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

                                  8612

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                           September 21, 2011
                               ___________

Introduced  by  M.  of  A.  TITONE, MORELLE, LUPARDO, P. RIVERA, JAFFEE,
  CASTRO -- Multi-Sponsored by -- M. of A. BRAUNSTEIN, BRENNAN,  COLTON,
  GABRYSZAK,  GIBSON,  MARKEY -- read once and referred to the Committee
  on Governmental Operations

AN ACT to amend the executive  law,  in  relation  to  establishing  the
  office of risk assessment and management

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

  Section 1. The executive law is amended by adding a new  article  10-A
to read as follows:
                               ARTICLE 10-A
                OFFICE OF RISK ASSESSMENT AND MANAGEMENT
SECTION 204. DEFINITIONS.
        205. OFFICE OF RISK ASSESSMENT AND MANAGEMENT; QUALIFICATIONS OF
               RISK MANAGER.
        206. FUNCTIONS AND DUTIES OF THE OFFICE.
        207. BOARD OF RISK ASSESSMENT AND MANAGEMENT.
  S 204. DEFINITIONS. FOR THE PURPOSES OF THIS ARTICLE:
  1. "ENTERPRISE RISK MANAGEMENT" SHALL MEAN A STRATEGIC DISCIPLINE THAT
SUPPORTS  THE  ACHIEVEMENT  OF  THE STATE'S OBJECTIVES BY ADDRESSING THE
FULL SPECTRUM OF ITS RISKS AND MANAGES  THE  COMBINED  IMPACT  OF  THOSE
RISKS AS AN INTERRELATED RISK PORTFOLIO.
  2.  "LOCAL  GOVERNMENT"  SHALL  MEAN  ANY COUNTY, CITY, TOWN, VILLAGE,
SUPERVISORY  DISTRICT,  SCHOOL  DISTRICT,  FIRE  DISTRICT,   IMPROVEMENT
DISTRICT OR SPECIAL DISTRICT.
  3.  "OFFICE"  SHALL  MEAN THE OFFICE OF RISK ASSESSMENT AND MANAGEMENT
ESTABLISHED PURSUANT TO SECTION TWO HUNDRED FIVE OF THIS ARTICLE.
  4. "RISK MANAGER" SHALL MEAN THE RISK MANAGER OF THE OFFICE.
  5. "STATE AGENCY" SHALL MEAN ANY DEPARTMENT, DIVISION, BOARD,  COMMIS-
SION, BUREAU, OFFICE OR OTHER AGENCY OF THE STATE.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05007-02-1

              

