Tuesday, February 8, 2005

1 NEW YORK STATE SENATE 2 3 4 THE STENOGRAPHIC RECORD 5 6 7 8 9 ALBANY, NEW YORK 10 February 8, 2005 11 3:00 p.m. 12 13 14 REGULAR SESSION 15 16 17 18 SENATOR JOHN J. FLANAGAN, Acting President 19 STEVEN M. BOGGESS, Secretary 20 21 22 23 24 25

Candyco Transcription Service, Inc.

(518) 371-8910 1 P R O C E E D I N G S 2 ACTING PRESIDENT FLANAGAN: The 3 Senate will come to order. 4 I ask everyone present to please 5 rise and join me in the Pledge of Allegiance. 6 (Whereupon, the assemblage recited 7 the Pledge of Allegiance to the Flag.) 8 ACTING PRESIDENT FLANAGAN: In 9 the absence of clergy, I would ask everyone to 10 bow their heads in a moment of silence. 11 (Whereupon, the assemblage 12 respected a moment of silence.) 13 ACTING PRESIDENT FLANAGAN: 14 Reading of the Journal. 15 THE SECRETARY: In Senate, 16 Monday, February 7, the Senate met pursuant to 17 adjournment. The Journal of Friday, 18 February 4, was read and approved. On motion, 19 Senate adjourned. 20 ACTING PRESIDENT FLANAGAN: 21 Without objection, the Journal stands approved 22 as read. 23 Presentation of petitions. 24 Messages from the Assembly. 25 Messages from the Governor.

Candyco Transcription Service, Inc.

(518) 371-8910 1 Reports of standing committees. 2 Reports of select committees. 3 Communications and reports from 4 state officers. 5 Motions and resolutions. 6 Senator Skelos. 7 SENATOR SKELOS: Mr. President, 8 there is a privileged resolution, 399, at the 9 desk by Senator Bruno. I ask that it be read 10 in its entirety and move for its immediate 11 adoption. 12 ACTING PRESIDENT FLANAGAN: The 13 Secretary will read. 14 THE SECRETARY: By Senator Bruno, 15 Legislative Resolution Number 399, recognizing 16 February 11, 2005, as "Blue Friday." 17 "WHEREAS, The State of New York 18 takes great pride in participating in 19 significant days of recognition; and 20 "WHEREAS, Albany radio station WGNA 21 has teamed up with the Capital District 22 Chapter of Concerns of Police Survivors, 23 Incorporated (COPS), in recognizing 24 February 11, 2005, as 'Blue Friday' in honor 25 of Albany Police Lieutenant John Finn and

Candyco Transcription Service, Inc.

(518) 371-8910 1 Schenectady Police Officer Eric Verteramo, 2 both of whom tragically and heroically lost 3 their lives in the line of duty; and 4 "WHEREAS, COPS, organized in 1984 5 with 110 members, is a nationwide nonprofit 6 organization which helps rebuild the lives of 7 survivors of law officers killed in the line 8 of duty, as determined by federal government 9 criteria; and 10 "WHEREAS, COPS also provides 11 training to law enforcement agencies on 12 survivor victimization issues and educates the 13 public of the need to support the law 14 enforcement profession and its survivors; and 15 "WHEREAS, Each year between 140 and 16 160 officers are killed in the line of duty, 17 and their families and coworkers are left to 18 cope with the tragic loss; and 19 "WHEREAS, Today COPS' membership 20 includes spouses, children, parents, siblings, 21 significant others and coworkers of officers 22 killed in the line of duty, and consists of 23 more than 12,000 families; and 24 "WHEREAS, February 11 marks the 25 one-year anniversary of the death of

Candyco Transcription Service, Inc.

(518) 371-8910 1 Lieutenant John Finn from the Albany Police 2 Department. This anniversary is a reminder to 3 pay tribute to those in the law enforcement 4 community who have made the ultimate 5 sacrifice; and 6 "WHEREAS, On February 11, 2005, 7 from 6:00 a.m. until 10:00 a.m., WGNA and COPS 8 will be taking a donation for a carnation, 9 selling blue carnations for $5. T-shirts will 10 also be available for $10; and 11 "WHEREAS, All proceeds will go 12 directly to COPS in memory of Lieutenant Finn 13 and Officer Verteramo; and 14 "WHEREAS, In addition, supporters 15 are asked to wear blue on that day; and 16 "WHEREAS, The State of New York is 17 eternally grateful for the service of its 18 brave men and women in law enforcement and 19 applauds the efforts of COPS to assist the 20 families of those who have made the ultimate 21 sacrifice; now, therefore, be it 22 "RESOLVED, That this Legislative 23 Body pause in its deliberations to recognize 24 February 11, 2005, as 'Blue Friday'; and be it 25 further

Candyco Transcription Service, Inc.

(518) 371-8910 1 "RESOLVED, That copies of this 2 resolution, suitably engrossed, be transmitted 3 to WGNA and COPS." 4 ACTING PRESIDENT FLANAGAN: 5 Senator Farley. 6 SENATOR FARLEY: Thank you, Mr. 7 President. 8 This resolution, by Senator Bruno, 9 myself and Senator Breslin, is one that 10 proclaims February 11th as "Blue Friday." And 11 with us in the gallery are a number of police 12 officers representing both cities, who lost 13 two valiant police officers. 14 WGNA, a local radio station, has 15 made a major project out of promoting this. 16 Incidentally, it's the number-one radio 17 station listener-wise in this area. And they 18 will be holding, this Friday, a sale of 19 carnations, blue carnations, which Senator 20 Breslin and I both have on, at the Colonie 21 Center, and also T-shirts to support COPS, 22 which is an organization that supports the 23 families of surviving police officers. 24 This is a significant day for us, 25 because I just want to say a few words about

Candyco Transcription Service, Inc.

(518) 371-8910 1 these two incredible officers that gave their 2 lives on behalf of their communities. 3 Lieutenant John Finn, only 38 years of age, 4 survived by his wife, Maura, and their two 5 daughters, Clara and Molly. 6 I was told by people that were 7 there at the funeral mass that the daughter 8 singing just absolutely devastated the entire 9 audience. 10 You know, this man was somebody 11 that always wanted to be a police officer. He 12 created the Children and Family Service Unit 13 for the City of Albany. He was a 13-year 14 veteran of the Albany P.D. and rose to the 15 rank of lieutenant. 16 He was responding to an armed 17 robbery within almost sight of the Capitol, on 18 South Pearl Street, and a fleeing suspect 19 opened fire, hitting him three times with the 20 intention to kill him. Fortunately, he was 21 able to get off a shot. But he suffered for 22 51 days before he passed away. 23 A man that is truly loved and 24 honored by his fellow police officers, 25 Lieutenant Finn will be sorely missed.

Candyco Transcription Service, Inc.

