NY State Senate Bill S4339B

Archive: Last Bill Status - Passed Senate

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

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Actions

view actions (11)

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 01, 2022	referred to ways and means delivered to assembly passed senate ordered to third reading cal.1750 committee discharged and committed to rules
May 20, 2022	print number 4339b
May 20, 2022	amend and recommit to corporations, authorities and commissions
Jan 05, 2022	referred to corporations, authorities and commissions
Jun 02, 2021	print number 4339a
Jun 02, 2021	amend and recommit to corporations, authorities and commissions
Feb 03, 2021	referred to corporations, authorities and commissions

Votes

Bill Amendments

Original

B (Active)

Original

B (Active)

S4339 - Details

See Assembly Version of this Bill:: A4575
Law Section:: Not-for-Profit Corporation Law
Laws Affected:: Amd §§104, 402, 404 & 1411, N-PC L; amd §2, add §2829, Pub Auth L
Versions Introduced in 2023-2024 Legislative Session:: S2727, A3715

S4339 - Summary

Relates to the applicability of open meetings and freedom of information laws to certain not-for-profit corporations.

S4339 - Sponsor Memo

 
BILL NUMBER: S4339

SPONSOR: SKOUFIS
 
TITLE OF BILL:

An act to amend the not-for-profit corporation law and the public
authorities law, in relation to the applicability of open meetings and
freedom of information laws to certain not-for-profit corporations

 
PURPOSE OR GENERAL IDEA OF BILL:

The purpose of this bill is to impose greater transparency and account-
ability on those not-for-profit corporations that engage in municipal
economic development and function as an instrument and subsidiary of
local government.

 
SUMMARY OF PROVISIONS:

Section 1 of the bill would add a new subdivision (h) to section 104 of
the not-for-profit corporation law, which would require the Department
of State to transmit to the Authorities Budget Office a copy of any

filed certified of incorporation which indicates such certificate has
been filed on behalf or at the behest of a municipal corporation, public
authority, or district.

Section 2 of the bill would add a new section 116 to the not-for-profit
corporation law, which would subject certain not-for-profit corpo-
rations, such as those corporations where a majority of board members
are appointed by elected officials of any municipal corporation, to the
requirements of the open meetings law and freedom of information laws.
Furthermore, such corporations shall also stream all their meetings in
real-time, if practicable.

Section 3 of this bill would amend section 402 of the not-for-profit
corporation law, by requiring those wishing to file certificates of
incorporation to note on their certificates whether they have received
the relevant consent of the Authorities Budget Office, if applicable.

Section 4 of this bill would amend section 402 of the not-for-profit
corporation law, by requiring those wishing to file certificates of
incorporation to note on their certificates whether such corporation is
being incorporated on the behalf of or at the behest of a municipal
corporation, public authority, or district.

Section 5 of this bill would amend section 404 of the not-for-profit
corporation law, by requiring those wishing to incorporate certain types
of corporations, such as those corporations where a majority of board
members are appointed by elected officials of any municipal corporation,
to obtain the consent of the Authorities Budget Office prior to filing
certificates of incorporation.

Section 6 of this bill would amend paragraph (a) of section 1411; of the
not-for-profit corporation law, by proscribing a not-for-profit corpo-
ration from incorporating or reincorporating as a local development
corporation if its sole corporate purpose would be to "lessen the
burdens of government and act in the public interest."



Section 7 of this bill would amend subparagraph 2 of paragraph (d) of
section 1411 of the not-for-profit corporation law by making a technical
change to account for changes added in Section 8 of this bill.

Section 8 of this bill would amend paragraph (d) of section 1411 of the
not-for-profit corporation law by requiring, in regard to the mandatory
public hearing to consider the sale or lease of municipal property to a
local development corporation, that such advanced notice of said meet-
ing: be given 21 days in advance of the hearing; describe the property
at issue; describe the proposed consideration for the sale; include an
estimated fair-market value of the property at issue; and include a
statement of the intended use of the property by the corporation.

Section 9 of this bill would amend paragraph (i) of section 1411 of the
not-for-profit corporation law by placing certain statutory requirements
and limitations on the contracts entered into between a local develop-
ment corporations and a municipal corporations, public authority, or
district in relation to one of said corporations corporate purposes.
This section would also add a new paragraph (j) to this same section,
which would subject all local development corporations to the require-
ments of the open meetings law and freedom of information laws, and
require them to stream all their meeting in real-time, if practicable.

Section 10 of this bill would amend subdivision 2 of section 2 of the
public authorities law, by expanding the definition of "local authority"
to include certain not-for-profit corporations, such as those corpo-
rations where a majority of board members are appointed by elected offi-
cials of any municipal corporation, or those which pay staff of a local
or state government to provide administrative support.

Section 11 of this bill would amend the public authorities law by adding
a new section 2829, which would subject all state and local authorities
to the open meetings law and freedom of information laws, as well
require such authorities to stream their meeting in real-time.

Section 12 of this bill is the effective date.

 
JUSTIFICATION:

Local development corporations (LDCs), as well as other types of private
not-for profit corporations, are often used by local governments as a
means to indirectly finance local government operations and projects.
These LDCs and similar private entities, however, are exempt from many
of the constitutional and statutory provisions that guide the operations
and financial transactions conducted by local governments, despite how,
as a practical matter, they often function as an instrument and subsid-
iary of local government.

While such organizations mostly do great work in developing their local
economies and serve an important quasi-governmental role, reports from
the Authorities Budget Office, the State Comptroller, and good-govern-
ment groups have exposed that LDCs and such other non-profits are too
frequently used solely to circumvent these constitutional and statutory
restrictions that apply to projects directly undertaken by a local
government, as well as to circumvent transparency and public scrutiny
laws through such entities status as private organizations. The end
result of this lack of transparency, accountability and restraint has
been a significant waste of taxpayer dollars and public resources.
When organizations rely on taxpayer resources to operate, they should be
subject to strong oversight and be held accountable. With such entities
holding presently around $20 billion in outstanding debt, New York's
taxpayers deserve far more accountability and responsibility with how
their money is being spent and leveraged by such entities. To protect
the interests of the taxpayer, our localities, and the state, this bill
seeks to subject these LDCs and other similar not-for-profits to greater
governmental accountability and public transparency, as well as to reign
in some of their more problematic activities.

 
PRIOR LEGISLATIVE HISTORY:

New bill.

 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:

None noted.

 
EFFECTIVE DATE:
This act shall take effect on the thirtieth day after enactment,
provided that section nine of this act shall not apply retroactively to
any contract between a local development corporation and a municipal
corporation, public authority or district entered into prior to the
enactment of this act.

S4339 - Bill Text download pdf

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4339
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             February 3, 2021
                                ___________
 
 Introduced  by  Sen. SKOUFIS -- read twice and ordered printed, and when
   printed to be committed to the Committee on Corporations,  Authorities
   and Commissions
 
 AN  ACT  to  amend  the  not-for-profit  corporation  law and the public
   authorities law, in relation to the applicability of open meetings and
   freedom of information laws to certain not-for-profit corporations
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Section  104  of  the  not-for-profit  corporation law is
 amended by adding a new subdivision (h) to read as follows:
   (H) THE DEPARTMENT SHALL TRANSMIT ELECTRONICALLY  TO  THE  AUTHORITIES
 BUDGET  OFFICE  A  COPY  OF  EVERY CERTIFICATE OF INCORPORATION FILED OR
 DELIVERED WHERE THE INCORPORATOR HAS INDICATED ON THE  CERTIFICATE  THAT
 HE OR SHE IS FILING SAID CERTIFICATE ON THE BEHALF OR AT THE BEHEST OF A
 MUNICIPAL CORPORATION, STATE OR LOCAL AUTHORITY, OR DISTRICT.
   §  2.  The  not-for-profit  corporation law is amended by adding a new
 section 116 to read as follows:
 § 116. CERTAIN CORPORATIONS SUBJECT TO THE OPEN MEETINGS AND FREEDOM  OF
          INFORMATION LAWS.
   THE FOLLOWING CORPORATIONS SHALL BE SUBJECT TO THE PROVISIONS OF ARTI-
 CLES  SIX  AND SEVEN OF THE PUBLIC OFFICERS LAW, RELATING TO THE FREEDOM
 OF INFORMATION LAW AND OPEN MEETINGS LAW RESPECTIVELY:
   (A) ALL CORPORATIONS WHOSE CERTIFICATE OF INCORPORATION  INCLUDES  THE
 PURPOSE  OF RELIEVING AND REDUCING UNEMPLOYMENT, PROMOTING AND PROVIDING
 FOR ADDITIONAL AND MAXIMUM EMPLOYMENT,  BETTERING  AND  MAINTAINING  JOB
 OPPORTUNITIES, INSTRUCTING OR TRAINING INDIVIDUALS TO IMPROVE OR DEVELOP
 THEIR  CAPABILITIES  FOR  SUCH JOBS, CARRYING ON SCIENTIFIC RESEARCH FOR
 THE PURPOSE OF AIDING A COMMUNITY OR GEOGRAPHICAL AREA BY ATTRACTING NEW
 INDUSTRY TO THE COMMUNITY OR AREA OR BY ENCOURAGING THE DEVELOPMENT  OF,
 OR RETENTION OF, AN INDUSTRY IN THE COMMUNITY OR AREA, AND LESSENING THE
 BURDENS OF GOVERNMENT AND ACTING IN THE PUBLIC INTEREST, OR ANY ABBREVI-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD08161-01-1

