S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2727
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             January 24, 2023
                                ___________
 
 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 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-
 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.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD04263-01-3
 S. 2727                             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. 2727                             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]
 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
 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.
 S. 2727                             4
 
   (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
 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
 S. 2727                             5

 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.