(518) 371-8910 1 In my hometown of Schenectady, Eric 2 Verteramo, 30 years of age, rushing to a 3 motorcycle accident, lost control of his 4 cruiser, slammed into a utility pole and was 5 killed, I believe, at the site. 6 Of course Eric was the ninth 7 officer who lost his life in the line of duty 8 in Schenectady. He was a very bright young 9 officer known for his good humor and his 10 physical fitness. He was an incredible 11 athlete. And he's another one that always 12 wanted to be a police officer. 13 I think it's rather significant 14 that we call this "Blue Friday." And the 15 results of this drive will go to try to help 16 the surviving families. As we honor these 17 police officers, you have to realize that they 18 leave a family behind. The mourning never 19 stops. Those children will never again see or 20 know their father. And of course in the case 21 of Eric, he's a young man -- they're both in 22 their thirties -- the tragedy is just beyond 23 belief. 24 It is with this that I yield the 25 floor. And I'm sure that Senator Breslin, who

Candyco Transcription Service, Inc.

(518) 371-8910 1 represents the City of Albany, would like to 2 speak to it. 3 Thank you, Mr. President. 4 ACTING PRESIDENT FLANAGAN: 5 Senator Breslin. 6 SENATOR BRESLIN: Thank you very 7 much, Mr. President. 8 And thank you, Senator Farley, for 9 such an eloquent presentation about Officer 10 Verteramo and Lieutenant John Finn from my 11 city of Albany. And John Finn's life and my 12 own and my brother's interacted frequently. 13 He exemplified what the definition of a police 14 officer really is about, and that's caring for 15 others. 16 But when we think of that caring 17 for others, we sometimes lose sight of the 18 fact that each and every day police officers 19 go out in the line of duty and put their life 20 at risk. And John Finn suffered the ultimate 21 sacrifice with the loss of his life and, as 22 Senator Farley said, leaving behind a wife and 23 two children. 24 But he is part of the best, those 25 people who protect us. And we're joined here

Candyco Transcription Service, Inc.

(518) 371-8910 1 today by Chief Jim Turley of the Albany Police 2 Department and other members of law 3 enforcement agencies. 4 And it will give us -- on "Blue 5 Friday" on an annual basis, we'll remember 6 Lieutenant John Finn, but we'll also remember 7 police forces as an entity. And it will place 8 them in our prayers and our thoughts to make 9 sure that not only for the deceased members, 10 who we'll raise money for, but each and every 11 member of those police agencies, what they do 12 on a daily basis to protect us. 13 And I commend Senator Farley, I 14 commend Senator Bruno for making this happen 15 today. And I'm delighted that the entire 16 Senate will participate in this process, to 17 make sure that "Blue Friday" is a success this 18 year as it will be every year. 19 Thank you, Mr. President. 20 ACTING PRESIDENT FLANAGAN: 21 Senator Farley. 22 SENATOR FARLEY: With this 23 addendum, I'd like to say that Senator Bruno 24 truly regrets that he's not here to address 25 and honor these police officers.

Candyco Transcription Service, Inc.

(518) 371-8910 1 And if it's all right with the 2 Acting Majority Leader, then we'll open up 3 this resolution to every member of the Senate. 4 And anyone wishing not to be on it please 5 notify the desk. 6 ACTING PRESIDENT FLANAGAN: On 7 the resolution, all in favor signify by saying 8 aye. 9 (Response of "Aye.") 10 ACTING PRESIDENT FLANAGAN: 11 Opposed, nay. 12 (No response.) 13 ACTING PRESIDENT FLANAGAN: The 14 resolution is adopted. 15 Senator Skelos. 16 SENATOR SKELOS: Mr. President, 17 if we could go to the noncontroversial reading 18 of the calendar. 19 ACTING PRESIDENT FLANAGAN: The 20 Secretary will read. 21 THE SECRETARY: Calendar Number 22 11, by Senator McGee, Senate Print 86, an act 23 to amend the Criminal Procedure Law, in 24 relation to eligibility. 25 SENATOR SCHNEIDERMAN: Lay it

Candyco Transcription Service, Inc.

(518) 371-8910 1 aside. 2 SENATOR SKELOS: Lay it aside for 3 the day, please. 4 ACTING PRESIDENT FLANAGAN: The 5 bill is laid aside for the day. 6 THE SECRETARY: Calendar Number 7 14, by Senator Trunzo, Senate Print 150, an 8 act to amend the Penal Law, in relation to 9 unlawful sale of tobacco. 10 SENATOR TRUNZO: Hold it up for 11 amendment. 12 ACTING PRESIDENT FLANAGAN: Lay 13 it aside for the day. 14 THE SECRETARY: Calendar Number 15 18, by Senator Morahan, Senate Print 237, an 16 act to amend the Penal Law -- 17 SENATOR HASSELL-THOMPSON: Lay it 18 aside. 19 ACTING PRESIDENT FLANAGAN: The 20 bill is laid aside. 21 THE SECRETARY: Calendar Number 22 20, by Senator Maltese, Senate Print 274, an 23 act to amend the Penal Law, in relation to 24 clarifying the definition of physical injury. 25 ACTING PRESIDENT FLANAGAN: Read

Candyco Transcription Service, Inc.

(518) 371-8910 1 the last section. 2 THE SECRETARY: Section 2. This 3 act shall take effect on the first of 4 November. 5 ACTING PRESIDENT FLANAGAN: Call 6 the roll. 7 (The Secretary called the roll.) 8 THE SECRETARY: Ayes, 58. 9 ACTING PRESIDENT FLANAGAN: The 10 bill is passed. 11 THE SECRETARY: Calendar Number 12 21, by Senator Saland, Senate Print 312, an 13 act to amend the Penal Law, in relation to 14 including school buses. 15 SENATOR SABINI: Lay it aside. 16 ACTING PRESIDENT FLANAGAN: The 17 bill is laid aside. 18 THE SECRETARY: Calendar Number 19 22, by Senator Skelos, Senate Print 498, an 20 act to amend the Criminal Procedure Law, in 21 relation to limiting plea bargaining. 22 ACTING PRESIDENT FLANAGAN: Read 23 the last section. 24 THE SECRETARY: Section 2. This 25 act shall take effect on the first of

Candyco Transcription Service, Inc.

(518) 371-8910 1 November. 2 ACTING PRESIDENT FLANAGAN: Call 3 the roll. 4 (The Secretary called the roll.) 5 THE SECRETARY: Ayes, 58. 6 ACTING PRESIDENT FLANAGAN: The 7 bill is passed. 8 THE SECRETARY: Calendar Number 9 25, by Senator Volker, Senate Print 777, an 10 act to amend the Penal Law, in relation to the 11 imposition of certain fees. 12 ACTING PRESIDENT FLANAGAN: Read 13 the last section. 14 THE SECRETARY: Section 3. This 15 act shall take effect on the same date as 16 Part F of Chapter 56 of the Laws of 2004. 17 ACTING PRESIDENT FLANAGAN: Call 18 the roll. 19 (The Secretary called the roll.) 20 THE SECRETARY: Ayes, 58. 21 ACTING PRESIDENT FLANAGAN: The 22 bill is passed. 23 THE SECRETARY: Calendar Number 24 28, by Senator Balboni, Senate Print 183, an 25 act to amend the Penal Law, in relation to

Candyco Transcription Service, Inc.

