senate Bill S5861C

2013-2014 Legislative Session

Authorizes the power authority of the state of New York and the Long Island power authority to enter into public-private partnerships for the improvement of the state's electric transmission grid

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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
May 28, 2014 advanced to third reading
May 21, 2014 2nd report cal.
May 20, 2014 1st report cal.850
Mar 06, 2014 print number 5861c
amend and recommit to finance
Feb 27, 2014 reported and committed to finance
Feb 11, 2014 print number 5861b
amend and recommit to energy and telecommunications
Jan 22, 2014 print number 5861a
amend and recommit to energy and telecommunications
Jan 08, 2014 referred to energy and telecommunications
returned to senate
died in assembly
Jun 24, 2013 referred to corporations, authorities and commissions
Jun 21, 2013 delivered to assembly
passed senate
ordered to third reading cal.1629
Jun 18, 2013 referred to rules

Votes

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May 20, 2014 - Finance committee Vote

S5861C
32
0
committee
32
Aye
0
Nay
5
Aye with Reservations
0
Absent
0
Excused
0
Abstained
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Feb 27, 2014 - Energy and Telecommunications committee Vote

S5861B
10
0
committee
10
Aye
0
Nay
0
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show committee vote details

Committee Vote: Feb 27, 2014

Jun 21, 2013 - Rules committee Vote

S5861
22
0
committee
22
Aye
0
Nay
3
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show committee vote details

Bill Amendments

Original
A
B
C (Active)
Original
A
B
C (Active)

Co-Sponsors

S5861 - Bill Details

See Assembly Version of this Bill:
A8095C
Current Committee:
Law Section:
Public Authorities Law
Laws Affected:
Amd §§1001, 1005, 1020-a, 1020-c & 1020-f, Pub Auth L

S5861 - Bill Texts

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Authorizes the power authority of the state of New York and the Long Island power authority to enter into public-private partnerships for the improvement of the state's electric transmission grid.

view sponsor memo
BILL NUMBER:S5861

TITLE OF BILL: An act to amend the public authorities law, in
relation to authorizing the power authority of the state of New York
and the Long Island power authority to participate in public-private
transmission projects to improve the state's electric transmission
grid

Purpose:

This bill would allow the creation of a public-private partnership
between the State's public utilities - the Power Authority of the
State of New York (NYPA) and the Long Island Power Authority (LIPA) -
and the State's private transmission owners, for the sole purpose of
jointly developing, constructing and owning transmission facilities in
New York State. This partnership would be in the form of a New York
Transmission Company (Transco) that would pursue new transmission
projects that would enhance the current capabilities of the bulk power
system within New York State.

Summary of Provisions:

Section 1 of the bill would provide legislative findings.

Section 2 would amend the "declaration of policy" in NYPA's enabling
statute.

Section 3 would amend PAL § 1005 to, among other things, provide
definitions of key terms, authorize NYPA to form a subsidiary company
for purposes of participating in the Transco company, and to provide
commensurate financial powers. This section would exempt projects from
article eight of the environmental conservation law since these
projects are subject to other regulatory review, which includes an
environmental review.

Section 4 of the bill would amend the legislative findings in LIPA's
enabling statute -PAL § 1020-a.

Section 5 would amend subdivision 2 of PAL § 1020-c(2) to provide LIPA
or subsidiary company an interest in transmission assets that are
located in whole or in part outside the LIPA service area.

Section 6 would amend PAL § 1020-f to provide authority consistent
with the authority to be provided in section 3 of the bill.

Section 7 of the bill would provide a severability clause. Section 8
of the bill would make the bill effective immediately.

Existing Law:

PAL § 1005 provides NYPA's existing authority, and PAL 1020-f provides
L1PA's existing statutory authority.

Justification:

The State's electric transmission system is facing two major
challenges: 1) Aging infrastructure that requires significant


reinvestment; and 2) System constraints that cause transmission
congestion, creating higher electric customer costs. Over 40 percent
of the State's electric transmission system will require replacement
within the next 30 years, at an estimated cost of $25 billion.
Replacement is required to assure long-term reliability of the
electric system.. The State's electric transmission system is also
congested at critical points on the pathways linking upstate and
downstate New York. Together, New York City, Long Island, and
Westchester County account for more than half of the demand for
electricity in the State and this demand is increasing. However, in
times of peak demand and high prices, lower-cost and/or cleaner power
available from upstate cannot reach these densely populated areas
because of the transmission bottlenecks. Congestion can have adverse
environmental and economic consequences. Older, less energy-efficient
and cost-effective plants in urban areas run more frequently than they
otherwise would if power from other sources of energy could reach
these areas.

Under the approach provided for in this bill, NYPA and LIPA would each
be authorized to form a subsidiary company to participate as a member
of a Transco company. These public and private partners would enter
into an agreement providing for the formation of the Transco company,
the projects that could be undertaken by the Transco, and the rights
and obligations of the Transco members. It is expected that the
Transco agreement would authorize Transco members to enter into
ancillary agreements that would provide for the administration of the
Transco and individual Transco projects.

This unique approach to addressing the State's aging infrastructure
empowers the State's transmission owners to create a unified plan for
statewide electric power benefits. Such a partnership would facilitate
state-wide transmission planning, facilitate lower financing costs for
grid infrastructure projects and improvements, and promote sorely
needed and sensible investment in the State's power grid.

Transco projects will provide numerous short and long term benefits to
New York residents, such as reducing transmission constraints between
the upstate and downstate regions, creating a stronger and more
resilient transmission system with improved reliability, creating jobs
and stimulating statewide economic growth, increasing local property
tax revenues, reducing pollution emissions by dispatching more energy
efficient generation resources; and facilitating the integration of
renewable resources, including wind generation resources, located in
upstate and elsewhere in New York.

Legislative History:

This is a new bill.

Budget Implications:

There are no budget implications.

Effective Date:

This bill would take effect immediately upon enactment into law.


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

                                  5861

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              June 18, 2013
                               ___________

Introduced  by  Sen. MAZIARZ -- read twice and ordered printed, and when
  printed to be committed to the Committee on Rules

AN ACT to amend the public authorities law, in relation  to  authorizing
  the power authority of the state of New York and the Long Island power
  authority  to  participate  in public-private transmission projects to
  improve the state's electric transmission grid

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

  Section  1.  Legislative  findings and purpose. The legislature hereby
finds and determines that:
  1. The state's vital electric transmission grid  is  aging,  congested
and  subject  to  outages caused by storms, obsolescence and the growing
demands for energy by the  state's  residents,  and  such  problems  and
conditions  pose  serious  threats  to  the  health, welfare, safety and
economic well-being of the people of the state of New York.
  2. The condition and operation of the  state's  electric  transmission
grid  is  a matter of state concern, and it is in the public interest to
provide for the means  to  repair,  replace,  reinforce,  modernize  and
expand  the  state's  electric  transmission grid to ensure the safe and
reliable provision of electric service to the state's residents now  and
into the future.
  3.  A  modernized  electric  transmission grid and energy highway will
also encourage investments  in  new  energy-related  infrastructure  and
technologies,  facilitate the development and integration into the power
grid of renewable energy resources, and stimulate and  support  economic
development in the state. Public-private transmission projects undertak-
en  jointly by the owner of transmission facilities, systems and infras-
tructure, including the power authority of the state of New York and the
Long Island power authority, which provide  for  the  ongoing  planning,
construction,  owning,  operating, maintaining and expanding of electric
transmission facilities, systems and  infrastructure  can  serve  as  an

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11579-02-3

S. 5861                             2

effective  means to address the aforementioned problems and concerns and
stimulate ongoing critical investment in  the  state's  electric  trans-
mission grid.
  4.  The purposes of this act can be achieved, while managing and miti-
gating potential liabilities, by authorizing the power authority of  the
state  of New York and the Long Island power authority to participate in
such public-private  transmission  projects  through  the  formation  of
subsidiary companies.
  S 2. Section 1001 of the public authorities law is amended by adding a
new closing paragraph to read as follows:
  IT  IS FURTHER DECLARED THAT: (A) THERE SHOULD BE FULL COOPERATION AND
COORDINATION AMONG PRIVATE AND PUBLIC OWNERS AND OPERATORS  OF  ELECTRIC
TRANSMISSION  FACILITIES,  SYSTEMS  AND  INFRASTRUCTURE  IN  THE  STATE,
INCLUDING THE AUTHORITY, FOR THE  PURPOSE  OF  EXPEDITIOUSLY  REPAIRING,
REPLACING,  REINFORCING,  MODERNIZING AND EXPANDING THE STATE'S ELECTRIC
TRANSMISSION GRID; (B) IT IS DESIRABLE THAT THE  AUTHORITY,  WHICH  OWNS
AND  OPERATES  ELECTRIC TRANSMISSION ASSETS IN THE STATE, PARTICIPATE IN
PUBLIC-PRIVATE TRANSMISSION PROJECTS THAT ARE UNDERTAKEN  BY  A  LIMITED
LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZATIONAL STRUCTURE, THROUGH
A  SUBSIDIARY  COMPANY  FORMED  BY  THE  AUTHORITY AS AUTHORIZED BY THIS
TITLE; AND (C) THE AUTHORITY SHOULD  BE  AUTHORIZED  TO  PARTICIPATE  IN
PUBLIC-PRIVATE TRANSMISSION PROJECTS AND TRANSFER TRANSMISSION ASSETS OR
ANY  INTEREST  THEREIN  IN  CONNECTION  WITH ITS PARTICIPATION IN SUCH A
LIMITED LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZATIONAL  STRUCTURE
ON SUCH TERMS AND CONDITIONS AS THE AUTHORITY MAY NEGOTIATE.
  S 3. Section 1005 of the public authorities law is amended by adding a
new subdivision 24 to read as follows:
  24.  A.  FOR  PURPOSES  OF THIS SUBDIVISION, THE FOLLOWING TERMS SHALL
HAVE THE MEANINGS INDICATED:
  (I)  "SUBSIDIARY  COMPANY"  MEANS   A   SUBSIDIARY   COMPANY   FORMED,
WHOLLY-OWNED  AND  CONTROLLED  BY  THE  AUTHORITY IN ACCORDANCE WITH AND
SUBJECT TO THE BUSINESS CORPORATION LAW, THE NOT-FOR-PROFIT  CORPORATION
LAW,  THE  LIMITED  LIABILITY  COMPANY  LAW OR THE TRANSPORTATION CORPO-
RATIONS LAW.
  (II) "TRANSCO MASTER AGREEMENT" MEANS A  WRITTEN  AGREEMENT  PROVIDING
FOR  THE FORMATION AND OPERATION OF A LIMITED LIABILITY COMPANY OR OTHER
ORGANIZATIONAL STRUCTURE  TO  SERVE  AS  A  TRANSCO  COMPANY  AND  WHICH
PROVIDES  FOR, AMONG OTHER THINGS, THE RIGHTS AND OBLIGATIONS OF MEMBERS
OF SUCH TRANSCO COMPANY.
  (III) "TRANSCO ANCILLARY AGREEMENT" MEANS A WRITTEN  AGREEMENT,  OTHER
THAN  A  TRANSCO  PROJECT AGREEMENT, BETWEEN THE AUTHORITY OR SUBSIDIARY
COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS  OF  A  TRANSCO  COMPANY,
MADE IN ACCORDANCE WITH THE TRANSCO MASTER AGREEMENT, FOR THE PURPOSE OF
IMPLEMENTING THE TRANSCO MASTER AGREEMENT.
  (IV)  "TRANSCO  COMPANY"  MEANS  AN ENTITY FORMED IN ACCORDANCE WITH A
TRANSCO MASTER AGREEMENT PRIMARILY  FOR THE PURPOSE OF ENGAGING  IN  THE
BUSINESS  OF PLANNING, CONSTRUCTING, OWNING, OPERATING, MAINTAINING, AND
EXPANDING ELECTRIC TRANSMISSION FACILITIES, SYSTEMS  AND  INFRASTRUCTURE
SERVING THE PEOPLE OF THE STATE OF NEW YORK.
  (V) "TRANSCO PROJECT" MEANS A PROJECT UNDERTAKEN BY THE TRANSCO COMPA-
NY IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT.
  (VI) "TRANSCO PROJECT AGREEMENT" MEANS A WRITTEN AGREEMENT BETWEEN THE
AUTHORITY  OR  SUBSIDIARY COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS
OF A TRANSCO COMPANY, MADE IN ACCORDANCE WITH THE TRANSCO MASTER  AGREE-
MENT, THAT RELATES TO A SPECIFIC TRANSCO PROJECT.

S. 5861                             3

  (VII)  "TRANSMISSION ASSETS" MEANS: (1) ALL PHYSICAL ASSETS (INCLUDING
BUT NOT LIMITED TO ELECTRICAL  TRANSMISSION  LINES,  POLES,  TOWERS  AND
SIMILAR STRUCTURES, CONDUITS, SUBSTATIONS, CONVERTER STATIONS, TRANSFOR-
MERS,  CONDUCTORS,  INSULATORS,  SWITCHING  DEVICES, CONTROLS, BREAKERS,
BUSES, STATIONS, RECTIFIERS, REGULATORS, EMERGENCY AND PROTECTIVE EQUIP-
MENT  AND  DEVICES, UTILITY INTERCONNECTIONS AND OTHER EQUIPMENT USED OR
NECESSARY FOR THE CONTROL, DISPATCH, RECEIPT AND DELIVERY OF  ENERGY  BY
SUCH  FACILITIES)  USED  FOR  THE  PURPOSE OF TRANSMITTING OR DELIVERING
DIRECT OR ALTERNATING CURRENT ELECTRIC ENERGY AT VOLTAGES  PRIMARILY  OF
ONE  HUNDRED KILOVOLTS OR HIGHER TO LOADS OR INTERCONNECTION POINTS; AND
(2) ALL ASSOCIATED (A) TANGIBLE AND INTANGIBLE PROPERTY USED TO OPERATE,
CONTROL, PROTECT AND MAINTAIN SUCH ASSETS, (B) REAL PROPERTY RIGHTS  FOR
LANDS  AND  RIGHTS-OF-WAY,  SITES,  AND  PLACES IN WHICH SUCH ASSETS ARE
SITUATED OR INSTALLED, AND (C) LEGAL  AND  REGULATORY  RIGHTS,  AUTHORI-
ZATIONS,  PERMITS, AND CONSENTS OF ANY NATURE TO OWN, OCCUPY, CONSTRUCT,
USE, OPERATE AND MAINTAIN, AND RECEIVE OR DISPOSE OF REVENUES FROM  SUCH
ASSETS  OR  LANDS  ON  WHICH  SUCH ASSETS ARE SITUATED, EXISTING, OWNED,
LEASED, DESIGNED, USED AND OPERATED.
  B. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, THE AUTHORITY  MAY
(I)  PARTICIPATE IN PUBLIC/PRIVATE PARTNERSHIPS TO PROVIDE FOR THE MEANS
TO REPAIR, REPLACE, REINFORCE, MODERNIZE AND EXPAND THE STATE'S ELECTRIC
TRANSMISSION GRID TO ENSURE THE SAFE AND RELIABLE PROVISION OF  ELECTRIC
SERVICE  TO  THE  STATE'S RESIDENTS NOW AND INTO THE FUTURE, (II) FORM A
SUBSIDIARY COMPANY FOR THE PURPOSE OF PARTICIPATING IN A TRANSCO  COMPA-
NY,  (III)  PARTICIPATE IN THE TRANSCO COMPANY BY CAUSING THE SUBSIDIARY
COMPANY TO BECOME A PARTY TO A TRANSCO MASTER AGREEMENT AND EXERCISE THE
RIGHTS AND PERFORM THE OBLIGATIONS OF A TRANSCO COMPANY MEMBER AS MAY BE
PROVIDED FOR IN A TRANSCO MASTER AGREEMENT, AND (IV) EXERCISE THE  OTHER
POWERS AND DUTIES PROVIDED FOR BY THIS SUBDIVISION.
  C. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, IN ADDITION TO ANY
OTHER  POWERS  AND  DUTIES GRANTED TO IT UNDER THIS TITLE, THE AUTHORITY
SHALL BE AUTHORIZED TO:
  (I) EXERCISE ALL OF THE RIGHTS  AND  PRIVILEGES  ASSOCIATED  WITH  ANY
OWNERSHIP INTEREST IN OR ORGANIZER OF THE SUBSIDIARY COMPANY;
  (II)  ISSUE  ITS  BONDS,  NOTES  AND OTHER EVIDENCE OF INDEBTEDNESS TO
FINANCE THE OPERATIONS OF THE SUBSIDIARY COMPANY, INCLUDING THE  SUBSID-
IARY COMPANY'S PARTICIPATION IN AND OBLIGATIONS UNDERTAKEN IN CONNECTION
WITH A TRANSCO COMPANY;
  (III)  LEND,  OR  OTHERWISE TRANSFER MONIES TO THE SUBSIDIARY COMPANY,
INCLUDING THE PROCEEDS OF THE AUTHORITY'S BONDS, NOTES,  OTHER  EVIDENCE
OF INDEBTEDNESS AND OTHER AUTHORITY FUNDS;
  (IV) RECEIVE MONIES FROM THE SUBSIDIARY COMPANY, INCLUDING MONIES THAT
RESULT FROM THE OPERATION OF THE TRANSCO COMPANY;
  (V)  AS DEEMED FEASIBLE AND ADVISABLE BY THE TRUSTEES, TRANSFER TO THE
SUBSIDIARY COMPANY TRANSMISSION ASSETS OR INTERESTS  THEREIN  THAT  HAVE
BEEN  OR  ARE  EXPECTED TO BE USED IN PROJECTS UNDERTAKEN BY THE TRANSCO
COMPANY FOR SUCH CONSIDERATION AND ON SUCH OTHER TERMS AND CONDITIONS AS
THE AUTHORITY SHALL NEGOTIATE;
  (VI) RECEIVE FROM THE SUBSIDIARY COMPANY OR THE  TRANSCO  COMPANY  ANY
PERSONAL OR REAL PROPERTY;
  (VII)  ENTER  INTO GUARANTEE AGREEMENTS IN CONNECTION WITH THE SUBSID-
IARY COMPANY'S PARTICIPATION IN THE TRANSCO COMPANY;
  (VIII) ENTER INTO CONTRACTS AND OTHER  FORMS  OF  AGREEMENT  WITH  THE
TRANSCO COMPANY, THE SUBSIDIARY COMPANY AND OTHER MEMBERS OF THE TRANSCO
COMPANY;