 S. 4339                             2
 
 ATION  OR DERIVATIVE THEREOF IN A CONTEXT THAT INDICATES OR IMPLIES THAT
 THE CORPORATION IS FORMED FOR ANY OF THE ABOVE PURPOSES;
   (B)  ALL  CORPORATIONS  WHOSE  CERTIFICATE OF INCORPORATION OR BY-LAWS
 STATES OR OTHERWISE INDICATES THAT ONE OR MORE INDIVIDUALS WHO SERVE  AS
 OFFICERS  OR  EMPLOYEES  OF  ANY  MUNICIPAL  CORPORATION, STATE OR LOCAL
 AUTHORITY, OR DISTRICT SHALL: (1) SELECT EITHER A MAJORITY OF THE CORPO-
 RATION'S BOARD OF DIRECTORS OR THE CORPORATION'S CHIEF  EXECUTIVE  OFFI-
 CER;  (2)  CONSTITUTE  A  MAJORITY  OF  THE VOTING STRENGTH THAT SELECTS
 EITHER A MAJORITY OF THE CORPORATION'S BOARD OF DIRECTORS OR THE  CORPO-
 RATION'S  CHIEF  EXECUTIVE  OFFICER; OR (3) SERVE AS:  (I) A MAJORITY OF
 THE CORPORATION'S BOARD OF DIRECTORS; OR (II) IN  HIS  OR  HER  OFFICIAL
 CAPACITY,  THE CORPORATION'S CHIEF EXECUTIVE OFFICER; OR (III) IN HIS OR
 HER OFFICIAL CAPACITY, A DIRECTOR IN THE ORGANIZATION; AND
   (C) ALL CORPORATIONS WHOSE CERTIFICATE OF INCORPORATION INDICATES THAT
 SUCH CORPORATION IS BEING INCORPORATED ON THE BEHALF OR AT THE BEHEST OF
 A MUNICIPAL CORPORATION, STATE AND LOCAL AUTHORITY, OR DISTRICT.
   SUCH CORPORATIONS SHALL, TO THE EXTENT PRACTICABLE:   STREAM ALL  OPEN
 MEETINGS   ON   THE  CORPORATION'S  WEBSITE  IN  REAL-TIME;  POST  VIDEO
 RECORDINGS OF ALL OPEN MEETINGS AND PUBLIC HEARINGS ON ITS WEBSITE WITH-
 IN FIVE BUSINESS DAYS OF THE MEETING; AND MAINTAIN VIDEO  RECORDINGS  OF
 SUCH MEETINGS FOR A PERIOD OF NOT LESS THAN FIVE YEARS.
   §  3.  Subdivision 2-b of paragraph (a) of section 402 of the not-for-
 profit corporation law, as added by chapter 23 of the laws of  2014,  is
 amended to read as follows:
   (2-b) If it is not formed to engage in any activity or for any purpose
 requiring  consent or approval of any state official, department, board,
 agency or other body, OR DOES NOT REQUIRE CONSENT PURSUANT  TO  SUBPARA-
 GRAPH  (2)  OR (3) OF PARAGRAPH (W) OF SECTION FOUR HUNDRED FOUR OF THIS
 ARTICLE, a statement that no such consent or approval is required.  Such
 statement  shall  be  deemed  conclusive  for  purposes of filing by the
 department of state. If subsequent  to  submitting  the  certificate  of
 incorporation  for filing, the corporation plans to engage in any activ-
 ity requiring consent or approval pursuant to  section  404  (approvals,
 notices and consents) of this chapter, the corporation shall obtain such
 consent  or  approval  and accordingly amend its certificate of incorpo-
 ration pursuant to article eight of this chapter.
   § 4. Paragraph (a) of section 402 of  the  not-for-profit  corporation
 law is amended by adding a new subparagraph 9 to read as follows:
   (9)  A  STATEMENT WHETHER THE CORPORATION IS BEING INCORPORATED ON THE
 BEHALF OR AT THE BEHEST OF ANY MUNICIPAL  CORPORATION,  STATE  OR  LOCAL
 AUTHORITY,  OR  DISTRICT.  IF  SO,  THE INCORPORATOR SHALL IDENTIFY SUCH
 MUNICIPAL CORPORATION, STATE OR LOCAL AUTHORITY, OR DISTRICT.
   § 5. Section 404 of the not-for-profit corporation law is  amended  by
 adding a new paragraph (w) to read as follows:
   (W)  EVERY  CERTIFICATE  OF  INCORPORATION  WHICH  INCLUDES ANY OF THE
 FOLLOWING SHALL HAVE ENDORSED THEREON OR ANNEXED THERETO THE CONSENT  OF
 THE DIRECTOR OF THE AUTHORITIES BUDGET OFFICE:
   (1)  INCLUDES  AMONG  ITS PURPOSES THE RELIEVING AND REDUCING OF UNEM-
 PLOYMENT, PROMOTING AND PROVIDING FOR ADDITIONAL AND MAXIMUM EMPLOYMENT,
 BETTERING AND MAINTAINING JOB  OPPORTUNITIES,  INSTRUCTING  OR  TRAINING
 INDIVIDUALS  TO  IMPROVE  OR  DEVELOP  THEIR CAPABILITIES FOR SUCH JOBS,
 CARRYING ON SCIENTIFIC RESEARCH FOR THE PURPOSE OF AIDING A COMMUNITY OR
 GEOGRAPHICAL AREA BY ATTRACTING NEW INDUSTRY TO THE COMMUNITY OR AREA OR
 BY ENCOURAGING THE DEVELOPMENT OF, OR RETENTION OF, AN INDUSTRY  IN  THE
 COMMUNITY OR AREA, AND LESSENING THE BURDENS OF GOVERNMENT AND ACTING IN
 THE  PUBLIC  INTEREST,  OR  ANY  ABBREVIATION OR DERIVATIVE THEREOF IN A

 S. 4339                             3
 
 CONTEXT THAT INDICATES OR IMPLIES THAT THE CORPORATION IS FORMED FOR ANY
 OF THE ABOVE PURPOSES;
   (2)  INDICATES  THAT  ONE OR MORE INDIVIDUALS WHO SERVE AS OFFICERS OR
 EMPLOYEES OF ANY MUNICIPAL CORPORATION, STATE  OR  LOCAL  AUTHORITY,  OR
 DISTRICT  SHALL: (I) SELECT EITHER A MAJORITY OF THE CORPORATION'S BOARD
 OF DIRECTORS OR THE CORPORATION'S CHIEF EXECUTIVE OFFICER; (II)  CONSTI-
 TUTE A MAJORITY OF THE VOTING STRENGTH THAT SELECTS EITHER A MAJORITY OF
 THE  CORPORATION'S  BOARD OF DIRECTORS OR THE CORPORATION'S CHIEF EXECU-
 TIVE OFFICER; OR (III) SERVE AS: (A) A  MAJORITY  OF  THE  CORPORATION'S
 BOARD  OF  DIRECTORS; OR (B) IN HIS OR HER OFFICIAL CAPACITY, THE CORPO-
 RATION'S CHIEF EXECUTIVE OFFICER; OR (C) IN HIS OR HER OFFICIAL  CAPACI-
 TY, A DIRECTOR IN THE CORPORATION; OR
   (3)  INDICATES  THAT  SUCH  CORPORATION  IS  BEING INCORPORATED ON THE
 BEHALF OR AT THE BEHEST OF ANY MUNICIPAL  CORPORATION,  STATE  OR  LOCAL
 AUTHORITY, OR DISTRICT.
   THE DIRECTOR SHALL MAKE SUCH INQUIRY INTO THE PURPOSES OF THE PROPOSED
 CORPORATION AS HE OR SHE SHALL DEEM ADVISABLE.
   §  6.  Paragraph (a) of section 1411 of the not-for-profit corporation
 law, as amended by chapter 847 of the laws of 1970, is amended  to  read
 as follows:
   (a) Purposes.
   This  section  shall  provide  an  additional  and alternate method of
 incorporation or reincorporation of not-for-profit corporations for  any
 of  the  purposes set forth in this paragraph and shall not be deemed to
 alter, impair or diminish the purposes, rights, powers or privileges  of
 any  corporation heretofore or hereafter incorporated under this section
 or under the stock or business corporation  laws.  Corporations  may  be
 incorporated  or  reincorporated  under  this  section as not-for-profit
 local development corporations operated for the  exclusively  charitable
 or public purposes of relieving and reducing unemployment, promoting and
 providing for additional and maximum employment, bettering and maintain-
 ing job opportunities, instructing or training individuals to improve or
 develop  their  capabilities  for  such  jobs,  carrying  on  scientific
 research for the purpose of aiding a community or geographical  area  by
 attracting  new  industry to the community or area or by encouraging the
 development of, or retention of, an industry in the community  or  area,
 and  lessening the burdens of government and acting in the public inter-
 est, and any one or more counties, cities,  towns  or  villages  of  the
 state,  or  any  combination  thereof,  or  the New York job development
 authority in exercising its power under the public  authorities  law  to
 encourage  the organization of local development corporations, may cause
 such corporations to be incorporated by public officers or private indi-
 viduals or reincorporated upon compliance with the requirements of  this
 section,  and it is hereby found, determined and declared that in carry-
 ing out said purposes and in exercising the powers  conferred  by  para-
 graph (b) such corporations will be performing an essential governmental
 function. A NOT-FOR-PROFIT CORPORATION MAY NOT INCORPORATE OR REINCORPO-
 RATE  UNDER  THIS SECTION IF ITS SOLE CORPORATE PURPOSE IS FOR LESSENING
 THE BURDENS OF GOVERNMENT AND ACTING IN THE PUBLIC INTEREST.
   § 7. Subparagraph 2 of paragraph (d) of section 1411 of  the  not-for-
 profit corporation law is amended to read as follows:
   (2)  Notwithstanding  the  provisions of any general, special or local
 law, charter or ordinance to the contrary, such sale  or  lease  may  be
 made without appraisal (EXCEPT AS MAY BE NECESSARY IN REGARD TO SUBPARA-
 GRAPH  (4)  OF  THIS PARAGRAPH), public notice[,] (except as provided in
 subparagraph (4) OF THIS PARAGRAPH), or public bidding for such price or