(518) 371-8910 1 establishing. 2 SENATOR SCHNEIDERMAN: Lay it 3 aside. 4 ACTING PRESIDENT FLANAGAN: The 5 bill is laid aside. 6 THE SECRETARY: Calendar Number 7 46, by the Senate Committee on Rules, Senate 8 Print 1815, an act to amend the Insurance Law, 9 in relation to insurance conversions. 10 ACTING PRESIDENT FLANAGAN: Read 11 the last section. 12 THE SECRETARY: Section 4. This 13 act shall take effect immediately. 14 ACTING PRESIDENT FLANAGAN: Call 15 the roll. 16 SENATOR SCHNEIDERMAN: Lay it 17 aside. 18 ACTING PRESIDENT FLANAGAN: The 19 bill is laid aside. 20 Senator Skelos, that completes the 21 noncontroversial reading of the calendar. 22 SENATOR SKELOS: Mr. President. 23 ACTING PRESIDENT FLANAGAN: 24 Senator Skelos. 25 SENATOR SKELOS: Mr. President,

Candyco Transcription Service, Inc.

(518) 371-8910 1 would you please ring the bells to inform the 2 members of the Senate that we are now on the 3 controversial calendar. 4 ACTING PRESIDENT FLANAGAN: The 5 Secretary will ring the bell. 6 Senator Skelos. 7 SENATOR SKELOS: Mr. President, 8 if we could now go to the controversial 9 reading of the calendar. 10 ACTING PRESIDENT FLANAGAN: The 11 Secretary will read. 12 THE SECRETARY: Calendar Number 13 18, by Senator Morahan, Senate Print 237, an 14 act to amend the Penal Law and the Criminal 15 Procedure Law. 16 SENATOR HASSELL-THOMPSON: 17 Explanation. 18 ACTING PRESIDENT FLANAGAN: 19 Senator Morahan, an explanation has been 20 requested. 21 SENATOR MORAHAN: Thank you, Mr. 22 President. 23 This bill amends the Penal Law and 24 the Criminal Procedure Law to provide that if 25 a person, while on parole or other conditional

Candyco Transcription Service, Inc.

(518) 371-8910 1 release, commits a felony, that they would 2 have to then complete the original felony 3 sentence to the maximum and then serve the 4 minimum of the new crime penalty before they 5 can again be paroled or released. 6 ACTING PRESIDENT FLANAGAN: 7 Senator Hassell-Thompson. 8 SENATOR HASSELL-THOMPSON: Thank 9 you, Mr. President. 10 Just a very quick question, if 11 Senator Morahan would yield. 12 ACTING PRESIDENT FLANAGAN: 13 Senator Morahan, will you yield? 14 SENATOR MORAHAN: Certainly, yes. 15 ACTING PRESIDENT FLANAGAN: 16 Senator Hassell-Thompson. 17 SENATOR HASSELL-THOMPSON: Thank 18 you. 19 Senator Morahan, are there any 20 changes in this bill from last year? 21 SENATOR MORAHAN: No, ma'am. 22 SENATOR HASSELL-THOMPSON: Okay. 23 I'll waive any other questions. 24 Thank you, Mr. President. Thank 25 you.

Candyco Transcription Service, Inc.

(518) 371-8910 1 ACTING PRESIDENT FLANAGAN: Any 2 other Senators wishing to be heard? 3 Then the debate is closed. 4 The Secretary will ring the bell, 5 and the Sergeant-at-Arms will bring in the 6 members to the chamber. 7 Read the last section. 8 THE SECRETARY: Section 8. This 9 act shall take effect on the first of 10 November. 11 ACTING PRESIDENT FLANAGAN: Call 12 the roll. 13 (The Secretary called the roll.) 14 ACTING PRESIDENT FLANAGAN: The 15 Secretary will announce the results. 16 THE SECRETARY: Those voting in 17 the negative on Calendar Number 18 are 18 Senators Andrews, Duane, Hassell-Thompson, 19 Montgomery, and Parker. 20 Those Senators absent from voting 21 on Calendar Number 18 are Senators Johnson and 22 Stavisky. 23 Ayes, 52. Nays, 5. 24 ACTING PRESIDENT FLANAGAN: The 25 bill is passed.

Candyco Transcription Service, Inc.

(518) 371-8910 1 The Secretary will read. 2 THE SECRETARY: Calendar Number 3 21, by Senator Saland, Senate Print 312, an 4 act to amend the Penal Law. 5 ACTING PRESIDENT FLANAGAN: 6 Senator Sabini. 7 SENATOR SABINI: Mr. President, 8 if the sponsor would yield for a question. 9 ACTING PRESIDENT FLANAGAN: 10 Senator Saland, will you yield to a question? 11 SENATOR SALAND: Yes, Mr. 12 President. As soon as I can get my colleague 13 to my right to sit down and not whisper in my 14 ear. 15 ACTING PRESIDENT FLANAGAN: 16 Senator Sabini. 17 SENATOR SABINI: Thank you, Mr. 18 President. I'd like to ask the sponsor to 19 clarify for me the intent or the actual 20 implication of the bill. 21 This bill came to Codes and not 22 Education, so I didn't have a chance to 23 reference the Vehicle and Traffic Law that it 24 refers to. But it is my understanding that 25 right now --

Candyco Transcription Service, Inc.

(518) 371-8910 1 SENATOR SALAND: Senator Sabini, 2 can I just ask for your indulgence. 3 I welcome Senator Goodman back to 4 the chamber, but there's a little bit of a din 5 over here, making it hard for me to hear 6 Senator Sabini. Thank you. 7 ACTING PRESIDENT FLANAGAN: 8 Senator Sabini. 9 SENATOR SABINI: I'm interested 10 in the application of the Vehicle and Traffic 11 Law here. And since it is my understanding 12 that currently if a school bus is parked on 13 school grounds, it is part of school grounds. 14 Does this bill address a school bus 15 moving? Since in some cases a school bus off 16 school grounds would be more of a fertile 17 place with less supervision than a school bus 18 on school grounds. 19 SENATOR SALAND: This is intended 20 to address the school bus that is somewhere 21 beyond the "drug-free school zone" boundaries 22 that surround our schools. 23 The long and short of it, Senator 24 Sabini, is that this is a bill that was 25 recommended to me several years ago by a local

Candyco Transcription Service, Inc.

(518) 371-8910 1 official in my Senate district who has since 2 passed away. And it just seemed to make a 3 heck of a lot of sense. We try to protect our 4 children within the drug-free school zones, 5 and it just seems a logical extension to say 6 if in fact they're in transit in a school bus, 7 they're entitled to the same protection. 8 SENATOR SABINI: Mr. President, 9 if I could ask just a follow-up to the 10 sponsor. 11 ACTING PRESIDENT FLANAGAN: 12 Senator Saland, do you continue to yield? 13 SENATOR SALAND: Yes, Mr. 14 President. 15 ACTING PRESIDENT FLANAGAN: 16 Senator Sabini. 17 SENATOR SABINI: I agree with the 18 sponsor's assertion. My question is, does 19 this bill do it, in effect, anywhere where a 20 school bus is, is this applicable? 21 SENATOR SALAND: I'm sorry, 22 Senator? 23 SENATOR SABINI: Does this law 24 apply no matter where a school bus is? 25 SENATOR SALAND: If it's being

Candyco Transcription Service, Inc.