S. 5861                             4

  (IX)  PLEDGE OR ASSIGN ALL OR ANY PORTION OF ANY INTEREST IN A TRANSCO
COMPANY;
  (X) TRANSFER AND RECEIVE ALL OR ANY PORTION OF ANY INTEREST IN A TRAN-
SCO COMPANY;
  (XI)  SELL,  PURCHASE, OR OTHERWISE TRANSFER ALL OR ANY PORTION OF ANY
INTEREST IN A TRANSCO COMPANY  ON  SUCH  TERMS  AND  CONDITIONS  AS  THE
AUTHORITY DEEMS APPROPRIATE;
  (XII)  ASSIGN  ONE  OR MORE EMPLOYEES TO PROVIDE SERVICES TO A TRANSCO
COMPANY FOR A SPECIFIED PERIOD OF TIME, PROVIDED THAT ANY SUCH  EMPLOYEE
SHALL CONTINUE TO BE AN EMPLOYEE OF THE AUTHORITY; AND
  (XIII) DISSOLVE OR TERMINATE THE SUBSIDIARY COMPANY IN ACCORDANCE WITH
APPLICABLE LAW.
  D.  NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, NO TRUSTEE, OFFI-
CER OR EMPLOYEE OF THE STATE, OR OF ANY STATE AGENCY,  PUBLIC  AUTHORITY
OR  PUBLIC  BENEFIT  CORPORATION,  SHALL  BE DEEMED TO HAVE FORFEITED OR
SHALL FORFEIT SUCH PERSON'S OFFICE OR EMPLOYMENT OR ANY BENEFITS ASSOCI-
ATED THEREWITH BY REASON OF SUCH PERSON'S ACCEPTANCE OF  MEMBERSHIP  ON,
OR  SUCH  PERSON  BEING  AN  OFFICER,  EMPLOYEE OR AGENT OF A SUBSIDIARY
COMPANY, OR BY REASON OF  SUCH  PERSON'S  PROVISION  OF  SERVICES  TO  A
SUBSIDIARY COMPANY.
  E.  THE  PROVISIONS  OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF
THIS CHAPTER SHALL BE APPLICABLE TO  ANY  TRANSCO  MASTER  AGREEMENT  TO
WHICH THE AUTHORITY OR SUBSIDIARY COMPANY IS A PARTY, BUT SHALL BE INAP-
PLICABLE TO ANY TRANSCO ANCILLARY AGREEMENT OR TRANSCO PROJECT AGREEMENT
THAT  OTHERWISE  SATISFIES  THE  REQUIREMENTS OF PARAGRAPH (A) OR (B) OF
SUBDIVISION ONE OF SUCH SECTION PROVIDED THAT (I) A  FINAL  OR  SUBSTAN-
TIALLY  NEGOTIATED  FORM  OF SUCH TRANSCO ANCILLARY AGREEMENT OR TRANSCO
PROJECT AGREEMENT, AS THE CASE MAY BE, IS ANNEXED TO  A  TRANSCO  MASTER
AGREEMENT  THAT  HAS BECOME VALID AND ENFORCEABLE IN ACCORDANCE WITH THE
PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS  CHAP-
TER,  AND  (II)  IN  THE  CASE OF A TRANSCO PROJECT AGREEMENT, THE FINAL
EXECUTED FORM OF SUCH TRANSCO PROJECT AGREEMENT IS LIMITED TO A  TRANSCO
PROJECT THAT WAS IDENTIFIED IN SUCH TRANSCO MASTER AGREEMENT.
  F.  THE  PROVISIONS  OF  TITLE  FIVE-A OF ARTICLE NINE OF THIS CHAPTER
SHALL BE INAPPLICABLE TO ANY DISPOSAL OF PROPERTY BY  THE  AUTHORITY  OR
SUBSIDIARY  COMPANY  THAT  (I) IS OTHERWISE AUTHORIZED BY THIS TITLE, OR
(II) IS MADE IN ACCORDANCE WITH A  TRANSCO  MASTER  AGREEMENT  THAT  HAS
BECOME  VALID  AND  ENFORCEABLE  IN  ACCORDANCE  WITH  THE PROVISIONS OF
SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAPTER.
  G. NO ACTS OR ACTIVITIES TAKEN OR PROPOSED TO BE TAKEN BY THE AUTHORI-
TY OR A SUBSIDIARY COMPANY PURSUANT TO THE PROVISIONS OF  THIS  SUBDIVI-
SION,  INCLUDING  THE  EXECUTION  OF A TRANSCO MASTER AGREEMENT, AND THE
ISSUANCE OF BONDS, NOTES, OR OTHER OBLIGATIONS, SHALL BE  DEEMED  TO  BE
"ACTIONS" FOR THE PURPOSES OR WITHIN THE MEANING OF ARTICLE EIGHT OF THE
ENVIRONMENTAL CONSERVATION LAW.
  H. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, ANY TRANSCO COMPA-
NY  FORMED  OR  AUTHORIZED  PURSUANT  TO THIS ARTICLE IS PROHIBITED FROM
FINANCING OR CONSTRUCTING NEW ELECTRIC GENERATING FACILITIES.
  S 4. Section 1020-a of the public authorities law, as added by chapter
517 of the laws of 1986, is amended by adding a new closing paragraph to
read as follows:
  THE LEGISLATURE FURTHER FINDS AND DECLARES THAT: (I) THERE  SHOULD  BE
FULL  COOPERATION  AND  COORDINATION AMONG PRIVATE AND PUBLIC OWNERS AND
OPERATORS OF ELECTRIC TRANSMISSION FACILITIES, SYSTEMS  AND  INFRASTRUC-
TURE  IN  THE  STATE,  INCLUDING THE AUTHORITY, FOR THE PURPOSE OF EXPE-
DITIOUSLY REPAIRING, REPLACING, REINFORCING, MODERNIZING  AND  EXPANDING

S. 5861                             5

THE  STATE'S  ELECTRIC  TRANSMISSION GRID; (II) IT IS DESIRABLE THAT THE
AUTHORITY, WHICH OWNS AND OPERATES ELECTRIC TRANSMISSION ASSETS  IN  THE
STATE,  PARTICIPATES  IN  PUBLIC-PRIVATE  TRANSMISSION PROJECTS THAT ARE
UNDERTAKEN BY A LIMITED LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZA-
TIONAL  STRUCTURE,  THROUGH A SUBSIDIARY COMPANY FORMED BY THE AUTHORITY
AS AUTHORIZED BY THIS TITLE; AND (III) THE AUTHORITY SHOULD  BE  AUTHOR-
IZED TO PARTICIPATE IN PUBLIC-PRIVATE TRANSMISSION PROJECTS AND TRANSFER
TRANSMISSION  ASSETS  OR  ANY  INTEREST  THEREIN  IN CONNECTION WITH ITS
PARTICIPATION IN SUCH A LIMITED LIABILITY COMPANY OR  OTHER  APPROPRIATE
ORGANIZATIONAL  STRUCTURE  ON SUCH TERMS AND CONDITIONS AS THE AUTHORITY
MAY NEGOTIATE.
  S 5. Subdivision 2 of section 1020-c of the public authorities law, as
added by chapter 517 of the laws of 1986, is amended to read as follows:
  2. The area of operations of the authority shall be the service  area,
PROVIDED THAT THE AUTHORITY OR SUBSIDIARY COMPANY MAY OWN AN INTEREST IN
TRANSMISSION  ASSETS  THAT  ARE  LOCATED IN WHOLE OR IN PART OUTSIDE THE
SERVICE AREA.
  S 6. Section 1020-f of the public authorities law is amended by adding
a new subdivision (g-1) to read as follows:
  (G-1) (I) FOR PURPOSES OF THIS SUBDIVISION, THE FOLLOWING  TERMS  HAVE
THE MEANINGS INDICATED:
  1.   "SUBSIDIARY   COMPANY"   MEANS   A   SUBSIDIARY  COMPANY  FORMED,
WHOLLY-OWNED AND CONTROLLED BY THE  AUTHORITY  IN  ACCORDANCE  WITH  AND
SUBJECT  TO THE BUSINESS CORPORATION LAW, THE NOT-FOR-PROFIT CORPORATION
LAW, THE LIMITED LIABILITY COMPANY  LAW  OR  THE  TRANSPORTATION  CORPO-
RATIONS LAW.
  2.  "TRANSCO MASTER AGREEMENT" MEANS A WRITTEN AGREEMENT PROVIDING FOR
THE FORMATION AND OPERATION OF A  LIMITED  LIABILITY  COMPANY  OR  OTHER
ORGANIZATIONAL  STRUCTURE  TO  SERVE  AS  A  TRANSCO  COMPANY  AND WHICH
PROVIDES FOR, AMONG OTHER THINGS, THE RIGHTS AND OBLIGATIONS OF  MEMBERS
OF SUCH TRANSCO COMPANY.
  3. "TRANSCO ANCILLARY AGREEMENT" MEANS A WRITTEN AGREEMENT, OTHER THAN
A TRANSCO PROJECT AGREEMENT, BETWEEN THE AUTHORITY OR SUBSIDIARY COMPANY
AND  THE  TRANSCO  COMPANY  AND/OR MEMBERS OF A TRANSCO COMPANY, MADE IN
ACCORDANCE WITH THE TRANSCO MASTER AGREEMENT, FOR THE PURPOSE OF  IMPLE-
MENTING THE TRANSCO MASTER AGREEMENT.
  4. "TRANSCO COMPANY" MEANS AN ENTITY FORMED IN ACCORDANCE WITH A TRAN-
SCO  MASTER AGREEMENT PRIMARILY FOR THE PURPOSE OF ENGAGING IN THE BUSI-
NESS OF PLANNING,  CONSTRUCTING,  OWNING,  OPERATING,  MAINTAINING,  AND
EXPANDING  ELECTRIC  TRANSMISSION FACILITIES, SYSTEMS AND INFRASTRUCTURE
SERVING THE PEOPLE OF THE STATE OF NEW YORK.
  5. "TRANSCO PROJECT" MEANS A PROJECT UNDERTAKEN BY THE TRANSCO COMPANY
IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT.
  6. "TRANSCO PROJECT AGREEMENT" MEANS A WRITTEN AGREEMENT  BETWEEN  THE
AUTHORITY  OR  SUBSIDIARY COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS
OF A TRANSCO COMPANY, MADE IN ACCORDANCE WITH THE TRANSCO MASTER  AGREE-
MENT, THAT RELATES TO A SPECIFIC TRANSCO PROJECT.
  7. "TRANSMISSION ASSETS" MEANS: (A) ALL PHYSICAL ASSETS (INCLUDING BUT
NOT  LIMITED TO ELECTRICAL TRANSMISSION LINES, POLES, TOWERS AND SIMILAR
STRUCTURES, CONDUITS,  SUBSTATIONS,  CONVERTER  STATIONS,  TRANSFORMERS,
CONDUCTORS,  INSULATORS,  SWITCHING  DEVICES, CONTROLS, BREAKERS, BUSES,
STATIONS, RECTIFIERS, REGULATORS, EMERGENCY AND PROTECTIVE EQUIPMENT AND
DEVICES, UTILITY INTERCONNECTIONS AND OTHER EQUIPMENT USED OR  NECESSARY
FOR THE CONTROL, DISPATCH, RECEIPT AND DELIVERY OF ENERGY BY SUCH FACIL-
ITIES)  USED  FOR  THE  PURPOSE  OF TRANSMITTING OR DELIVERING DIRECT OR
ALTERNATING CURRENT ELECTRIC ENERGY AT VOLTAGES PRIMARILY OF ONE HUNDRED

S. 5861                             6

KILOVOLTS OR HIGHER TO LOADS OR  INTERCONNECTION  POINTS;  AND  (B)  ALL
ASSOCIATED  (I)  TANGIBLE  AND  INTANGIBLE  PROPERTY  USED  TO  OPERATE,
CONTROL, PROTECT AND MAINTAIN SUCH ASSETS, (II) REAL PROPERTY RIGHTS FOR
LANDS  AND  RIGHTS-OF-WAY,  SITES,  AND  PLACES IN WHICH SUCH ASSETS ARE
SITUATED OR INSTALLED, AND (III) LEGAL AND REGULATORY  RIGHTS,  AUTHORI-
ZATIONS,  PERMITS, AND CONSENTS OF ANY NATURE TO OWN, OCCUPY, CONSTRUCT,
USE, OPERATE AND MAINTAIN, AND RECEIVE OR DISPOSE OF REVENUES FROM  SUCH
ASSETS  OR  LANDS  ON  WHICH  SUCH ASSETS ARE SITUATED, EXISTING, OWNED,
LEASED, DESIGNED, USED AND OPERATED.
  (II) NOTWITHSTANDING THE PROVISIONS OF ANY OTHER  LAW,  INCLUDING  THE
PROVISIONS OF SECTION ONE THOUSAND TWENTY-I OF THIS TITLE, THE AUTHORITY
MAY  1.  FORM A SUBSIDIARY COMPANY FOR THE PURPOSE OF PARTICIPATING IN A
TRANSCO COMPANY, 2.  PARTICIPATE IN THE TRANSCO COMPANY BY  CAUSING  THE
SUBSIDIARY  COMPANY  TO BECOME A PARTY TO A TRANSCO MASTER AGREEMENT AND
EXERCISE THE RIGHTS AND PERFORM THE OBLIGATIONS  OF  A  TRANSCO  COMPANY
MEMBER  AS  MAY  BE  PROVIDED  FOR IN A TRANSCO MASTER AGREEMENT, AND 3.
EXERCISE THE OTHER POWERS AND DUTIES PROVIDED FOR BY THIS SUBDIVISION.
  (III) NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, IN ADDITION  TO
ANY OTHER POWERS AND DUTIES GRANTED TO IT UNDER THIS TITLE, THE AUTHORI-
TY SHALL BE AUTHORIZED TO:
  1.    PARTICIPATE  IN  PUBLIC/PRIVATE  PARTNERSHIPS TO PROVIDE FOR THE
MEANS TO REPAIR, REPLACE, REINFORCE, MODERNIZE AND  EXPAND  THE  STATE'S
ELECTRIC  TRANSMISSION GRID TO ENSURE THE SAFE AND RELIABLE PROVISION OF
ELECTRIC SERVICE TO THE SERVICE AREA AND THE STATE'S RESIDENTS  NOW  AND
INTO THE FUTURE;
  2.  EXERCISE  ALL  OF  THE  RIGHTS  AND PRIVILEGES ASSOCIATED WITH ANY
OWNERSHIP INTEREST IN OR ORGANIZER OF THE SUBSIDIARY COMPANY;
  3. ISSUE ITS BONDS,  NOTES  AND  OTHER  EVIDENCE  OF  INDEBTEDNESS  TO
FINANCE  THE OPERATIONS OF THE SUBSIDIARY COMPANY, INCLUDING THE SUBSID-
IARY COMPANY'S PARTICIPATION IN AND OBLIGATIONS UNDERTAKEN IN CONNECTION
WITH A TRANSCO COMPANY;
  4. LEND, OR OTHERWISE  TRANSFER  MONIES  TO  THE  SUBSIDIARY  COMPANY,
INCLUDING  THE  PROCEEDS OF THE AUTHORITY'S BONDS, NOTES, OTHER EVIDENCE
OF INDEBTEDNESS AND OTHER AUTHORITY FUNDS;
  5. RECEIVE MONIES FROM THE SUBSIDIARY COMPANY, INCLUDING  MONIES  THAT
RESULT FROM THE OPERATION OF THE TRANSCO COMPANY;
  6.   AS DEEMED FEASIBLE AND ADVISABLE BY THE TRUSTEES, TRANSFER TO THE
SUBSIDIARY COMPANY TRANSMISSION ASSETS THAT HAVE BEEN OR ARE EXPECTED TO
BE USED IN PROJECTS UNDERTAKEN BY THE TRANSCO COMPANY FOR SUCH CONSIDER-
ATION AND ON SUCH OTHER TERMS AND  CONDITIONS  AS  THE  AUTHORITY  SHALL
NEGOTIATE;
  7.  RECEIVE  FROM  THE  SUBSIDIARY  COMPANY OR THE TRANSCO COMPANY ANY
PERSONAL OR REAL PROPERTY;
  8. ENTER INTO GUARANTEE AGREEMENTS IN CONNECTION WITH  THE  SUBSIDIARY
COMPANY'S PARTICIPATION IN THE TRANSCO COMPANY;
  9.  ENTER INTO CONTRACTS AND OTHER FORMS OF AGREEMENT WITH THE TRANSCO
COMPANY, THE SUBSIDIARY COMPANY AND OTHER MEMBERS OF THE TRANSCO  COMPA-
NY;
  10.  PLEDGE  OR ASSIGN ALL OR ANY PORTION OF ANY INTEREST IN A TRANSCO
COMPANY;
  11. TRANSFER AND RECEIVE ALL OR ANY PORTION OF ANY INTEREST IN A TRAN-
SCO COMPANY;
  12. SELL, PURCHASE, OR OTHERWISE TRANSFER ALL OR ANY  PORTION  OF  ANY
INTEREST  IN  A  TRANSCO  COMPANY  ON  SUCH  TERMS AND CONDITIONS AS THE
AUTHORITY DEEMS APPROPRIATE;

S. 5861                             7

  13. ASSIGN ONE OR MORE EMPLOYEES TO  PROVIDE  SERVICES  TO  A  TRANSCO
COMPANY  FOR A SPECIFIED PERIOD OF TIME, PROVIDED THAT ANY SUCH EMPLOYEE
SHALL CONTINUE TO BE AN EMPLOYEE OF THE AUTHORITY; AND
  14.  DISSOLVE  OR  TERMINATE THE SUBSIDIARY COMPANY IN ACCORDANCE WITH
APPLICABLE LAW.
  (IV) NOTWITHSTANDING THE PROVISIONS OF  ANY  OTHER  LAW,  NO  TRUSTEE,
OFFICER OR EMPLOYEE OF THE STATE, OR OF ANY STATE AGENCY, PUBLIC AUTHOR-
ITY  OR PUBLIC BENEFIT CORPORATION, SHALL BE DEEMED TO HAVE FORFEITED OR
SHALL FORFEIT SUCH PERSON'S OFFICE OR EMPLOYMENT OR ANY BENEFITS ASSOCI-
ATED THEREWITH BY REASON OF SUCH PERSON'S ACCEPTANCE OF  MEMBERSHIP  ON,
OR  SUCH  PERSON  BEING  AN  OFFICER, EMPLOYEE OR AGENT OF, A SUBSIDIARY
COMPANY, OR BY REASON OF  SUCH  PERSON'S  PROVISION  OF  SERVICES  TO  A
SUBSIDIARY COMPANY.
  (V)  THE  PROVISIONS  OF  SECTION ONE THOUSAND TWENTY-CC OF THIS TITLE
SHALL BE INAPPLICABLE TO ANY TRANSCO MASTER AGREEMENT, TRANSCO ANCILLARY
AGREEMENT AND TRANSCO PROJECT AGREEMENT.
  (VI) THE PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A  OF
THIS  CHAPTER  SHALL  BE  APPLICABLE  TO ANY TRANSCO MASTER AGREEMENT TO
WHICH THE AUTHORITY OR SUBSIDIARY COMPANY IS A PARTY, BUT SHALL BE INAP-
PLICABLE TO ANY TRANSCO ANCILLARY AGREEMENT OR TRANSCO PROJECT AGREEMENT
THAT OTHERWISE SATISFIES THE REQUIREMENTS OF PARAGRAPH  (A)  OR  (B)  OF
SUBDIVISION ONE OF SUCH SECTION PROVIDED THAT 1. A FINAL OR SUBSTANTIAL-
LY  NEGOTIATED  FORM  OF  SUCH  TRANSCO  ANCILLARY  AGREEMENT OR TRANSCO
PROJECT AGREEMENT, AS THE CASE MAY BE, IS ANNEXED TO  A  TRANSCO  MASTER
AGREEMENT  THAT  HAS BECOME VALID AND ENFORCEABLE IN ACCORDANCE WITH THE
PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS  CHAP-
TER,  AND  2.  IN  THE  CASE  OF  A TRANSCO PROJECT AGREEMENT, THE FINAL
EXECUTED FORM OF SUCH TRANSCO PROJECT AGREEMENT IS LIMITED TO A  TRANSCO
PROJECT THAT WAS IDENTIFIED IN SUCH TRANSCO MASTER AGREEMENT.
  (VII)  THE  PROVISIONS OF TITLE FIVE-A OF ARTICLE NINE OF THIS CHAPTER
SHALL BE INAPPLICABLE TO ANY DISPOSAL OF PROPERTY BY  THE  AUTHORITY  OR
SUBSIDIARY  COMPANY THAT 1. IS OTHERWISE AUTHORIZED BY THIS TITLE, OR 2.
IS MADE IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT  THAT  HAS  BECOME
VALID AND ENFORCEABLE IN ACCORDANCE WITH THE PROVISIONS OF SECTION TWEN-
TY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAPTER.
  (VIII)  THE  PROVISIONS OF PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION
ONE THOUSAND TWENTY-S OF THIS TITLE AND SECTION THREE-B  OF  THE  PUBLIC
SERVICE  LAW  SHALL BE INAPPLICABLE TO THE RATES, SERVICES AND PRACTICES
RELATED TO THE TRANSCO MASTER AGREEMENT AND ANY  ACTIONS  UNDERTAKEN  BY
THE  AUTHORITY  OR SUBSIDIARY CORPORATION IN ACCORDANCE WITH THE TRANSCO
MASTER AGREEMENT.
  (IX) NO ACTS OR ACTIVITIES TAKEN  OR  PROPOSED  TO  BE  TAKEN  BY  THE
AUTHORITY  OR  A  SUBSIDIARY  COMPANY PURSUANT TO THE PROVISIONS OF THIS
SUBDIVISION, INCLUDING THE EXECUTION OF A TRANSCO MASTER AGREEMENT,  AND
THE  ISSUANCE  OF BONDS, NOTES, OR OTHER OBLIGATIONS, SHALL BE DEEMED TO
BE "ACTIONS" FOR THE PURPOSES OR WITHIN THE MEANING OF ARTICLE EIGHT  OF
THE ENVIRONMENTAL CONSERVATION LAW.
  (X)  NOTWITHSTANDING  THE  PROVISIONS  OF  ANY  OTHER LAW, ANY TRANSCO
COMPANY FORMED OR AUTHORIZED PURSUANT TO THIS ARTICLE IS PROHIBITED FROM
FINANCING OR CONSTRUCTING NEW ELECTRIC GENERATING FACILITIES.
  S 7. Severability clause. If any clause, sentence, paragraph, subdivi-
sion, section or part of this act shall be  adjudged  by  any  court  of
competent  jurisdiction  to  be invalid, such judgment shall not affect,
impair, or invalidate the remainder thereof, but shall  be  confined  in
its  operation  to the clause, sentence, paragraph, subdivision, section
or part thereof directly involved in the controversy in which such judg-

S. 5861                             8

ment shall have been rendered. It is hereby declared to be the intent of
the legislature that this act would  have  been  enacted  even  if  such
invalid provisions had not been included therewith.
  S  8.  This  act  shall  take  effect on the same date and in the same
manner as a chapter of the laws of 2013 amending the public service  law
and  other  laws  relating to the powers and duties of the department of
public service and the Long  Island  power  authority,  as  proposed  in
legislative bill numbers S. 5844 and A. 8073, takes effect.

