Creates the public authority inspector general and provides for greater accountability of industrial development agencies, preservation of open space, and health care

Summary of provisions

§ 1 amends the public authorities law by adding a new article 1-B creating the office of the public Authorities inspector General.

* section 55 would establish the position and office of the public authorities inspector general (IG); provide that the IG be appointed by the attorney general for a five year term; and establish the IG's salary and mode of removal.

* Section 56 would allow the IG to appoint and remove staff, and establish and modify a plan of organization; it would establish a funding mechanism by which the expenses of the IG's office would be paid by assessing the public authorities and public benefit corporations.

* Section 57 would authorize the IG to investigate and report his or her findings and to work on policies to avoid corruption and other abuse in public authorities; it would authorize the IC to obtain evidence by subpoena or otherwise and to require testimony under oath. It would also require disclosure to the IG of information that is considered privileged by the authorities, and provides a procedure for disclosing confidential information and to protect a person who would be injured by such disclosure.

§ 2 amends subdivision 1 of section 51 of the public authorities law by adding a new paragraph "m" to add industrial development agencies under the purview of the New York State Public Authorities control Board. § 3 amends section 854 of the general municipal law by adding two new subdivisions 20 and 21 which define "preservation" and "public Open space" pertaining to projects subsidized by Industrial Development Agencies (IDA).

§ 4 amends subdivision 2 of section 856 of the general municipal law, as amended by Chapter. 355 of the laws of 1993, to diversify IDA board

membership to include representatives from local businesses, local educational agencies, labor organizations and community-based organizations.

§ 5 amends the general municipal law by adding a new section 857 to place limitations on the powers of Industrial Development Agencies, public authorities and public benefit corporations concerning the granting of financial assistance. IDAs, public authorities and public benefit corporations would not be able to provide financial assistance for any project or facility that diminishes open space, extends publicly owned water and/or sewer lines, or whose applicant has a substantial record of unlawful conduct.

§ 6 amends the opening paragraph of section 858 of the general municipal law, as amended by chapter 659 of the laws of 1997 to promote open space and promote economic development in areas where transportation, water, and sewer infrastructure are readily available.

§ 7 amends section 856 of the general municipal law by adding a new subdivision 15-a to provide reporting requirements for IDAs. This section requires IDAS to submit an annual report to the PACE and public Authorities Inspector General and to submit to annual audits by the State comptroller's office and makes the result available to the Governor's Office, the speaker of the Assembly, and the Temporary President of the senate.

§ 8 amends section 868 of the General Municipal Law, as added by chapter 1030 of the laws of 1969, to provide the public Authorities Inspector General with the power to review and approve, or disapprove any contract with unattainable terms.

§ 9 amends paragraph (a) of subdivision 4 of section 674 of the general municipal law to provide for a schedule of reimbursement should all contractual obligations associated with the project not be fulfilled.

§ 10 adds a new section 885 to the general municipal law requiring prevailing wages for public works projects in which financial assistance is provided by Industrial Development Agency.

§ 11 adds a new section 959-b to the general municipal law requiring prevailing wages for public work projects within an empire zone.

§ 12 add a new article 9-E to the public health law enacting the Industrial Development Agency/Empire Zone Health Security Act.

§ 13 contains a severability clause, should any language in this bill be found unconstitutional or invalid.

§ 14 states the effective date of the bill.

Justification

New York State expends billions of dollars through public authorities, corporations and development agencies for the purpose of stimulating private sector economic growth and the creation of jobs for New Yorkers. Such expenditures should be consistent with a high road economic development strategy: promoting the creation of good

family-supporting jobs, with pay and benefits that are adequate to ensure that the newly employed will not be dependent on public benefits to meet their basic needs; and promoting the use of existing infrastructure and the revitalization of previously developed land and buildings that have fallen into disuse, rather than subsidizing sprawl and the destruction of green space. Recent investigations by the State Comptroller have highlighted the absence of adequate mechanism for determining the effectiveness of state economic development expenditures for achieving the goals above. In some cases companies have taken state benefits in exchange for creating a specified number of jobs, but then failed to live up to their end of the deal. There have even been cases in which public funds seem to have been deliberately abused by state economic development entities for the private gain of politically connected individuals.

Significant improvements in oversight, transparency and accountability for authorities, corporations and development agencies are needed to determine when and how economic development resources are used most effectively, and to prevent waste and corruption. To achieve such improvements this legislation provides for the creation of a vigorous and independent inspector general's office with the powers and staff needed to do the important job of policing the behavior of officers and employees of public authorities, corporations and development agencies. The Inspector General shall be empowered to review and enforce the terms of economic development deals made by the entities under his/her supervision, up to and including imposing a schedule for repayment of benefits received by companies that fail to fulfill their obligations under such deals.

To further improve public accountability and public confidence in the state's economic development activities this legislation provides that: the boards of public entities covered by the law must have a quorum at all public hearings; that their boards must be reasonably representative of all stakeholders in matters under their jurisdiction as provided in this bill; and that the entities covered by this legislation shall not provide public benefits of any kind to businesses with a history of repeated and/or egregious violations of the law as provided in this legislation.

Furthermore, to ensure that state resources are used to encourage family supporting jobs, this legislation provides for minimum standards for wages and health benefits that shall be met for any new job created by a company receiving state benefits in order for such job to be counted towards any minimum job creation threshold to qualify for benefits. Finally, to prevent the use of state resources to support the destruction of green space, this legislation bans entities covered under the law from approving projects that involve the development of green spaces ox from extending water. or sewer lines where none exist.

Legislative history

New Bill.

Fiscal implications

To be determined.

Effective date

This act shall take effect on the one hundred twentieth day after it

shall have become a law, provided that the Commissioner of Health is authorized to promulgate any and all rules and regulations and take any other measures necessary to implement this act on its effective date on or before such date, provided that section four of this act shall take effect one year after the effective date of this act.