(518) 371-8910 1 used for school purposes, if it's sitting in 2 front of somebody's driveway waiting for a 3 student to get on the bus, whether it's in 4 transit, if it's part of its regular and 5 ordinary duties, the intention is is that it 6 applies. 7 SENATOR SABINI: Mr. President, 8 if the sponsor would yield once again for 9 another question. 10 ACTING PRESIDENT FLANAGAN: 11 Senator Saland, do you continue to yield? 12 SENATOR SALAND: Yes, Mr. 13 President. 14 ACTING PRESIDENT FLANAGAN: 15 Senator Sabini. 16 SENATOR SABINI: Just in reading 17 the bill, halfway down it talks about a 18 thousand feet off of a school line. And that 19 was really where our confusion was, in that if 20 the bus is beyond a thousand feet, which is 21 less than a quarter of a mile, does this law 22 apply? 23 Because some of us agree with you, 24 we want tough penalties and tough laws on 25 people that deal drugs to our children.

Candyco Transcription Service, Inc.

(518) 371-8910 1 SENATOR SALAND: Well, there are 2 two subsections to the bill. And the language 3 that you're interested in is placed in 4 Subsection A. And if you read what's included 5 in A, there -- that -- what is included in A, 6 if you then look at the conclusion, it says 7 "or," and "or" leads into your 1,000 foot 8 context for -- 9 SENATOR SABINI: So it's 10 either/or? 11 SENATOR SALAND: Yes. 12 SENATOR SABINI: Okay. Thank 13 you, Mr. President. 14 ACTING PRESIDENT FLANAGAN: Any 15 other Senator wishing to be heard on the bill? 16 Senator Onorato. 17 SENATOR ONORATO: Would the 18 sponsor yield for another question? 19 ACTING PRESIDENT FLANAGAN: 20 Senator Saland, will you yield? 21 SENATOR SALAND: Yes. 22 ACTING PRESIDENT FLANAGAN: 23 Senator Onorato. 24 SENATOR ONORATO: Senator Saland, 25 does the school bus have to have students on

Candyco Transcription Service, Inc.

(518) 371-8910 1 it for this to apply? 2 SENATOR SALAND: The school bus 3 has to be engaged in whatever would be part of 4 its ordinary and normal activities. If in 5 fact -- I guess I could conjure up a scenario. 6 If -- I'm trying to conjure up a scenario. 7 If in fact it was parked, again 8 waiting for a student to get on, and there 9 were some personnel that were on, whether they 10 were bus assistants or attendants, and they 11 were engaged in drug trafficking, I would 12 think it could be applicable. 13 But again, it would have to be 14 something that occurs during the ordinary 15 course of the operation of the school bus in 16 school business. 17 SENATOR ONORATO: Thank you. 18 ACTING PRESIDENT FLANAGAN: Any 19 other Senator wish to be heard? 20 Senator Diaz. 21 SENATOR DIAZ: Thank you, Mr. 22 President. If my colleague Senator Onorato 23 will yield for a question, please. 24 ACTING PRESIDENT FLANAGAN: 25 Senator Onorato, will you yield?

Candyco Transcription Service, Inc.

(518) 371-8910 1 SENATOR ONORATO: I yield. 2 SENATOR DIAZ: It was not clear 3 to me when you asked the question, and also 4 Senator Sabini, in questioning the distance of 5 the school bus of being on the property of a 6 school and being considered as a school 7 grounds. 8 It is -- it is -- are you saying -- 9 just for my benefit, are you saying that we 10 would allow a school bus to be used as a 11 drug -- to use drugs in school buses if that 12 bus is not close to school? 13 SENATOR ONORATO: No, Senator, 14 you misinterpreted my question. 15 SENATOR DIAZ: Please explain to 16 me. 17 SENATOR ONORATO: My question 18 was, will this law apply if the school bus is 19 empty of students. In other words, the bus 20 driver may have already completed his route 21 and may be on his way back to the garage with 22 no students or any other school personnel on 23 it. 24 SENATOR DIAZ: Mr. President, 25 would the Senator yield.

Candyco Transcription Service, Inc.

(518) 371-8910 1 ACTING PRESIDENT FLANAGAN: 2 Senator Onorato, will you continue to yield? 3 SENATOR ONORATO: I'll be happy 4 to yield on my bill. 5 (Laughter.) 6 SENATOR DIAZ: So if the school 7 bus is empty and the driver already left all 8 the students and the driver is coming back 9 home, would it be okay, would it be good 10 enough so then they could use drugs in it? 11 SENATOR ONORATO: No, it's not 12 okay. But I want to know if the law will 13 apply if it's empty. 14 SENATOR DIAZ: Thank you, Mr. 15 President. 16 ACTING PRESIDENT FLANAGAN: Any 17 other Senator wish to be heard? 18 Debate is closed. 19 The Secretary will ring the bill. 20 The Sergeant-at-Arms will bring the members 21 into the chamber. 22 Read the last section. 23 THE SECRETARY: Section 2. This 24 act shall take effect on the first of 25 November.

Candyco Transcription Service, Inc.

(518) 371-8910 1 ACTING PRESIDENT FLANAGAN: Call 2 the roll. 3 (The Secretary called the roll.) 4 ACTING PRESIDENT FLANAGAN: 5 Announce the results. 6 THE SECRETARY: Ayes, 57. 7 Those Senators absent from voting 8 on Calendar Number 21 are Senators Johnson and 9 Stavisky. 10 ACTING PRESIDENT FLANAGAN: The 11 bill is passed. 12 The Secretary will read. 13 THE SECRETARY: Calendar Number 14 28, by Senator Balboni, Senate Print 183, an 15 act to amend the Penal Law, in relation to 16 establishing definitions. 17 SENATOR SCHNEIDERMAN: 18 Explanation. 19 ACTING PRESIDENT FLANAGAN: 20 Senator Balboni, an explanation has been 21 requested. 22 SENATOR BALBONI: Thank you, Mr. 23 President. 24 This is a bill that we have visited 25 beforehand but, I would argue, could not be

Candyco Transcription Service, Inc.

(518) 371-8910 1 more timely. As you will recall, in the 2 Governor's State of the State address he 3 outlined several criminal justice initiatives, 4 and one of the initiatives he talked about was 5 the creation of a cyberterrorism crime in this 6 state. That is what this bill does. 7 But it also does some things that I 8 think are crucial and obvious. The computer 9 laws in the State of New York were last 10 significantly changed in 1986. It's almost 20 11 years since we have updated our computer 12 crimes. 13 And to give you just how different 14 our world is today, back then, most of the 15 computers that were in our homes and our 16 schools were not connected to the Internet. 17 Now all our computers are connected to the 18 Internet. 19 I have some information to share 20 with my colleagues. USA Today did a study 21 back in November of last year, and all they 22 did was they took six computers and they 23 merely hooked them up to the Internet, and 24 they let them run. And they saw whether or 25 not there would be any type of attacks or an

Candyco Transcription Service, Inc.