 S. 4339                             4
 
 rental and upon such terms as may be agreed  upon  between  the  county,
 city,  town or village and said local development corporation; provided,
 however, that in case of a lease the term may not  exceed  [ninety-nine]
 FIVE  years and provided, further, that in cities having a population of
 one million or more, no such sale or lease shall  be  made  without  the
 approval  of  a majority of the members of the borough improvement board
 of the borough in which such real property is located.
   § 8. Subparagraph 4 of paragraph (d) of section 1411 of  the  not-for-
 profit corporation law is amended to read as follows:
   (4)  Notice  of such hearing shall be published at least [ten] TWENTY-
 ONE days before the date set for the hearing in such publication and  in
 such  manner  as may be designated by the local legislative body, or the
 board of estimate as the case may be. SUCH NOTICE SHALL ALSO INCLUDE:  A
 DESCRIPTION  OF THE PROPERTY AT ISSUE; THE VALUE OF THE PROPOSED CONSID-
 ERATION TO BE RECEIVED FROM THE SALE OR LEASE; THE ESTIMATED FAIR MARKET
 VALUE OF THE ASSET; AND A STATEMENT OF THE INTENDED USE  OR  DISPOSITION
 OF THE PROPERTY BY THE LOCAL DEVELOPMENT CORPORATION.
   §  9.  Paragraph (i) of section 1411 of the not-for-profit corporation
 law is amended to read as follows:
   (i) CONTRACTS BETWEEN A MUNICIPAL CORPORATION,  PUBLIC  AUTHORITY,  OR
 DISTRICT AND A LOCAL DEVELOPMENT CORPORATION.
   ANY  CONTRACT  OR  OTHER  AGREEMENT BETWEEN A LOCAL DEVELOPMENT CORPO-
 RATION AND A MUNICIPAL CORPORATION, STATE AUTHORITY OR LOCAL  AUTHORITY,
 OR  DISTRICT FOR ONE OR MORE OF THE PURPOSES ENUMERATED IN PARAGRAPH (A)
 OF THIS SECTION SHALL: (1) CAUSE THE LOCAL DEVELOPMENT CORPORATION TO BE
 DEFINED AS A LOCAL AUTHORITY PURSUANT TO SUBDIVISION TWO OF SECTION  TWO
 OF  THE  PUBLIC  AUTHORITIES  LAW;  (2) PROVIDE FOR THE MUNICIPAL CORPO-
 RATION, STATE AUTHORITY OR LOCAL AUTHORITY, OR DISTRICT TO RECEIVE  FAIR
 AND  ADEQUATE CONSIDERATION; (3) BE SUBJECT TO THE REQUIREMENTS OF ARTI-
 CLE FIVE-A OF THE GENERAL MUNICIPAL LAW; AND (4)  HAVE  A  TERM  NOT  TO
 EXCEED FIVE YEARS, SUBJECT TO ONE OR MORE SUBSEQUENT RENEWALS FOR A TERM
 NOT  TO  EXCEED  FIVE YEARS EACH UPON THE MUTUAL CONSENT OF THE PARTIES;
 PROVIDED HOWEVER THAT A CONTRACT WITH A MUNICIPAL CORPORATION SHALL  NOT
 BE  USED TO FINANCE THE MUNICIPAL CORPORATION'S OPERATIONS OR TO ACQUIRE
 OR IMPROVE AN ASSET FOR USE OF THE MUNICIPAL CORPORATION.
   (J) APPLICABILITY OF FREEDOM OF INFORMATION AND OPEN MEETINGS LAWS.
   ALL LOCAL  DEVELOPMENT  CORPORATIONS  INCORPORATED  OR  REINCORPORATED
 UNDER  THIS  SECTION,  AS WELL AS ALL AFFILIATES OR SUBSIDIARIES OF SUCH
 CORPORATIONS, SHALL BE SUBJECT TO THE PROVISIONS  OF  ARTICLES  SIX  AND
 SEVEN OF THE PUBLIC OFFICERS LAW, RELATING TO THE FREEDOM OF INFORMATION
 LAW  AND  OPEN  MEETINGS LAW RESPECTIVELY. THE CORPORATION SHALL, TO THE
 EXTENT PRACTICABLE, STREAM ALL OPEN MEETINGS ON  ITS  WEBSITE  IN  REAL-
 TIME.  THE  CORPORATION  SHALL,  TO  THE  EXTENT PRACTICABLE, POST VIDEO
 RECORDINGS OF ALL OPEN MEETINGS AND PUBLIC HEARINGS ON ITS WEBSITE WITH-
 IN FIVE BUSINESS DAYS OF THE MEETING AND SHALL MAINTAIN SUCH  RECORDINGS
 FOR A PERIOD OF NOT LESS THAN FIVE YEARS.
   (K) Effect of section.
   Corporations  incorporated  or reincorporated under this section shall
 be organized and operated exclusively for  the  purposes  set  forth  in
 paragraph  (a)  OF  THIS  SECTION, shall have, in addition to the powers
 otherwise conferred by law, the powers conferred  by  paragraph  (c)  OF
 THIS SECTION and shall be subject to all the restrictions [and], limita-
 tions  AND  OBLIGATIONS imposed by [paragraph] PARAGRAPHS (e) [and para-
 graph], (g), (I) AND (J) OF THIS SECTION.  In so far as  the  provisions
 of  this  section are inconsistent with the provisions of any other law,

 S. 4339                             5
 
 general or special, the provisions of this section shall be  controlling
 as to corporations incorporated or reincorporated hereunder.
   §  10.  Subdivision  2  of section 2 of the public authorities law, as
 amended by chapter 257 of the laws  of  2011,  is  amended  to  read  as
 follows:
   2. "local authority" shall mean (a) a public authority or public bene-
 fit  corporation  created by or existing under this chapter or any other
 law of the state of New York whose members do not hold a civil office of
 the state, are not appointed by the governor or  are  appointed  by  the
 governor specifically upon the recommendation of the local government or
 governments;  (b) a not-for-profit corporation, OTHER THAN A FIRE CORPO-
 RATION, STATEWIDE ASSOCIATION OF LOCAL GOVERNMENTS OR  LOCAL  OFFICIALS,
 OR  BUSINESS  IMPROVEMENT  DISTRICT,  affiliated  with, sponsored by, or
 created by a county, city, town  or  village  government;  (c)  a  local
 industrial developmental agency or authority or other local public bene-
 fit  corporation;  (d)  an affiliate of such local authority; [or] (e) a
 land bank corporation created pursuant to article sixteen  of  the  not-
 for-profit  corporation  law; OR (F) A NOT-FOR-PROFIT CORPORATION, OTHER
 THAN A FIRE CORPORATION OR STATEWIDE ASSOCIATION OF LOCAL GOVERNMENTS OR
 LOCAL OFFICIALS, OR BUSINESS IMPROVEMENT DISTRICT, THAT (I)  HAS  ISSUED
 OR  HAS THE AUTHORITY TO ISSUE TAX EXEMPT DEBT OR (II) PROVIDES STATE OR
 MUNICIPAL TAX EXEMPTIONS THROUGH ITS PARTICIPATION IN A  PROJECT  UNDER-
 TAKEN IN FURTHERANCE OF ITS PURPOSES.
   FOR  THE  PURPOSES  OF  PARAGRAPH (B) OF THE OPENING PARAGRAPH OF THIS
 SUBDIVISION, "AFFILIATED WITH, SPONSORED BY, OR  CREATED  BY  A  COUNTY,
 CITY, TOWN OR VILLAGE GOVERNMENT" SHALL ALSO INCLUDE, BUT NOT BE LIMITED
 TO,  ENTITIES:   (A) WHERE ONE OR MORE INDIVIDUALS WHO SERVE AS OFFICERS
 OR EMPLOYEES OF ANY COUNTY, CITY, TOWN, VILLAGE:   (I) SELECT  EITHER  A
 MAJORITY  OF  THE NOT-FOR-PROFIT CORPORATION'S BOARD OF DIRECTORS OR THE
 NOT-FOR-PROFIT CORPORATION'S CHIEF EXECUTIVE OFFICER; (II) CONSTITUTE  A
 MAJORITY  OF  THE  VOTING STRENGTH THAT SELECTS EITHER A MAJORITY OF THE
 NOT-FOR-PROFIT CORPORATION'S BOARD OF  DIRECTORS  OR  THE  CORPORATION'S
 CHIEF  EXECUTIVE  OFFICER; OR (III) SERVE AS: (1) A MAJORITY OF THE NOT-
 FOR-PROFIT CORPORATION'S BOARD OF DIRECTORS; OR (2) IN HIS OR HER  OFFI-
 CIAL CAPACITY, THE NOT-FOR-PROFIT CORPORATION'S CHIEF EXECUTIVE OFFICER;
 OR (3) IN HIS OR HER OFFICIAL CAPACITY, A DIRECTOR IN THE NOT-FOR-PROFIT
 CORPORATION;  OR  (B)  WHICH PAY STAFF OF A STATE OR LOCAL GOVERNMENT OR
 STATE OR  LOCAL  AUTHORITY  TO  PROVIDE  ADMINISTRATIVE  OR  OPERATIONAL
 SUPPORT.
   §  11.  The  public authorities law is amended by adding a new section
 2829 to read as follows:
   § 2829. STATE AND LOCAL AUTHORITIES SUBJECT TO THE OPEN  MEETINGS  AND
 FREEDOM  OF  INFORMATION  LAWS. ALL STATE AND LOCAL AUTHORITIES, AS SUCH
 TERMS ARE DEFINED IN SECTION TWO OF THIS CHAPTER, AS WELL AS ALL SUBSID-
 IARIES AND AFFILIATES OF SUCH STATE AND LOCAL AUTHORITIES, AS SUCH TERMS
 ARE DEFINED IN SECTION TWO OF THIS CHAPTER,  SHALL  BE  SUBJECT  TO  THE
 PROVISIONS OF ARTICLES SIX AND SEVEN OF THE PUBLIC OFFICERS LAW RELATING
 TO  THE  FREEDOM OF INFORMATION AND OPEN MEETINGS LAWS RESPECTIVELY. ALL
 STATE AND LOCAL AUTHORITIES, AS WELL AS ALL SUBSIDIARIES AND  AFFILIATES
 OF  SUCH  STATE AND LOCAL AUTHORITIES, SHALL, TO THE EXTENT PRACTICABLE,
 STREAM ALL OPEN MEETINGS AND PUBLIC HEARINGS ON  ITS  WEBSITE  IN  REAL-
 TIME,  POST VIDEO RECORDINGS OF ALL OPEN MEETINGS AND PUBLIC HEARINGS ON
 ITS WEBSITE WITHIN FIVE BUSINESS DAYS OF  THE  MEETING  OR  HEARING  AND
 MAINTAIN SUCH RECORDINGS FOR A PERIOD OF NOT LESS THAN FIVE YEARS.
   §  12.  This act shall take effect on the thirtieth day after it shall
 have become a law; provided, however, that the provisions  of  paragraph

 S. 4339                             6
 
 (i)  of  section  1411  of  the not-for-profit corporation law, as added
 pursuant to section nine of this act shall not  apply  retroactively  to
 contracts  or  agreements  between a local development corporation and a
 municipal  corporation,  state  or  local authority, or district entered
 into prior to the effective date of this act.