Co-Sponsors

S5861A - Bill Details

See Assembly Version of this Bill:
A8095C
Current Committee:
Law Section:
Public Authorities Law
Laws Affected:
Amd §§1001, 1005, 1020-a, 1020-c & 1020-f, Pub Auth L

S5861A - Bill Texts

view summary

Authorizes the power authority of the state of New York and the Long Island power authority to enter into public-private partnerships for the improvement of the state's electric transmission grid.

view sponsor memo
BILL NUMBER:S5861A

TITLE OF BILL: An act to amend the public authorities law, in
relation to authorizing the power authority of the state of New York
and the Long Island power authority to participate in public-private
transmission projects to improve the state's electric transmission
grid

PURPOSE:

This bill would allow the creation of a public-private partnership
between the State's public utilities - the Power Authority of the
State of New York (NYPA) and the Long Island Power Authority (LIPA) -
and the State's private transmission owners, for the sole purpose of
jointly developing, constructing and owning transmission facilities in
New York State. This partnership would be in the form of a New York
Transmission Company (Transco) that would pursue new transmission
projects that would enhance the current capabilities of the bulk power
system within New York State.

SUMMARY OF PROVISIONS:

Section 1 of the bill would provide legislative findings.

Section 2 would amend the "declaration of policy" in NYPA's enabling
statute.

Section 3 would amend PAL § 1005 to, among other things, provide
definitions of key terms, authorize NYPA to form a subsidiary company
for purposes of participating in the Transco company, and to provide
commensurate financial powers. This section would exempt projects from
article eight of the environmental conservation law since these
projects are subject to other regulatory review, which includes an
environmental review.

Section 4 of the bill would amend the legislative findings in LIPA's
enabling statute -PAL § 1020-a.

Section 5 would amend subdivision 2 of PAL § l020-c(2) to provide LIPA
or subsidiary company an interest in transmission assets that are
located in whole or in part outside the LISA service area.

Section 6 would amend PAL § 1020-f to provide authority consistent
with the authority to be provided in section 3 of the bill.

Section 7 of the bill would provide a severability clause. Section 8
of the bill would make the bill effective immediately.

EXISTING LAW:

PAL § 1005 provides NYPA's existing authority, and PAL 1020-f provides
LIPA's existing statutory authority.

JUSTIFICATION:

The State's electric transmission system is facing two major
challenges: 1) Aging infrastructure that requires significant


reinvestment; and 2) System constraints that cause transmission
congestion, creating higher electric customer costs. Over 40 percent
of the State's electric transmission system will require replacement
within the next 30 years, at an estimated cost of $25 billion.
Replacement is required to assure long-term reliability of the
electric system. The State's electric transmission system is also
congested at critical points on the pathways linking upstate and
downstate New York. Together, New York City, Long Island, and
Westchester County account for more than half of the demand for
electricity in the State and this demand is increasing. However, in
times of peak demand and high prices, lower-cost and/or cleaner power
available from upstate cannot reach these densely populated areas
because of the transmission bottlenecks. Congestion can have adverse
environmental and economic consequences. Older, less energy-efficient
and cost-effective plants in urban areas run more frequently than they
otherwise would if power from other sources of energy could reach
these areas.

Under the approach provided for in this bill, NYPA and LIPA would each
be authorized to form a subsidiary company to participate as a member
of a Transco company. These public and private partners would enter
into an agreement providing for the formation of the Transco company,
the projects that could be undertaken by the Transco, and the rights
and obligations of the Transco members. It is expected that the
Transco agreement would authorize Transco members to enter into
ancillary agreements that would provide for the administration of the
Transco and individual Transco projects.

This unique approach to addressing the State's aging infrastructure
empowers the State's transmission owners to create a unified plan for
statewide electric power benefits. Such a partnership would facilitate
state-wide transmission planning, facilitate lower financing costs for
grid infrastructure projects and improvements, and promote sorely
needed and sensible investment in the State's power grid.

Transco projects will provide numerous short and long term benefits to
New York residents, such as reducing transmission constraints between
the upstate and downstate regions, creating a stronger and more
resilient transmission system with improved reliability, creating jobs
and stimulating statewide economic growth, increasing local property
tax revenues, reducing pollution emissions by dispatching more energy
efficient generation resources; and facilitating the integration of
renewable resources, including wind generation resources, located in
upstate and elsewhere in New York.

LEGISLATIVE HISTORY:

This is a new bill.

BUDGET IMPLICATIONS:

There are no budget implications.

EFFECTIVE DATE:

This bill would take effect immediately upon enactment into law.


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

                                 5861--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              June 18, 2013
                               ___________

Introduced  by  Sens. MAZIARZ, O'MARA -- read twice and ordered printed,
  and when printed to be committed to the Committee on Rules  --  recom-
  mitted to the Committee on Energy and Telecommunications in accordance
  with  Senate  Rule  6,  sec.  8 -- committee discharged, bill amended,
  ordered reprinted as amended and recommitted to said committee

AN ACT to amend the public authorities law, in relation  to  authorizing
  the power authority of the state of New York and the Long Island power
  authority  to  participate  in public-private transmission projects to
  improve the state's electric transmission grid

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

  Section  1.  Legislative  findings and purpose. The legislature hereby
finds and determines that:
  1. The state's vital electric transmission grid  is  aging,  congested
and  subject  to  outages caused by storms, obsolescence and the growing
demands for energy by the  state's  residents,  and  such  problems  and
conditions  pose  serious  threats  to  the  health, welfare, safety and
economic well-being of the people of the state of New York.
  2. The condition and operation of the  state's  electric  transmission
grid  is  a matter of state concern, and it is in the public interest to
provide for the means  to  repair,  replace,  reinforce,  modernize  and
expand  the  state's  electric  transmission grid to ensure the safe and
reliable provision of electric service to the state's residents now  and
into the future.
  3.  A  modernized  electric  transmission grid and energy highway will
also encourage investments  in  new  energy-related  infrastructure  and
technologies,  facilitate the development and integration into the power
grid of renewable energy resources, and stimulate and  support  economic
development in the state. Public-private transmission projects undertak-
en  jointly by the owner of transmission facilities, systems and infras-
tructure, including the power authority of the state of New York and the

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11579-03-4

S. 5861--A                          2

Long Island power authority, which provide  for  the  ongoing  planning,
construction,  owning,  operating, maintaining and expanding of electric
transmission facilities, systems and  infrastructure  can  serve  as  an
effective  means to address the aforementioned problems and concerns and
stimulate ongoing critical investment in  the  state's  electric  trans-
mission grid.
  4.  The purposes of this act can be achieved, while managing and miti-
gating potential liabilities, by authorizing the power authority of  the
state  of New York and the Long Island power authority to participate in
such public-private  transmission  projects  through  the  formation  of
subsidiary companies.
  S 2. Section 1001 of the public authorities law is amended by adding a
new closing paragraph to read as follows:
  IT  IS FURTHER DECLARED THAT: (A) THERE SHOULD BE FULL COOPERATION AND
COORDINATION AMONG PRIVATE AND PUBLIC OWNERS AND OPERATORS  OF  ELECTRIC
TRANSMISSION  FACILITIES,  SYSTEMS  AND  INFRASTRUCTURE  IN  THE  STATE,
INCLUDING THE AUTHORITY, FOR THE  PURPOSE  OF  EXPEDITIOUSLY  REPAIRING,
REPLACING,  REINFORCING,  MODERNIZING AND EXPANDING THE STATE'S ELECTRIC
TRANSMISSION GRID; (B) IT IS DESIRABLE THAT THE  AUTHORITY,  WHICH  OWNS
AND  OPERATES  ELECTRIC TRANSMISSION ASSETS IN THE STATE, PARTICIPATE IN
PUBLIC-PRIVATE TRANSMISSION PROJECTS THAT ARE UNDERTAKEN  BY  A  LIMITED
LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZATIONAL STRUCTURE, THROUGH
A  SUBSIDIARY  COMPANY  FORMED  BY  THE  AUTHORITY AS AUTHORIZED BY THIS
TITLE; AND (C) THE AUTHORITY SHOULD  BE  AUTHORIZED  TO  PARTICIPATE  IN
PUBLIC-PRIVATE TRANSMISSION PROJECTS AND TRANSFER TRANSMISSION ASSETS OR
ANY  INTEREST  THEREIN  IN  CONNECTION  WITH ITS PARTICIPATION IN SUCH A
LIMITED LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZATIONAL  STRUCTURE
ON SUCH TERMS AND CONDITIONS AS THE AUTHORITY MAY NEGOTIATE.
  S 3. Section 1005 of the public authorities law is amended by adding a
new subdivision 25 to read as follows:
  25.  A.  FOR  PURPOSES  OF THIS SUBDIVISION, THE FOLLOWING TERMS SHALL
HAVE THE MEANINGS INDICATED:
  (I)  "SUBSIDIARY  COMPANY"  MEANS   A   SUBSIDIARY   COMPANY   FORMED,
WHOLLY-OWNED  AND  CONTROLLED  BY  THE  AUTHORITY IN ACCORDANCE WITH AND
SUBJECT TO THE BUSINESS CORPORATION LAW, THE NOT-FOR-PROFIT  CORPORATION
LAW,  THE  LIMITED  LIABILITY  COMPANY  LAW OR THE TRANSPORTATION CORPO-
RATIONS LAW.
  (II) "TRANSCO MASTER AGREEMENT" MEANS A  WRITTEN  AGREEMENT  PROVIDING
FOR  THE FORMATION AND OPERATION OF A LIMITED LIABILITY COMPANY OR OTHER
ORGANIZATIONAL STRUCTURE  TO  SERVE  AS  A  TRANSCO  COMPANY  AND  WHICH
PROVIDES  FOR, AMONG OTHER THINGS, THE RIGHTS AND OBLIGATIONS OF MEMBERS
OF SUCH TRANSCO COMPANY.
  (III) "TRANSCO ANCILLARY AGREEMENT" MEANS A WRITTEN  AGREEMENT,  OTHER
THAN  A  TRANSCO  PROJECT AGREEMENT, BETWEEN THE AUTHORITY OR SUBSIDIARY
COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS  OF  A  TRANSCO  COMPANY,
MADE IN ACCORDANCE WITH THE TRANSCO MASTER AGREEMENT, FOR THE PURPOSE OF
IMPLEMENTING THE TRANSCO MASTER AGREEMENT.
  (IV)  "TRANSCO  COMPANY"  MEANS  AN ENTITY FORMED IN ACCORDANCE WITH A
TRANSCO MASTER AGREEMENT PRIMARILY  FOR THE PURPOSE OF ENGAGING  IN  THE
BUSINESS  OF PLANNING, CONSTRUCTING, OWNING, OPERATING, MAINTAINING, AND
EXPANDING ELECTRIC TRANSMISSION FACILITIES, SYSTEMS  AND  INFRASTRUCTURE
SERVING THE PEOPLE OF THE STATE OF NEW YORK.
  (V) "TRANSCO PROJECT" MEANS A PROJECT UNDERTAKEN BY THE TRANSCO COMPA-
NY IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT.
  (VI) "TRANSCO PROJECT AGREEMENT" MEANS A WRITTEN AGREEMENT BETWEEN THE
AUTHORITY  OR  SUBSIDIARY COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS

S. 5861--A                          3

OF A TRANSCO COMPANY, MADE IN ACCORDANCE WITH THE TRANSCO MASTER  AGREE-
MENT, THAT RELATES TO A SPECIFIC TRANSCO PROJECT.
  (VII)  "TRANSMISSION ASSETS" MEANS: (1) ALL PHYSICAL ASSETS (INCLUDING
BUT NOT LIMITED TO ELECTRICAL  TRANSMISSION  LINES,  POLES,  TOWERS  AND
SIMILAR STRUCTURES, CONDUITS, SUBSTATIONS, CONVERTER STATIONS, TRANSFOR-
MERS,  CONDUCTORS,  INSULATORS,  SWITCHING  DEVICES, CONTROLS, BREAKERS,
BUSES, STATIONS, RECTIFIERS, REGULATORS, EMERGENCY AND PROTECTIVE EQUIP-
MENT AND DEVICES, UTILITY INTERCONNECTIONS AND OTHER EQUIPMENT  USED  OR
NECESSARY  FOR  THE CONTROL, DISPATCH, RECEIPT AND DELIVERY OF ENERGY BY
SUCH FACILITIES) USED FOR THE  PURPOSE  OF  TRANSMITTING  OR  DELIVERING
DIRECT  OR  ALTERNATING CURRENT ELECTRIC ENERGY AT VOLTAGES PRIMARILY OF
ONE HUNDRED KILOVOLTS OR HIGHER TO LOADS OR INTERCONNECTION POINTS;  AND
(2) ALL ASSOCIATED (A) TANGIBLE AND INTANGIBLE PROPERTY USED TO OPERATE,
CONTROL,  PROTECT AND MAINTAIN SUCH ASSETS, (B) REAL PROPERTY RIGHTS FOR
LANDS AND RIGHTS-OF-WAY, SITES, AND PLACES  IN  WHICH  SUCH  ASSETS  ARE
SITUATED  OR  INSTALLED,  AND  (C) LEGAL AND REGULATORY RIGHTS, AUTHORI-
ZATIONS, PERMITS, AND CONSENTS OF ANY NATURE TO OWN, OCCUPY,  CONSTRUCT,
USE,  OPERATE AND MAINTAIN, AND RECEIVE OR DISPOSE OF REVENUES FROM SUCH
ASSETS OR LANDS ON WHICH SUCH  ASSETS  ARE  SITUATED,  EXISTING,  OWNED,
LEASED, DESIGNED, USED AND OPERATED.
  B.  NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, THE AUTHORITY MAY
(I) PARTICIPATE IN PUBLIC/PRIVATE PARTNERSHIPS TO PROVIDE FOR THE  MEANS
TO REPAIR, REPLACE, REINFORCE, MODERNIZE AND EXPAND THE STATE'S ELECTRIC
TRANSMISSION  GRID TO ENSURE THE SAFE AND RELIABLE PROVISION OF ELECTRIC
SERVICE TO THE STATE'S RESIDENTS NOW AND INTO THE FUTURE,  (II)  FORM  A
SUBSIDIARY  COMPANY FOR THE PURPOSE OF PARTICIPATING IN A TRANSCO COMPA-
NY, (III) PARTICIPATE IN THE TRANSCO COMPANY BY CAUSING  THE  SUBSIDIARY
COMPANY TO BECOME A PARTY TO A TRANSCO MASTER AGREEMENT AND EXERCISE THE
RIGHTS AND PERFORM THE OBLIGATIONS OF A TRANSCO COMPANY MEMBER AS MAY BE
PROVIDED  FOR IN A TRANSCO MASTER AGREEMENT, AND (IV) EXERCISE THE OTHER
POWERS AND DUTIES PROVIDED FOR BY THIS SUBDIVISION.
  C. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, IN ADDITION TO ANY
OTHER POWERS AND DUTIES GRANTED TO IT UNDER THIS  TITLE,  THE  AUTHORITY
SHALL BE AUTHORIZED TO:
  (I)  EXERCISE  ALL  OF  THE  RIGHTS AND PRIVILEGES ASSOCIATED WITH ANY
OWNERSHIP INTEREST IN OR ORGANIZER OF THE SUBSIDIARY COMPANY;
  (II) ISSUE ITS BONDS, NOTES AND  OTHER  EVIDENCE  OF  INDEBTEDNESS  TO
FINANCE  THE OPERATIONS OF THE SUBSIDIARY COMPANY, INCLUDING THE SUBSID-
IARY COMPANY'S PARTICIPATION IN AND OBLIGATIONS UNDERTAKEN IN CONNECTION
WITH A TRANSCO COMPANY;
  (III) LEND, OR OTHERWISE TRANSFER MONIES TO  THE  SUBSIDIARY  COMPANY,
INCLUDING  THE  PROCEEDS OF THE AUTHORITY'S BONDS, NOTES, OTHER EVIDENCE
OF INDEBTEDNESS AND OTHER AUTHORITY FUNDS;
  (IV) RECEIVE MONIES FROM THE SUBSIDIARY COMPANY, INCLUDING MONIES THAT
RESULT FROM THE OPERATION OF THE TRANSCO COMPANY;
  (V) AS DEEMED FEASIBLE AND ADVISABLE BY THE TRUSTEES, TRANSFER TO  THE
SUBSIDIARY  COMPANY  TRANSMISSION  ASSETS OR INTERESTS THEREIN THAT HAVE
BEEN OR ARE EXPECTED TO BE USED IN PROJECTS UNDERTAKEN  BY  THE  TRANSCO
COMPANY FOR SUCH CONSIDERATION AND ON SUCH OTHER TERMS AND CONDITIONS AS
THE AUTHORITY SHALL NEGOTIATE;
  (VI)  RECEIVE  FROM  THE SUBSIDIARY COMPANY OR THE TRANSCO COMPANY ANY
PERSONAL OR REAL PROPERTY;
  (VII) ENTER INTO GUARANTEE AGREEMENTS IN CONNECTION WITH  THE  SUBSID-
IARY COMPANY'S PARTICIPATION IN THE TRANSCO COMPANY;

S. 5861--A                          4

  (VIII)  ENTER  INTO  CONTRACTS  AND  OTHER FORMS OF AGREEMENT WITH THE
TRANSCO COMPANY, THE SUBSIDIARY COMPANY AND OTHER MEMBERS OF THE TRANSCO
COMPANY;
  (IX)  PLEDGE OR ASSIGN ALL OR ANY PORTION OF ANY INTEREST IN A TRANSCO
COMPANY;
  (X) TRANSFER AND RECEIVE ALL OR ANY PORTION OF ANY INTEREST IN A TRAN-
SCO COMPANY;
  (XI) SELL, PURCHASE, OR OTHERWISE TRANSFER ALL OR ANY PORTION  OF  ANY
INTEREST  IN  A  TRANSCO  COMPANY  ON  SUCH  TERMS AND CONDITIONS AS THE
AUTHORITY DEEMS APPROPRIATE;
  (XII) ASSIGN ONE OR MORE EMPLOYEES TO PROVIDE SERVICES  TO  A  TRANSCO
COMPANY  FOR A SPECIFIED PERIOD OF TIME, PROVIDED THAT ANY SUCH EMPLOYEE
SHALL CONTINUE TO BE AN EMPLOYEE OF THE AUTHORITY; AND
  (XIII) DISSOLVE OR TERMINATE THE SUBSIDIARY COMPANY IN ACCORDANCE WITH
APPLICABLE LAW.
  D. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, NO TRUSTEE,  OFFI-
CER  OR  EMPLOYEE OF THE STATE, OR OF ANY STATE AGENCY, PUBLIC AUTHORITY
OR PUBLIC BENEFIT CORPORATION, SHALL BE  DEEMED  TO  HAVE  FORFEITED  OR
SHALL FORFEIT SUCH PERSON'S OFFICE OR EMPLOYMENT OR ANY BENEFITS ASSOCI-
ATED  THEREWITH  BY REASON OF SUCH PERSON'S ACCEPTANCE OF MEMBERSHIP ON,
OR SUCH PERSON BEING AN OFFICER,  EMPLOYEE  OR  AGENT  OF  A  SUBSIDIARY
COMPANY,  OR  BY  REASON  OF  SUCH  PERSON'S  PROVISION OF SERVICES TO A
SUBSIDIARY COMPANY.
  E. THE PROVISIONS OF SECTION TWENTY-EIGHT  HUNDRED  SEVENTY-NINE-A  OF
THIS  CHAPTER  SHALL  BE  APPLICABLE  TO ANY TRANSCO MASTER AGREEMENT TO
WHICH THE AUTHORITY OR SUBSIDIARY COMPANY IS A PARTY, BUT SHALL BE INAP-
PLICABLE TO ANY TRANSCO ANCILLARY AGREEMENT OR TRANSCO PROJECT AGREEMENT
THAT OTHERWISE SATISFIES THE REQUIREMENTS OF PARAGRAPH  (A)  OR  (B)  OF
SUBDIVISION  ONE  OF  SUCH SECTION PROVIDED THAT (I) A FINAL OR SUBSTAN-
TIALLY NEGOTIATED FORM OF SUCH TRANSCO ANCILLARY  AGREEMENT  OR  TRANSCO
PROJECT  AGREEMENT,  AS  THE CASE MAY BE, IS ANNEXED TO A TRANSCO MASTER
AGREEMENT THAT HAS BECOME VALID AND ENFORCEABLE IN ACCORDANCE  WITH  THE
PROVISIONS  OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAP-
TER, AND (II) IN THE CASE OF A  TRANSCO  PROJECT  AGREEMENT,  THE  FINAL
EXECUTED  FORM OF SUCH TRANSCO PROJECT AGREEMENT IS LIMITED TO A TRANSCO
PROJECT THAT WAS IDENTIFIED IN SUCH TRANSCO MASTER AGREEMENT.
  F. THE PROVISIONS OF TITLE FIVE-A OF  ARTICLE  NINE  OF  THIS  CHAPTER
SHALL  BE  INAPPLICABLE  TO ANY DISPOSAL OF PROPERTY BY THE AUTHORITY OR
SUBSIDIARY COMPANY THAT (I) IS OTHERWISE AUTHORIZED BY  THIS  TITLE,  OR
(II)  IS  MADE  IN  ACCORDANCE  WITH A TRANSCO MASTER AGREEMENT THAT HAS
BECOME VALID AND  ENFORCEABLE  IN  ACCORDANCE  WITH  THE  PROVISIONS  OF
SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAPTER.
  G. NO ACTS OR ACTIVITIES TAKEN OR PROPOSED TO BE TAKEN BY THE AUTHORI-
TY  OR  A SUBSIDIARY COMPANY PURSUANT TO THE PROVISIONS OF THIS SUBDIVI-
SION, INCLUDING THE EXECUTION OF A TRANSCO  MASTER  AGREEMENT,  AND  THE
ISSUANCE  OF  BONDS,  NOTES, OR OTHER OBLIGATIONS, SHALL BE DEEMED TO BE
"ACTIONS" FOR THE PURPOSES OR WITHIN THE MEANING OF ARTICLE EIGHT OF THE
ENVIRONMENTAL CONSERVATION LAW.
  H. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, ANY TRANSCO COMPA-
NY FORMED OR AUTHORIZED PURSUANT TO  THIS  ARTICLE  IS  PROHIBITED  FROM
FINANCING OR CONSTRUCTING NEW ELECTRIC GENERATING FACILITIES.
  S 4. Section 1020-a of the public authorities law, as added by chapter
517 of the laws of 1986, is amended by adding a new closing paragraph to
read as follows:
  THE  LEGISLATURE  FURTHER FINDS AND DECLARES THAT: (I) THERE SHOULD BE
FULL COOPERATION AND COORDINATION AMONG PRIVATE AND  PUBLIC  OWNERS  AND