(518) 371-8910 1 attempted intrusions. 2 Here are the numbers that came out 3 as a result of this little experiment. From 4 September 10th to September 25th, online 5 intruders made 305,000 attempts to break in to 6 six unguarded computers. The total attacks 7 averaged about 300 per day. 8 Now, these attacks can range from 9 anything from the attempted introduction of a 10 worm or a virus in your computer or to the 11 attempt to take over your computer to use it 12 in a subsequent attack, what we refer to as a 13 "denial of service" attack. 14 What this bill does is it sets up a 15 revamping of the criminal justice laws as it 16 relates to computer intrusion crimes, and it 17 creates a cyberterrorism crime for the State 18 of New York. 19 Thank you, Mr. President. 20 ACTING PRESIDENT FLANAGAN: 21 Senator Schneiderman. 22 SENATOR SCHNEIDERMAN: Thank you, 23 Mr. President. Briefly on the bill. 24 The -- my concern with this 25 legislation I expressed before. And I would

Candyco Transcription Service, Inc.

(518) 371-8910 1 urge the sponsor that I think everyone in this 2 house agrees that the laws in this area need 3 to be updated. Everyone agrees that 4 cyberterrorism, particularly where it relates 5 to things like power plants and the water 6 supply that rely on software, is an important 7 issue. 8 The difficulty I have is, as with 9 the last version, what we have here is an 10 incredibly overbroad definition of 11 cyberterrorism. And I would urge that a 12 one-house bill doesn't help make anyone any 13 safer from cyberterrorism. 14 If we want to really move forward 15 and make this a law, we're going to have to do 16 something about the definition, which creates 17 a Class B felony for anyone who is guilty of 18 any of the misdemeanors enumerated in this 19 statute "with the intent to affect the conduct 20 of a unit of government." 21 That means that if you are engaged 22 in computer intrusion in the third degree, 23 which means -- could mean you wilfully use a 24 computer without authorization to influence 25 the conduct of a unit of government, you're

Candyco Transcription Service, Inc.

(518) 371-8910 1 guilty of a B felony. So if you make 2 unauthorized use of someone's computer to send 3 an email to President Bush opposing his 4 proposal to raise copayments by veterans for 5 health care by $250 a year, you're guilty of a 6 B felony. 7 It is an incredibly broad 8 definition. And my suggestion to the sponsor, 9 as I did suggest last year as well, is that a 10 little bit of editing and a little bit of work 11 could make this a statute that would be 12 something that we could move forward, I 13 believe, even in the other house. 14 As it is drafted now, I think it 15 really contains what amounts to a poison pill. 16 You can't make every misdemeanor a B felony 17 just because it was done to affect the conduct 18 of a unit of government. That could mean 19 trying to affect the decision of a school 20 district whether to have a prom. 21 I mean, you know, there are lots of 22 things that are done by email now, lots of 23 things that are done through computer 24 networks. And this is just a -- the 25 escalation of a penalty into a major felony

Candyco Transcription Service, Inc.

(518) 371-8910 1 that is completely inappropriate given the 2 breadth of the definition. 3 So I supported this is in the past 4 with the view that we were going to move 5 forward and edit it and try and get a statute 6 actually passed. I would urge the sponsor, 7 though, that, you know, we've got time. Let's 8 do some editing now. Let's make this a 9 definition that could get somewhere in the 10 other house and come up with a cyberterrorism 11 law as opposed to letting another year go by 12 passing a one-house bill. 13 I will support the bill again, Mr. 14 President, with this ongoing request that 15 we're never going to get anywhere with this 16 until we narrow the definition. 17 Thank you. 18 ACTING PRESIDENT FLANAGAN: 19 Senator Klein. 20 SENATOR KLEIN: On the bill, Mr. 21 President. 22 ACTING PRESIDENT FLANAGAN: On 23 the bill. 24 SENATOR KLEIN: While I applaud 25 Senator Balboni's effort to punish people who

Candyco Transcription Service, Inc.

(518) 371-8910 1 commit various acts of cyberterrorism, I think 2 what we're doing is, first, we're not 3 addressing the problem and we're not doing 4 anything to prevent the problem. 5 I did an investigation last year 6 which showed our own state computers in 7 various state agencies that are holding very, 8 very important information -- like tax 9 information, our records from the Department 10 of Motor Vehicles -- were hacked into three 11 times in a three-month period. 12 And so we're really doing very, 13 very little within our own state within this 14 present administration to protect very 15 pertinent information from cyberthieves. 16 Also, one of the pieces of 17 legislation that I passed last year in the 18 Assembly would do something that's very, very 19 simple and, again, go a long way towards 20 preventing the ramifications of being a victim 21 of a cyberthief and identity fraud, and that's 22 to notify individuals if their pertinent 23 information is taken off a state computer or a 24 private computer. 25 Believe it or not, we have no

Candyco Transcription Service, Inc.

(518) 371-8910 1 policy and there is not one corporation in the 2 United States that has an affirmative program, 3 a program within their own company to notify 4 people if they're the victim of a cyberthief. 5 And I don't have to tell you, if 6 your information is taken -- your Social 7 Security number, your address -- what type of 8 havoc that can cause with your own finances. 9 So I look forward to doing a lot 10 more on this issue, and I applaud Senator 11 Balboni in actually punishing the people who 12 commit these crimes. But at the same time, I 13 think we need to do a lot more towards 14 preventing this crime and actually recognizing 15 that it exists in the State of New York. 16 Thank you. 17 ACTING PRESIDENT FLANAGAN: 18 Senator Krueger. 19 SENATOR LIZ KRUEGER: Thank you, 20 Mr. President. If the sponsor would please 21 yield. 22 ACTING PRESIDENT FLANAGAN: 23 Senator Balboni, will you yield? 24 SENATOR BALBONI: Yes. 25 ACTING PRESIDENT FLANAGAN:

Candyco Transcription Service, Inc.

(518) 371-8910 1 Senator Krueger. 2 SENATOR LIZ KRUEGER: Thank you. 3 Senator Balboni, I also find much 4 in this bill that I can be comfortable with. 5 Some concerns, technical. But two issues 6 stuck in my head this year that I didn't ask 7 you about last year. 8 Would this apply to ATM machines? 9 When I read the definition of the bill about 10 what a computer is, I believe it would. I was 11 wondering -- 12 SENATOR BALBONI: I believe it 13 would also. 14 SENATOR LIZ KRUEGER: Okay. So I 15 suppose a follow-up question, Mr. President. 16 ACTING PRESIDENT FLANAGAN: 17 Senator Balboni, will you continue to yield? 18 SENATOR BALBONI: Yes, sir. Mr. 19 President, I yield. 20 SENATOR LIZ KRUEGER: Thank you. 21 Is there any reason for us to think 22 we ought to be reviewing this with the Banking 23 Department, on the theory that it would also 24 apply to ATM machines, which are under their 25 auspices?

