S T A T E   O F   N E W   Y O R K
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                                  8747

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                              June 5, 2009
                               ___________

Introduced  by  M.  of  A.  BRENNAN,  MILLMAN, LANCMAN, MAISEL, PHEFFER,
  BARRON -- Multi-Sponsored by -- M. of A. GLICK, GOTTFRIED, MENG, NOLAN
  -- read once and referred to the Committee on  Corporations,  Authori-
  ties and Commissions

AN  ACT to amend the public authorities law, in relation to debt held by
  the New York city municipal water finance authority

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

  Section  1.  Subdivision 3 of section 1045-d of the public authorities
law, as added by chapter 513 of the laws of 1984, is amended to read  as
follows:
  3. To borrow money and issue negotiable or non-negotiable notes, bonds
or other obligations and to provide for the rights of the holders there-
of, PROVIDED, HOWEVER, THAT SUCH POWER TO BORROW MONEY AND ISSUE NEGOTI-
ABLE OR NON-NEGOTIABLE NOTES, BONDS OR OTHER OBLIGATIONS SHALL BE LIMIT-
ED  TO  THE  LIMITATION  ON  THE ANNUAL INCREASE IN DEBT AS SET FORTH IN
SECTION ONE THOUSAND FORTY-FIVE-AA OF THIS TITLE;
  S 2. Sections 1045-aa and 1045-bb of the public  authorities  law  are
renumbered  sections  1045-bb  and  1045-cc and a new section 1045-aa is
added to read as follows:
  S 1045-AA. LIMITATION ON DEBT INCREASE. BEGINNING WITH  THE  NEW  YORK
CITY  FISCAL YEAR BEGINNING JULY FIRST, TWO THOUSAND TEN AND ENDING JUNE
THIRTIETH, TWO THOUSAND ELEVEN, THE ANNUAL INCREASE IN TOTAL  DEBT  HELD
BY  THE  AUTHORITY AT ANY TIME DURING A FISCAL YEAR SHALL NOT EXCEED SIX
PERCENT OF THE TOTAL DEBT HELD BY THE  AUTHORITY  DURING  THE  PRECEDING
FISCAL  YEAR  WITHOUT THE APPROVAL BY MAJORITY VOTE OF THE NEW YORK CITY
COUNCIL.
  S 3. The public authorities law is amended by  adding  a  new  section
1045-g-1 to read as follows:
  S  1045-G-1.    ROLE  AND  RESPONSIBILITIES OF BOARD MEMBERS. 1. BOARD
MEMBERS OF THE WATER BOARD SHALL: (A) EXECUTE DIRECT  OVERSIGHT  OF  THE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD14116-03-9
              

