED TO FUND THE STATE BOARD TRAINING CONSORTIUM.

A. 10508                            9

  2. SAID FEES SHALL BE MAINTAINED IN THE STATE BOARD TRAINING CONSORTI-
UM FUND, AS ESTABLISHED BY SECTION NINETY-SEVEN-J OF THE  STATE  FINANCE
LAW,  TO SUPPORT THE STATE BOARD TRAINING CONSORTIUM ESTABLISHED BY THIS
SECTION.
  (B)  THE  STATE BOARD TRAINING CONSORTIUM SHALL BE ADMINISTERED BY THE
DEPARTMENT OF STATE THROUGH A CONTRACT UNDER COUNSEL'S OFFICE. A  QUALI-
FIED  NOT-FOR-PROFIT  CORPORATION WILL BE CONTRACTED WITH BY THE DEPART-
MENT OF STATE TO PROVIDE THE TRAINING AND ASSOCIATED SERVICES  DELIVERED
UNDER  THE  STATE  BOARD TRAINING CONSORTIUM, TOGETHER WITH MANAGING ALL
DAY-TO-DAY OPERATIONS, MARKETING EFFORTS, CURRICULUM  UPDATES,  PRINTING
AND  RECORD-KEEPING. THE CONTRACT SHALL HAVE A FIVE YEAR TERM, RENEWABLE
FOR THREE ADDITIONAL YEARS, AND A STANDARD REQUEST FOR PROPOSALS/REQUEST
FOR QUALIFICATIONS PROCESS WILL BE UTILIZED AT  THE  INCEPTION  OF  EACH
CONTRACT.
  (1)  THE  COMMISSIONERS  OF  THE  OFFICE FOR PEOPLE WITH DEVELOPMENTAL
DISABILITIES,  OFFICE  OF  MENTAL  HEALTH,  OFFICE  OF  ALCOHOLISM   AND
SUBSTANCE  ABUSE  SERVICES,  OFFICE OF CHILDREN AND FAMILY SERVICES, AND
DEPARTMENT OF HEALTH, HAVING PRIOR EXPERIENCE IN THE STATE BOARD  TRAIN-
ING  CONSORTIUM  AS  ADMINISTERED  BY OFFICE OF ALCOHOLISM AND SUBSTANCE
ABUSE SERVICES, AND THE DEPARTMENT  OF  HEALTH,  AIDS  INSTITUTE,  SHALL
JOINTLY:
  (I)  DEVELOP  A CONTRACT FOR THE STATE BOARD TRAINING CONSORTIUM ALONG
THE LINES ALREADY PROMULGATED BY THEIR AGENCIES;
  (II) ESTABLISH UNIFORM PROCEDURES TO MONITOR ATTENDANCE  AT  TRAININGS
CONDUCTED UNDER THE STATE BOARD TRAINING CONSORTIUM AND IN REPORTING THE
SAME TO THE ATTENDING BOARDS OF DIRECTORS.
  (2)  THE COMMISSIONERS OF OTHER AGENCIES, INCLUDING BUT NOT LIMITED TO
THE OFFICE FOR AGING, DEPARTMENT OF AGRICULTURE AND MARKETS, COUNCIL  ON
ARTS,  OFFICE  OF  COURT  ADMINISTRATION,  DIVISION  OF CRIMINAL JUSTICE
SERVICES, EMPIRE STATE DEVELOPMENT, DEPARTMENT OF ENVIRONMENTAL  CONSER-
VATION, OFFICE OF GENERAL SERVICES, NEW YORK STATE CANAL CORPORATION AND
THE OFFICE OF TEMPORARY DISABILITY ASSISTANCE SHALL ESTABLISH PROCEDURES
TO  MONITOR  ATTENDANCE  AT  TRAININGS  CONDUCTED  UNDER THE STATE BOARD
TRAINING CONSORTIUM AND IN REPORTING THE SAME TO THE ATTENDING BOARDS OF
DIRECTORS.
  (C) ALL NOT-FOR-PROFIT CORPORATIONS THAT CONTRACT WITH  THE  STATE  OF
NEW  YORK  MAY ATTEND THE STATE BOARD TRAINING CONSORTIUM TRAININGS FREE
OF CHARGE.
  S 20. The state finance law is amended by adding a new section 97-j to
read as follows:
  S 97-J. STATE BOARD TRAINING  CONSORTIUM  FUND.  1.  THERE  IS  HEREBY
ESTABLISHED  IN  THE  JOINT  CUSTODY OF THE COMMISSIONER OF TAXATION AND
FINANCE AND THE COMPTROLLER A FUND TO  BE  KNOWN  AS  THE  "STATE  BOARD
TRAINING CONSORTIUM FUND."
  2.  SUCH  FUND  SHALL  CONSIST  OF  FEES GENERATED FROM THE TEN DOLLAR
INCREASE IN FILING FEES IN PARAGRAPHS (E), (F), (G), (H), (I), (J), (M),
(N), (O) AND (P) OF SECTION ONE HUNDRED  FOUR-A  OF  THE  NOT-FOR-PROFIT
CORPORATION  LAW,  ASSOCIATED WITH CERTIFICATES OF INCORPORATION, AMEND-
MENT, CHANGE, MERGER OR CONSOLIDATION, ANNULMENT OF DISSOLUTION, AUTHOR-
ITY BY A FOREIGN CORPORATION, AN AMENDMENT OF SAME OR A  CHANGE  IN  THE
AUTHORITY  OF  A  FOREIGN CORPORATION, PROMULGATED BY THE CHAPTER OF THE
LAWS OF TWO THOUSAND TWELVE THAT  ADDED  THIS  SECTION,  AND  ALL  OTHER
MONEYS CREDITED OR APPROPRIATED FOR TRANSFER THERETO FROM ANY OTHER FUND
OR SOURCE ACCORDING TO LAW.
  3.  MONEYS  IN  THE STATE BOARD TRAINING CONSORTIUM FUND SHALL BE KEPT
SEPARATE AND SHALL NOT BE COMMINGLED WITH ANY OTHER MONEYS IN THE CUSTO-