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  S  205.  OFFICE  OF  RISK ASSESSMENT AND MANAGEMENT; QUALIFICATIONS OF
RISK MANAGER. 1. THERE SHALL BE ESTABLISHED WITHIN THE OFFICE OF GENERAL
SERVICES, AN OFFICE OF RISK ASSESSMENT AND MANAGEMENT.  THERE  SHALL  BE
APPOINTED  BY  THE  COMMISSIONER OF GENERAL SERVICES THE RISK MANAGER OF
THE  OFFICE,  WHO  SHALL  BE  CHARGED WITH THE DUTY OF ADMINISTERING THE
OFFICE. THE COMMISSIONER OF GENERAL SERVICES SHALL FIX  COMPENSATION  OF
THE RISK MANAGER WITHIN THE AMOUNTS APPROPRIATED THEREFOR.
  2. THE RISK MANAGER SHALL HAVE THE FOLLOWING QUALIFICATIONS:
  (A)  AN  UNDERSTANDING  OF  AND  THE  ABILITY  TO  APPLY THE GENERALLY
ACCEPTED PRINCIPLES, STANDARDS AND TECHNIQUES UTILIZED FOR THE IDENTIFI-
CATION, ASSESSMENT AND MANAGEMENT OF ENTERPRISE RISK; AND
  (B) SUFFICIENT  EXPERIENCE  IN  IDENTIFYING,  ASSESSING  AND  MANAGING
ENTERPRISE RISK EXPOSURES THAT PRESENT THE BREADTH AND LEVEL OF COMPLEX-
ITY  OF  ISSUES  THAT CAN REASONABLY BE EXPECTED TO BE RAISED DURING THE
COURSE OF STATE OPERATIONS.
  3. EVERY RISK MANAGER SHALL HAVE ACQUIRED HIS OR  HER  QUALIFICATIONS,
AS  REQUIRED  BY  SUBDIVISION  TWO  OF THIS SECTION, THROUGH APPROPRIATE
EDUCATION AND RELEVANT RISK MANAGEMENT EXPERIENCE ON BEHALF OF A COMMER-
CIAL OR GOVERNMENTAL ORGANIZATION.
  S 206. FUNCTIONS AND DUTIES OF THE OFFICE.  1.  THE  FUNCTION  OF  THE
OFFICE SHALL BE:
  (A)  TO DETERMINE THE POTENTIAL EXPOSURE OF THE STATE TO LIABILITY AND
FINANCIAL LOSS ARISING FROM ITS ACTS AND OMISSIONS, FROM THE  OWNERSHIP,
CONTROL  OR USE OF ITS REAL AND PERSONAL PROPERTY, OR CONDUCT OR ACTIONS
OF ITS EMPLOYEES OR AGENTS;
  (B) TO ESTABLISH  AND  COORDINATE  BUSINESS  CONTINUITY  PROGRAMS  FOR
ESSENTIAL STATE FUNCTIONS AND SERVICES;
  (C)  TO IMPLEMENT RISK MANAGEMENT PROGRAMS TO MANAGE THE STATE'S EXPO-
SURE TO RISK IN THE MOST COST EFFECTIVE MANNER INCLUDING, BUT NOT LIMIT-
ED TO, PROGRAMS TO REDUCE THE LIKELIHOOD  AND  POTENTIAL  COST  OF  LOSS
EVENTS, AND THE PURCHASE OF INSURANCE OR OTHER RISK SHARING ARRANGEMENTS
WHERE APPROPRIATE; AND
  (D)  TO  COORDINATE  AND  SUPPORT  THE RISK MANAGEMENT PROGRAMS OF ALL
STATE AGENCIES.
  2. THE RISK MANAGER AND  OFFICE  SHALL  FULFILL  THEIR  FUNCTIONS  AND
DUTIES BY:
  (A)  CONDUCTING  A  STUDY  OF THE STATE'S RISK EXPOSURES ON AN ONGOING
BASIS. SUCH STUDY SHALL INCLUDE:
  (I) PRACTICES AND PROCEDURES OF ALL STATE AGENCIES,  AS  THEY  PERTAIN
TO,  IMPACT  UPON,  CAUSE  OR DETER DAMAGE OR LOSS TO: PHYSICAL PROPERTY
OWNED OR CONTROLLED BY THE STATE,  OR  PHYSICAL  INJURIES  SUSTAINED  BY
STATE EMPLOYEES, PERSONS RECEIVING SERVICES FROM THE STATE OR MEMBERS OF
THE GENERAL PUBLIC;
  (II)  THE  ACTIONS, CLAIM SETTLEMENTS, AND CLAIMS SETTLEMENT PROCESSES
RELATED TO ACTIONS IN THE COURT OF CLAIMS,  AND  IN  FEDERAL  AND  STATE
COURTS  OF  COMPETENT JURISDICTIONS AS THEY RELATE TO THE DISPOSITION OF
MATTERS AGAINST THE STATE. FURTHERMORE, FOR THE PURPOSE  OF  DETERMINING
PAST,  PRESENT  AND FUTURE EXPOSURES TO LIABILITY, THE NATURE AND MAGNI-
TUDE OF SUCH EXPOSURES, AND THE TECHNIQUES  FOR  REDUCING  THE  COST  OF
MANAGING AND SETTLING CLAIMS ARISING FROM SUCH EXPOSURES;
  (III) THE ESSENTIAL OPERATIONS AND SERVICE FUNCTIONS OF THE STATE, AND
THE  PROCEDURES  NECESSARY  TO  MAINTAIN  OR RESTORE SUCH OPERATIONS AND
FUNCTIONS TO THE REQUIRED LEVEL FOLLOWING AN EMERGENCY EVENT;
  (IV)  THE  POTENTIAL  FUTURE  LIABILITIES  ARISING  FROM  EXISTING  OR
PROPOSED STATE OPERATIONS OR FUNCTIONS;