Candyco Transcription Service, Inc.

(518) 371-8910 1 SENATOR BALBONI: Mr. President, 2 through you, I have discussed this bill with 3 our Department of Homeland Security, Mark 4 Cohen, who's the chief counsel. We have sent 5 this over for comment and review, and they, I 6 believe, have talked to not only DCJS but also 7 folks in the other agencies, including 8 Insurance and Banking. 9 Just on that point, you know, this 10 is a very coordinated approach that a lot of 11 people don't know about. There's actually a 12 group -- and I don't know what the acronym 13 stands for, but it's called FIPIC [ph], and it 14 talks about a federal, state and private 15 partnership that actually takes the insurance 16 industry, the banking industry, all of the 17 financial industries and tries to reach out 18 and give them governmental templates for them 19 to utilize in their own businesses to prevent, 20 again, these types of attacks. 21 So there is the involvement of the 22 financial community. Perhaps not as focused 23 on the bill as -- on the language that we have 24 here, but certainly in the general concepts of 25 how do we protect against cyberterrorism

Candyco Transcription Service, Inc.

(518) 371-8910 1 attacks. 2 SENATOR LIZ KRUEGER: Thank you. 3 Mr. President, if the sponsor would 4 continue to yield, please. 5 ACTING PRESIDENT FLANAGAN: 6 Senator Balboni, do you continue to yield? 7 SENATOR BALBONI: Yes, I do, Mr. 8 President. 9 ACTING PRESIDENT FLANAGAN: 10 Senator Krueger. 11 SENATOR LIZ KRUEGER: Can I 12 assume that also -- because you are right, the 13 definition of what is on computer is expanding 14 every day. Would this bill also apply to 15 video lottery terminals and lottery machines, 16 since they're also -- 17 SENATOR BALBONI: Mr. President, 18 through you. To the extent that any 19 program -- I'm sorry, any -- let's see how to 20 describe it -- any platform is computer-based 21 and you would attempt to get into that 22 platform, that operating platform or computing 23 platform, yes, in fact that would fall under 24 the definitions. Which are in the first part 25 of the bill.

Candyco Transcription Service, Inc.

(518) 371-8910 1 SENATOR LIZ KRUEGER: Right. 2 Thank you. 3 Mr. President, if the sponsor would 4 please yield for another question. 5 ACTING PRESIDENT FLANAGAN: 6 Senator Balboni? 7 SENATOR BALBONI: I do, Mr. 8 President. 9 SENATOR LIZ KRUEGER: Thank you. 10 This clarification is very helpful, because I 11 think it both broadens my understanding of the 12 issues we're talking about and also where we 13 might need to go in the future in the state. 14 So would this also, I assume, then, 15 apply to voting machines if the State of 16 New York continues down the road of ending up 17 choosing machines that are attached to the 18 Internet in some way, or computer-driven? 19 SENATOR BALBONI: Mr. President, 20 through you, I don't believe that there's any 21 prohibition or restriction that it must be 22 connected to the Internet. We focus on that 23 as a relatively new phenomenon relative to the 24 initial amendments of the statute itself. But 25 we don't restrict it to the Internet use.

Candyco Transcription Service, Inc.

(518) 371-8910 1 Should you have a computer issue, 2 you try to access it without authorization, 3 that would fall under the definitions of the 4 bill. 5 SENATOR LIZ KRUEGER: Thank you. 6 Thank you very much. 7 Mr. President, briefly on the bill. 8 ACTING PRESIDENT FLANAGAN: 9 Senator Krueger, on the bill. 10 SENATOR LIZ KRUEGER: Thank you. 11 Well, I share my colleague Senator 12 Schneiderman's concerns that perhaps the 13 definitions are changing every day and we need 14 to think through what some of the impacts are. 15 To be honest, I am very glad to 16 hear that this would apply to ATM crimes, 17 which is a very real issue, as Senator Farley 18 knows from the Banking Committee. It would 19 apply to video lottery terminals and lottery 20 machines, which is also, whether anyone likes 21 it or not, a growing business in the state of 22 New York, and we need to assure that we are 23 protecting citizens from any kind of hacking 24 into that system. 25 And, frankly, perhaps most

Candyco Transcription Service, Inc.

(518) 371-8910 1 importantly, voting machines. Because as the 2 President Pro Tem certainly knows, we're 3 dealing with questions of where we go with 4 voting machines in this state, and there are 5 great concerns about our failure to be 6 exploring machines that are safe enough and 7 secure enough to be -- to have our votes be 8 counted on them. 9 And the fact is that research shows 10 that we do more to protect ATM machines and 11 more to protect video gambling machines than 12 we currently are doing in this country to 13 protect voting machines. So I'm glad to see 14 that if this bill became law, we'd be 15 expanding the definitions of oversight and 16 evaluation of all these new computer systems 17 that are affecting our lives. 18 So while I still don't know that I 19 understand all of this bill completely, I 20 respect the Senator's efforts on these issues 21 and think that in fact the impact is far 22 broader than even just homeland security. So 23 I will be voting for the bill. 24 Thank you very much for the 25 explanation.

Candyco Transcription Service, Inc.

(518) 371-8910 1 ACTING PRESIDENT FLANAGAN: 2 Senator Balboni. 3 SENATOR BALBONI: Yes, Mr. 4 President, on the bill. I wanted to address 5 Senator Schneiderman's concerns. 6 I've had a chance to work with many 7 people, Michael Fallon one of them, and we did 8 consider the change in the definition. The 9 difficulty, frankly, is that Assemblyman 10 Lentol introduced this bill last year. I 11 believe that he's going to be doing it again 12 this year. We're going to be negotiating that 13 definition. 14 The difficulty here is that we have 15 to start from a starting point. And the 16 starting point is the definition of terrorism 17 that we use in the Penal Law that we passed in 18 2001. The difficulty, of course, is in that 19 definition you have the utilization of 20 assassination, kidnapping, or murder as the 21 active components of an act of terrorism. 22 Well, you don't have that with computer crimes 23 or cyberterrorism. 24 And so that's, frankly, the 25 difficulty, the definitional difficulty. In

Candyco Transcription Service, Inc.

(518) 371-8910 1 other words, would you say it's only 2 cyberterrorism if someone died as a result of 3 the act? You know, and so we're actually 4 negotiating that. 5 But at the same point in time, I 6 think we're going to see initiatives from the 7 Governor that's going to talk about this 8 specific act. 9 And to Senator Klein's point, this 10 is the first of a series of bills that we will 11 be putting out that will talk about the new 12 assault on the American public through the 13 computer. Whether it is spyware, whether it 14 is other computer crimes or activities, we're 15 going to be hopefully be rolling out a lot of 16 pretty progressive stuff. I'm working with 17 Assemblyman Morelle on that. And I think that 18 you'll like what we have to say about that. 19 So some of the things that Senator 20 Klein pointed out are some of the things we'll 21 be looking at also. 22 So I want to thank you for all your 23 attention to this one. This is a good concept 24 we need in the state. 25 Thank you very much.