S4339A - Details

See Assembly Version of this Bill:: A4575
Law Section:: Not-for-Profit Corporation Law
Laws Affected:: Amd §§104, 402, 404 & 1411, N-PC L; amd §2, add §2829, Pub Auth L
Versions Introduced in 2023-2024 Legislative Session:: S2727, A3715

S4339A - Summary

Relates to the applicability of open meetings and freedom of information laws to certain not-for-profit corporations.

S4339A - Sponsor Memo

 
BILL NUMBER: S4339A

SPONSOR: SKOUFIS
 
TITLE OF BILL:

An act to amend the not-for-profit corporation law and the public
authorities law, in relation to the applicability of open meetings and
freedom of information laws to certain not-for-profit corporations

 
PURPOSE OR GENERAL IDEA OF BILL:

The purpose of this bill is to impose greater transparency and account-
ability on those not-for-profit corporations that engage in municipal
economic development and function as an instrument and subsidiary of
local government.

 
SUMMARY OF PROVISIONS:

Section 1 of the bill would add a new subdivision (h) to section 104 of
the not-for-profit corporation law, which would require the Department
of State to transmit to the Authorities Budget Office a copy of any

filed certified of incorporation which indicates such certificate has
been filed on behalf or at the behest of a municipal corporation, public
authority, or district.

Section 2 of this bill would amend section 402 of the not-for-profit
corporation law, by requiring those wishing to file certificates of
incorporation to note on their certificates whether they have received
the relevant consent of the Authorities Budget Office, if applicable.

Section 3 of this bill would amend section 402 of the not-for-profit
corporation law, by requiring those wishing to file certificates of
incorporation to note on their certificates whether such corporation is
being incorporated on the behalf of or at the behest of a municipal
corporation, public authority, or district.

Section 4 of this bill would amend section 404 of the not-for-profit
corporation law, by requiring those wishing to incorporate certain types
of corporations, such as those corporations where a majority of board
members are appointed by elected officials of any municipal corporation,
to obtain the consent of the Authorities Budget Office prior to filing
certificates of incorporation.

Section 5 of this bill would amend paragraph (a) of section 1411 of the
not-for-profit corporation law, by proscribing a not-for-profit corpo-
ration from incorporating or reincorporating as a local development
corporation if its sole corporate purpose would be to "lessen the
burdens of government and act in the public interest."

Section 6 of this bill would amend subparagraph 2 of paragraph (d) of
section 1411 of the not-for-profit corporation law by making a technical
change to account for changes added in Section 8 of this bill.

Section 7 of this bill would amend paragraph (d) of section 1411 of the
not-for-profit corporation law by requiring, in regard to the mandatory
public hearing to consider the sale or lease of municipal property to a
local development corporation, that such advanced notice of said meet-
ing: be given 21 days in advance of the hearing; describe the property
at issue; describe the proposed consideration for the sale; include an
estimated fair-market value of the property at issue; and include a
statement of the intended use of the property by the corporation.

Section 8 of this bill would amend paragraph (i) of section 1411 of the
not-for-profit corporation law by placing certain statutory requirements
and limitations on the contracts entered into between a local develop-
ment corporations and a municipal corporations, public authority, or
district in relation to one of said corporations corporate purposes.

Section 9 of this bill would amend subdivision 2 of section 2 of the
public authorities law, by expanding the definition of "local authority"
to include certain not-for-profit corporations, such as those corpo-
rations where a majority of board members are appointed by elected offi-
cials of any municipal corporation, or those which pay staff of a local
or state government to provide administrative support.

Section 10 of this bill would amend the public authorities law by adding
a new section 2829, which would subject all state and local authorities
to the open meetings law and freedom of information laws, as well
require such authorities to stream their meeting in real-time.

Section 11 of this bill is the effective date.

 
JUSTIFICATION:

Local development corporations (LDCs), as well as other types of private
not-for profit corporations, are often used by local governments as a
means to indirectly finance local government operations and projects.
These LDCs and similar private entities, however, are exempt from many
of the constitutional and statutory provisions that guide the operations
and financial transactions conducted by local governments, despite how,
as a practical matter, they often function as an instrument and subsid-
iary of local government.

While such organizations mostly do great work in developing their local
economies and serve an important quasi-governmental role, reports from
the Authorities Budget Office, the State Comptroller, and good-govern-
ment groups have exposed that LDCs and such other non-profits are too
frequently used solely to circumvent these constitutional and statutory
restrictions that apply to projects directly undertaken by a local
government, as well as to circumvent transparency and public scrutiny
laws through such entities status as private organizations. The end
result of this lack of transparency, accountability and restraint has
been a significant waste of taxpayer dollars and public resources.

When organizations rely on taxpayer resources to operate, they should be
subject to strong oversight and be held accountable. With such entities
holding presently around $20 billion in outstanding debt, New York's
taxpayers deserve far more accountability and responsibility with how
their money is being spent and leveraged by such entities. To protect
the interests of the taxpayer, our localities, and the state, this bill
seeks to subject these LDCs and other similar not-for-profits to greater
governmental accountability and public transparency, as well as to reign
in some of their more problematic activities.

 
PRIOR LEGISLATIVE HISTORY:

New bill.
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:

None noted.

 
EFFECTIVE DATE:
This act shall take effect on the thirtieth day after enactment,
provided that section nine of this act shall not apply retroactively to
any contract between a local development corporation and a municipal
corporation, public authority or district entered into prior to the
enactment of this act.

S4339A - Bill Text download pdf

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4339--A
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             February 3, 2021
                                ___________
 
 Introduced  by  Sen. SKOUFIS -- read twice and ordered printed, and when
   printed to be committed to the Committee on Corporations,  Authorities
   and   Commissions  --  committee  discharged,  bill  amended,  ordered
   reprinted as amended and recommitted to said committee
 
 AN ACT to amend  the  not-for-profit  corporation  law  and  the  public
   authorities law, in relation to the applicability of open meetings and
   freedom of information laws to certain not-for-profit corporations
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section  104  of  the  not-for-profit  corporation  law  is
 amended by adding a new subdivision (h) to read as follows:
   (H)  THE  DEPARTMENT  SHALL TRANSMIT ELECTRONICALLY TO THE AUTHORITIES
 BUDGET OFFICE A COPY OF EVERY  CERTIFICATE  OF  INCORPORATION  FILED  OR
 DELIVERED  WHERE  THE INCORPORATOR HAS INDICATED ON THE CERTIFICATE THAT
 HE OR SHE IS FILING SAID CERTIFICATE ON THE BEHALF OR AT THE BEHEST OF A
 MUNICIPAL CORPORATION, STATE OR LOCAL AUTHORITY, OR DISTRICT.
   § 2. Subdivision 2-b of paragraph (a) of section 402 of  the  not-for-
 profit  corporation  law, as added by chapter 23 of the laws of 2014, is
 amended to read as follows:
   (2-b) If it is not formed to engage in any activity or for any purpose
 requiring consent or approval of any state official, department,  board,
 agency  or  other body, OR DOES NOT REQUIRE CONSENT PURSUANT TO SUBPARA-
 GRAPH (2) OR (3) OF PARAGRAPH (W) OF SECTION FOUR HUNDRED FOUR  OF  THIS
 ARTICLE,  a statement that no such consent or approval is required. Such
 statement shall be deemed conclusive  for  purposes  of  filing  by  the
 department  of  state.  If  subsequent  to submitting the certificate of
 incorporation for filing, the corporation plans to engage in any  activ-
 ity  requiring  consent  or approval pursuant to section 404 (approvals,
 notices and consents) of this chapter, the corporation shall obtain such
 consent or approval and accordingly amend its  certificate  of  incorpo-
 ration pursuant to article eight of this chapter.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD08161-03-1

