senate Bill S4497

2013-2014 Legislative Session

Relates to comptroller audits of certain organizations controlled by municipal corporations and certain other government entities

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Archive: Last Bill Status - In Committee


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jun 20, 2014 committed to rules
Jun 10, 2014 advanced to third reading
Jun 09, 2014 2nd report cal.
Jun 03, 2014 1st report cal.1161
Jan 08, 2014 referred to local government
Jun 21, 2013 committed to rules
May 29, 2013 advanced to third reading
May 23, 2013 2nd report cal.
May 22, 2013 1st report cal.754
Apr 03, 2013 referred to local government

Votes

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Jun 3, 2014 - Local Government committee Vote

S4497
9
0
committee
9
Aye
0
Nay
0
Aye with Reservations
0
Absent
0
Excused
0
Abstained
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Local Government Committee Vote: Jun 3, 2014

May 22, 2013 - Local Government committee Vote

S4497
9
0
committee
9
Aye
0
Nay
0
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show Local Government committee vote details

Local Government Committee Vote: May 22, 2013

Co-Sponsors

S4497 - Bill Details

See Assembly Version of this Bill:
A3633
Current Committee:
Senate Rules
Law Section:
General Municipal Law
Laws Affected:
Amd ยง34, Gen Muni L
Versions Introduced in 2011-2012 Legislative Session:
S7540, A9682, A9689

S4497 - Bill Texts

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Relates to audits by the state comptroller of certain organizations directly or indirectly controlled by municipal corporations and certain other government entities.

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BILL NUMBER:S4497

TITLE OF BILL: An act to amend the general municipal law, in relation
to audits by the state comptroller of certain organizations controlled
by municipal corporations and certain other government entities

PURPOSE :

To expand the State Comptroller's express audit authority to include
auditing organizations controlled by local government entities.

SUMMARY OF PROVISIONS:

Section 1 of this bill amends Section 34 of the General Municipal Law
to authorize the State Comptroller to examine the financial affairs of
any organization (other than a statewide association of local
governments or local government officials) that is controlled by one
or more municipal corporations, industrial development agencies, or
certain districts or agencies. An organization shall be deemed "under
the control" of a municipal corporation, industrial development
agency, district or agency when one or more individuals who serve as
officers or employees of any such municipal corporation, industrial
development agency, district or agency: (a) select either a majority
of the organization's highest policy-making body or the organization's
chief executive officer; (b) constitute a majority of the voting
strength that selects either a majority of the organization's highest
policy-making body or the organization's chief executive officer; or
(c) serve as (i) a majority of the organization's highest
policy-making body; (ii) in his or her official capacity, the
organization's chief executive officer; or (iii) in his or her
official capacity, a partner in the organization. An organization
under the control of one or more more municipal corporations,
industrial development agencies, districts or agencies shall also
include any other organization that is controlled by such
organization.

Section 2 of this bill provides that this act shall take effect
immediately.

PRIOR LEGISLATIVE HISTORY:

S. 7907 (Passed Senate) and A. 11088 of 2009-2010
S. 7540 and A. 9689 (Passed Assembly) of 2011-2012

JUSTIFICATION:

Currently, the State Comptroller does not have express authority to
directly audit Local Development Corporations (LDCs) and other similar
types of private entities, even when they are controlled by a local
government entity. However, many local governments rely upon, and have
some type of business or financial relationship with, one or more such
entities. In these cases, the Comptroller may examine that
relationship, but only as part of an audit of the local government
entity. Even in the context of such an audit, there is no authority
for the Comptroller to look beyond the financial or business
relationship in order to examine the overall finances and operations
of the private entity.


Similarly, there is no express authority for the Comptroller to audit
the overall finances or operations of such an organization separately.
This bill would expand the Comptroller's express audit authority to
include audits of such organizations, but only when the organization
is under the control of one or more local government entities.

This expansion of the Comptroller's audit authority is necessary to
promote and increase transparency in municipal and local government
finances and operations because an organization that is under the
control of a municipal corporation or local government entity
functions in many ways essentially as an instrumentality of that
municipal corporation or local government entity. Thus, in order to
fully understand the financial condition and operations of a municipal
corporation or other local government entity, it is necessary to
examine the finances and operations of organizations controlled by the
municipal corporation or local government entity. To avoid creating
incentives or disincentives to the use of any particular type of
organization, this bill would apply to every type of organization
under the control of a municipal corporation or other local government
entity that is not already subject to audit by the Comptroller, except
a statewide association of local governments or local government
officials.

The Comptroller urges the passage of this proposed legislation.

BUDGET IMPLICATIONS

This bill has no significant fiscal impact.

EFFECTIVE DATE:

This bill would take effect immediately.