S. 5861--A                          5

OPERATORS  OF  ELECTRIC TRANSMISSION FACILITIES, SYSTEMS AND INFRASTRUC-
TURE IN THE STATE, INCLUDING THE AUTHORITY, FOR  THE  PURPOSE  OF  EXPE-
DITIOUSLY  REPAIRING,  REPLACING, REINFORCING, MODERNIZING AND EXPANDING
THE  STATE'S  ELECTRIC  TRANSMISSION GRID; (II) IT IS DESIRABLE THAT THE
AUTHORITY, WHICH OWNS AND OPERATES ELECTRIC TRANSMISSION ASSETS  IN  THE
STATE,  PARTICIPATES  IN  PUBLIC-PRIVATE  TRANSMISSION PROJECTS THAT ARE
UNDERTAKEN BY A LIMITED LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZA-
TIONAL STRUCTURE, THROUGH A SUBSIDIARY COMPANY FORMED BY  THE  AUTHORITY
AS  AUTHORIZED  BY THIS TITLE; AND (III) THE AUTHORITY SHOULD BE AUTHOR-
IZED TO PARTICIPATE IN PUBLIC-PRIVATE TRANSMISSION PROJECTS AND TRANSFER
TRANSMISSION ASSETS OR ANY  INTEREST  THEREIN  IN  CONNECTION  WITH  ITS
PARTICIPATION  IN  SUCH A LIMITED LIABILITY COMPANY OR OTHER APPROPRIATE
ORGANIZATIONAL STRUCTURE ON SUCH TERMS AND CONDITIONS AS  THE  AUTHORITY
MAY NEGOTIATE.
  S 5. Subdivision 2 of section 1020-c of the public authorities law, as
added by chapter 517 of the laws of 1986, is amended to read as follows:
  2.  The area of operations of the authority shall be the service area,
PROVIDED THAT THE AUTHORITY OR SUBSIDIARY COMPANY MAY OWN AN INTEREST IN
TRANSMISSION ASSETS THAT ARE LOCATED IN WHOLE OR  IN  PART  OUTSIDE  THE
SERVICE AREA.
  S 6. Section 1020-f of the public authorities law is amended by adding
a new subdivision (g-1) to read as follows:
  (G-1)  (I)  FOR PURPOSES OF THIS SUBDIVISION, THE FOLLOWING TERMS HAVE
THE MEANINGS INDICATED:
  1.  "SUBSIDIARY  COMPANY"   MEANS   A   SUBSIDIARY   COMPANY   FORMED,
WHOLLY-OWNED  AND  CONTROLLED  BY  THE  AUTHORITY IN ACCORDANCE WITH AND
SUBJECT TO THE BUSINESS CORPORATION LAW, THE NOT-FOR-PROFIT  CORPORATION
LAW,  THE  LIMITED  LIABILITY  COMPANY  LAW OR THE TRANSPORTATION CORPO-
RATIONS LAW.
  2. "TRANSCO MASTER AGREEMENT" MEANS A WRITTEN AGREEMENT PROVIDING  FOR
THE  FORMATION  AND  OPERATION  OF  A LIMITED LIABILITY COMPANY OR OTHER
ORGANIZATIONAL STRUCTURE  TO  SERVE  AS  A  TRANSCO  COMPANY  AND  WHICH
PROVIDES  FOR, AMONG OTHER THINGS, THE RIGHTS AND OBLIGATIONS OF MEMBERS
OF SUCH TRANSCO COMPANY.
  3. "TRANSCO ANCILLARY AGREEMENT" MEANS A WRITTEN AGREEMENT, OTHER THAN
A TRANSCO PROJECT AGREEMENT, BETWEEN THE AUTHORITY OR SUBSIDIARY COMPANY
AND THE TRANSCO COMPANY AND/OR MEMBERS OF A  TRANSCO  COMPANY,  MADE  IN
ACCORDANCE  WITH THE TRANSCO MASTER AGREEMENT, FOR THE PURPOSE OF IMPLE-
MENTING THE TRANSCO MASTER AGREEMENT.
  4. "TRANSCO COMPANY" MEANS AN ENTITY FORMED IN ACCORDANCE WITH A TRAN-
SCO MASTER AGREEMENT PRIMARILY FOR THE PURPOSE OF ENGAGING IN THE  BUSI-
NESS  OF  PLANNING,  CONSTRUCTING,  OWNING,  OPERATING, MAINTAINING, AND
EXPANDING ELECTRIC TRANSMISSION FACILITIES, SYSTEMS  AND  INFRASTRUCTURE
SERVING THE PEOPLE OF THE STATE OF NEW YORK.
  5. "TRANSCO PROJECT" MEANS A PROJECT UNDERTAKEN BY THE TRANSCO COMPANY
IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT.
  6.  "TRANSCO  PROJECT AGREEMENT" MEANS A WRITTEN AGREEMENT BETWEEN THE
AUTHORITY OR SUBSIDIARY COMPANY AND THE TRANSCO COMPANY  AND/OR  MEMBERS
OF  A TRANSCO COMPANY, MADE IN ACCORDANCE WITH THE TRANSCO MASTER AGREE-
MENT, THAT RELATES TO A SPECIFIC TRANSCO PROJECT.
  7. "TRANSMISSION ASSETS" MEANS: (A) ALL PHYSICAL ASSETS (INCLUDING BUT
NOT LIMITED TO ELECTRICAL TRANSMISSION LINES, POLES, TOWERS AND  SIMILAR
STRUCTURES,  CONDUITS,  SUBSTATIONS,  CONVERTER  STATIONS, TRANSFORMERS,
CONDUCTORS, INSULATORS, SWITCHING DEVICES,  CONTROLS,  BREAKERS,  BUSES,
STATIONS, RECTIFIERS, REGULATORS, EMERGENCY AND PROTECTIVE EQUIPMENT AND
DEVICES,  UTILITY INTERCONNECTIONS AND OTHER EQUIPMENT USED OR NECESSARY

S. 5861--A                          6

FOR THE CONTROL, DISPATCH, RECEIPT AND DELIVERY OF ENERGY BY SUCH FACIL-
ITIES) USED FOR THE PURPOSE OF  TRANSMITTING  OR  DELIVERING  DIRECT  OR
ALTERNATING CURRENT ELECTRIC ENERGY AT VOLTAGES PRIMARILY OF ONE HUNDRED
KILOVOLTS  OR  HIGHER  TO  LOADS  OR INTERCONNECTION POINTS; AND (B) ALL
ASSOCIATED  (I)  TANGIBLE  AND  INTANGIBLE  PROPERTY  USED  TO  OPERATE,
CONTROL, PROTECT AND MAINTAIN SUCH ASSETS, (II) REAL PROPERTY RIGHTS FOR
LANDS  AND  RIGHTS-OF-WAY,  SITES,  AND  PLACES IN WHICH SUCH ASSETS ARE
SITUATED OR INSTALLED, AND (III) LEGAL AND REGULATORY  RIGHTS,  AUTHORI-
ZATIONS,  PERMITS, AND CONSENTS OF ANY NATURE TO OWN, OCCUPY, CONSTRUCT,
USE, OPERATE AND MAINTAIN, AND RECEIVE OR DISPOSE OF REVENUES FROM  SUCH
ASSETS  OR  LANDS  ON  WHICH  SUCH ASSETS ARE SITUATED, EXISTING, OWNED,
LEASED, DESIGNED, USED AND OPERATED.
  (II) NOTWITHSTANDING THE PROVISIONS OF ANY OTHER  LAW,  INCLUDING  THE
PROVISIONS OF SECTION ONE THOUSAND TWENTY-I OF THIS TITLE, THE AUTHORITY
MAY  1.  FORM A SUBSIDIARY COMPANY FOR THE PURPOSE OF PARTICIPATING IN A
TRANSCO COMPANY, 2.  PARTICIPATE IN THE TRANSCO COMPANY BY  CAUSING  THE
SUBSIDIARY  COMPANY  TO BECOME A PARTY TO A TRANSCO MASTER AGREEMENT AND
EXERCISE THE RIGHTS AND PERFORM THE OBLIGATIONS  OF  A  TRANSCO  COMPANY
MEMBER  AS  MAY  BE  PROVIDED  FOR IN A TRANSCO MASTER AGREEMENT, AND 3.
EXERCISE THE OTHER POWERS AND DUTIES PROVIDED FOR BY THIS SUBDIVISION.
  (III) NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, IN ADDITION  TO
ANY OTHER POWERS AND DUTIES GRANTED TO IT UNDER THIS TITLE, THE AUTHORI-
TY SHALL BE AUTHORIZED TO:
  1.    PARTICIPATE  IN  PUBLIC/PRIVATE  PARTNERSHIPS TO PROVIDE FOR THE
MEANS TO REPAIR, REPLACE, REINFORCE, MODERNIZE AND  EXPAND  THE  STATE'S
ELECTRIC  TRANSMISSION GRID TO ENSURE THE SAFE AND RELIABLE PROVISION OF
ELECTRIC SERVICE TO THE SERVICE AREA AND THE STATE'S RESIDENTS  NOW  AND
INTO THE FUTURE;
  2.  EXERCISE  ALL  OF  THE  RIGHTS  AND PRIVILEGES ASSOCIATED WITH ANY
OWNERSHIP INTEREST IN OR ORGANIZER OF THE SUBSIDIARY COMPANY;
  3. ISSUE ITS BONDS,  NOTES  AND  OTHER  EVIDENCE  OF  INDEBTEDNESS  TO
FINANCE  THE OPERATIONS OF THE SUBSIDIARY COMPANY, INCLUDING THE SUBSID-
IARY COMPANY'S PARTICIPATION IN AND OBLIGATIONS UNDERTAKEN IN CONNECTION
WITH A TRANSCO COMPANY;
  4. LEND, OR OTHERWISE  TRANSFER  MONIES  TO  THE  SUBSIDIARY  COMPANY,
INCLUDING  THE  PROCEEDS OF THE AUTHORITY'S BONDS, NOTES, OTHER EVIDENCE
OF INDEBTEDNESS AND OTHER AUTHORITY FUNDS;
  5. RECEIVE MONIES FROM THE SUBSIDIARY COMPANY, INCLUDING  MONIES  THAT
RESULT FROM THE OPERATION OF THE TRANSCO COMPANY;
  6.   AS DEEMED FEASIBLE AND ADVISABLE BY THE TRUSTEES, TRANSFER TO THE
SUBSIDIARY COMPANY TRANSMISSION ASSETS THAT HAVE BEEN OR ARE EXPECTED TO
BE USED IN PROJECTS UNDERTAKEN BY THE TRANSCO COMPANY FOR SUCH CONSIDER-
ATION AND ON SUCH OTHER TERMS AND  CONDITIONS  AS  THE  AUTHORITY  SHALL
NEGOTIATE;
  7.  RECEIVE  FROM  THE  SUBSIDIARY  COMPANY OR THE TRANSCO COMPANY ANY
PERSONAL OR REAL PROPERTY;
  8. ENTER INTO GUARANTEE AGREEMENTS IN CONNECTION WITH  THE  SUBSIDIARY
COMPANY'S PARTICIPATION IN THE TRANSCO COMPANY;
  9.  ENTER INTO CONTRACTS AND OTHER FORMS OF AGREEMENT WITH THE TRANSCO
COMPANY, THE SUBSIDIARY COMPANY AND OTHER MEMBERS OF THE TRANSCO  COMPA-
NY;
  10.  PLEDGE  OR ASSIGN ALL OR ANY PORTION OF ANY INTEREST IN A TRANSCO
COMPANY;
  11. TRANSFER AND RECEIVE ALL OR ANY PORTION OF ANY INTEREST IN A TRAN-
SCO COMPANY;

S. 5861--A                          7

  12. SELL, PURCHASE, OR OTHERWISE TRANSFER ALL OR ANY  PORTION  OF  ANY
INTEREST  IN  A  TRANSCO  COMPANY  ON  SUCH  TERMS AND CONDITIONS AS THE
AUTHORITY DEEMS APPROPRIATE;
  13.  ASSIGN  ONE  OR  MORE  EMPLOYEES TO PROVIDE SERVICES TO A TRANSCO
COMPANY FOR A SPECIFIED PERIOD OF TIME, PROVIDED THAT ANY SUCH  EMPLOYEE
SHALL CONTINUE TO BE AN EMPLOYEE OF THE AUTHORITY; AND
  14.  DISSOLVE  OR  TERMINATE THE SUBSIDIARY COMPANY IN ACCORDANCE WITH
APPLICABLE LAW.
  (IV) NOTWITHSTANDING THE PROVISIONS OF  ANY  OTHER  LAW,  NO  TRUSTEE,
OFFICER OR EMPLOYEE OF THE STATE, OR OF ANY STATE AGENCY, PUBLIC AUTHOR-
ITY  OR PUBLIC BENEFIT CORPORATION, SHALL BE DEEMED TO HAVE FORFEITED OR
SHALL FORFEIT SUCH PERSON'S OFFICE OR EMPLOYMENT OR ANY BENEFITS ASSOCI-
ATED THEREWITH BY REASON OF SUCH PERSON'S ACCEPTANCE OF  MEMBERSHIP  ON,
OR  SUCH  PERSON  BEING  AN  OFFICER, EMPLOYEE OR AGENT OF, A SUBSIDIARY
COMPANY, OR BY REASON OF  SUCH  PERSON'S  PROVISION  OF  SERVICES  TO  A
SUBSIDIARY COMPANY.
  (V)  THE  PROVISIONS  OF  SECTION ONE THOUSAND TWENTY-CC OF THIS TITLE
SHALL BE INAPPLICABLE TO ANY TRANSCO MASTER AGREEMENT, TRANSCO ANCILLARY
AGREEMENT AND TRANSCO PROJECT AGREEMENT.
  (VI) THE PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A  OF
THIS  CHAPTER  SHALL  BE  APPLICABLE  TO ANY TRANSCO MASTER AGREEMENT TO
WHICH THE AUTHORITY OR SUBSIDIARY COMPANY IS A PARTY, BUT SHALL BE INAP-
PLICABLE TO ANY TRANSCO ANCILLARY AGREEMENT OR TRANSCO PROJECT AGREEMENT
THAT OTHERWISE SATISFIES THE REQUIREMENTS OF PARAGRAPH  (A)  OR  (B)  OF
SUBDIVISION ONE OF SUCH SECTION PROVIDED THAT 1. A FINAL OR SUBSTANTIAL-
LY  NEGOTIATED  FORM  OF  SUCH  TRANSCO  ANCILLARY  AGREEMENT OR TRANSCO
PROJECT AGREEMENT, AS THE CASE MAY BE, IS ANNEXED TO  A  TRANSCO  MASTER
AGREEMENT  THAT  HAS BECOME VALID AND ENFORCEABLE IN ACCORDANCE WITH THE
PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS  CHAP-
TER,  AND  2.  IN  THE  CASE  OF  A TRANSCO PROJECT AGREEMENT, THE FINAL
EXECUTED FORM OF SUCH TRANSCO PROJECT AGREEMENT IS LIMITED TO A  TRANSCO
PROJECT THAT WAS IDENTIFIED IN SUCH TRANSCO MASTER AGREEMENT.
  (VII)  THE  PROVISIONS OF TITLE FIVE-A OF ARTICLE NINE OF THIS CHAPTER
SHALL BE INAPPLICABLE TO ANY DISPOSAL OF PROPERTY BY  THE  AUTHORITY  OR
SUBSIDIARY  COMPANY THAT 1. IS OTHERWISE AUTHORIZED BY THIS TITLE, OR 2.
IS MADE IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT  THAT  HAS  BECOME
VALID AND ENFORCEABLE IN ACCORDANCE WITH THE PROVISIONS OF SECTION TWEN-
TY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAPTER.
  (VIII)  THE  PROVISIONS OF PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION
ONE THOUSAND TWENTY-S OF THIS TITLE AND SECTION THREE-B  OF  THE  PUBLIC
SERVICE  LAW  SHALL BE INAPPLICABLE TO THE RATES, SERVICES AND PRACTICES
RELATED TO THE TRANSCO MASTER AGREEMENT AND ANY  ACTIONS  UNDERTAKEN  BY
THE  AUTHORITY  OR SUBSIDIARY CORPORATION IN ACCORDANCE WITH THE TRANSCO
MASTER AGREEMENT.
  (IX) NO ACTS OR ACTIVITIES TAKEN  OR  PROPOSED  TO  BE  TAKEN  BY  THE
AUTHORITY  OR  A  SUBSIDIARY  COMPANY PURSUANT TO THE PROVISIONS OF THIS
SUBDIVISION, INCLUDING THE EXECUTION OF A TRANSCO MASTER AGREEMENT,  AND
THE  ISSUANCE  OF BONDS, NOTES, OR OTHER OBLIGATIONS, SHALL BE DEEMED TO
BE "ACTIONS" FOR THE PURPOSES OR WITHIN THE MEANING OF ARTICLE EIGHT  OF
THE ENVIRONMENTAL CONSERVATION LAW.
  (X)  NOTWITHSTANDING  THE  PROVISIONS  OF  ANY  OTHER LAW, ANY TRANSCO
COMPANY FORMED OR AUTHORIZED PURSUANT TO THIS ARTICLE IS PROHIBITED FROM
FINANCING OR CONSTRUCTING NEW ELECTRIC GENERATING FACILITIES.
  S 7. Severability clause. If any clause, sentence, paragraph, subdivi-
sion, section or part of this act shall be  adjudged  by  any  court  of
competent  jurisdiction  to  be invalid, such judgment shall not affect,

S. 5861--A                          8

impair, or invalidate the remainder thereof, but shall  be  confined  in
its  operation  to the clause, sentence, paragraph, subdivision, section
or part thereof directly involved in the controversy in which such judg-
ment shall have been rendered. It is hereby declared to be the intent of
the  legislature  that  this  act  would  have been enacted even if such
invalid provisions had not been included therewith.
  S 8. This act shall take effect immediately.

Co-Sponsors

S5861B - Bill Details

See Assembly Version of this Bill:
A8095C
Current Committee:
Law Section:
Public Authorities Law
Laws Affected:
Amd §§1001, 1005, 1020-a, 1020-c & 1020-f, Pub Auth L

S5861B - Bill Texts

view summary

Authorizes the power authority of the state of New York and the Long Island power authority to enter into public-private partnerships for the improvement of the state's electric transmission grid.

view sponsor memo
BILL NUMBER:S5861B

TITLE OF BILL: An act to amend the public authorities law, in
relation to authorizing the power authority of the state of New York
and the Long Island power authority to participate in public-private
transmission projects to improve the state's electric transmission
grid

PURPOSE: This bill would allow the creation of a public-private
partnership between the State's public utilities - the Power Authority
of the State of New York (NYPA) and the Long Island Power Authority
(LIPA) - and the State's private transmission owners, for the sole
purpose of jointly developing, constructing and owning transmission
facilities in New York State. This partnership would be in the form of
a New York Transmission Company (Transco) that would pursue new
transmission projects that would enhance the current capabilities of
the bulk power system within New York State.