 S. 4339--A                          2
 
   §  3.  Paragraph  (a) of section 402 of the not-for-profit corporation
 law is amended by adding a new subparagraph 9 to read as follows:
   (9)  A  STATEMENT WHETHER THE CORPORATION IS BEING INCORPORATED ON THE
 BEHALF OR AT THE BEHEST OF ANY MUNICIPAL  CORPORATION,  STATE  OR  LOCAL
 AUTHORITY,  OR  DISTRICT.  IF  SO,  THE INCORPORATOR SHALL IDENTIFY SUCH
 MUNICIPAL CORPORATION, STATE OR LOCAL AUTHORITY, OR DISTRICT.
   § 4. Section 404 of the not-for-profit corporation law is  amended  by
 adding a new paragraph (w) to read as follows:
   (W)  EVERY  CERTIFICATE  OF  INCORPORATION  WHICH  INCLUDES ANY OF THE
 FOLLOWING SHALL HAVE ENDORSED THEREON OR ANNEXED THERETO THE CONSENT  OF
 THE DIRECTOR OF THE AUTHORITIES BUDGET OFFICE:
   (1)  INCLUDES  AMONG  ITS PURPOSES THE RELIEVING AND REDUCING OF UNEM-
 PLOYMENT, PROMOTING AND PROVIDING FOR ADDITIONAL AND MAXIMUM EMPLOYMENT,
 BETTERING AND MAINTAINING JOB  OPPORTUNITIES,  INSTRUCTING  OR  TRAINING
 INDIVIDUALS  TO  IMPROVE  OR  DEVELOP  THEIR CAPABILITIES FOR SUCH JOBS,
 CARRYING ON SCIENTIFIC RESEARCH FOR THE PURPOSE OF AIDING A COMMUNITY OR
 GEOGRAPHICAL AREA BY ATTRACTING NEW INDUSTRY TO THE COMMUNITY OR AREA OR
 BY ENCOURAGING THE DEVELOPMENT OF, OR RETENTION OF, AN INDUSTRY  IN  THE
 COMMUNITY OR AREA, AND LESSENING THE BURDENS OF GOVERNMENT AND ACTING IN
 THE  PUBLIC  INTEREST,  OR  ANY  ABBREVIATION OR DERIVATIVE THEREOF IN A
 CONTEXT THAT INDICATES OR IMPLIES THAT THE CORPORATION IS FORMED FOR ANY
 OF THE ABOVE PURPOSES;
   (2) INDICATES THAT ONE OR MORE INDIVIDUALS WHO SERVE  AS  OFFICERS  OR
 EMPLOYEES  OF  ANY  MUNICIPAL  CORPORATION, STATE OR LOCAL AUTHORITY, OR
 DISTRICT SHALL: (I) SELECT EITHER A MAJORITY OF THE CORPORATION'S  BOARD
 OF  DIRECTORS OR THE CORPORATION'S CHIEF EXECUTIVE OFFICER; (II) CONSTI-
 TUTE A MAJORITY OF THE VOTING STRENGTH THAT SELECTS EITHER A MAJORITY OF
 THE CORPORATION'S BOARD OF DIRECTORS OR THE CORPORATION'S  CHIEF  EXECU-
 TIVE  OFFICER;  OR  (III)  SERVE AS: (A) A MAJORITY OF THE CORPORATION'S
 BOARD OF DIRECTORS; OR (B) IN HIS OR HER OFFICIAL CAPACITY,  THE  CORPO-
 RATION'S  CHIEF EXECUTIVE OFFICER; OR (C) IN HIS OR HER OFFICIAL CAPACI-
 TY, A DIRECTOR IN THE CORPORATION; OR
   (3) INDICATES THAT SUCH  CORPORATION  IS  BEING  INCORPORATED  ON  THE
 BEHALF  OR  AT  THE  BEHEST OF ANY MUNICIPAL CORPORATION, STATE OR LOCAL
 AUTHORITY, OR DISTRICT.
   THE DIRECTOR SHALL MAKE SUCH INQUIRY INTO THE PURPOSES OF THE PROPOSED
 CORPORATION AS HE OR SHE SHALL DEEM ADVISABLE.
   § 5. Paragraph (a) of section 1411 of the  not-for-profit  corporation
 law,  as  amended by chapter 847 of the laws of 1970, is amended to read
 as follows:
   (a) Purposes.
   This section shall provide  an  additional  and  alternate  method  of
 incorporation  or reincorporation of not-for-profit corporations for any
 of the purposes set forth in this paragraph and shall not be  deemed  to
 alter,  impair or diminish the purposes, rights, powers or privileges of
 any corporation heretofore or hereafter incorporated under this  section
 or  under  the  stock  or business corporation laws. Corporations may be
 incorporated or reincorporated  under  this  section  as  not-for-profit
 local  development  corporations operated for the exclusively charitable
 or public purposes of relieving and reducing unemployment, promoting and
 providing for additional and maximum employment, bettering and maintain-
 ing job opportunities, instructing or training individuals to improve or
 develop  their  capabilities  for  such  jobs,  carrying  on  scientific
 research  for  the purpose of aiding a community or geographical area by
 attracting new industry to the community or area or by  encouraging  the
 development  of,  or retention of, an industry in the community or area,

 S. 4339--A                          3
 
 and lessening the burdens of government and acting in the public  inter-
 est,  and  any  one  or  more counties, cities, towns or villages of the
 state, or any combination thereof,  or  the  New  York  job  development
 authority  in  exercising  its power under the public authorities law to
 encourage the organization of local development corporations, may  cause
 such corporations to be incorporated by public officers or private indi-
 viduals  or reincorporated upon compliance with the requirements of this
 section, and it is hereby found, determined and declared that in  carry-
 ing  out  said  purposes and in exercising the powers conferred by para-
 graph (b) such corporations will be performing an essential governmental
 function. A NOT-FOR-PROFIT CORPORATION MAY NOT INCORPORATE OR REINCORPO-
 RATE UNDER THIS SECTION IF ITS SOLE CORPORATE PURPOSE IS  FOR  LESSENING
 THE BURDENS OF GOVERNMENT AND ACTING IN THE PUBLIC INTEREST.
   §  6.  Subparagraph 2 of paragraph (d) of section 1411 of the not-for-
 profit corporation law is amended to read as follows:
   (2) Notwithstanding the provisions of any general,  special  or  local
 law,  charter  or  ordinance  to the contrary, such sale or lease may be
 made without appraisal (EXCEPT AS MAY BE NECESSARY IN REGARD TO SUBPARA-
 GRAPH (4) OF THIS PARAGRAPH), public notice[,] (except  as  provided  in
 subparagraph (4) OF THIS PARAGRAPH), or public bidding for such price or
 rental  and  upon  such  terms as may be agreed upon between the county,
 city, town or village and said local development corporation;  provided,
 however,  that  in case of a lease the term may not exceed [ninety-nine]
 FIVE years and provided, further, that in cities having a population  of
 one  million  or  more,  no such sale or lease shall be made without the
 approval of a majority of the members of the borough  improvement  board
 of the borough in which such real property is located.
   §  7.  Subparagraph 4 of paragraph (d) of section 1411 of the not-for-
 profit corporation law is amended to read as follows:
   (4) Notice of such hearing shall be published at least  [ten]  TWENTY-
 ONE  days before the date set for the hearing in such publication and in
 such manner as may be designated by the local legislative body,  or  the
 board  of estimate as the case may be. SUCH NOTICE SHALL ALSO INCLUDE: A
 DESCRIPTION OF THE PROPERTY AT ISSUE; THE VALUE OF THE PROPOSED  CONSID-
 ERATION TO BE RECEIVED FROM THE SALE OR LEASE; THE ESTIMATED FAIR MARKET
 VALUE  OF  THE ASSET; AND A STATEMENT OF THE INTENDED USE OR DISPOSITION
 OF THE PROPERTY BY THE LOCAL DEVELOPMENT CORPORATION.
   § 8. Paragraph (i) of section 1411 of the  not-for-profit  corporation
 law is amended to read as follows:
   (i)  CONTRACTS  BETWEEN  A MUNICIPAL CORPORATION, PUBLIC AUTHORITY, OR
 DISTRICT AND A LOCAL DEVELOPMENT CORPORATION.
   ANY CONTRACT OR OTHER AGREEMENT BETWEEN  A  LOCAL  DEVELOPMENT  CORPO-
 RATION  AND A MUNICIPAL CORPORATION, STATE AUTHORITY OR LOCAL AUTHORITY,
 OR DISTRICT FOR ONE OR MORE OF THE PURPOSES ENUMERATED IN PARAGRAPH  (A)
 OF THIS SECTION SHALL: (1) CAUSE THE LOCAL DEVELOPMENT CORPORATION TO BE
 DEFINED  AS A LOCAL AUTHORITY PURSUANT TO SUBDIVISION TWO OF SECTION TWO
 OF THE PUBLIC AUTHORITIES LAW; (2)  PROVIDE  FOR  THE  MUNICIPAL  CORPO-
 RATION,  STATE AUTHORITY OR LOCAL AUTHORITY, OR DISTRICT TO RECEIVE FAIR
 AND ADEQUATE CONSIDERATION; (3) BE SUBJECT TO THE REQUIREMENTS OF  ARTI-
 CLE  FIVE-A  OF  THE  GENERAL  MUNICIPAL LAW; AND (4) HAVE A TERM NOT TO
 EXCEED FIVE YEARS, SUBJECT TO ONE OR MORE SUBSEQUENT RENEWALS FOR A TERM
 NOT TO EXCEED FIVE YEARS EACH UPON THE MUTUAL CONSENT  OF  THE  PARTIES;
 PROVIDED  HOWEVER THAT A CONTRACT WITH A MUNICIPAL CORPORATION SHALL NOT
 BE USED TO FINANCE THE MUNICIPAL CORPORATION'S OPERATIONS OR TO  ACQUIRE
 OR IMPROVE AN ASSET FOR USE OF THE MUNICIPAL CORPORATION.
   (J)  Effect of section.