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  (V)  THE  PREPARATION  OF  AN  INVENTORY OF ALL REAL PROPERTY OWNED OR
LEASED, FOR A PERIOD OF TIME OF MORE THAN FIVE YEARS, BY ALL STATE AGEN-
CIES, AND TO ASCERTAIN PAST,  PRESENT  AND  POTENTIAL  FUTURE  LIABILITY
EXPOSURES AND THE NATURE OF THOSE EXPOSURES; AND
  (VI) THE DESIGN AND IMPLEMENTATION OF APPROPRIATE COST EFFECTIVE TECH-
NIQUES  AND  PROGRAMS  TO  REDUCE  THE  COST  OF THE STATE'S EXPOSURE TO
LIABILITY AND FINANCIAL LOSS ARISING FROM ITS OPERATIONS OR  THE  OWNER-
SHIP, CONTROL OR USE OF REAL AND PERSONAL PROPERTY, INCLUDING RECOMMEND-
ING STEPS AND PROCEDURES TO BE IMPLEMENTED BY INDIVIDUAL STATE AGENCIES.
  THE  RISK  MANAGER,  IN THE PERFORMANCE OF SUCH STUDY, SHALL ENJOY THE
FULL COOPERATION AND ASSISTANCE OF  STATE  AGENCIES  AND  THE  COURT  OF
CLAIMS; AND
  (B)  RECOMMENDING AND IMPLEMENTING THE APPROPRIATE RISK MANAGEMENT AND
BUSINESS CONTINUITY PROGRAMS AS SHALL BE NECESSARY.
  3. SUCH STUDY AND RECOMMENDATIONS SHALL BE COMPLETED AND SENT  TO  THE
GOVERNOR, COMPTROLLER, ATTORNEY GENERAL, EXECUTIVE OFFICER OF EACH STATE
AGENCY  INCLUDED  THEREIN, TEMPORARY PRESIDENT OF THE SENATE, SPEAKER OF
THE ASSEMBLY, MINORITY LEADER OF THE SENATE AND MINORITY LEADER  OF  THE
ASSEMBLY  NO LATER THAN EIGHTEEN MONTHS AFTER THE EFFECTIVE DATE OF THIS
ARTICLE.  THE STUDY AND RECOMMENDATIONS SHALL BE REVISED AND UPDATED  AS
IS PERIODICALLY DEEMED APPROPRIATE BY THE RISK MANAGER; PROVIDED, HOWEV-
ER, THAT SUCH STUDY AND RECOMMENDATIONS SHALL BE REVISED AND UPDATED NOT
LESS THAN ONCE EVERY FIVE YEARS.
  4. THE OFFICE SHALL ADVISE THE VARIOUS STATE AGENCIES ON PROPER ENTER-
PRISE  RISK MANAGEMENT TECHNIQUES AND PROCEDURES, AND THE IMPLEMENTATION
THEREOF, FOR THE PURPOSE OF REDUCING EXPOSURES TO LIABILITY  AND  FINAN-
CIAL  LOSS,  OR  THE  DISRUPTION OF ESSENTIAL STATE OPERATIONS AND FUNC-
TIONS, AS WELL AS ALL RESPONSIBILITIES  AND  DUTIES  OF  THE  BUREAU  OF
INSURANCE  IN THE OFFICE OF GENERAL SERVICES. THOSE AGENCIES INVOLVED IN
OR RESPONSIBLE FOR THE CONSTRUCTION  OR  MAINTENANCE  OF  STRUCTURES  OR
ROADWAYS,  THE  CARE AND CUSTODY OF PERSONS MORE THAN IN TEMPORARY QUAR-
TERS, THE PROVISION OF SERVICES OF THE GENERAL PUBLIC, AND  THOSE  AGEN-
CIES WITH VEHICLES ASSIGNED FOR THEIR USE, SHALL UNDERGO DETAILED ENTER-
PRISE  RISK  MANAGEMENT ANALYSIS AND, WHEREVER PRACTICABLE AND AFTER THE
AGENCY IS GRANTED AN OPPORTUNITY TO REVIEW AND APPEAL THE  FINDINGS  AND
RECOMMENDATIONS  OF  SUCH ANALYSIS, IMPLEMENT THE RECOMMENDATIONS OF THE
RISK MANAGER WITHIN ONE HUNDRED EIGHTY DAYS OF THE DATE THAT SUCH RECOM-
MENDATIONS ARE AGREED TO BY THE EXECUTIVE OFFICER OF SUCH AGENCY.
  5. THE RISK MANAGER SHALL FILE AN ANNUAL REPORT ON THE  ACTIVITIES  OF
THE  OFFICE  WITH THE GOVERNOR, COMPTROLLER, ATTORNEY GENERAL, TEMPORARY
PRESIDENT OF THE SENATE, SPEAKER OF THE ASSEMBLY, THE  MINORITY  LEADERS
OF  THE  SENATE AND ASSEMBLY, SENATE FINANCE COMMITTEE AND ASSEMBLY WAYS
AND MEANS COMMITTEE, NO LATER THAN ONE HUNDRED  EIGHTY  DAYS  AFTER  THE
COMPLETION OF THE CALENDAR YEAR TO WHICH THE REPORT REFERS.
  6.  ANY  PUBLIC BENEFIT CORPORATION, PUBLIC AUTHORITY OR LOCAL GOVERN-
MENT MAY CONTRACT FOR THE SERVICES OF THE RISK MANAGER AND THE OFFICE IN
THE EVENT THAT SUCH PUBLIC  BENEFIT  CORPORATION,  PUBLIC  AUTHORITY  OR
LOCAL GOVERNMENT IS WITHOUT INTERNAL RISK ASSESSMENT AND ENTERPRISE RISK
MANAGEMENT SERVICES, OR WISHES TO SUPPLEMENT SUCH INTERNAL SERVICES WITH
THE SERVICES PROVIDED BY THE RISK MANAGER AND THE OFFICE.
  7.  THE  RISK  MANAGER MAY REVIEW, STUDY AND ENTER INTO A RELATIONSHIP
WITH: (A) OUTSIDE VENDORS OR CONSULTANTS WITH EXPERTISE IN RISK  MANAGE-
MENT,  CLAIMS MANAGEMENT OR SAFETY MANAGEMENT, AND (B) CAPTIVE INSURANCE
COMPANIES, AS DEFINED IN SUBSECTION (C) OF SECTION SEVEN THOUSAND TWO OF
THE INSURANCE LAW, OR OTHER RISK SHARING  ENTITIES  TO  REDUCE  PERSONAL
INJURY  OR  PROPERTY  DAMAGE LIABILITY CLAIMS AND PAYMENTS, EITHER ON AN