SUMMARY OF PROVISIONS:

Section 1 of the bill would provide legislative findings.

Section 2 would amend the "declaration of policy" in NYPA's enabling
statute.

Section 3 would amend PAL § 1005 to, among other things, provide
definitions of key terms, authorize NYPA to form a subsidiary company
for purposes of participating in the Transco company, and to provide
commensurate financial powers. This section would exempt projects from
article eight of the environmental conservation law since these
projects are subject to other regulatory review, which includes an
environmental review. Further, this section specifies that any
transmission company that may be created, may not engage in the
construction of electric generating facilities and further clarifies
that such company shall engage in projects directly related to
transmission reinforcement and construction.

Section 4 of the bill would amend the legislative findings in LIPA's
enabling statute PAL § 1020-a.

Section 5 would amend subdivision 2 of PAL § 1020-c(2) to provide LIPA
or subsidiary company an interest in transmission assets that are
located in whole or in part outside the LIPA service area.

Section 6 would amend PAL § 1020-f to provide authority consistent
with the authority to be provided in section 3 of the bill.

Section 7 of the bill would provide a severability clause.

Section 8 of the bill would make the bill effective immediately.

EXISTING LAW: PAL § 1005 provides NYPA's existing authority, and PAL
1020-f provides LIPA's existing statutory authority.

JUSTIFICATION: The State's electric transmission system is facing two
major challenges: 1) Aging infrastructure that requires significant
reinvestment; and 2) System constraints that cause transmission


congestion, creating higher electric customer costs. Over 40 percent
of the State's electric transmission system will require replacement
within the next 30 years, at an estimated cost of $25 billion.
Replacement is required to assure longterm reliability of the electric
system. The State's electric transmission system is also congested at
critical points on the pathways linking upstate and downstate New
York. Together, New York City, Long Island, and Westchester County
account for more than half of the demand for electricity in the State
and this demand is increasing. However, in times of peak demand and
high prices, lower-cost and/or cleaner power available from upstate
cannot reach these densely populated areas because of the transmission
bottlenecks Congestion can have adverse environmental and economic
consequences. Older, less energy-efficient and cost-effective plants
in urban areas run more frequently than they otherwise would if power
from other sources of energy could reach these areas.

Under the approach provided for in this bill, NYPA and LIPA would each
be authorized to form a subsidiary company to participate as a member
of a Transco company. These public and private partners would enter
into an agreement providing for the formation of the Transco company,
the projects that could be undertaken by the Transco, and the rights
and obligations of the Transco members. It is expected that the
Transco agreement would authorize Transco members to enter into
ancillary agreements that would provide for the administration of the
Transco and individual Transco projects

This unique approach to addressing the State's aging infrastructure
empowers the State's transmission owners to create a unified plan for
statewide electric power benefits. Such a partnership would facilitate
state-wide transmission planning, facilitate lower financing costs for
grid infrastructure projects and improvements, and promote sorely
needed and sensible investment in the State's power grid.

Transco projects will provide numerous short and long term benefits to
New York residents, such as reducing transmission constraints between
the upstate and downstate regions, creating a stronger and more
resilient transmission system with improved reliability, creating jobs
and stimulating statewide economic growth, increasing local property
tax revenues, reducing pollution emissions by dispatching more energy
efficient generation resources; and facilitating the integration of
renewable resources, including wind generation resources, located in
upstate and elsewhere in New York.

LEGISLATIVE HISTORY: This is a new bill.

BUDGET IMPLICATIONS: There are no budget implications.

EFFECTIVE DATE: This bill would take effect immediately upon
enactment into law.

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

                                 5861--B

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              June 18, 2013
                               ___________

Introduced  by  Sens. MAZIARZ, O'MARA -- read twice and ordered printed,
  and when printed to be committed to the Committee on Rules  --  recom-
  mitted to the Committee on Energy and Telecommunications in accordance
  with  Senate  Rule  6,  sec.  8 -- committee discharged, bill amended,
  ordered reprinted as amended and  recommitted  to  said  committee  --
  committee  discharged,  bill amended, ordered reprinted as amended and
  recommitted to said committee

AN ACT to amend the public authorities law, in relation  to  authorizing
  the power authority of the state of New York and the Long Island power
  authority  to  participate  in public-private transmission projects to
  improve the state's electric transmission grid

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

  Section  1.  Legislative  findings and purpose. The legislature hereby
finds and determines that:
  1. The state's vital electric transmission grid  is  aging,  congested
and  subject  to  outages caused by storms, obsolescence and the growing
demands for energy by the  state's  residents,  and  such  problems  and
conditions  pose  serious  threats  to  the  health, welfare, safety and
economic well-being of the people of the state of New York.
  2. The condition and operation of the  state's  electric  transmission
grid  is  a matter of state concern, and it is in the public interest to
provide for the means  to  repair,  replace,  reinforce,  modernize  and
expand  the  state's  electric  transmission grid to ensure the safe and
reliable provision of electric service to the state's residents now  and
into the future.
  3.  A  modernized  electric  transmission grid and energy highway will
also encourage investments  in  new  energy-related  infrastructure  and
technologies,  facilitate the development and integration into the power
grid of renewable energy resources, and stimulate and  support  economic
development in the state. Public-private transmission projects undertak-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11579-05-4

S. 5861--B                          2

en  jointly by the owner of transmission facilities, systems and infras-
tructure, including the power authority of the state of New York and the
Long Island power authority, which provide  for  the  ongoing  planning,
construction,  owning,  operating, maintaining and expanding of electric
transmission facilities, systems and  infrastructure  can  serve  as  an
effective  means to address the aforementioned problems and concerns and
stimulate ongoing critical investment in  the  state's  electric  trans-
mission grid.
  4.  The purposes of this act can be achieved, while managing and miti-
gating potential liabilities, by authorizing the power authority of  the
state  of New York and the Long Island power authority to participate in
such public-private  transmission  projects  through  the  formation  of
subsidiary companies.
  S 2. Section 1001 of the public authorities law is amended by adding a
new closing paragraph to read as follows:
  IT  IS FURTHER DECLARED THAT: (A) THERE SHOULD BE FULL COOPERATION AND
COORDINATION AMONG PRIVATE AND PUBLIC OWNERS AND OPERATORS  OF  ELECTRIC
TRANSMISSION  FACILITIES,  SYSTEMS  AND  INFRASTRUCTURE  IN  THE  STATE,
INCLUDING THE AUTHORITY, FOR THE  PURPOSE  OF  EXPEDITIOUSLY  REPAIRING,
REPLACING,  REINFORCING,  MODERNIZING AND EXPANDING THE STATE'S ELECTRIC
TRANSMISSION GRID; (B) IT IS DESIRABLE THAT THE  AUTHORITY,  WHICH  OWNS
AND  OPERATES  ELECTRIC TRANSMISSION ASSETS IN THE STATE, PARTICIPATE IN
PUBLIC-PRIVATE TRANSMISSION PROJECTS THAT ARE UNDERTAKEN  BY  A  LIMITED
LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZATIONAL STRUCTURE, THROUGH
A  SUBSIDIARY  COMPANY  FORMED  BY  THE  AUTHORITY AS AUTHORIZED BY THIS
TITLE; AND (C) THE AUTHORITY SHOULD  BE  AUTHORIZED  TO  PARTICIPATE  IN
PUBLIC-PRIVATE TRANSMISSION PROJECTS AND TRANSFER TRANSMISSION ASSETS OR
ANY  INTEREST  THEREIN  IN  CONNECTION  WITH ITS PARTICIPATION IN SUCH A
LIMITED LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZATIONAL  STRUCTURE
ON SUCH TERMS AND CONDITIONS AS THE AUTHORITY MAY NEGOTIATE.
  S 3. Section 1005 of the public authorities law is amended by adding a
new subdivision 25 to read as follows:
  25.  A.  FOR  PURPOSES  OF THIS SUBDIVISION, THE FOLLOWING TERMS SHALL
HAVE THE MEANINGS INDICATED:
  (I)  "SUBSIDIARY  COMPANY"  MEANS   A   SUBSIDIARY   COMPANY   FORMED,
WHOLLY-OWNED  AND  CONTROLLED  BY  THE  AUTHORITY IN ACCORDANCE WITH AND
SUBJECT TO THE BUSINESS CORPORATION LAW, THE NOT-FOR-PROFIT  CORPORATION
LAW,  THE  LIMITED  LIABILITY  COMPANY  LAW OR THE TRANSPORTATION CORPO-
RATIONS LAW.
  (II) "TRANSCO MASTER AGREEMENT" MEANS A  WRITTEN  AGREEMENT  PROVIDING
FOR  THE FORMATION AND OPERATION OF A LIMITED LIABILITY COMPANY OR OTHER
ORGANIZATIONAL STRUCTURE  TO  SERVE  AS  A  TRANSCO  COMPANY  AND  WHICH
PROVIDES  FOR, AMONG OTHER THINGS, THE RIGHTS AND OBLIGATIONS OF MEMBERS
OF SUCH TRANSCO COMPANY.
  (III) "TRANSCO ANCILLARY AGREEMENT" MEANS A WRITTEN  AGREEMENT,  OTHER
THAN  A  TRANSCO  PROJECT AGREEMENT, BETWEEN THE AUTHORITY OR SUBSIDIARY
COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS  OF  A  TRANSCO  COMPANY,
MADE IN ACCORDANCE WITH THE TRANSCO MASTER AGREEMENT, FOR THE PURPOSE OF
IMPLEMENTING THE TRANSCO MASTER AGREEMENT.
  (IV)  "TRANSCO  COMPANY"  MEANS  AN ENTITY FORMED IN ACCORDANCE WITH A
TRANSCO MASTER AGREEMENT PRIMARILY  FOR THE PURPOSE OF ENGAGING  IN  THE
BUSINESS  OF PLANNING, CONSTRUCTING, OWNING, OPERATING, MAINTAINING, AND
EXPANDING ELECTRIC TRANSMISSION FACILITIES, SYSTEMS  AND  INFRASTRUCTURE
SERVING THE PEOPLE OF THE STATE OF NEW YORK.
  (V) "TRANSCO PROJECT" MEANS A PROJECT UNDERTAKEN BY THE TRANSCO COMPA-
NY IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT.

S. 5861--B                          3

  (VI) "TRANSCO PROJECT AGREEMENT" MEANS A WRITTEN AGREEMENT BETWEEN THE
AUTHORITY  OR  SUBSIDIARY COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS
OF A TRANSCO COMPANY, MADE IN ACCORDANCE WITH THE TRANSCO MASTER  AGREE-
MENT, THAT RELATES TO A SPECIFIC TRANSCO PROJECT.
  (VII)  "TRANSMISSION ASSETS" MEANS: (1) ALL PHYSICAL ASSETS (INCLUDING
BUT NOT LIMITED TO ELECTRICAL  TRANSMISSION  LINES,  POLES,  TOWERS  AND
SIMILAR STRUCTURES, CONDUITS, SUBSTATIONS, CONVERTER STATIONS, TRANSFOR-
MERS,  CONDUCTORS,  INSULATORS,  SWITCHING  DEVICES, CONTROLS, BREAKERS,
BUSES, STATIONS, RECTIFIERS, REGULATORS, EMERGENCY AND PROTECTIVE EQUIP-
MENT AND DEVICES, UTILITY INTERCONNECTIONS AND OTHER EQUIPMENT  USED  OR
NECESSARY  FOR  THE CONTROL, DISPATCH, RECEIPT AND DELIVERY OF ENERGY BY
SUCH FACILITIES) USED FOR THE  PURPOSE  OF  TRANSMITTING  OR  DELIVERING
DIRECT  OR  ALTERNATING CURRENT ELECTRIC ENERGY AT VOLTAGES PRIMARILY OF
ONE HUNDRED KILOVOLTS OR HIGHER TO LOADS OR INTERCONNECTION POINTS;  AND
(2) ALL ASSOCIATED (A) TANGIBLE AND INTANGIBLE PROPERTY USED TO OPERATE,
CONTROL,  PROTECT AND MAINTAIN SUCH ASSETS, (B) REAL PROPERTY RIGHTS FOR
LANDS AND RIGHTS-OF-WAY, SITES, AND PLACES  IN  WHICH  SUCH  ASSETS  ARE
SITUATED  OR  INSTALLED,  AND  (C) LEGAL AND REGULATORY RIGHTS, AUTHORI-
ZATIONS, PERMITS, AND CONSENTS OF ANY NATURE TO OWN, OCCUPY,  CONSTRUCT,
USE,  OPERATE AND MAINTAIN, AND RECEIVE OR DISPOSE OF REVENUES FROM SUCH
ASSETS OR LANDS ON WHICH SUCH  ASSETS  ARE  SITUATED,  EXISTING,  OWNED,
LEASED, DESIGNED, USED AND OPERATED.
  B.  NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, THE AUTHORITY MAY
(I) PARTICIPATE IN PUBLIC/PRIVATE PARTNERSHIPS TO PROVIDE FOR THE  MEANS
TO REPAIR, REPLACE, REINFORCE, MODERNIZE AND EXPAND THE STATE'S ELECTRIC
TRANSMISSION  GRID TO ENSURE THE SAFE AND RELIABLE PROVISION OF ELECTRIC
SERVICE TO THE STATE'S RESIDENTS NOW AND INTO THE FUTURE,  (II)  FORM  A
SUBSIDIARY  COMPANY FOR THE PURPOSE OF PARTICIPATING IN A TRANSCO COMPA-
NY, (III) PARTICIPATE IN THE TRANSCO COMPANY BY CAUSING  THE  SUBSIDIARY
COMPANY TO BECOME A PARTY TO A TRANSCO MASTER AGREEMENT AND EXERCISE THE
RIGHTS AND PERFORM THE OBLIGATIONS OF A TRANSCO COMPANY MEMBER AS MAY BE
PROVIDED  FOR IN A TRANSCO MASTER AGREEMENT, AND (IV) EXERCISE THE OTHER
POWERS AND DUTIES PROVIDED FOR BY THIS SUBDIVISION.
  C. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, IN ADDITION TO ANY
OTHER POWERS AND DUTIES GRANTED TO IT UNDER THIS  TITLE,  THE  AUTHORITY
SHALL BE AUTHORIZED TO:
  (I)  EXERCISE  ALL  OF  THE  RIGHTS AND PRIVILEGES ASSOCIATED WITH ANY
OWNERSHIP INTEREST IN OR ORGANIZER OF THE SUBSIDIARY COMPANY;
  (II) ISSUE ITS BONDS, NOTES AND  OTHER  EVIDENCE  OF  INDEBTEDNESS  TO
FINANCE  THE OPERATIONS OF THE SUBSIDIARY COMPANY, INCLUDING THE SUBSID-
IARY COMPANY'S PARTICIPATION IN AND OBLIGATIONS UNDERTAKEN IN CONNECTION
WITH A TRANSCO COMPANY;
  (III) LEND, OR OTHERWISE TRANSFER MONIES TO  THE  SUBSIDIARY  COMPANY,
INCLUDING  THE  PROCEEDS OF THE AUTHORITY'S BONDS, NOTES, OTHER EVIDENCE
OF INDEBTEDNESS AND OTHER AUTHORITY FUNDS;
  (IV) RECEIVE MONIES FROM THE SUBSIDIARY COMPANY, INCLUDING MONIES THAT
RESULT FROM THE OPERATION OF THE TRANSCO COMPANY;
  (V) AS DEEMED FEASIBLE AND ADVISABLE BY THE TRUSTEES, TRANSFER TO  THE
SUBSIDIARY  COMPANY  TRANSMISSION  ASSETS OR INTERESTS THEREIN THAT HAVE
BEEN OR ARE EXPECTED TO BE USED IN PROJECTS UNDERTAKEN  BY  THE  TRANSCO
COMPANY FOR SUCH CONSIDERATION AND ON SUCH OTHER TERMS AND CONDITIONS AS
THE AUTHORITY SHALL NEGOTIATE;
  (VI)  RECEIVE  FROM  THE SUBSIDIARY COMPANY OR THE TRANSCO COMPANY ANY
PERSONAL OR REAL PROPERTY;
  (VII) ENTER INTO GUARANTEE AGREEMENTS IN CONNECTION WITH  THE  SUBSID-
IARY COMPANY'S PARTICIPATION IN THE TRANSCO COMPANY;

S. 5861--B                          4

  (VIII)  ENTER  INTO  CONTRACTS  AND  OTHER FORMS OF AGREEMENT WITH THE
TRANSCO COMPANY, THE SUBSIDIARY COMPANY AND OTHER MEMBERS OF THE TRANSCO
COMPANY;
  (IX)  PLEDGE OR ASSIGN ALL OR ANY PORTION OF ANY INTEREST IN A TRANSCO
COMPANY;
  (X) TRANSFER AND RECEIVE ALL OR ANY PORTION OF ANY INTEREST IN A TRAN-
SCO COMPANY;
  (XI) SELL, PURCHASE, OR OTHERWISE TRANSFER ALL OR ANY PORTION  OF  ANY
INTEREST  IN  A  TRANSCO  COMPANY  ON  SUCH  TERMS AND CONDITIONS AS THE
AUTHORITY DEEMS APPROPRIATE;
  (XII) ASSIGN ONE OR MORE EMPLOYEES TO PROVIDE SERVICES  TO  A  TRANSCO
COMPANY  FOR A SPECIFIED PERIOD OF TIME, PROVIDED THAT ANY SUCH EMPLOYEE
SHALL CONTINUE TO BE AN EMPLOYEE OF THE AUTHORITY; AND
  (XIII) DISSOLVE OR TERMINATE THE SUBSIDIARY COMPANY IN ACCORDANCE WITH
APPLICABLE LAW.
  D. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, NO TRUSTEE,  OFFI-
CER  OR  EMPLOYEE OF THE STATE, OR OF ANY STATE AGENCY, PUBLIC AUTHORITY
OR PUBLIC BENEFIT CORPORATION, SHALL BE  DEEMED  TO  HAVE  FORFEITED  OR
SHALL FORFEIT SUCH PERSON'S OFFICE OR EMPLOYMENT OR ANY BENEFITS ASSOCI-
ATED  THEREWITH  BY REASON OF SUCH PERSON'S ACCEPTANCE OF MEMBERSHIP ON,
OR SUCH PERSON BEING AN OFFICER,  EMPLOYEE  OR  AGENT  OF  A  SUBSIDIARY
COMPANY,  OR  BY  REASON  OF  SUCH  PERSON'S  PROVISION OF SERVICES TO A
SUBSIDIARY COMPANY.
  E. THE PROVISIONS OF SECTION TWENTY-EIGHT  HUNDRED  SEVENTY-NINE-A  OF
THIS  CHAPTER  SHALL  BE  APPLICABLE  TO ANY TRANSCO MASTER AGREEMENT TO
WHICH THE AUTHORITY OR SUBSIDIARY COMPANY IS A PARTY, BUT SHALL BE INAP-
PLICABLE TO ANY TRANSCO ANCILLARY AGREEMENT OR TRANSCO PROJECT AGREEMENT
THAT OTHERWISE SATISFIES THE REQUIREMENTS OF PARAGRAPH  (A)  OR  (B)  OF
SUBDIVISION  ONE  OF  SUCH SECTION PROVIDED THAT (I) A FINAL OR SUBSTAN-
TIALLY NEGOTIATED FORM OF SUCH TRANSCO ANCILLARY  AGREEMENT  OR  TRANSCO
PROJECT  AGREEMENT,  AS  THE CASE MAY BE, IS ANNEXED TO A TRANSCO MASTER
AGREEMENT THAT HAS BECOME VALID AND ENFORCEABLE IN ACCORDANCE  WITH  THE
PROVISIONS  OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAP-
TER, AND (II) IN THE CASE OF A  TRANSCO  PROJECT  AGREEMENT,  THE  FINAL
EXECUTED  FORM OF SUCH TRANSCO PROJECT AGREEMENT IS LIMITED TO A TRANSCO
PROJECT THAT WAS IDENTIFIED IN SUCH TRANSCO MASTER AGREEMENT.
  F. THE PROVISIONS OF TITLE FIVE-A OF  ARTICLE  NINE  OF  THIS  CHAPTER
SHALL  BE  INAPPLICABLE  TO ANY DISPOSAL OF PROPERTY BY THE AUTHORITY OR
SUBSIDIARY COMPANY THAT (I) IS OTHERWISE AUTHORIZED BY  THIS  TITLE,  OR
(II)  IS  MADE  IN  ACCORDANCE  WITH A TRANSCO MASTER AGREEMENT THAT HAS
BECOME VALID AND  ENFORCEABLE  IN  ACCORDANCE  WITH  THE  PROVISIONS  OF
SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAPTER.
  G. NO ACTS OR ACTIVITIES TAKEN OR PROPOSED TO BE TAKEN BY THE AUTHORI-
TY  OR  A SUBSIDIARY COMPANY PURSUANT TO THE PROVISIONS OF THIS SUBDIVI-
SION, INCLUDING THE EXECUTION OF A TRANSCO  MASTER  AGREEMENT,  AND  THE
ISSUANCE  OF  BONDS,  NOTES, OR OTHER OBLIGATIONS, SHALL BE DEEMED TO BE
"ACTIONS" FOR THE PURPOSES OR WITHIN THE MEANING OF ARTICLE EIGHT OF THE
ENVIRONMENTAL CONSERVATION LAW.
  H. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW  TO  THE  CONTRARY,
THE AUTHORITY AND THE SUBSIDIARY COMPANY ONLY MAY PARTICIPATE IN A TRAN-
SCO  COMPANY  THAT REPAIRS, REPLACES, REINFORCES, MODERNIZES AND EXPANDS
TRANSMISSION ASSETS, AND, ANY TRANSCO COMPANY IS PROHIBITED FROM FINANC-
ING OR CONSTRUCTING NEW ELECTRIC GENERATING FACILITIES.
  S 4. Section 1020-a of the public authorities law, as added by chapter
517 of the laws of 1986, is amended by adding a new closing paragraph to
read as follows:

S. 5861--B                          5

  THE LEGISLATURE FURTHER FINDS AND DECLARES THAT: (I) THERE  SHOULD  BE
FULL  COOPERATION  AND  COORDINATION AMONG PRIVATE AND PUBLIC OWNERS AND
OPERATORS OF ELECTRIC TRANSMISSION FACILITIES, SYSTEMS  AND  INFRASTRUC-
TURE  IN  THE  STATE,  INCLUDING THE AUTHORITY, FOR THE PURPOSE OF EXPE-
DITIOUSLY  REPAIRING,  REPLACING, REINFORCING, MODERNIZING AND EXPANDING
THE STATE'S ELECTRIC TRANSMISSION GRID; (II) IT IS  DESIRABLE  THAT  THE
AUTHORITY,  WHICH  OWNS AND OPERATES ELECTRIC TRANSMISSION ASSETS IN THE
STATE, PARTICIPATES IN PUBLIC-PRIVATE  TRANSMISSION  PROJECTS  THAT  ARE
UNDERTAKEN BY A LIMITED LIABILITY COMPANY OR OTHER APPROPRIATE ORGANIZA-
TIONAL  STRUCTURE,  THROUGH A SUBSIDIARY COMPANY FORMED BY THE AUTHORITY
AS AUTHORIZED BY THIS TITLE; AND (III) THE AUTHORITY SHOULD  BE  AUTHOR-
IZED TO PARTICIPATE IN PUBLIC-PRIVATE TRANSMISSION PROJECTS AND TRANSFER
TRANSMISSION  ASSETS  OR  ANY  INTEREST  THEREIN  IN CONNECTION WITH ITS
PARTICIPATION IN SUCH A LIMITED LIABILITY COMPANY OR  OTHER  APPROPRIATE
ORGANIZATIONAL  STRUCTURE  ON SUCH TERMS AND CONDITIONS AS THE AUTHORITY
MAY NEGOTIATE.
  S 5. Subdivision 2 of section 1020-c of the public authorities law, as
added by chapter 517 of the laws of 1986, is amended to read as follows:
  2. The area of operations of the authority shall be the service  area,
PROVIDED THAT THE AUTHORITY OR SUBSIDIARY COMPANY MAY OWN AN INTEREST IN
TRANSMISSION  ASSETS  THAT  ARE  LOCATED IN WHOLE OR IN PART OUTSIDE THE
SERVICE AREA.
  S 6. Section 1020-f of the public authorities law is amended by adding
a new subdivision (g-1) to read as follows:
  (G-1) (I) FOR PURPOSES OF THIS SUBDIVISION, THE FOLLOWING  TERMS  HAVE
THE MEANINGS INDICATED:
  1.   "SUBSIDIARY   COMPANY"   MEANS   A   SUBSIDIARY  COMPANY  FORMED,
WHOLLY-OWNED AND CONTROLLED BY THE  AUTHORITY  IN  ACCORDANCE  WITH  AND
SUBJECT  TO THE BUSINESS CORPORATION LAW, THE NOT-FOR-PROFIT CORPORATION
LAW, THE LIMITED LIABILITY COMPANY  LAW  OR  THE  TRANSPORTATION  CORPO-
RATIONS LAW.
  2.  "TRANSCO MASTER AGREEMENT" MEANS A WRITTEN AGREEMENT PROVIDING FOR
THE FORMATION AND OPERATION OF A  LIMITED  LIABILITY  COMPANY  OR  OTHER
ORGANIZATIONAL  STRUCTURE  TO  SERVE  AS  A  TRANSCO  COMPANY  AND WHICH
PROVIDES FOR, AMONG OTHER THINGS, THE RIGHTS AND OBLIGATIONS OF  MEMBERS
OF SUCH TRANSCO COMPANY.
  3. "TRANSCO ANCILLARY AGREEMENT" MEANS A WRITTEN AGREEMENT, OTHER THAN
A TRANSCO PROJECT AGREEMENT, BETWEEN THE AUTHORITY OR SUBSIDIARY COMPANY
AND  THE  TRANSCO  COMPANY  AND/OR MEMBERS OF A TRANSCO COMPANY, MADE IN
ACCORDANCE WITH THE TRANSCO MASTER AGREEMENT, FOR THE PURPOSE OF  IMPLE-
MENTING THE TRANSCO MASTER AGREEMENT.
  4. "TRANSCO COMPANY" MEANS AN ENTITY FORMED IN ACCORDANCE WITH A TRAN-
SCO  MASTER AGREEMENT PRIMARILY FOR THE PURPOSE OF ENGAGING IN THE BUSI-
NESS OF PLANNING,  CONSTRUCTING,  OWNING,  OPERATING,  MAINTAINING,  AND
EXPANDING  ELECTRIC  TRANSMISSION FACILITIES, SYSTEMS AND INFRASTRUCTURE
SERVING THE PEOPLE OF THE STATE OF NEW YORK.
  5. "TRANSCO PROJECT" MEANS A PROJECT UNDERTAKEN BY THE TRANSCO COMPANY
IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT.
  6. "TRANSCO PROJECT AGREEMENT" MEANS A WRITTEN AGREEMENT  BETWEEN  THE
AUTHORITY  OR  SUBSIDIARY COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS
OF A TRANSCO COMPANY, MADE IN ACCORDANCE WITH THE TRANSCO MASTER  AGREE-
MENT, THAT RELATES TO A SPECIFIC TRANSCO PROJECT.
  7. "TRANSMISSION ASSETS" MEANS: (A) ALL PHYSICAL ASSETS (INCLUDING BUT
NOT  LIMITED TO ELECTRICAL TRANSMISSION LINES, POLES, TOWERS AND SIMILAR
STRUCTURES, CONDUITS,  SUBSTATIONS,  CONVERTER  STATIONS,  TRANSFORMERS,
CONDUCTORS,  INSULATORS,  SWITCHING  DEVICES, CONTROLS, BREAKERS, BUSES,

S. 5861--B                          6

STATIONS, RECTIFIERS, REGULATORS, EMERGENCY AND PROTECTIVE EQUIPMENT AND
DEVICES, UTILITY INTERCONNECTIONS AND OTHER EQUIPMENT USED OR  NECESSARY
FOR THE CONTROL, DISPATCH, RECEIPT AND DELIVERY OF ENERGY BY SUCH FACIL-
ITIES)  USED  FOR  THE  PURPOSE  OF TRANSMITTING OR DELIVERING DIRECT OR
ALTERNATING CURRENT ELECTRIC ENERGY AT VOLTAGES PRIMARILY OF ONE HUNDRED
KILOVOLTS OR HIGHER TO LOADS OR  INTERCONNECTION  POINTS;  AND  (B)  ALL
ASSOCIATED  (I)  TANGIBLE  AND  INTANGIBLE  PROPERTY  USED  TO  OPERATE,
CONTROL, PROTECT AND MAINTAIN SUCH ASSETS, (II) REAL PROPERTY RIGHTS FOR
LANDS AND RIGHTS-OF-WAY, SITES, AND PLACES  IN  WHICH  SUCH  ASSETS  ARE
SITUATED  OR  INSTALLED, AND (III) LEGAL AND REGULATORY RIGHTS, AUTHORI-
ZATIONS, PERMITS, AND CONSENTS OF ANY NATURE TO OWN, OCCUPY,  CONSTRUCT,
USE,  OPERATE AND MAINTAIN, AND RECEIVE OR DISPOSE OF REVENUES FROM SUCH
ASSETS OR LANDS ON WHICH SUCH  ASSETS  ARE  SITUATED,  EXISTING,  OWNED,
LEASED, DESIGNED, USED AND OPERATED.
  (II)  NOTWITHSTANDING  THE  PROVISIONS OF ANY OTHER LAW, INCLUDING THE
PROVISIONS OF SECTION ONE THOUSAND TWENTY-I OF THIS TITLE, THE AUTHORITY
MAY 1. FORM A SUBSIDIARY COMPANY FOR THE PURPOSE OF PARTICIPATING  IN  A
TRANSCO  COMPANY, 2.   PARTICIPATE IN THE TRANSCO COMPANY BY CAUSING THE
SUBSIDIARY COMPANY TO BECOME A PARTY TO A TRANSCO MASTER  AGREEMENT  AND
EXERCISE  THE  RIGHTS  AND  PERFORM THE OBLIGATIONS OF A TRANSCO COMPANY
MEMBER AS MAY BE PROVIDED FOR IN A  TRANSCO  MASTER  AGREEMENT,  AND  3.
EXERCISE THE OTHER POWERS AND DUTIES PROVIDED FOR BY THIS SUBDIVISION.
  (III)  NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, IN ADDITION TO
ANY OTHER POWERS AND DUTIES GRANTED TO IT UNDER THIS TITLE, THE AUTHORI-
TY SHALL BE AUTHORIZED TO:
  1.   PARTICIPATE IN PUBLIC/PRIVATE PARTNERSHIPS  TO  PROVIDE  FOR  THE
MEANS  TO  REPAIR,  REPLACE, REINFORCE, MODERNIZE AND EXPAND THE STATE'S
ELECTRIC TRANSMISSION GRID TO ENSURE THE SAFE AND RELIABLE PROVISION  OF
ELECTRIC  SERVICE  TO THE SERVICE AREA AND THE STATE'S RESIDENTS NOW AND
INTO THE FUTURE;
  2. EXERCISE ALL OF THE  RIGHTS  AND  PRIVILEGES  ASSOCIATED  WITH  ANY
OWNERSHIP INTEREST IN OR ORGANIZER OF THE SUBSIDIARY COMPANY;
  3.  ISSUE  ITS  BONDS,  NOTES  AND  OTHER  EVIDENCE OF INDEBTEDNESS TO
FINANCE THE OPERATIONS OF THE SUBSIDIARY COMPANY, INCLUDING THE  SUBSID-
IARY COMPANY'S PARTICIPATION IN AND OBLIGATIONS UNDERTAKEN IN CONNECTION
WITH A TRANSCO COMPANY;
  4.  LEND,  OR  OTHERWISE  TRANSFER  MONIES  TO THE SUBSIDIARY COMPANY,
INCLUDING THE PROCEEDS OF THE AUTHORITY'S BONDS, NOTES,  OTHER  EVIDENCE
OF INDEBTEDNESS AND OTHER AUTHORITY FUNDS;
  5.  RECEIVE  MONIES FROM THE SUBSIDIARY COMPANY, INCLUDING MONIES THAT
RESULT FROM THE OPERATION OF THE TRANSCO COMPANY;
  6.  AS DEEMED FEASIBLE AND ADVISABLE BY THE TRUSTEES, TRANSFER TO  THE
SUBSIDIARY COMPANY TRANSMISSION ASSETS THAT HAVE BEEN OR ARE EXPECTED TO
BE USED IN PROJECTS UNDERTAKEN BY THE TRANSCO COMPANY FOR SUCH CONSIDER-
ATION  AND  ON  SUCH  OTHER  TERMS AND CONDITIONS AS THE AUTHORITY SHALL
NEGOTIATE;
  7. RECEIVE FROM THE SUBSIDIARY COMPANY  OR  THE  TRANSCO  COMPANY  ANY
PERSONAL OR REAL PROPERTY;
  8.  ENTER  INTO GUARANTEE AGREEMENTS IN CONNECTION WITH THE SUBSIDIARY
COMPANY'S PARTICIPATION IN THE TRANSCO COMPANY;
  9. ENTER INTO CONTRACTS AND OTHER FORMS OF AGREEMENT WITH THE  TRANSCO
COMPANY,  THE SUBSIDIARY COMPANY AND OTHER MEMBERS OF THE TRANSCO COMPA-
NY;
  10. PLEDGE OR ASSIGN ALL OR ANY PORTION OF ANY INTEREST IN  A  TRANSCO
COMPANY;

S. 5861--B                          7

  11. TRANSFER AND RECEIVE ALL OR ANY PORTION OF ANY INTEREST IN A TRAN-
SCO COMPANY;
  12.  SELL,  PURCHASE,  OR OTHERWISE TRANSFER ALL OR ANY PORTION OF ANY
INTEREST IN A TRANSCO COMPANY  ON  SUCH  TERMS  AND  CONDITIONS  AS  THE
AUTHORITY DEEMS APPROPRIATE;
  13.  ASSIGN  ONE  OR  MORE  EMPLOYEES TO PROVIDE SERVICES TO A TRANSCO
COMPANY FOR A SPECIFIED PERIOD OF TIME, PROVIDED THAT ANY SUCH  EMPLOYEE
SHALL CONTINUE TO BE AN EMPLOYEE OF THE AUTHORITY; AND
  14.  DISSOLVE  OR  TERMINATE THE SUBSIDIARY COMPANY IN ACCORDANCE WITH
APPLICABLE LAW.
  (IV) NOTWITHSTANDING THE PROVISIONS OF  ANY  OTHER  LAW,  NO  TRUSTEE,
OFFICER OR EMPLOYEE OF THE STATE, OR OF ANY STATE AGENCY, PUBLIC AUTHOR-
ITY  OR PUBLIC BENEFIT CORPORATION, SHALL BE DEEMED TO HAVE FORFEITED OR
SHALL FORFEIT SUCH PERSON'S OFFICE OR EMPLOYMENT OR ANY BENEFITS ASSOCI-
ATED THEREWITH BY REASON OF SUCH PERSON'S ACCEPTANCE OF  MEMBERSHIP  ON,
OR  SUCH  PERSON  BEING  AN  OFFICER, EMPLOYEE OR AGENT OF, A SUBSIDIARY
COMPANY, OR BY REASON OF  SUCH  PERSON'S  PROVISION  OF  SERVICES  TO  A
SUBSIDIARY COMPANY.
  (V)  THE  PROVISIONS  OF  SECTION ONE THOUSAND TWENTY-CC OF THIS TITLE
SHALL BE INAPPLICABLE TO ANY TRANSCO MASTER AGREEMENT, TRANSCO ANCILLARY
AGREEMENT AND TRANSCO PROJECT AGREEMENT.
  (VI) THE PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A  OF
THIS  CHAPTER  SHALL  BE  APPLICABLE  TO ANY TRANSCO MASTER AGREEMENT TO
WHICH THE AUTHORITY OR SUBSIDIARY COMPANY IS A PARTY, BUT SHALL BE INAP-
PLICABLE TO ANY TRANSCO ANCILLARY AGREEMENT OR TRANSCO PROJECT AGREEMENT
THAT OTHERWISE SATISFIES THE REQUIREMENTS OF PARAGRAPH  (A)  OR  (B)  OF
SUBDIVISION ONE OF SUCH SECTION PROVIDED THAT 1. A FINAL OR SUBSTANTIAL-
LY  NEGOTIATED  FORM  OF  SUCH  TRANSCO  ANCILLARY  AGREEMENT OR TRANSCO
PROJECT AGREEMENT, AS THE CASE MAY BE, IS ANNEXED TO  A  TRANSCO  MASTER
AGREEMENT  THAT  HAS BECOME VALID AND ENFORCEABLE IN ACCORDANCE WITH THE
PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS  CHAP-
TER,  AND  2.  IN  THE  CASE  OF  A TRANSCO PROJECT AGREEMENT, THE FINAL
EXECUTED FORM OF SUCH TRANSCO PROJECT AGREEMENT IS LIMITED TO A  TRANSCO
PROJECT THAT WAS IDENTIFIED IN SUCH TRANSCO MASTER AGREEMENT.
  (VII)  THE  PROVISIONS OF TITLE FIVE-A OF ARTICLE NINE OF THIS CHAPTER
SHALL BE INAPPLICABLE TO ANY DISPOSAL OF PROPERTY BY  THE  AUTHORITY  OR
SUBSIDIARY  COMPANY THAT 1. IS OTHERWISE AUTHORIZED BY THIS TITLE, OR 2.
IS MADE IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT  THAT  HAS  BECOME
VALID AND ENFORCEABLE IN ACCORDANCE WITH THE PROVISIONS OF SECTION TWEN-
TY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAPTER.
  (VIII)  THE  PROVISIONS OF PARAGRAPH (D) OF SUBDIVISION ONE OF SECTION
ONE THOUSAND TWENTY-S OF THIS TITLE AND SECTION THREE-B  OF  THE  PUBLIC
SERVICE  LAW  SHALL BE INAPPLICABLE TO THE RATES, SERVICES AND PRACTICES
RELATED TO THE TRANSCO MASTER AGREEMENT AND ANY  ACTIONS  UNDERTAKEN  BY
THE  AUTHORITY  OR SUBSIDIARY CORPORATION IN ACCORDANCE WITH THE TRANSCO
MASTER AGREEMENT.
  (IX) NO ACTS OR ACTIVITIES TAKEN  OR  PROPOSED  TO  BE  TAKEN  BY  THE
AUTHORITY  OR  A  SUBSIDIARY  COMPANY PURSUANT TO THE PROVISIONS OF THIS
SUBDIVISION, INCLUDING THE EXECUTION OF A TRANSCO MASTER AGREEMENT,  AND
THE  ISSUANCE  OF BONDS, NOTES, OR OTHER OBLIGATIONS, SHALL BE DEEMED TO
BE "ACTIONS" FOR THE PURPOSES OR WITHIN THE MEANING OF ARTICLE EIGHT  OF
THE ENVIRONMENTAL CONSERVATION LAW.
  (X)  NOTWITHSTANDING  THE PROVISIONS OF ANY OTHER LAW TO THE CONTRARY,
THE AUTHORITY AND THE SUBSIDIARY COMPANY ONLY MAY PARTICIPATE IN A TRAN-
SCO COMPANY THAT REPAIRS, REPLACES, REINFORCES, MODERNIZES  AND  EXPANDS

S. 5861--B                          8

TRANSMISSION ASSETS, AND, ANY TRANSCO COMPANY IS PROHIBITED FROM FINANC-
ING OR CONSTRUCTING NEW ELECTRIC GENERATING FACILITIES.
  S 7. Severability clause. If any clause, sentence, paragraph, subdivi-
sion,  section  or  part  of  this act shall be adjudged by any court of
competent jurisdiction to be invalid, such judgment  shall  not  affect,
impair,  or  invalidate  the remainder thereof, but shall be confined in
its operation to the clause, sentence, paragraph,  subdivision,  section
or part thereof directly involved in the controversy in which such judg-
ment shall have been rendered. It is hereby declared to be the intent of
the  legislature  that  this  act  would  have been enacted even if such
invalid provisions had not been included therewith.
  S 8. This act shall take effect immediately.

Co-Sponsors

S5861C (ACTIVE) - Bill Details

See Assembly Version of this Bill:
A8095C
Current Committee:
Law Section:
Public Authorities Law
Laws Affected:
Amd §§1001, 1005, 1020-a, 1020-c & 1020-f, Pub Auth L

S5861C (ACTIVE) - Bill Texts

view summary

Authorizes the power authority of the state of New York and the Long Island power authority to enter into public-private partnerships for the improvement of the state's electric transmission grid.

view sponsor memo
BILL NUMBER:S5861C

TITLE OF BILL: An act to amend the public authorities law, in
relation to authorizing the power authority of the state of New York
and the Long Island power authority to participate in public-private
transmission projects to improve the state's electric transmission
grid

PURPOSE: This bill would allow the creation of a public-private
partnership between the State's public utilities -- the Power
Authority of the State of New York (NYPA) and the Long Island Power
Authority (LIPA) - and the State's private transmission owners, for
the sole purpose of jointly developing, constructing and owning
transmission facilities in New York State. This partnership would be
in the form of a New York Transmission Company (Transco) that would
pursue new transmission projects that would enhance the current
capabilities of the bulk power system within New York State.