 S. 4339--A                          4
 
   Corporations  incorporated  or reincorporated under this section shall
 be organized and operated exclusively for  the  purposes  set  forth  in
 paragraph  (a)  OF  THIS  SECTION, shall have, in addition to the powers
 otherwise conferred by law, the powers conferred  by  paragraph  (c)  OF
 THIS SECTION and shall be subject to all the restrictions [and], limita-
 tions  AND  OBLIGATIONS imposed by [paragraph] PARAGRAPHS (e) [and para-
 graph], (g) AND (I) OF THIS SECTION.   In so far as  the  provisions  of
 this  section  are  inconsistent  with  the provisions of any other law,
 general or special, the provisions of this section shall be  controlling
 as to corporations incorporated or reincorporated hereunder.
   §  9.  Subdivision  2  of  section 2 of the public authorities law, as
 amended by chapter 257 of the laws  of  2011,  is  amended  to  read  as
 follows:
   2. "local authority" shall mean (a) a public authority or public bene-
 fit  corporation  created by or existing under this chapter or any other
 law of the state of New York whose members do not hold a civil office of
 the state, are not appointed by the governor or  are  appointed  by  the
 governor specifically upon the recommendation of the local government or
 governments;  (b) a not-for-profit corporation, OTHER THAN A FIRE CORPO-
 RATION, STATEWIDE ASSOCIATION OF LOCAL GOVERNMENTS OR  LOCAL  OFFICIALS,
 OR  BUSINESS  IMPROVEMENT  DISTRICT,  affiliated  with, sponsored by, or
 created by a county, city, town  or  village  government;  (c)  a  local
 industrial developmental agency or authority or other local public bene-
 fit  corporation;  (d)  an affiliate of such local authority; [or] (e) a
 land bank corporation created pursuant to article sixteen  of  the  not-
 for-profit  corporation  law; OR (F) A NOT-FOR-PROFIT CORPORATION, OTHER
 THAN A FIRE CORPORATION OR STATEWIDE ASSOCIATION OF LOCAL GOVERNMENTS OR
 LOCAL OFFICIALS, OR BUSINESS IMPROVEMENT DISTRICT, THAT (I)  HAS  ISSUED
 OR  HAS THE AUTHORITY TO ISSUE TAX EXEMPT DEBT OR (II) PROVIDES STATE OR
 MUNICIPAL TAX EXEMPTIONS THROUGH ITS PARTICIPATION IN A  PROJECT  UNDER-
 TAKEN IN FURTHERANCE OF ITS PURPOSES.
   FOR  THE  PURPOSES  OF  PARAGRAPH (B) OF THE OPENING PARAGRAPH OF THIS
 SUBDIVISION, "AFFILIATED WITH, SPONSORED BY, OR  CREATED  BY  A  COUNTY,
 CITY, TOWN OR VILLAGE GOVERNMENT" SHALL ALSO INCLUDE, BUT NOT BE LIMITED
 TO,  ENTITIES:   (A) WHERE ONE OR MORE INDIVIDUALS WHO SERVE AS OFFICERS
 OR EMPLOYEES OF ANY COUNTY, CITY, TOWN, VILLAGE:   (I) SELECT  EITHER  A
 MAJORITY  OF  THE NOT-FOR-PROFIT CORPORATION'S BOARD OF DIRECTORS OR THE
 NOT-FOR-PROFIT CORPORATION'S CHIEF EXECUTIVE OFFICER; (II) CONSTITUTE  A
 MAJORITY  OF  THE  VOTING STRENGTH THAT SELECTS EITHER A MAJORITY OF THE
 NOT-FOR-PROFIT CORPORATION'S BOARD OF  DIRECTORS  OR  THE  CORPORATION'S
 CHIEF  EXECUTIVE  OFFICER; OR (III) SERVE AS: (1) A MAJORITY OF THE NOT-
 FOR-PROFIT CORPORATION'S BOARD OF DIRECTORS; OR (2) IN HIS OR HER  OFFI-
 CIAL CAPACITY, THE NOT-FOR-PROFIT CORPORATION'S CHIEF EXECUTIVE OFFICER;
 OR (3) IN HIS OR HER OFFICIAL CAPACITY, A DIRECTOR IN THE NOT-FOR-PROFIT
 CORPORATION;  OR  (B)  WHICH PAY STAFF OF A STATE OR LOCAL GOVERNMENT OR
 STATE OR  LOCAL  AUTHORITY  TO  PROVIDE  ADMINISTRATIVE  OR  OPERATIONAL
 SUPPORT.
   §  10.  The  public authorities law is amended by adding a new section
 2829 to read as follows:
   § 2829. STATE AND LOCAL AUTHORITIES SUBJECT TO THE OPEN  MEETINGS  AND
 FREEDOM  OF  INFORMATION  LAWS. ALL STATE AND LOCAL AUTHORITIES, AS SUCH
 TERMS ARE DEFINED IN SECTION TWO OF THIS CHAPTER, AS WELL AS ALL SUBSID-
 IARIES AND AFFILIATES OF SUCH STATE AND LOCAL AUTHORITIES, AS SUCH TERMS
 ARE DEFINED IN SECTION TWO OF THIS CHAPTER,  SHALL  BE  SUBJECT  TO  THE
 PROVISIONS OF ARTICLES SIX AND SEVEN OF THE PUBLIC OFFICERS LAW RELATING
 TO  THE  FREEDOM OF INFORMATION AND OPEN MEETINGS LAWS RESPECTIVELY. ALL

 S. 4339--A                          5
 
 STATE AND LOCAL AUTHORITIES, AS WELL AS ALL SUBSIDIARIES AND  AFFILIATES
 OF  SUCH  STATE AND LOCAL AUTHORITIES, SHALL, TO THE EXTENT PRACTICABLE,
 STREAM ALL OPEN MEETINGS AND PUBLIC HEARINGS ON  ITS  WEBSITE  IN  REAL-
 TIME,  POST VIDEO RECORDINGS OF ALL OPEN MEETINGS AND PUBLIC HEARINGS ON
 ITS WEBSITE WITHIN FIVE BUSINESS DAYS OF  THE  MEETING  OR  HEARING  AND
 MAINTAIN SUCH RECORDINGS FOR A PERIOD OF NOT LESS THAN FIVE YEARS.
   §  11.  This act shall take effect on the thirtieth day after it shall
 have become a law; provided, however, that the provisions  of  paragraph
 (i)  of  section  1411 of the not-for-profit corporation law, as amended
 pursuant to section eight of this act shall not apply  retroactively  to
 contracts  or  agreements  between a local development corporation and a
 municipal corporation, state or local  authority,  or  district  entered
 into prior to the effective date of this act.

S4339B (ACTIVE) - Details

See Assembly Version of this Bill:: A4575
Law Section:: Not-for-Profit Corporation Law
Laws Affected:: Amd §§104, 402, 404 & 1411, N-PC L; amd §2, add §2829, Pub Auth L
Versions Introduced in 2023-2024 Legislative Session:: S2727, A3715

S4339B (ACTIVE) - Summary

Relates to the applicability of open meetings and freedom of information laws to certain not-for-profit corporations.

S4339B (ACTIVE) - Sponsor Memo

 
BILL NUMBER: S4339B

SPONSOR: SKOUFIS
 
TITLE OF BILL:

An act to amend the not-for-profit corporation law and the public
authorities law, in relation to the applicability of open meetings and
freedom of information laws to certain not-for-profit corporations

 
PURPOSE:

The purpose of this bill is to impose greater transparency and account-
ability on those not-for-profit corporations that engage in municipal
economic development and function as an instrument and subsidiary of
local government.

 
SUMMARY OF PROVISIONS:

Section 1 of the bill would add a new subdivision (h) to section 104 of
the not-for-profit corporation law, which would require the Department
of State to transmit to the Authorities Budget Office a copy of any
filed certified of incorporation which indicates such certificate has

been filed on behalf or at the behest of a municipal corporation, public
authority, or district.

Section 2 of this bill would amend section 402 of the not-for-profit
corporation law, by requiring those wishing to file certificates of
incorporation to note on their certificates whether they have received
the relevant consent of the Authorities Budget Office, if applicable.

Section 3 of this bill would amend section 402 of the not-for-profit
corporation law, by requiring those wishing to file certificates of
incorporation to note on their certificates whether such corporation is
being incorporated on the behalf of or at the behest of a municipal
corporation, public authority, or district.

Section 4 of this bill would amend section 404 of the not-for-profit
corporation law, by requiring those wishing to incorporate certain types
of corporations, such as those corporations where a majority of board
members are appointed by elected officials of any municipal corporation,
to obtain the consent of the Authorities Budget Office prior to filing
certificates of incorporation.

Section 5 of this bill would amend paragraph (a) of section 1411 of the
not-for-profit corporation law, by proscribing a not-for-profit corpo-
ration from incorporating or reincorporating as a local development
corporation if its sole corporate purpose would be to "lessen the
burdens of government and act in the public interest."

Section 6 of this bill would amend subparagraph 2 of paragraph (d) of
section 1411 of the not-for-profit corporation law by making a technical
change to account for changes added in Section 8 of this bill.

Section 7 of this bill would amend paragraph (d) of section 1411 of the
not-for-profit corporation law by requiring, in regard to the mandatory
public hearing to consider the sale or lease of municipal property to a
local development corporation, that such advanced notice of said meet-
ing: be given 21 days in advance of the hearing; describe the property
at issue; describe the proposed consideration for the sale; include an
estimated fair-market value of the property at issue; and include a
statement of the intended use of the property by the corporation.

Section 8 of this bill would amend paragraph (i) of section 1411 of the
not-for-profit corporation law by placing certain statutory requirements
and limitations on the contracts entered into between a local develop-
ment corporations and a municipal corporations, public authority, or
district in relation to one of said corporations corporate purposes.

Section 9 of this bill would amend subdivision 2 of section 2 of the
public authorities law, by expanding the definition of "local authority"
to include certain not-for-profit corporations, such as those corpo-
rations where a majority of board members are appointed by elected offi-
cials of any municipal corporation, or those which pay staff of a local
or state government to provide administrative support.

Section 10 of this bill would amend the public authorities law by adding
a new section 2829, which would subject all state and local authorities
to the open meetings law and freedom of information laws, as well
require such authorities to stream their meeting in real-time.

Section 11 of this bill is the effective date.

 
JUSTIFICATION:

Local development corporations (LDCs), as well as other types of private
not-for profit corporations, are often used by local governments as a
means to indirectly finance local government operations and projects.
These LDCs and similar private entities, however, are exempt from many
of the constitutional and statutory provisions that guide the operations
and financial transactions conducted by local governments, despite how,
as a practical matter, they often function as an instrument and subsid-
iary of local government.

While such organizations mostly do great work in developing their local
economies and serve an important quasi-governmental role, reports from
the Authorities Budget Office, the State Comptroller, and good-govern-
ment groups have exposed that LDCs and such other non-profits are too
frequently used solely to circumvent these constitutional and statutory
restrictions that apply to projects directly undertaken by a local
government, as well as to circumvent transparency and public scrutiny
laws through such entities status as private organizations. The end
result of this lack of transparency, accountability and restraint has
been a significant waste of taxpayer dollars and public resources.

When organizations rely on taxpayer resources to operate, they should be
subject to strong oversight and be held accountable. With such entities
holding presently around $20 billion in outstanding debt, New York's
taxpayers deserve far more accountability and responsibility with how
their money is being spent and leveraged by such entities. To protect
the interests of the taxpayer, our localities, and the state, this bill
seeks to subject these LDCs and other similar not-for-profits to greater
governmental accountability and public transparency, as well as to reign
in some of their more problematic activities.