A. 8747                             2

BOARD'S  CHIEF  EXECUTIVE  AND  OTHER  MANAGEMENT  IN  THE EFFECTIVE AND
ETHICAL MANAGEMENT OF THE BOARD; (B) UNDERSTAND, REVIEW AND MONITOR  THE
IMPLEMENTATION  OF  FUNDAMENTAL  FINANCIAL  AND  MANAGEMENT CONTROLS AND
OPERATIONAL DECISIONS OF THE BOARD; (C) ESTABLISH POLICIES REGARDING THE
PAYMENT  OF  SALARY,  COMPENSATION  AND REIMBURSEMENTS TO, AND ESTABLISH
RULES FOR THE TIME AND ATTENDANCE OF, THE CHIEF  EXECUTIVE  AND  MANAGE-
MENT;  (D)  ADOPT  A CODE OF ETHICS APPLICABLE TO EACH OFFICER, DIRECTOR
AND EMPLOYEE THAT, AT A MINIMUM, INCLUDES THE STANDARDS  ESTABLISHED  IN
SECTION  SEVENTY-FOUR  OF THE PUBLIC OFFICERS LAW; (E) ESTABLISH WRITTEN
POLICIES AND  PROCEDURES  ON  PERSONNEL  INCLUDING  POLICIES  PROTECTING
EMPLOYEES FROM RETALIATION FOR DISCLOSING INFORMATION CONCERNING ACTS OF
WRONGDOING,  MISCONDUCT, MALFEASANCE, OR OTHER INAPPROPRIATE BEHAVIOR BY
AN EMPLOYEE OR BOARD MEMBER OF THE WATER BOARD, INVESTMENTS, TRAVEL, THE
ACQUISITION OF REAL PROPERTY AND THE DISPOSITION OF  REAL  AND  PERSONAL
PROPERTY  AND THE PROCUREMENT OF GOODS AND SERVICES; (F) ADOPT A DEFENSE
AND INDEMNIFICATION POLICY  AND  DISCLOSE  SUCH  PLAN  TO  ANY  AND  ALL
PROSPECTIVE BOARD MEMBERS; AND (G) AT THE TIME THAT THE MEMBER TAKES AND
SUBSCRIBES HIS OR HER OATH OF OFFICE, EXECUTE AN ACKNOWLEDGMENT IN WHICH
THE BOARD MEMBER ACKNOWLEDGES THAT HE OR SHE UNDERSTANDS HIS OR HER ROLE
AND RESPONSIBILITIES IMPOSED PURSUANT TO THIS SECTION.
  2.  BOARD  MEMBERS  OF  THE  WATER BOARD, OR SUBSIDIARY THEREOF, SHALL
ESTABLISH AN AUDIT COMMITTEE TO BE COMPRISED  OF  NOT  LESS  THAN  THREE
INDEPENDENT  MEMBERS,  WHO SHALL CONSTITUTE A MAJORITY ON THE COMMITTEE,
AND WHO SHALL POSSESS THE NECESSARY SKILLS TO UNDERSTAND THE DUTIES  AND
FUNCTIONS  OF  THE AUDIT COMMITTEE; PROVIDED, HOWEVER, THAT IN THE EVENT
THAT A BOARD HAS LESS THAN THREE  INDEPENDENT  MEMBERS,  THE  BOARD  MAY
APPOINT  NON-INDEPENDENT  MEMBERS  TO THE AUDIT COMMITTEE, PROVIDED THAT
THE INDEPENDENT MEMBERS MUST CONSTITUTE A MAJORITY OF THE MEMBERS OF THE
AUDIT COMMITTEE. THE COMMITTEE SHALL RECOMMEND TO THE BOARD  THE  HIRING
OF A CERTIFIED INDEPENDENT ACCOUNTING FIRM FOR SUCH BOARD, ESTABLISH THE
COMPENSATION  TO BE PAID TO THE ACCOUNTING FIRM AND PROVIDE DIRECT OVER-
SIGHT OF THE PERFORMANCE OF  THE  INDEPENDENT  AUDIT  PERFORMED  BY  THE
ACCOUNTING  FIRM HIRED FOR SUCH PURPOSES. MEMBERS OF THE AUDIT COMMITTEE
SHALL BE FAMILIAR WITH CORPORATE FINANCIAL AND ACCOUNTING PRACTICES.
  3. BOARD MEMBERS OF THE WATER  BOARD,  OR  SUBSIDIARY  THEREOF,  SHALL
ESTABLISH  A GOVERNANCE COMMITTEE TO BE COMPRISED OF NOT LESS THAN THREE
INDEPENDENT MEMBERS, WHO SHALL CONSTITUTE A MAJORITY ON  THE  COMMITTEE,
AND  WHO SHALL POSSESS THE NECESSARY SKILLS TO UNDERSTAND THE DUTIES AND
FUNCTIONS OF THE GOVERNANCE COMMITTEE; PROVIDED, HOWEVER,  THAT  IN  THE
EVENT  THAT  A  BOARD HAS LESS THAN THREE INDEPENDENT MEMBERS, THE BOARD
MAY  APPOINT  NON-INDEPENDENT  MEMBERS  TO  THE  GOVERNANCE   COMMITTEE,
PROVIDED  THAT THE INDEPENDENT MEMBERS MUST CONSTITUTE A MAJORITY OF THE
MEMBERS OF THE GOVERNANCE COMMITTEE. IT SHALL BE THE  RESPONSIBILITY  OF
THE  MEMBERS  OF  THE GOVERNANCE COMMITTEE TO KEEP THE BOARD INFORMED OF
CURRENT  BEST  GOVERNANCE  PRACTICES;  TO  REVIEW  CORPORATE  GOVERNANCE
TRENDS; TO RECOMMEND UPDATES TO THE BOARD'S CORPORATE GOVERNANCE PRINCI-
PLES;  TO  ADVISE  APPOINTING  AUTHORITIES ON THE SKILLS AND EXPERIENCES
REQUIRED OF POTENTIAL BOARD MEMBERS; TO EXAMINE ETHICAL AND CONFLICT  OF
INTEREST  ISSUES;  TO  PERFORM  BOARD SELF-EVALUATIONS; AND TO RECOMMEND
BY-LAWS WHICH INCLUDE RULES AND PROCEDURES FOR CONDUCT  OF  BOARD  BUSI-
NESS.
  S 4. This act shall take effect immediately.