A. 10508                           10

DY OF THE STATE COMPTROLLER. MONEYS IN THE FUND MAY BE INVESTED  BY  THE
COMPTROLLER PURSUANT TO THE PROVISIONS OF SECTION NINETY-EIGHT-A OF THIS
ARTICLE AND ANY INCOME RECEIVED BY THE COMPTROLLER FROM SUCH INVESTMENTS
SHALL BE ADDED TO AND BECOME PART OF, AND SHALL BE USED FOR THE PURPOSES
OF SUCH FUND. ALL DEPOSITS OF SUCH MONEY SHALL, IF REQUIRED BY THE COMP-
TROLLER,  BE SECURED BY OBLIGATIONS OF THE UNITED STATES OR OF THE STATE
OF MARKET VALUE EQUAL AT ALL TIMES TO THE AMOUNT OF THE DEPOSIT AND  ALL
BANKS  AND  TRUST  COMPANIES  ARE AUTHORIZED TO GIVE SUCH SECURITIES FOR
SUCH DEPOSITS.
  4. MONEYS IN THE FUND, FOLLOWING  APPROPRIATION  BY  THE  LEGISLATURE,
SHALL BE ALLOCATED UPON A CERTIFICATE OF APPROVAL OF AVAILABILITY BY THE
DIRECTOR  OF  THE  BUDGET  SOLELY  FOR  THE  PURPOSES  SET FORTH IN THIS
SECTION.
  5. ALL MONEYS IN THE FUND SHALL BE MADE AVAILABLE PURSUANT  TO  APPRO-
PRIATION  FOR  USE IN FUNDING THE STATE BOARD TRAINING CONSORTIUM ESTAB-
LISHED PURSUANT TO SECTION ONE HUNDRED  SIXTEEN  OF  THE  NOT-FOR-PROFIT
CORPORATION LAW.
  S  21. (a) This act shall take effect on the one hundred eightieth day
after it shall have become law.
  (b) The commissioners of the  office  for  people  with  developmental
disabilities,   office  of  mental  health,  office  of  alcoholism  and
substance abuse  services,  office  of  children  and  family  services,
department of health, office for the aging, and the division of criminal
justice  services shall immediately take the necessary actions to ensure
that forms and regulations required by section nine of this act  are  in
place  on such effective date. Further, whereas the authority to promul-
gate regulations and make rules is derived from an express  or  implicit
statutory grant provided by the legislature, all agencies, divisions and
departments  of  the state are hereby prohibited from promulgating regu-
lations and making rules pursuant to 9 NYCRR  8.38,  or  that  otherwise
address  the  extent and nature of a provider's administrative costs and
executive compensation, except as required and  necessary  to  implement
the provisions of section six of this act.
  (c)  Absent  explicit  language  expressly and unequivocally stating a
legislative intent to the contrary, all provisions of this act are irre-
futably presumed to operate in a wholly prospective  manner.  Provisions
shall be considered to operate retroactively, and therefore in violation
of  this  act,  if applied in such a manner as to alter, change, affect,
impair or defeat any rights, obligations, duties or  interests  accrued,
incurred  or conferred prior to the effective date of this act. Further-
more, the provisions of this act shall neither apply to, nor be  applied
based upon the occasion of, acts occurring prior to it becoming law.