SUMMARY OF PROVISIONS:

Section 1 of the bill would provide legislative findings.

Section 2 would amend the "declaration of policy" in NYPA's enabling
statute.

Section 3 would amend PAL § 1005 to, among other things, provide
definitions of key terms, authorize NYPA to form a subsidiary company
for purposes of participating in the Transco company, and to provide
commensurate financial powers. This section would exempt projects from
article eight of the environmental conservation law since these
projects are subject to other regulatory review, which includes an
environmental review. Further, this section specifies that any
transmission company that may be created, may not engage in the
construction of electric generating facilities and further clarifies
that such company shall engage in projects directly related to
transmission reinforcement and construction.

Section 4 of the bill would amend the legislative findings in LIPA's
enabling statute PAL § 1020-a.

Section 5 would amend subdivision 2 of PAL § 1020-c(2) to provide LIPA
or subsidiary company an interest in transmission assets that are
located in whole or in part outside the LIPA service area.

Section 6 would amend PAL § 1020-f to provide authority consistent
with the authority to be provided in section 3 of the bill.

Section 7 of the bill would provide a severability clause.

Section 8 of the bill would make the bill effective immediately.

EXISTING LAW: PAL § 1005 provides NYPA's existing authority, and PAL
1020-f provides LIPA's existing statutory authority.

JUSTIFICATION: The State's electric transmission system is facing two
major challenges: 1) Aging infrastructure that requires significant
reinvestment; and 2) System constraints that cause transmission


congestion, creating higher electric customer costs. Over 40 percent
of the State's electric transmission system will require replacement
within the next 30 years, at an estimated cost of $25 billion.
Replacement is required to assure longterm reliability of the electric
system. The State's electric transmission system is also congested at
critical points on the pathways linking upstate and downstate New
York. Together, New York City, Long Island, and Westchester County
account for more than half of the demand for electricity in the State
and this demand is increasing. However, in times of peak demand and
high prices, lower-cost and/or cleaner power available from upstate
cannot reach these densely populated areas because of the transmission
bottlenecks Congestion can have adverse environmental and economic
consequences. Older, less energy-efficient and cost-effective plants
in urban areas run more frequently than they otherwise would if power
from other sources of energy could reach these areas.

Under the approach provided for in this bill, NYPA and LIPA would each
be authorized to form a subsidiary company to participate as a member
of a Transco company. These public and private partners would enter
into an agreement providing for the formation of the Transco company,
the projects that could be undertaken by the Transco, and the rights
and obligations of the Transco members. It is expected that the
Transco agreement would authorize Transco members to enter into
ancillary agreements that would provide for the administration of the
Transco and individual Transco projects.

This unique approach to addressing the State's aging infrastructure
empowers the State's transmission owners to create a unified plan for
statewide electric power benefits. Such a partnership would facilitate
state-wide transmission planning, facilitate lower financing costs for
grid infrastructure projects and improvements, and promote sorely
needed and sensible investment in the State's power grid.

Transco projects will provide numerous short and long term benefits to
New York residents, such as reducing transmission constraints between
the upstate and downstate regions, creating a stronger and more
resilient transmission system with improved reliability, creating jobs
and stimulating statewide economic growth, increasing local property
tax revenues, reducing pollution emissions by dispatching more energy
efficient generation resources; and facilitating the integration of
renewable resources, including wind generation resources, located in
upstate and elsewhere in New York.

LEGISLATIVE HISTORY: This is a new bill.

BUDGET IMPLICATIONS: There are no budget implications.

EFFECTIVE DATE: This bill would take effect immediately upon enactment
into law.

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

                                 5861--C

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              June 18, 2013
                               ___________

Introduced  by  Sens. MAZIARZ, O'MARA -- read twice and ordered printed,
  and when printed to be committed to the Committee on Rules  --  recom-
  mitted to the Committee on Energy and Telecommunications in accordance
  with  Senate  Rule  6,  sec.  8 -- committee discharged, bill amended,
  ordered reprinted as amended and  recommitted  to  said  committee  --
  committee  discharged,  bill amended, ordered reprinted as amended and
  recommitted to said committee -- reported favorably from said  commit-
  tee and committed to the Committee on Finance -- committee discharged,
  bill  amended,  ordered  reprinted  as amended and recommitted to said
  committee

AN ACT to amend the public authorities law, in relation  to  authorizing
  the power authority of the state of New York and the Long Island power
  authority  to  participate  in public-private transmission projects to
  improve the state's electric transmission grid

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

  Section  1.  Legislative  findings and purpose. The legislature hereby
finds and determines that:
  1. The state's vital electric transmission grid  is  aging,  congested
and  subject  to  outages caused by storms, obsolescence and the growing
demands for energy by the  state's  residents,  and  such  problems  and
conditions  pose  serious  threats  to  the  health, welfare, safety and
economic well-being of the people of the state of New York.
  2. The condition and operation of the  state's  electric  transmission
grid  is  a matter of state concern, and it is in the public interest to
provide for the means  to  repair,  replace,  reinforce,  modernize  and
expand  the  state's  electric  transmission grid to ensure the safe and
reliable provision of electric service to the state's residents now  and
into the future.
  3.  A  modernized  electric  transmission grid and energy highway will
also encourage investments  in  new  energy-related  infrastructure  and

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD11579-07-4

S. 5861--C                          2

technologies,  facilitate the development and integration into the power
grid of renewable energy resources, and stimulate and  support  economic
development in the state. Public-private transmission projects undertak-
en  jointly by the owner of transmission facilities, systems and infras-
tructure, including the power authority of the state of New York and the
Long Island power authority, which provide  for  the  ongoing  planning,
construction,  owning,  operating, maintaining and expanding of electric
transmission facilities, systems and  infrastructure  can  serve  as  an
effective  means to address the aforementioned problems and concerns and
stimulate ongoing critical investment in  the  state's  electric  trans-
mission grid.
  4.  The purposes of this act can be achieved, while managing and miti-
gating potential liabilities, by authorizing the power authority of  the
state  of New York and the Long Island power authority to participate in
such public-private  transmission  projects  through  the  formation  of
subsidiary companies.
  S 2. Section 1001 of the public authorities law is amended by adding a
new closing paragraph to read as follows:
  IT  IS FURTHER DECLARED THAT: (A) THERE SHOULD BE FULL COOPERATION AND
COORDINATION AMONG PRIVATE AND PUBLIC OWNERS AND OPERATORS  OF  ELECTRIC
TRANSMISSION  FACILITIES,  SYSTEMS  AND  INFRASTRUCTURE  IN  THE  STATE,
INCLUDING THE AUTHORITY, FOR THE PURPOSE OF EXPEDITIOUSLY  CONSTRUCTING,
REPAIRING,  REPLACING, REINFORCING, MODERNIZING OR EXPANDING THE STATE'S
ELECTRIC TRANSMISSION GRID; (B) IT  IS  DESIRABLE  THAT  THE  AUTHORITY,
WHICH  OWNS  AND  OPERATES  ELECTRIC  TRANSMISSION  ASSETS IN THE STATE,
PARTICIPATE IN PUBLIC-PRIVATE TRANSMISSION PROJECTS THAT ARE  UNDERTAKEN
BY  A  LIMITED  LIABILITY  COMPANY  OR  OTHER APPROPRIATE ORGANIZATIONAL
STRUCTURE, THROUGH A SUBSIDIARY  COMPANY  FORMED  BY  THE  AUTHORITY  AS
AUTHORIZED  BY THIS TITLE; AND (C) THE AUTHORITY SHOULD BE AUTHORIZED TO
PARTICIPATE IN PUBLIC-PRIVATE TRANSMISSION PROJECTS AND TRANSFER  TRANS-
MISSION  ASSETS  OR  ANY INTEREST THEREIN IN CONNECTION WITH ITS PARTIC-
IPATION IN SUCH A LIMITED LIABILITY COMPANY OR OTHER APPROPRIATE  ORGAN-
IZATIONAL  STRUCTURE  ON  SUCH TERMS AND CONDITIONS AS THE AUTHORITY MAY
NEGOTIATE.
  S 3. Section 1005 of the public authorities law is amended by adding a
new subdivision 25 to read as follows:
  25. A. FOR PURPOSES OF THIS SUBDIVISION,  THE  FOLLOWING  TERMS  SHALL
HAVE THE MEANINGS INDICATED:
  (I)   "SUBSIDIARY   COMPANY"   MEANS   A  SUBSIDIARY  COMPANY  FORMED,
WHOLLY-OWNED AND CONTROLLED BY THE  AUTHORITY  IN  ACCORDANCE  WITH  AND
SUBJECT  TO THE BUSINESS CORPORATION LAW, THE NOT-FOR-PROFIT CORPORATION
LAW, THE LIMITED LIABILITY COMPANY  LAW  OR  THE  TRANSPORTATION  CORPO-
RATIONS LAW.
  (II)  "TRANSCO  MASTER  AGREEMENT" MEANS A WRITTEN AGREEMENT PROVIDING
FOR THE FORMATION AND OPERATION OF A LIMITED LIABILITY COMPANY OR  OTHER
ORGANIZATIONAL  STRUCTURE  TO  SERVE  AS  A  TRANSCO  COMPANY  AND WHICH
PROVIDES FOR, AMONG OTHER THINGS, THE RIGHTS AND OBLIGATIONS OF  MEMBERS
OF SUCH TRANSCO COMPANY.
  (III)  "TRANSCO  ANCILLARY AGREEMENT" MEANS A WRITTEN AGREEMENT, OTHER
THAN A TRANSCO PROJECT AGREEMENT, BETWEEN THE  AUTHORITY  OR  SUBSIDIARY
COMPANY  AND  THE  TRANSCO  COMPANY AND/OR MEMBERS OF A TRANSCO COMPANY,
MADE IN ACCORDANCE WITH THE TRANSCO MASTER AGREEMENT, FOR THE PURPOSE OF
IMPLEMENTING THE TRANSCO MASTER AGREEMENT.
  (IV) "TRANSCO COMPANY" MEANS AN ENTITY FORMED  IN  ACCORDANCE  WITH  A
TRANSCO  MASTER  AGREEMENT PRIMARILY  FOR THE PURPOSE OF ENGAGING IN THE
BUSINESS OF PLANNING, CONSTRUCTING, OWNING, OPERATING, MAINTAINING,  AND

S. 5861--C                          3

EXPANDING  ELECTRIC  TRANSMISSION FACILITIES, SYSTEMS AND INFRASTRUCTURE
SERVING THE PEOPLE OF THE STATE OF NEW YORK.
  (V) "TRANSCO PROJECT" MEANS A PROJECT UNDERTAKEN BY THE TRANSCO COMPA-
NY IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT.
  (VI) "TRANSCO PROJECT AGREEMENT" MEANS A WRITTEN AGREEMENT BETWEEN THE
AUTHORITY  OR  SUBSIDIARY COMPANY AND THE TRANSCO COMPANY AND/OR MEMBERS
OF A TRANSCO COMPANY, MADE IN ACCORDANCE WITH THE TRANSCO MASTER  AGREE-
MENT, THAT RELATES TO A SPECIFIC TRANSCO PROJECT.
  (VII)  "TRANSMISSION ASSETS" MEANS: (1) ALL PHYSICAL ASSETS (INCLUDING
BUT NOT LIMITED TO ELECTRICAL  TRANSMISSION  LINES,  POLES,  TOWERS  AND
SIMILAR STRUCTURES, CONDUITS, SUBSTATIONS, CONVERTER STATIONS, TRANSFOR-
MERS,  CONDUCTORS,  INSULATORS,  SWITCHING  DEVICES, CONTROLS, BREAKERS,
BUSES, STATIONS, RECTIFIERS, REGULATORS, EMERGENCY AND PROTECTIVE EQUIP-
MENT AND DEVICES, UTILITY INTERCONNECTIONS AND OTHER EQUIPMENT  USED  OR
NECESSARY  FOR  THE CONTROL, DISPATCH, RECEIPT AND DELIVERY OF ENERGY BY
SUCH FACILITIES) USED FOR THE  PURPOSE  OF  TRANSMITTING  OR  DELIVERING
DIRECT  OR  ALTERNATING CURRENT ELECTRIC ENERGY AT VOLTAGES PRIMARILY OF
ONE HUNDRED KILOVOLTS OR HIGHER TO LOADS OR INTERCONNECTION POINTS;  AND
(2) ALL ASSOCIATED (A) TANGIBLE AND INTANGIBLE PROPERTY USED TO OPERATE,
CONTROL,  PROTECT AND MAINTAIN SUCH ASSETS, (B) REAL PROPERTY RIGHTS FOR
LANDS AND RIGHTS-OF-WAY, SITES, AND PLACES  IN  WHICH  SUCH  ASSETS  ARE
SITUATED  OR  INSTALLED,  AND  (C) LEGAL AND REGULATORY RIGHTS, AUTHORI-
ZATIONS, PERMITS, AND CONSENTS OF ANY NATURE TO OWN, OCCUPY,  CONSTRUCT,
USE,  OPERATE AND MAINTAIN, AND RECEIVE OR DISPOSE OF REVENUES FROM SUCH
ASSETS OR LANDS ON WHICH SUCH  ASSETS  ARE  SITUATED,  EXISTING,  OWNED,
LEASED, DESIGNED, USED AND OPERATED.
  B.  NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, THE AUTHORITY MAY
(I) PARTICIPATE IN PUBLIC/PRIVATE PARTNERSHIPS TO PROVIDE FOR THE  MEANS
TO  CONSTRUCT,  REPAIR,  REPLACE,  REINFORCE,  MODERNIZE  AND EXPAND THE
STATE'S ELECTRIC TRANSMISSION GRID  TO  ENSURE  THE  SAFE  AND  RELIABLE
PROVISION  OF ELECTRIC SERVICE TO THE STATE'S RESIDENTS NOW AND INTO THE
FUTURE, (II) FORM A SUBSIDIARY COMPANY FOR THE PURPOSE OF  PARTICIPATING
IN  A TRANSCO COMPANY, (III) PARTICIPATE IN THE TRANSCO COMPANY BY CAUS-
ING THE SUBSIDIARY COMPANY TO BECOME A PARTY TO A TRANSCO MASTER  AGREE-
MENT  AND  EXERCISE  THE RIGHTS AND PERFORM THE OBLIGATIONS OF A TRANSCO
COMPANY MEMBER AS MAY BE PROVIDED FOR IN A TRANSCO MASTER AGREEMENT, AND
(IV) EXERCISE THE OTHER POWERS AND DUTIES PROVIDED FOR BY THIS  SUBDIVI-
SION.
  C. NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, IN ADDITION TO ANY
OTHER  POWERS  AND  DUTIES GRANTED TO IT UNDER THIS TITLE, THE AUTHORITY
SHALL BE AUTHORIZED TO:
  (I) EXERCISE ALL OF THE RIGHTS  AND  PRIVILEGES  ASSOCIATED  WITH  ANY
OWNERSHIP INTEREST IN OR ORGANIZER OF THE SUBSIDIARY COMPANY;
  (II)  ISSUE  ITS  BONDS,  NOTES  AND OTHER EVIDENCE OF INDEBTEDNESS TO
FINANCE THE OPERATIONS OF THE SUBSIDIARY COMPANY, INCLUDING THE  SUBSID-
IARY COMPANY'S PARTICIPATION IN AND OBLIGATIONS UNDERTAKEN IN CONNECTION
WITH A TRANSCO COMPANY;
  (III)  LEND,  OR  OTHERWISE TRANSFER MONIES TO THE SUBSIDIARY COMPANY,
INCLUDING THE PROCEEDS OF THE AUTHORITY'S BONDS, NOTES,  OTHER  EVIDENCE
OF INDEBTEDNESS AND OTHER AUTHORITY FUNDS;
  (IV) RECEIVE MONIES FROM THE SUBSIDIARY COMPANY, INCLUDING MONIES THAT
RESULT FROM THE OPERATION OF THE TRANSCO COMPANY;
  (V)  AS DEEMED FEASIBLE AND ADVISABLE BY THE TRUSTEES, TRANSFER TO THE
SUBSIDIARY COMPANY TRANSMISSION ASSETS OR INTERESTS  THEREIN  THAT  HAVE
BEEN  OR  ARE  EXPECTED TO BE USED IN PROJECTS UNDERTAKEN BY THE TRANSCO

S. 5861--C                          4

COMPANY FOR SUCH CONSIDERATION AND ON SUCH OTHER TERMS AND CONDITIONS AS
THE AUTHORITY SHALL NEGOTIATE;
  (VI)  RECEIVE  FROM  THE SUBSIDIARY COMPANY OR THE TRANSCO COMPANY ANY
PERSONAL OR REAL PROPERTY;
  (VII) ENTER INTO GUARANTEE AGREEMENTS IN CONNECTION WITH  THE  SUBSID-
IARY COMPANY'S PARTICIPATION IN THE TRANSCO COMPANY;
  (VIII)  ENTER  INTO  CONTRACTS  AND  OTHER FORMS OF AGREEMENT WITH THE
TRANSCO COMPANY, THE SUBSIDIARY COMPANY AND OTHER MEMBERS OF THE TRANSCO
COMPANY;
  (IX) PLEDGE OR ASSIGN ALL OR ANY PORTION OF ANY INTEREST IN A  TRANSCO
COMPANY;
  (X) TRANSFER AND RECEIVE ALL OR ANY PORTION OF ANY INTEREST IN A TRAN-
SCO COMPANY;
  (XI)  SELL,  PURCHASE, OR OTHERWISE TRANSFER ALL OR ANY PORTION OF ANY
INTEREST IN A TRANSCO COMPANY  ON  SUCH  TERMS  AND  CONDITIONS  AS  THE
AUTHORITY DEEMS APPROPRIATE;
  (XII)  ASSIGN  ONE  OR MORE EMPLOYEES TO PROVIDE SERVICES TO A TRANSCO
COMPANY FOR A SPECIFIED PERIOD OF TIME, PROVIDED THAT ANY SUCH  EMPLOYEE
SHALL CONTINUE TO BE AN EMPLOYEE OF THE AUTHORITY; AND
  (XIII) DISSOLVE OR TERMINATE THE SUBSIDIARY COMPANY IN ACCORDANCE WITH
APPLICABLE LAW.
  D.  NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, NO TRUSTEE, OFFI-
CER OR EMPLOYEE OF THE STATE, OR OF ANY STATE AGENCY,  PUBLIC  AUTHORITY
OR  PUBLIC  BENEFIT  CORPORATION,  SHALL  BE DEEMED TO HAVE FORFEITED OR
SHALL FORFEIT SUCH PERSON'S OFFICE OR EMPLOYMENT OR ANY BENEFITS ASSOCI-
ATED THEREWITH BY REASON OF SUCH PERSON'S ACCEPTANCE OF  MEMBERSHIP  ON,
OR  SUCH  PERSON  BEING  AN  OFFICER,  EMPLOYEE OR AGENT OF A SUBSIDIARY
COMPANY, OR BY REASON OF  SUCH  PERSON'S  PROVISION  OF  SERVICES  TO  A
SUBSIDIARY COMPANY.
  E.  THE  PROVISIONS  OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF
THIS CHAPTER SHALL BE APPLICABLE TO  ANY  TRANSCO  MASTER  AGREEMENT  TO
WHICH THE AUTHORITY OR SUBSIDIARY COMPANY IS A PARTY, BUT SHALL BE INAP-
PLICABLE TO ANY TRANSCO ANCILLARY AGREEMENT OR TRANSCO PROJECT AGREEMENT
THAT  OTHERWISE  SATISFIES  THE  REQUIREMENTS OF PARAGRAPH (A) OR (B) OF
SUBDIVISION ONE OF SUCH SECTION PROVIDED THAT (I) A  FINAL  OR  SUBSTAN-
TIALLY  NEGOTIATED  FORM  OF SUCH TRANSCO ANCILLARY AGREEMENT OR TRANSCO
PROJECT AGREEMENT, AS THE CASE MAY BE, IS ANNEXED TO  A  TRANSCO  MASTER
AGREEMENT  THAT  HAS BECOME VALID AND ENFORCEABLE IN ACCORDANCE WITH THE
PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS  CHAP-
TER,  AND  (II)  IN  THE  CASE OF A TRANSCO PROJECT AGREEMENT, THE FINAL
EXECUTED FORM OF SUCH TRANSCO PROJECT AGREEMENT IS LIMITED TO A  TRANSCO
PROJECT THAT WAS IDENTIFIED IN SUCH TRANSCO MASTER AGREEMENT.
  F.  THE  PROVISIONS  OF  TITLE  FIVE-A OF ARTICLE NINE OF THIS CHAPTER
SHALL BE INAPPLICABLE TO ANY DISPOSAL OF PROPERTY BY  THE  AUTHORITY  OR
SUBSIDIARY  COMPANY  THAT  (I) IS OTHERWISE AUTHORIZED BY THIS TITLE, OR
(II) IS MADE IN ACCORDANCE WITH A  TRANSCO  MASTER  AGREEMENT  THAT  HAS
BECOME  VALID  AND  ENFORCEABLE  IN  ACCORDANCE  WITH  THE PROVISIONS OF
SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAPTER.
  G. NO ACTS OR ACTIVITIES TAKEN OR PROPOSED TO BE TAKEN BY THE AUTHORI-
TY OR A SUBSIDIARY COMPANY PURSUANT TO THE PROVISIONS OF  THIS  SUBDIVI-
SION,  INCLUDING  THE  EXECUTION  OF A TRANSCO MASTER AGREEMENT, AND THE
ISSUANCE OF BONDS, NOTES, OR OTHER OBLIGATIONS, SHALL BE  DEEMED  TO  BE
"ACTIONS" FOR THE PURPOSES OR WITHIN THE MEANING OF ARTICLE EIGHT OF THE
ENVIRONMENTAL CONSERVATION LAW.
  H.  NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, THE AUTHORITY AND
THE SUBSIDIARY COMPANY MAY ONLY PARTICIPATE IN A  TRANSCO  COMPANY  THAT