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

                                  4497

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              April 3, 2013
                               ___________

Introduced  by  Sen. MARTINS -- (at request of the State Comptroller) --
  read twice and ordered printed, and when printed to  be  committed  to
  the Committee on Local Government

AN  ACT to amend the general municipal law, in relation to audits by the
  state comptroller of certain  organizations  controlled  by  municipal
  corporations and certain other government entities

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

  Section 1.  Section 34 of the general municipal  law,  as  amended  by
chapter 233 of the laws of 2006, is amended to read as follows:
  S  34.  Powers  and  duties  of examiners. 1. The comptroller and each
examiner of municipal affairs shall  have  power  to  examine  into  the
financial affairs of every such municipal corporation, industrial devel-
opment agency, district, [fire company as defined in section two hundred
four-a  of this chapter,] agency and activity [and], ANY FIRE COMPANY AS
DEFINED IN SECTION TWO HUNDRED FOUR-A OF THIS  CHAPTER,  AND  ANY  OTHER
ORGANIZATION,  EXCEPT  A  STATEWIDE  ASSOCIATION OF LOCAL GOVERNMENTS OR
LOCAL GOVERNMENT OFFICIALS, THAT IS CONTROLLED BY ONE  OR  MORE  OF  ANY
SUCH  MUNICIPAL CORPORATIONS, INDUSTRIAL DEVELOPMENT AGENCIES, DISTRICTS
OR AGENCIES.  AN ORGANIZATION SHALL BE DEEMED UNDER THE CONTROL  OF  ONE
OR   MORE   MUNICIPAL  CORPORATIONS,  INDUSTRIAL  DEVELOPMENT  AGENCIES,
DISTRICTS OR AGENCIES WHEN ONE OR MORE INDIVIDUALS WHO SERVE AS OFFICERS
OR EMPLOYEES OF ANY SUCH MUNICIPAL CORPORATION,  INDUSTRIAL  DEVELOPMENT
AGENCY,  DISTRICT  OR AGENCY: (A) SELECT EITHER A MAJORITY OF THE ORGAN-
IZATION'S HIGHEST POLICY-MAKING BODY OR THE ORGANIZATION'S CHIEF  EXECU-
TIVE  OFFICER;  (B)  CONSTITUTE  A  MAJORITY OF THE VOTING STRENGTH THAT
SELECTS EITHER A MAJORITY OF THE  ORGANIZATION'S  HIGHEST  POLICY-MAKING
BODY  OR  THE  ORGANIZATION'S  CHIEF EXECUTIVE OFFICER; OR (C) SERVE AS:
(I) A MAJORITY OF THE ORGANIZATION'S HIGHEST POLICY-MAKING BODY; (II) IN
HIS OR HER OFFICIAL CAPACITY, THE ORGANIZATION'S CHIEF  EXECUTIVE  OFFI-
CER;  OR  (III) IN HIS OR HER OFFICIAL CAPACITY, A PARTNER IN THE ORGAN-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD04648-01-3

S. 4497                             2

IZATION. AN ORGANIZATION UNDER THE CONTROL  OF  ONE  OR  MORE  MUNICIPAL
CORPORATIONS,  INDUSTRIAL  DEVELOPMENT  AGENCIES,  DISTRICTS OR AGENCIES
SHALL ALSO INCLUDE ANY OTHER ORGANIZATION THAT  IS  CONTROLLED  BY  SUCH
ORGANIZATION.
  2. IN CONNECTION WITH ANY EXAMINATION AUTHORIZED BY SUBDIVISION ONE OF
THIS  SECTION,  THE  COMPTROLLER  AND EACH EXAMINER OF MUNICIPAL AFFAIRS
SHALL HAVE POWER to administer an oath to any person whose testimony may
be required, and to compel the appearance and attendance of such  person
for  the  purpose  of  any  such  examination and investigation, and the
production of books and papers. In the case of a municipal  corporation,
industrial  development agency, or school district, no such person shall
be compelled to appear or be examined elsewhere than within such munici-
pal corporation, industrial development agency, or school  district.  In
the  case  of  any district other than a school district, no such person
may be compelled to appear or be examined elsewhere than within the town
or one of the towns  in  which  such  district  or  portion  thereof  is
located. In the case of an urban renewal agency, no such person shall be
compelled  to  appear  or  be examined outside the municipal corporation
wherein such agency is established. In the case of a  fire  company,  no
such person shall be compelled to appear or be examined outside the area
served  by the company. In the case of an activity, no such person shall
be compelled to appear outside the area served by the activity.  IN  THE
CASE  OF  AN  ORGANIZATION  UNDER  THE  CONTROL OF ONE OR MORE MUNICIPAL
CORPORATIONS, INDUSTRIAL DEVELOPMENT AGENCIES, DISTRICTS OR AGENCIES, NO
SUCH PERSON SHALL BE COMPELLED TO APPEAR OR TO BE EXAMINED  OUTSIDE  THE
COUNTY IN WHICH THE ORGANIZATION HAS ITS PRINCIPAL HEADQUARTERS. Willful
false swearing in such examination shall be perjury and shall be punish-
able as such.
  3. FOR PURPOSES OF THIS SECTION, THE TERM "A MAJORITY OF THE ORGANIZA-
TION'S  HIGHEST  POLICY-MAKING  BODY" SHALL MEAN A MAJORITY OF THE WHOLE
NUMBER OF POSITIONS COMPRISING SUCH BODY, PROVIDED, HOWEVER, THAT IF THE
DOCUMENTS ESTABLISHING THE ORGANIZATION'S INTERNAL GOVERNANCE ALLOW SUCH
BODY TO ACT BY A MAJORITY OF A QUORUM,  THEN  SUCH  TERM  SHALL  MEAN  A
MAJORITY OF THE QUORUM.
  S 2. This act shall take effect immediately.

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