Candyco Transcription Service, Inc.

(518) 371-8910 1 ACTING PRESIDENT FLANAGAN: Any 2 other Senator wish to be heard? 3 The Secretary will ring the bell, 4 and the Sergeant-at-Arms will bring the 5 members into the chamber. 6 Read the last section. 7 THE SECRETARY: Section 12. This 8 act shall take effect on the first of 9 November. 10 ACTING PRESIDENT FLANAGAN: Call 11 the roll. 12 (The Secretary called the roll.) 13 THE SECRETARY: Those recorded in 14 the negative on Calendar Number 28 are -- is 15 Senator Duane. 16 Those Senators absent from voting 17 on Calendar Number 28 are Senators Johnson and 18 Stavisky. 19 Ayes, 56. Nays, 1. 20 ACTING PRESIDENT FLANAGAN: The 21 bill is passed. 22 THE SECRETARY: Calendar Number 23 46, by the Senate Committee on Rules, Senate 24 Print 1815, an act to amend the Insurance Law. 25 SENATOR LIZ KRUEGER:

Candyco Transcription Service, Inc.

(518) 371-8910 1 Explanation, please. 2 ACTING PRESIDENT FLANAGAN: An 3 explanation has been requested, Senator 4 Seward. 5 SENATOR SEWARD: Yes, Mr. 6 President. 7 The bill before us deals with some 8 clarifying provisions of Chapter 1 of the Laws 9 of 2002. And if you would recall, the 10 legislation that we enacted back in 2002 11 allowed the Empire Blue Cross Blue Shield to 12 convert to a for-profit entity. And also, as 13 part of that, it was created the Public Asset 14 Fund as well as the charitable foundation. 15 And this legislation does two 16 things. Number one, it extends to the members 17 of the board of these two entities 18 indemnification under the Public Officers Law; 19 and, number two, it clarifies that the Public 20 Asset Fund and its board shall not be 21 considered a state agency. 22 ACTING PRESIDENT FLANAGAN: 23 Senator Krueger. 24 SENATOR LIZ KRUEGER: Thank you, 25 Mr. President. If the sponsor would please

Candyco Transcription Service, Inc.

(518) 371-8910 1 yield. 2 ACTING PRESIDENT FLANAGAN: 3 Senator Seward, will you yield to a question? 4 SENATOR SEWARD: Certainly, Mr. 5 President. 6 ACTING PRESIDENT FLANAGAN: 7 Senator Krueger. 8 SENATOR LIZ KRUEGER: Thank you. 9 Thank you very much. 10 The sponsor discusses that there 11 are two parts to the bill, and one is to 12 indemnify the officers of the board under the 13 Public Officers Law. Am I correct that that 14 in-general indemnification under the Public 15 Officers Law is for entities that are in some 16 way the government or a part of the government 17 or affiliated with the government, as opposed 18 to private entities? 19 SENATOR SEWARD: Well, Mr. 20 President, it's not uncommon to extend this 21 type of indemnification under the Public 22 Officers Law to such entities as this board of 23 the Public Asset Fund. Because we do it for 24 the State Insurance Fund. We -- also a number 25 of nonprofit entities in the state, their

Candyco Transcription Service, Inc.

(518) 371-8910 1 boards are indemnified under these provisions 2 of law even though they are not considered 3 state agencies. So they obviously do public 4 good on behalf of the state, as does this 5 entity. 6 And I would also point out that the 7 laws of Chapter 1 of 2002 offered such 8 indemnification. 9 However, as you may know, there's 10 some litigation involving that law we passed 11 in 2002. And the passage of this bill today, 12 should it be enacted, would mean that 13 regardless of what happens in the court case 14 involving the original law, that the board 15 would be able to proceed with indemnification. 16 And that, frankly, is necessary in order to 17 allow for any further stock sales and also to 18 maintain the stock price. 19 SENATOR LIZ KRUEGER: Mr. 20 President, if the sponsor would please 21 continue to yield. 22 ACTING PRESIDENT FLANAGAN: 23 Senator Seward, will you continue to yield? 24 SENATOR SEWARD: Yes. 25 ACTING PRESIDENT FLANAGAN:

Candyco Transcription Service, Inc.

(518) 371-8910 1 Senator Krueger. 2 SENATOR LIZ KRUEGER: Thank you 3 very much. I appreciate the response on that 4 part of the bill. 5 The other part of the bill would 6 provide that this Public Asset Fund should no 7 longer be considered part of the state or its 8 agencies, even though, as you've already 9 raised, there is litigation still in process 10 that may change the outcome of what would 11 happen with the proceeds of a sale of this 12 asset fund, which would then no longer be 13 considered part of the state or its agencies 14 if this bill passed. 15 Is that correct on my part? Is 16 that a correct analysis? 17 SENATOR SEWARD: Mr. President, I 18 had difficulty hearing the question. If we 19 could have a little more quiet, and if you 20 could just repeat the question. 21 ACTING PRESIDENT FLANAGAN: If we 22 could get the house quiet. 23 And it would be helpful, Senator 24 Krueger, if you would be kind enough to repeat 25 the question.

Candyco Transcription Service, Inc.

(518) 371-8910 1 SENATOR LIZ KRUEGER: I will 2 repeat and try to be clearer, actually. 3 So the second part of this law, 4 which we didn't discuss yet, would clarify 5 that this Public Asset Fund would no longer be 6 a part of the state or its agencies, it would 7 become a private entity. Although you are 8 correct, there is still litigation moving 9 through the courts as to what might ultimately 10 might or might not happen to the distribution 11 of funds from this sale. 12 Is it a concern or -- one, am I 13 correct in my reading? And, two, should it be 14 a concern to us at all that this would then be 15 a private entity but we still don't know the 16 outcome of a legal decision and we, in fact, 17 then might have liability because we 18 underwrote them, so to speak, under our 19 liability law? 20 There's a complication, it seems to 21 me, between public role/private role and 22 litigation. Is there any concern you have 23 about the confusion that might occur after 24 litigation was resolved because of these 25 changing patterns of ownership?

Candyco Transcription Service, Inc.

(518) 371-8910 1 ACTING PRESIDENT FLANAGAN: 2 Senator Seward. 3 SENATOR SEWARD: Mr. President, 4 I'm very comfortable with the provisions in 5 the bill. 6 But let me explain further. The -- 7 I would make one correction to what Senator 8 Krueger said. She said that they would be 9 considered no longer to be a state agency. It 10 was never intended to be considered a state 11 agency. And that was -- we're really not 12 changing anything. We are clarifying that it 13 could not -- cannot be considered a state 14 agency or a direct state entity. 15 So that is just a -- really a 16 clarifying provision versus a major change in 17 law. 18 And, frankly, it's important to 19 move forward with that distinction for I think 20 two very important reasons. We as a state 21 have a great deal at stake in the sale of the 22 Empire Blue Cross stock as it proceeds. 23 They're scheduled stock sales. And, frankly, 24 we have -- we're looking to fund a good 25 portion of the HCRA through the proceeds of

Candyco Transcription Service, Inc.