S. 5861--C                          5

CONSTRUCTS,  REPAIRS, REPLACES, REINFORCES, MODERNIZES OR EXPANDS TRANS-
MISSION ASSETS, AND MAY  NOT  PARTICIPATE  IN  A  TRANSCO  COMPANY  THAT
FINANCES OR CONSTRUCTS NEW ELECTRIC GENERATING FACILITIES.
  S 4. Section 1020-a of the public authorities law, as added by chapter
517 of the laws of 1986, is amended by adding a new closing paragraph to
read as follows:
  THE  LEGISLATURE  FURTHER FINDS AND DECLARES THAT: (I) THERE SHOULD BE
FULL COOPERATION AND COORDINATION AMONG PRIVATE AND  PUBLIC  OWNERS  AND
OPERATORS  OF  ELECTRIC TRANSMISSION FACILITIES, SYSTEMS AND INFRASTRUC-
TURE IN THE STATE, INCLUDING THE AUTHORITY, FOR  THE  PURPOSE  OF  EXPE-
DITIOUSLY  CONSTRUCTING,  REPAIRING, REPLACING, REINFORCING, MODERNIZING
OR EXPANDING THE STATE'S ELECTRIC TRANSMISSION GRID; (II) IT IS  DESIRA-
BLE  THAT  THE  AUTHORITY, WHICH OWNS AND OPERATES ELECTRIC TRANSMISSION
ASSETS  IN  THE  STATE,  PARTICIPATES  IN  PUBLIC-PRIVATE   TRANSMISSION
PROJECTS  THAT  ARE  UNDERTAKEN  BY A LIMITED LIABILITY COMPANY OR OTHER
APPROPRIATE  ORGANIZATIONAL  STRUCTURE,  THROUGH  A  SUBSIDIARY  COMPANY
FORMED  BY  THE  AUTHORITY  AS  AUTHORIZED  BY THIS TITLE; AND (III) THE
AUTHORITY SHOULD BE AUTHORIZED TO PARTICIPATE IN  PUBLIC-PRIVATE  TRANS-
MISSION PROJECTS AND TRANSFER TRANSMISSION ASSETS OR ANY INTEREST THERE-
IN  IN  CONNECTION  WITH  ITS  PARTICIPATION IN SUCH A LIMITED LIABILITY
COMPANY OR OTHER APPROPRIATE ORGANIZATIONAL STRUCTURE ON SUCH TERMS  AND
CONDITIONS AS THE AUTHORITY MAY NEGOTIATE.
  S 5. Subdivision 2 of section 1020-c of the public authorities law, as
added by chapter 517 of the laws of 1986, is amended to read as follows:
  2.  The area of operations of the authority shall be the service area,
PROVIDED THAT THE AUTHORITY OR SUBSIDIARY COMPANY MAY OWN AN INTEREST IN
TRANSMISSION ASSETS THAT ARE LOCATED IN WHOLE OR  IN  PART  OUTSIDE  THE
SERVICE AREA.
  S 6. Section 1020-f of the public authorities law is amended by adding
a new subdivision (g-1) to read as follows:
  (G-1)  (I)  FOR PURPOSES OF THIS SUBDIVISION, THE FOLLOWING TERMS HAVE
THE MEANINGS INDICATED:
  1.  "SUBSIDIARY  COMPANY"   MEANS   A   SUBSIDIARY   COMPANY   FORMED,
WHOLLY-OWNED  AND  CONTROLLED  BY  THE  AUTHORITY IN ACCORDANCE WITH AND
SUBJECT TO THE BUSINESS CORPORATION LAW, THE NOT-FOR-PROFIT  CORPORATION
LAW,  THE  LIMITED  LIABILITY  COMPANY  LAW OR THE TRANSPORTATION CORPO-
RATIONS LAW.
  2. "TRANSCO MASTER AGREEMENT" MEANS A WRITTEN AGREEMENT PROVIDING  FOR
THE  FORMATION  AND  OPERATION  OF  A LIMITED LIABILITY COMPANY OR OTHER
ORGANIZATIONAL STRUCTURE  TO  SERVE  AS  A  TRANSCO  COMPANY  AND  WHICH
PROVIDES  FOR, AMONG OTHER THINGS, THE RIGHTS AND OBLIGATIONS OF MEMBERS
OF SUCH TRANSCO COMPANY.
  3. "TRANSCO ANCILLARY AGREEMENT" MEANS A WRITTEN AGREEMENT, OTHER THAN
A TRANSCO PROJECT AGREEMENT, BETWEEN THE AUTHORITY OR SUBSIDIARY COMPANY
AND THE TRANSCO COMPANY AND/OR MEMBERS OF A  TRANSCO  COMPANY,  MADE  IN
ACCORDANCE  WITH THE TRANSCO MASTER AGREEMENT, FOR THE PURPOSE OF IMPLE-
MENTING THE TRANSCO MASTER AGREEMENT.
  4. "TRANSCO COMPANY" MEANS AN ENTITY FORMED IN ACCORDANCE WITH A TRAN-
SCO MASTER AGREEMENT PRIMARILY FOR THE PURPOSE OF ENGAGING IN THE  BUSI-
NESS  OF  PLANNING,  CONSTRUCTING,  OWNING,  OPERATING, MAINTAINING, AND
EXPANDING ELECTRIC TRANSMISSION FACILITIES, SYSTEMS  AND  INFRASTRUCTURE
SERVING THE PEOPLE OF THE STATE OF NEW YORK.
  5. "TRANSCO PROJECT" MEANS A PROJECT UNDERTAKEN BY THE TRANSCO COMPANY
IN ACCORDANCE WITH A TRANSCO MASTER AGREEMENT.
  6.  "TRANSCO  PROJECT AGREEMENT" MEANS A WRITTEN AGREEMENT BETWEEN THE
AUTHORITY OR SUBSIDIARY COMPANY AND THE TRANSCO COMPANY  AND/OR  MEMBERS

S. 5861--C                          6

OF  A TRANSCO COMPANY, MADE IN ACCORDANCE WITH THE TRANSCO MASTER AGREE-
MENT, THAT RELATES TO A SPECIFIC TRANSCO PROJECT.
  7. "TRANSMISSION ASSETS" MEANS: (A) ALL PHYSICAL ASSETS (INCLUDING BUT
NOT  LIMITED TO ELECTRICAL TRANSMISSION LINES, POLES, TOWERS AND SIMILAR
STRUCTURES, CONDUITS,  SUBSTATIONS,  CONVERTER  STATIONS,  TRANSFORMERS,
CONDUCTORS,  INSULATORS,  SWITCHING  DEVICES, CONTROLS, BREAKERS, BUSES,
STATIONS, RECTIFIERS, REGULATORS, EMERGENCY AND PROTECTIVE EQUIPMENT AND
DEVICES, UTILITY INTERCONNECTIONS AND OTHER EQUIPMENT USED OR  NECESSARY
FOR THE CONTROL, DISPATCH, RECEIPT AND DELIVERY OF ENERGY BY SUCH FACIL-
ITIES)  USED  FOR  THE  PURPOSE  OF TRANSMITTING OR DELIVERING DIRECT OR
ALTERNATING CURRENT ELECTRIC ENERGY AT VOLTAGES PRIMARILY OF ONE HUNDRED
KILOVOLTS OR HIGHER TO LOADS OR  INTERCONNECTION  POINTS;  AND  (B)  ALL
ASSOCIATED  (I)  TANGIBLE  AND  INTANGIBLE  PROPERTY  USED  TO  OPERATE,
CONTROL, PROTECT AND MAINTAIN SUCH ASSETS, (II) REAL PROPERTY RIGHTS FOR
LANDS AND RIGHTS-OF-WAY, SITES, AND PLACES  IN  WHICH  SUCH  ASSETS  ARE
SITUATED  OR  INSTALLED, AND (III) LEGAL AND REGULATORY RIGHTS, AUTHORI-
ZATIONS, PERMITS, AND CONSENTS OF ANY NATURE TO OWN, OCCUPY,  CONSTRUCT,
USE,  OPERATE AND MAINTAIN, AND RECEIVE OR DISPOSE OF REVENUES FROM SUCH
ASSETS OR LANDS ON WHICH SUCH  ASSETS  ARE  SITUATED,  EXISTING,  OWNED,
LEASED, DESIGNED, USED AND OPERATED.
  (II)  NOTWITHSTANDING  THE  PROVISIONS OF ANY OTHER LAW, INCLUDING THE
PROVISIONS OF SECTION ONE THOUSAND TWENTY-I OF THIS TITLE, THE AUTHORITY
MAY 1. FORM A SUBSIDIARY COMPANY FOR THE PURPOSE OF PARTICIPATING  IN  A
TRANSCO  COMPANY, 2.   PARTICIPATE IN THE TRANSCO COMPANY BY CAUSING THE
SUBSIDIARY COMPANY TO BECOME A PARTY TO A TRANSCO MASTER  AGREEMENT  AND
EXERCISE  THE  RIGHTS  AND  PERFORM THE OBLIGATIONS OF A TRANSCO COMPANY
MEMBER AS MAY BE PROVIDED FOR IN A  TRANSCO  MASTER  AGREEMENT,  AND  3.
EXERCISE THE OTHER POWERS AND DUTIES PROVIDED FOR BY THIS SUBDIVISION.
  (III)  NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, IN ADDITION TO
ANY OTHER POWERS AND DUTIES GRANTED TO IT UNDER THIS TITLE, THE AUTHORI-
TY SHALL BE AUTHORIZED TO:
  1.   PARTICIPATE IN PUBLIC/PRIVATE PARTNERSHIPS  TO  PROVIDE  FOR  THE
MEANS  TO CONSTRUCT, REPAIR, REPLACE, REINFORCE, MODERNIZE OR EXPAND THE
STATE'S ELECTRIC TRANSMISSION GRID  TO  ENSURE  THE  SAFE  AND  RELIABLE
PROVISION  OF ELECTRIC SERVICE TO THE SERVICE AREA AND THE STATE'S RESI-
DENTS NOW AND INTO THE FUTURE;
  2. EXERCISE ALL OF THE  RIGHTS  AND  PRIVILEGES  ASSOCIATED  WITH  ANY
OWNERSHIP INTEREST IN OR ORGANIZER OF THE SUBSIDIARY COMPANY;
  3.  ISSUE  ITS  BONDS,  NOTES  AND  OTHER  EVIDENCE OF INDEBTEDNESS TO
FINANCE THE OPERATIONS OF THE SUBSIDIARY COMPANY, INCLUDING THE  SUBSID-
IARY COMPANY'S PARTICIPATION IN AND OBLIGATIONS UNDERTAKEN IN CONNECTION
WITH A TRANSCO COMPANY;
  4.  LEND,  OR  OTHERWISE  TRANSFER  MONIES  TO THE SUBSIDIARY COMPANY,
INCLUDING THE PROCEEDS OF THE AUTHORITY'S BONDS, NOTES,  OTHER  EVIDENCE
OF INDEBTEDNESS AND OTHER AUTHORITY FUNDS;
  5.  RECEIVE  MONIES FROM THE SUBSIDIARY COMPANY, INCLUDING MONIES THAT
RESULT FROM THE OPERATION OF THE TRANSCO COMPANY;
  6.  AS DEEMED FEASIBLE AND ADVISABLE BY THE TRUSTEES, TRANSFER TO  THE
SUBSIDIARY COMPANY TRANSMISSION ASSETS THAT HAVE BEEN OR ARE EXPECTED TO
BE USED IN PROJECTS UNDERTAKEN BY THE TRANSCO COMPANY FOR SUCH CONSIDER-
ATION  AND  ON  SUCH  OTHER  TERMS AND CONDITIONS AS THE AUTHORITY SHALL
NEGOTIATE;
  7. RECEIVE FROM THE SUBSIDIARY COMPANY  OR  THE  TRANSCO  COMPANY  ANY
PERSONAL OR REAL PROPERTY;
  8.  ENTER  INTO GUARANTEE AGREEMENTS IN CONNECTION WITH THE SUBSIDIARY
COMPANY'S PARTICIPATION IN THE TRANSCO COMPANY;

S. 5861--C                          7

  9. ENTER INTO CONTRACTS AND OTHER FORMS OF AGREEMENT WITH THE  TRANSCO
COMPANY,  THE SUBSIDIARY COMPANY AND OTHER MEMBERS OF THE TRANSCO COMPA-
NY;
  10.  PLEDGE  OR ASSIGN ALL OR ANY PORTION OF ANY INTEREST IN A TRANSCO
COMPANY;
  11. TRANSFER AND RECEIVE ALL OR ANY PORTION OF ANY INTEREST IN A TRAN-
SCO COMPANY;
  12. SELL, PURCHASE, OR OTHERWISE TRANSFER ALL OR ANY  PORTION  OF  ANY
INTEREST  IN  A  TRANSCO  COMPANY  ON  SUCH  TERMS AND CONDITIONS AS THE
AUTHORITY DEEMS APPROPRIATE;
  13. ASSIGN ONE OR MORE EMPLOYEES TO  PROVIDE  SERVICES  TO  A  TRANSCO
COMPANY  FOR A SPECIFIED PERIOD OF TIME, PROVIDED THAT ANY SUCH EMPLOYEE
SHALL CONTINUE TO BE AN EMPLOYEE OF THE AUTHORITY; AND
  14. DISSOLVE OR TERMINATE THE SUBSIDIARY COMPANY  IN  ACCORDANCE  WITH
APPLICABLE LAW.
  (IV)  NOTWITHSTANDING  THE  PROVISIONS  OF  ANY OTHER LAW, NO TRUSTEE,
OFFICER OR EMPLOYEE OF THE STATE, OR OF ANY STATE AGENCY, PUBLIC AUTHOR-
ITY OR PUBLIC BENEFIT CORPORATION, SHALL BE DEEMED TO HAVE FORFEITED  OR
SHALL FORFEIT SUCH PERSON'S OFFICE OR EMPLOYMENT OR ANY BENEFITS ASSOCI-
ATED  THEREWITH  BY REASON OF SUCH PERSON'S ACCEPTANCE OF MEMBERSHIP ON,
OR SUCH PERSON BEING AN OFFICER, EMPLOYEE  OR  AGENT  OF,  A  SUBSIDIARY
COMPANY,  OR  BY  REASON  OF  SUCH  PERSON'S  PROVISION OF SERVICES TO A
SUBSIDIARY COMPANY.
  (V) THE PROVISIONS OF SECTION ONE THOUSAND  TWENTY-CC  OF  THIS  TITLE
SHALL BE INAPPLICABLE TO ANY TRANSCO MASTER AGREEMENT, TRANSCO ANCILLARY
AGREEMENT, OR TRANSCO PROJECT AGREEMENT.
  (VI)  THE PROVISIONS OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF
THIS CHAPTER SHALL BE APPLICABLE TO  ANY  TRANSCO  MASTER  AGREEMENT  TO
WHICH THE AUTHORITY OR SUBSIDIARY COMPANY IS A PARTY, BUT SHALL BE INAP-
PLICABLE TO ANY TRANSCO ANCILLARY AGREEMENT OR TRANSCO PROJECT AGREEMENT
THAT  OTHERWISE  SATISFIES  THE  REQUIREMENTS OF PARAGRAPH (A) OR (B) OF
SUBDIVISION ONE OF SUCH SECTION PROVIDED THAT 1. A FINAL OR SUBSTANTIAL-
LY NEGOTIATED FORM  OF  SUCH  TRANSCO  ANCILLARY  AGREEMENT  OR  TRANSCO
PROJECT  AGREEMENT,  AS  THE CASE MAY BE, IS ANNEXED TO A TRANSCO MASTER
AGREEMENT THAT HAS BECOME VALID AND ENFORCEABLE IN ACCORDANCE  WITH  THE
PROVISIONS  OF SECTION TWENTY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAP-
TER, AND 2. IN THE CASE  OF  A  TRANSCO  PROJECT  AGREEMENT,  THE  FINAL
EXECUTED  FORM OF SUCH TRANSCO PROJECT AGREEMENT IS LIMITED TO A TRANSCO
PROJECT THAT WAS IDENTIFIED IN SUCH TRANSCO MASTER AGREEMENT.
  (VII) THE PROVISIONS OF TITLE FIVE-A OF ARTICLE NINE OF  THIS  CHAPTER
SHALL  BE  INAPPLICABLE  TO ANY DISPOSAL OF PROPERTY BY THE AUTHORITY OR
SUBSIDIARY COMPANY THAT 1. IS OTHERWISE AUTHORIZED BY THIS TITLE, OR  2.
IS  MADE  IN  ACCORDANCE WITH A TRANSCO MASTER AGREEMENT THAT HAS BECOME
VALID AND ENFORCEABLE IN ACCORDANCE WITH THE PROVISIONS OF SECTION TWEN-
TY-EIGHT HUNDRED SEVENTY-NINE-A OF THIS CHAPTER.
  (VIII) THE PROVISIONS OF PARAGRAPH (D) OF SUBDIVISION ONE  OF  SECTION
ONE  THOUSAND  TWENTY-S  OF THIS TITLE AND SECTION THREE-B OF THE PUBLIC
SERVICE LAW SHALL BE INAPPLICABLE TO THE RATES, SERVICES  AND  PRACTICES
RELATED  TO  THE  TRANSCO MASTER AGREEMENT AND ANY ACTIONS UNDERTAKEN BY
THE AUTHORITY OR SUBSIDIARY CORPORATION IN ACCORDANCE WITH  THE  TRANSCO
MASTER AGREEMENT.
  (IX)  NO  ACTS  OR  ACTIVITIES  TAKEN  OR  PROPOSED TO BE TAKEN BY THE
AUTHORITY OR A SUBSIDIARY COMPANY PURSUANT TO  THE  PROVISIONS  OF  THIS
SUBDIVISION,  INCLUDING THE EXECUTION OF A TRANSCO MASTER AGREEMENT, AND
THE ISSUANCE OF BONDS, NOTES, OR OTHER OBLIGATIONS, SHALL BE  DEEMED  TO

S. 5861--C                          8

BE  "ACTIONS" FOR THE PURPOSES OR WITHIN THE MEANING OF ARTICLE EIGHT OF
THE ENVIRONMENTAL CONSERVATION LAW.
  (X) NOTWITHSTANDING THE PROVISIONS OF ANY OTHER LAW, THE AUTHORITY AND
THE  SUBSIDIARY  COMPANY  MAY ONLY PARTICIPATE IN A TRANSCO COMPANY THAT
CONSTRUCTS, REPAIRS, REPLACES, REINFORCES, MODERNIZES OR EXPANDS  TRANS-
MISSION  ASSETS,  AND  MAY  NOT  PARTICIPATE  IN  A TRANSCO COMPANY THAT
FINANCES OR CONSTRUCTS NEW ELECTRIC GENERATING FACILITIES.
  S 7. Severability clause. If any clause, sentence, paragraph, subdivi-
sion, section or part of this act shall be  adjudged  by  any  court  of
competent  jurisdiction  to  be invalid, such judgment shall not affect,
impair, or invalidate the remainder thereof, but shall  be  confined  in
its  operation  to the clause, sentence, paragraph, subdivision, section
or part thereof directly involved in the controversy in which such judg-
ment shall have been rendered. It is hereby declared to be the intent of
the legislature that this act would  have  been  enacted  even  if  such
invalid provisions had not been included therewith.
  S 8. This act shall take effect immediately.

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