 
LEGISLATIVE HISTORY:

New bill.
 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect on the thirtieth day after it shall have
become a law; provided, however, that the provisions of subparagraph 2
of paragraph (d) and paragraph (i) of section 1411 of the not for-profit
corporation law, as amended by sections six and eight of this act shall
not apply retroactively to contracts or agreements between a local
development corporation and a municipal corporation, state or local
authority, or district entered into prior to the effective date of this
act.

S4339B (ACTIVE) - Bill Text download pdf

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4339--B
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             February 3, 2021
                                ___________
 
 Introduced  by  Sen. SKOUFIS -- read twice and ordered printed, and when
   printed to be committed to the Committee on Corporations,  Authorities
   and   Commissions  --  committee  discharged,  bill  amended,  ordered
   reprinted as amended and recommitted to said committee --  recommitted
   to  the  Committee  on  Corporations,  Authorities  and Commissions in
   accordance with Senate Rule 6, sec. 8 --  committee  discharged,  bill
   amended,  ordered reprinted as amended and recommitted to said commit-
   tee
 
 AN ACT to amend  the  not-for-profit  corporation  law  and  the  public
   authorities law, in relation to the applicability of open meetings and
   freedom of information laws to certain not-for-profit corporations
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section  104  of  the  not-for-profit  corporation  law  is
 amended by adding a new paragraph (h) to read as follows:
   (H)  THE  DEPARTMENT  SHALL TRANSMIT ELECTRONICALLY TO THE AUTHORITIES
 BUDGET OFFICE A COPY OF EVERY  CERTIFICATE  OF  INCORPORATION  FILED  OR
 DELIVERED  WHERE  THE INCORPORATOR HAS INDICATED ON THE CERTIFICATE THAT
 HE OR SHE IS FILING SAID CERTIFICATE ON THE BEHALF OR AT THE BEHEST OF A
 MUNICIPAL CORPORATION, STATE OR LOCAL AUTHORITY, OR DISTRICT.
   § 2. Subparagraph 2-b of paragraph (a) of section 402 of the  not-for-
 profit  corporation  law, as added by chapter 23 of the laws of 2014, is
 amended to read as follows:
   (2-b) If it is not formed to engage in any activity or for any purpose
 requiring consent or approval of any state official, department,  board,
 agency  or  other body, OR DOES NOT REQUIRE CONSENT PURSUANT TO SUBPARA-
 GRAPH (2) OR (3) OF PARAGRAPH (W) OF SECTION 404 (APPROVALS, NOTICES AND
 CONSENTS) a statement that no such consent or approval is required. Such
 statement shall be deemed conclusive  for  purposes  of  filing  by  the
 department  of  state.  If  subsequent  to submitting the certificate of
 incorporation for filing, the corporation plans to engage in any  activ-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD08161-05-2

 S. 4339--B                          2
 
 ity  requiring  consent or approval pursuant to section 404 [(approvals]
 (APPROVALS, notices and consents) of this chapter, the corporation shall
 obtain such consent or approval and accordingly amend its certificate of
 incorporation pursuant to article eight of this chapter.
   §  3.  Paragraph  (a) of section 402 of the not-for-profit corporation
 law is amended by adding a new subparagraph 9 to read as follows:
   (9) A STATEMENT WHETHER THE CORPORATION IS BEING INCORPORATED  ON  THE
 BEHALF  OR  AT  THE  BEHEST OF ANY MUNICIPAL CORPORATION, STATE OR LOCAL
 AUTHORITY, OR DISTRICT. IF SO,  THE  INCORPORATOR  SHALL  IDENTIFY  SUCH
 MUNICIPAL CORPORATION, STATE OR LOCAL AUTHORITY, OR DISTRICT.
   §  4.  Section 404 of the not-for-profit corporation law is amended by
 adding a new paragraph (w) to read as follows:
   (W) EVERY CERTIFICATE OF  INCORPORATION  WHICH  INCLUDES  ANY  OF  THE
 FOLLOWING  SHALL HAVE ENDORSED THEREON OR ANNEXED THERETO THE CONSENT OF
 THE DIRECTOR OF THE AUTHORITIES BUDGET OFFICE:
   (1) INCLUDES AMONG ITS PURPOSES THE RELIEVING AND  REDUCING  OF  UNEM-
 PLOYMENT, PROMOTING AND PROVIDING FOR ADDITIONAL AND MAXIMUM EMPLOYMENT,
 BETTERING  AND  MAINTAINING  JOB  OPPORTUNITIES, INSTRUCTING OR TRAINING
 INDIVIDUALS TO IMPROVE OR DEVELOP  THEIR  CAPABILITIES  FOR  SUCH  JOBS,
 CARRYING ON SCIENTIFIC RESEARCH FOR THE PURPOSE OF AIDING A COMMUNITY OR
 GEOGRAPHICAL AREA BY ATTRACTING NEW INDUSTRY TO THE COMMUNITY OR AREA OR
 BY  ENCOURAGING  THE DEVELOPMENT OF, OR RETENTION OF, AN INDUSTRY IN THE
 COMMUNITY OR AREA, AND LESSENING THE BURDENS OF GOVERNMENT AND ACTING IN
 THE PUBLIC INTEREST, OR ANY ABBREVIATION  OR  DERIVATIVE  THEREOF  IN  A
 CONTEXT THAT INDICATES OR IMPLIES THAT THE CORPORATION IS FORMED FOR ANY
 OF THE ABOVE PURPOSES;
   (2)  INDICATES  THAT  ONE OR MORE INDIVIDUALS WHO SERVE AS OFFICERS OR
 EMPLOYEES OF ANY MUNICIPAL CORPORATION, STATE  OR  LOCAL  AUTHORITY,  OR
 DISTRICT  SHALL: (I) SELECT EITHER A MAJORITY OF THE CORPORATION'S BOARD
 OF DIRECTORS OR THE CORPORATION'S CHIEF EXECUTIVE OFFICER; (II)  CONSTI-
 TUTE A MAJORITY OF THE VOTING STRENGTH THAT SELECTS EITHER A MAJORITY OF
 THE  CORPORATION'S  BOARD OF DIRECTORS OR THE CORPORATION'S CHIEF EXECU-
 TIVE OFFICER; OR (III) SERVE AS: (A) A  MAJORITY  OF  THE  CORPORATION'S
 BOARD  OF  DIRECTORS; OR (B) IN HIS OR HER OFFICIAL CAPACITY, THE CORPO-
 RATION'S CHIEF EXECUTIVE OFFICER; OR (C) IN HIS OR HER OFFICIAL  CAPACI-
 TY, A DIRECTOR IN THE CORPORATION; OR
   (3)  INDICATES  THAT  SUCH  CORPORATION  IS  BEING INCORPORATED ON THE
 BEHALF OR AT THE BEHEST OF ANY MUNICIPAL  CORPORATION,  STATE  OR  LOCAL
 AUTHORITY, OR DISTRICT.
   THE DIRECTOR SHALL MAKE SUCH INQUIRY INTO THE PURPOSES OF THE PROPOSED
 CORPORATION AS HE OR SHE SHALL DEEM ADVISABLE.
   §  5.  Paragraph (a) of section 1411 of the not-for-profit corporation
 law, as amended by chapter 847 of the laws of 1970, is amended  to  read
 as follows:
   (a) Purposes.
   This  section  shall  provide  an  additional  and alternate method of
 incorporation or reincorporation of not-for-profit corporations for  any
 of  the  purposes set forth in this paragraph and shall not be deemed to
 alter, impair or diminish the purposes, rights, powers or privileges  of
 any  corporation heretofore or hereafter incorporated under this section
 or under the stock or business corporation  laws.  Corporations  may  be
 incorporated  or  reincorporated  under  this  section as not-for-profit
 local development corporations operated for the  exclusively  charitable
 or public purposes of relieving and reducing unemployment, promoting and
 providing for additional and maximum employment, bettering and maintain-
 ing job opportunities, instructing or training individuals to improve or
 S. 4339--B                          3
 