(518) 371-8910 1 those sales. 2 So I think the state and, more 3 importantly, those that are -- very much need 4 the services and the medical and health care 5 that is derived through HCRA, it's important 6 that we get as much money from the sale of 7 this stock as possible. So it's important to 8 keep that stock price up and not have any 9 impediments to sale of the stock. 10 And secondly, along the same line, 11 it's important that we do not jeopardize the 12 Empire Blue Cross license under the national 13 Blue Cross Blue Shield Association. Because I 14 question very much that they would allow 15 Empire to continue to be -- use that Blue 16 Cross name if in fact there was any thought 17 that they were a state entity directly. 18 So for those two reasons, I'm very 19 comfortable with the bill that it really does 20 merely clarify provisions of the 2002 law and 21 will in fact help us in our efforts to fully 22 fund HCRA. 23 SENATOR LIZ KRUEGER: Mr. 24 President, if the sponsor would yield to one 25 additional question.

Candyco Transcription Service, Inc.

(518) 371-8910 1 ACTING PRESIDENT FLANAGAN: 2 Senator Seward, do you continue to yield? 3 SENATOR SEWARD: Certainly. 4 ACTING PRESIDENT FLANAGAN: 5 Senator Krueger. 6 SENATOR LIZ KRUEGER: Thank you. 7 I appreciate your clarification and educating 8 me about this. 9 So again, if I read this and listen 10 to your explanations, under this change we, 11 the State of New York, wouldn't have the right 12 to review their books because they wouldn't 13 be, quote, unquote, a public entity or a 14 public asset fund as we have understood it up 15 until now, where the Comptroller's office or 16 the Legislature or the executives had the 17 ability to review the finances of the entity. 18 So we would not, after passage of 19 this bill, have the right to review the books, 20 but we would still be liable as the government 21 for defense and indemnification of their 22 officers and their employees? Is that 23 correct? 24 SENATOR SEWARD: Well, Mr. 25 President, under the existing law, the board

Candyco Transcription Service, Inc.

(518) 371-8910 1 of this Public Asset Fund is subject to 2 consultation with the Division of the Budget. 3 Plus the Comptroller is the -- they do -- the 4 Comptroller does actually take care of the 5 accounts, the money. 6 So there is some degree of, shall 7 we say, state oversight on that very limited 8 basis. So it's not as if there's not some 9 degree of at least looking at the books. 10 SENATOR LIZ KRUEGER: Thank you, 11 Mr. President. 12 Briefly on the bill. 13 ACTING PRESIDENT FLANAGAN: 14 Senator Krueger, on the bill. 15 SENATOR LIZ KRUEGER: Thank you. 16 I do have some concern that we 17 would be continually responsible for defending 18 and indemnifying the officers and employees of 19 this company prior to the sale without having 20 necessarily the same oversights we do over 21 other entities of the State of New York. 22 I think one of the things we talk 23 about so often in this Legislature is the 24 importance of, again, bringing the dollars 25 back on the books. We finally got HCRA --

Candyco Transcription Service, Inc.

(518) 371-8910 1 well, we think we may have HCRA back on the 2 budget, if it moves forward this year. And as 3 Senator Seward talked about, now this would be 4 potentially a funding stream for HCRA, 5 although I think that's still open for 6 interpretation by some people. 7 And yet we'd be removing in some 8 way our oversight powers and our review and 9 accountability powers for this what may be -- 10 $2 billion is a number I heard earlier today. 11 So I will vote for the bill, 12 although I am not sure whether the other house 13 is moving forward on such bill, but with great 14 caution and concern over the precedent we 15 might be making here today that we would again 16 be removing legislatively our oversight 17 authority over large sums of the public's 18 money and, in this situation, even leaving 19 ourselves liable for the responsibilities if 20 something goes wrong, without having had a 21 direct role in overseeing the operation of 22 this set of funds or the sale therein. And 23 that ultimately, of course, there's the 24 question of how those funds are used. 25 So out of respect for Senator

Candyco Transcription Service, Inc.

(518) 371-8910 1 Seward, and the concerns that if we don't act 2 quickly we may face a serious problem, I will 3 vote for it. But I think we should all be 4 thinking carefully about what this is a 5 precedent and what some of the dangers and 6 risks from this action might be. 7 So thank you, Mr. President. 8 ACTING PRESIDENT FLANAGAN: 9 Senator Hannon. 10 SENATOR HANNON: Yes, Mr. 11 President. 12 I think Senator Seward has 13 comprehensively and thoroughly just addressed 14 the questions, but I just want to add, in 15 terms of oversight, that this entity is a 16 publicly traded corporation, it's subject to 17 all of the filing requirements established 18 under the SEC and the heightened filing 19 requirements required by the Sarbanes-Oxley. 20 In addition, as a publicly traded 21 insurance corporation, it's regulated by the 22 Superintendent of Insurance, in the same 23 fashion that we regulate the other publicly 24 traded health insurance corporations. 25 So that there is a great deal of

Candyco Transcription Service, Inc.

(518) 371-8910 1 information just in the same way we have with 2 the other corporations. So we're on an equal 3 footing with them. There's no less, there's 4 not been complaints we don't have the 5 oversight with the other corporations. 6 They're on an equal footing. We know what's 7 happening with their books. 8 ACTING PRESIDENT FLANAGAN: Any 9 other Senator wish to be heard? 10 The Secretary will ring the bell. 11 The Sergeant-at-Arms will bring the members 12 into the chamber. 13 Read the last section. 14 THE SECRETARY: Section 4. This 15 act shall take effect immediately. 16 ACTING PRESIDENT FLANAGAN: Call 17 the roll. 18 (The Secretary called the roll.) 19 THE SECRETARY: Those recorded in 20 the negative on Calendar Number 46 is Senator 21 Duane. Ayes, 56. Nays, 1. 22 Those Senators absent from voting 23 on Calendar Number 46 are Senators Dilan, 24 Johnson, and Stavisky. 25 ACTING PRESIDENT FLANAGAN: The

Candyco Transcription Service, Inc.

(518) 371-8910 1 bill is passed. 2 Senator Skelos, that completes the 3 controversial reading of the calendar. 4 SENATOR SKELOS: Mr. President, 5 is there any housekeeping at the desk? 6 ACTING PRESIDENT FLANAGAN: No 7 housekeeping, Senator. 8 SENATOR SKELOS: There being no 9 further business to come before the Senate, I 10 move we stand adjourned until Wednesday, 11 February 9th, at 11:00 a.m. 12 ACTING PRESIDENT FLANAGAN: On 13 motion, the Senate stands adjourned until 14 Wednesday, February 9th, at 11:00 a.m. 15 (Whereupon, at 4:04 p.m., the 16 Senate adjourned.) 17 18 19 20 21 22 23 24 25

Candyco Transcription Service, Inc.

(518) 371-8910