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ANNUAL BASIS OR OVER A LONGER PERIOD OF TIME, FOR ALL STATE AGENCIES, OR
AN INDIVIDUAL STATE AGENCY, PUBLIC BENEFIT CORPORATION, PUBLIC AUTHORITY
OR LOCAL GOVERNMENT.
  S  207.    BOARD OF RISK ASSESSMENT AND MANAGEMENT. 1. THERE IS HEREBY
ESTABLISHED, WITHIN THE OFFICE, A STATE BOARD  OF  RISK  ASSESSMENT  AND
MANAGEMENT.  THE BOARD, TO BE COMPRISED OF THE RISK MANAGER, THE COMMIS-
SIONER OF GENERAL SERVICES, THE CHAIR OF THE STATE INSURANCE  FUND,  THE
PRESIDENT  OF  THE  STATE  CIVIL SERVICE COMMISSION, THE DIRECTOR OF THE
OFFICE OF EMPLOYEE RELATIONS, THE DIRECTOR OF THE DIVISION OF THE  BUDG-
ET,  AND  A  REPRESENTATIVE OF EACH OF THE PUBLIC EMPLOYEE ORGANIZATIONS
WITH THE THREE LARGEST MEMBERSHIPS. SUCH BOARD SHALL MEET QUARTERLY  FOR
THE  PURPOSE  OF EXAMINING CURRENT METHODS OF ENTERPRISE RISK MANAGEMENT
AND CONTROL DEPLOYED BY THE STATE, AND REVIEW INSTANCES OF DIFFICULTY IN
DEPLOYING SOUND RISK ASSESSMENT AND ENTERPRISE  RISK  MANAGEMENT  PROCE-
DURES.
  2. A SUMMARY OF THE PROCEEDINGS OF THE BOARD, WITH RECOMMENDATIONS FOR
IMPROVEMENT  OF  THE  STATE'S  RISK MANAGEMENT PRACTICES AND PROCEDURES,
SHALL BE INCLUDED IN THE ANNUAL REPORT OF THE  RISK  MANAGER.  THE  RISK
MANAGER  SHALL  TAKE INTO CONSIDERATION THE RECOMMENDATIONS PERIODICALLY
MADE BY THE BOARD IN CONDUCTING HIS OR HER MANAGEMENT AND  ABATEMENT  OF
POTENTIAL LIABILITY ACTIVITIES.
  S 2. This act shall take effect on the one hundred eightieth day after
it shall have become a law, except that any rules and regulations neces-
sary  for  the  timely  implementation of this act on its effective date
shall be promulgated on or before such date.