 develop  their  capabilities  for  such  jobs,  carrying  on  scientific
 research for the purpose of aiding a community or geographical  area  by
 attracting  new  industry to the community or area or by encouraging the
 development  of,  or retention of, an industry in the community or area,
 and lessening the burdens of government and acting in the public  inter-
 est,  and  any  one  or  more counties, cities, towns or villages of the
 state, or any combination thereof,  or  the  New  York  job  development
 authority  in  exercising  its power under the public authorities law to
 encourage the organization of local development corporations, may  cause
 such corporations to be incorporated by public officers or private indi-
 viduals  or reincorporated upon compliance with the requirements of this
 section, and it is hereby found, determined and declared that in  carry-
 ing  out  said  purposes and in exercising the powers conferred by para-
 graph (b) such corporations will be performing an essential governmental
 function. A NOT-FOR-PROFIT CORPORATION MAY NOT INCORPORATE OR REINCORPO-
 RATE UNDER THIS SECTION IF ITS SOLE CORPORATE PURPOSE IS  FOR  LESSENING
 THE BURDENS OF GOVERNMENT AND ACTING IN THE PUBLIC INTEREST.
   §  6.  Subparagraph 2 of paragraph (d) of section 1411 of the not-for-
 profit corporation law is amended to read as follows:
   (2) Notwithstanding the provisions of any general,  special  or  local
 law,  charter  or  ordinance  to the contrary, such sale or lease may be
 made without appraisal (EXCEPT AS MAY BE NECESSARY IN REGARD TO SUBPARA-
 GRAPH (4) OF THIS PARAGRAPH), public notice[,] (except  as  provided  in
 subparagraph (4) OF THIS PARAGRAPH), or public bidding for such price or
 rental  and  upon  such  terms as may be agreed upon between the county,
 city, town or village and said local development corporation;  provided,
 however,  that  in case of a lease the term may not exceed [ninety-nine]
 TWENTY-FIVE years and provided, further, that in cities having  a  popu-
 lation of one million or more, no such sale or lease shall be made with-
 out the approval of a majority of the members of the borough improvement
 board of the borough in which such real property is located.
   §  7.  Subparagraph 4 of paragraph (d) of section 1411 of the not-for-
 profit corporation law is amended to read as follows:
   (4) Notice of such hearing shall be published at least  [ten]  TWENTY-
 ONE  days before the date set for the hearing in such publication and in
 such manner as may be designated by the local legislative body,  or  the
 board  of estimate as the case may be. SUCH NOTICE SHALL ALSO INCLUDE: A
 DESCRIPTION OF THE PROPERTY AT ISSUE; THE VALUE OF THE PROPOSED  CONSID-
 ERATION TO BE RECEIVED FROM THE SALE OR LEASE; THE ESTIMATED FAIR MARKET
 VALUE  OF  THE ASSET; AND A STATEMENT OF THE INTENDED USE OR DISPOSITION
 OF THE PROPERTY BY THE LOCAL DEVELOPMENT CORPORATION.
   § 8. Paragraph (i) of section 1411 of the  not-for-profit  corporation
 law is amended to read as follows:
   (i)  CONTRACTS  BETWEEN  A MUNICIPAL CORPORATION, PUBLIC AUTHORITY, OR
 DISTRICT AND A LOCAL DEVELOPMENT CORPORATION.
   ANY CONTRACT OR OTHER AGREEMENT BETWEEN  A  LOCAL  DEVELOPMENT  CORPO-
 RATION  AND A MUNICIPAL CORPORATION, STATE AUTHORITY OR LOCAL AUTHORITY,
 OR DISTRICT FOR ONE OR MORE OF THE PURPOSES ENUMERATED IN PARAGRAPH  (A)
 OF THIS SECTION SHALL: (1) CAUSE THE LOCAL DEVELOPMENT CORPORATION TO BE
 DEFINED  AS A LOCAL AUTHORITY PURSUANT TO SUBDIVISION TWO OF SECTION TWO
 OF THE PUBLIC AUTHORITIES LAW; (2)  PROVIDE  FOR  THE  MUNICIPAL  CORPO-
 RATION,  STATE AUTHORITY OR LOCAL AUTHORITY, OR DISTRICT TO RECEIVE FAIR
 AND ADEQUATE CONSIDERATION; (3) BE SUBJECT TO THE REQUIREMENTS OF  ARTI-
 CLE  FIVE-A  OF  THE  GENERAL  MUNICIPAL LAW; AND (4) HAVE A TERM NOT TO
 EXCEED TWENTY-FIVE YEARS, SUBJECT TO ONE OR MORE SUBSEQUENT RENEWALS FOR
 A TERM NOT TO EXCEED TWENTY-FIVE YEARS EACH UPON THE MUTUAL  CONSENT  OF
 S. 4339--B                          4
 
 THE  PARTIES;  PROVIDED  HOWEVER THAT A CONTRACT WITH A MUNICIPAL CORPO-
 RATION SHALL NOT BE USED TO FINANCE THE  MUNICIPAL  CORPORATION'S  OPER-
 ATIONS OR TO ACQUIRE OR IMPROVE AN ASSET FOR USE OF THE MUNICIPAL CORPO-
 RATION.
   (J)  Effect of section.
   Corporations  incorporated  or reincorporated under this section shall
 be organized and operated exclusively for  the  purposes  set  forth  in
 paragraph  (a)  OF  THIS  SECTION, shall have, in addition to the powers
 otherwise conferred by law, the powers conferred  by  paragraph  (c)  OF
 THIS SECTION and shall be subject to all the restrictions [and], limita-
 tions  AND  OBLIGATIONS imposed by [paragraph] PARAGRAPHS (e) [and para-
 graph], (g) AND (I) OF THIS SECTION.   In so far as  the  provisions  of
 this  section  are  inconsistent  with  the provisions of any other law,
 general or special, the provisions of this section shall be  controlling
 as to corporations incorporated or reincorporated hereunder.
   §  9.  Subdivision  2  of  section 2 of the public authorities law, as
 amended by chapter 257 of the laws  of  2011,  is  amended  to  read  as
 follows:
   2. "local authority" shall mean (a) a public authority or public bene-
 fit  corporation  created by or existing under this chapter or any other
 law of the state of New York whose members do not hold a civil office of
 the state, are not appointed by the governor or  are  appointed  by  the
 governor specifically upon the recommendation of the local government or
 governments;  (b) a not-for-profit corporation, OTHER THAN A FIRE CORPO-
 RATION, STATEWIDE ASSOCIATION OF LOCAL GOVERNMENTS OR  LOCAL  OFFICIALS,
 OR  BUSINESS  IMPROVEMENT  DISTRICT,  affiliated  with, sponsored by, or
 created by a county, city, town  or  village  government;  (c)  a  local
 industrial developmental agency or authority or other local public bene-
 fit  corporation;  (d)  an affiliate of such local authority; [or] (e) a
 land bank corporation created pursuant to article sixteen  of  the  not-
 for-profit  corporation  law; OR (F) A NOT-FOR-PROFIT CORPORATION, OTHER
 THAN A FIRE CORPORATION OR STATEWIDE ASSOCIATION OF LOCAL GOVERNMENTS OR
 LOCAL OFFICIALS, OR BUSINESS IMPROVEMENT DISTRICT, THAT (I)  HAS  ISSUED
 OR  HAS THE AUTHORITY TO ISSUE TAX EXEMPT DEBT OR (II) PROVIDES STATE OR
 MUNICIPAL TAX EXEMPTIONS THROUGH ITS PARTICIPATION IN A  PROJECT  UNDER-
 TAKEN IN FURTHERANCE OF ITS PURPOSES.
   FOR  THE  PURPOSES  OF  PARAGRAPH (B) OF THE OPENING PARAGRAPH OF THIS
 SUBDIVISION, "AFFILIATED WITH, SPONSORED BY, OR  CREATED  BY  A  COUNTY,
 CITY, TOWN OR VILLAGE GOVERNMENT" SHALL ALSO INCLUDE, BUT NOT BE LIMITED
 TO,  ENTITIES:   (A) WHERE ONE OR MORE INDIVIDUALS WHO SERVE AS OFFICERS
 OR EMPLOYEES OF ANY COUNTY, CITY, TOWN, VILLAGE:   (I) SELECT  EITHER  A
 MAJORITY  OF  THE NOT-FOR-PROFIT CORPORATION'S BOARD OF DIRECTORS OR THE
 NOT-FOR-PROFIT CORPORATION'S CHIEF EXECUTIVE OFFICER; (II) CONSTITUTE  A
 MAJORITY  OF  THE  VOTING STRENGTH THAT SELECTS EITHER A MAJORITY OF THE
 NOT-FOR-PROFIT CORPORATION'S BOARD OF  DIRECTORS  OR  THE  CORPORATION'S
 CHIEF  EXECUTIVE  OFFICER; OR (III) SERVE AS: (1) A MAJORITY OF THE NOT-
 FOR-PROFIT CORPORATION'S BOARD OF DIRECTORS; OR (2) IN HIS OR HER  OFFI-
 CIAL CAPACITY, THE NOT-FOR-PROFIT CORPORATION'S CHIEF EXECUTIVE OFFICER;
 OR (3) IN HIS OR HER OFFICIAL CAPACITY, A DIRECTOR IN THE NOT-FOR-PROFIT
 CORPORATION;  OR  (B)  WHICH PAY STAFF OF A STATE OR LOCAL GOVERNMENT OR
 STATE OR  LOCAL  AUTHORITY  TO  PROVIDE  ADMINISTRATIVE  OR  OPERATIONAL
 SUPPORT.
   §  10.  The  public authorities law is amended by adding a new section
 2829 to read as follows:
   § 2829. STATE AND LOCAL AUTHORITIES SUBJECT TO THE OPEN  MEETINGS  AND
 FREEDOM  OF  INFORMATION  LAWS. ALL STATE AND LOCAL AUTHORITIES, AS SUCH
 S. 4339--B                          5
 
 TERMS ARE DEFINED IN SECTION TWO OF THIS CHAPTER, AS WELL AS ALL SUBSID-
 IARIES AND AFFILIATES OF SUCH STATE AND LOCAL AUTHORITIES, AS SUCH TERMS
 ARE DEFINED IN SECTION TWO OF THIS CHAPTER,  SHALL  BE  SUBJECT  TO  THE
 PROVISIONS OF ARTICLES SIX AND SEVEN OF THE PUBLIC OFFICERS LAW RELATING
 TO  THE  FREEDOM OF INFORMATION AND OPEN MEETINGS LAWS RESPECTIVELY. ALL
 STATE AND LOCAL AUTHORITIES, AS WELL AS ALL SUBSIDIARIES AND  AFFILIATES
 OF  SUCH  STATE AND LOCAL AUTHORITIES, SHALL, TO THE EXTENT PRACTICABLE,
 STREAM ALL OPEN MEETINGS AND PUBLIC HEARINGS ON  ITS  WEBSITE  IN  REAL-
 TIME,  POST VIDEO RECORDINGS OF ALL OPEN MEETINGS AND PUBLIC HEARINGS ON
 ITS WEBSITE WITHIN FIVE BUSINESS DAYS OF  THE  MEETING  OR  HEARING  AND
 MAINTAIN SUCH RECORDINGS FOR A PERIOD OF NOT LESS THAN FIVE YEARS.
   §  11.  This act shall take effect on the thirtieth day after it shall
 have become a law; provided, however, that the  provisions  of  subpara-
 graph  2  of paragraph (d) and paragraph (i) of section 1411 of the not-
 for-profit corporation law, as amended by sections six and eight of this
 act shall not apply retroactively to contracts or agreements  between  a
 local  development  corporation  and  a  municipal corporation, state or
 local authority, or district entered into prior to the effective date of
 this act.

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The New York State Senate

senate Bill S4339B

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Archive: Last Bill Status - Passed Senate

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senate Bill S4339B

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Sponsored By

James Skoufis

Archive: Last Bill Status - Passed Senate

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Jun 1, 2022 - floor Vote

Floor Vote: Jun 1, 2022

Jun 1, 2022 - Rules committee Vote

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Bill Amendments

S4339 - Details

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S4339 - Bill Text download pdf

S4339A - Details

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S4339B (ACTIVE) - Details

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