S T A T E   O F   N E W   Y O R K
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                                  6445

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                             March 16, 2011
                               ___________

Introduced  by M. of A. BRENNAN -- (at request of the Dormitory Authori-
  ty) -- read once  and  referred  to  the  Committee  on  Corporations,
  Authorities and Commissions

AN  ACT  to  amend the public authorities law, in relation to the powers
  and duties of the dormitory authority of the state of New  York  rela-
  tive  to  the  establishment of subsidiaries for certain purposes; and
  providing for the repeal of such provisions upon expiration thereof

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

  Section  1.  Subdivision  25 of section 1678 of the public authorities
law, as added by chapter 561 of the laws of 2010, is amended to read  as
follows:
  25.  (a)  To  form  [a  subsidiary]  ONE  OR MORE SUBSIDIARIES for the
purpose of limiting the potential liability of the authority when  exer-
cising  the  powers  and  duties conferred upon the authority by article
eight of this chapter in connection with the exercise of remedies by the
authority against [North General  Hospital,  an  eligible  secured]  ANY
borrower  [(as defined in chapter five hundred ninety of the laws of two
thousand two) located in the borough of Manhattan, New  York]  that  has
defaulted  in  its obligations under its loan agreement or mortgage with
the authority and for which an event of default has been declared by the
authority.  [Such] EACH SUCH subsidiary created pursuant to this  subdi-
vision  may  exercise  and  perform one or more of the purposes, powers,
duties, functions, rights and responsibilities of the  authority  (other
than  the  issuance  of  indebtedness[,])  in  connection  with real and
personal property with respect to which the authority holds  or  held  a
mortgage,  security interest or other collateral interest including: (i)
bidding for, taking, holding, selling, conveying,  assigning  or  trans-
ferring  title  to  such property; (ii) entering into leases, subleases,
operating agreements, security  agreements,  loan  agreements  or  other
encumbrances  or arrangements with regard to such property and acting in

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09251-03-1
              

A. 6445                             2

a manner consistent with the rights, obligations or responsibilities  of
the  owner of such property pursuant to such agreements or encumbrances;
(iii) assuming any indebtedness or other  liabilities  secured  by  such
property.    Notwithstanding any other provision of law to the contrary,
but in all instances subject to the  provisions  of  any  contract  with
bondholders,  the  transfer of title to ANY such subsidiary or any other
actions taken by the authority or [the] SUCH subsidiary to  enforce  the
authority's rights under the mortgage, security interest or other colla-
teral interest or to protect, acquire, manage or dispose of the property
shall be deemed to be a corporate purpose of the authority and shall not
impair  the  validity  of  any  bonds, notes or other obligations of the
authority to which the mortgage, security interest or  other  collateral
interest relates.
  (b)  [Such]  EACH  SUCH subsidiary authorized by paragraph (a) of this
subdivision shall be established in the form of a public benefit  corpo-
ration by executing and filing with the secretary of state a certificate
of incorporation which shall identify the authority as the entity organ-
izing  such  subsidiary and set forth the name of such subsidiary public
benefit corporation, its duration, the location of its principal  office
and  its  corporate  purposes  as provided in this subdivision and which
certificate may be amended from time to time by the filing of amendments
thereto with the secretary of state.  [Such] EACH SUCH subsidiary  shall
be  organized  as  a public benefit corporation, shall be a body politic
and corporate, and  shall  have  all  the  privileges,  immunities,  tax
exemptions  and  other  exemptions of the authority. The members of EACH
such subsidiary shall be the same as the members of  the  authority  and
the  provisions of subdivision two of section sixteen hundred ninety-one
of this title shall in all respects apply to such members when acting in
such capacity.
  (c) Nothing in this subdivision  shall  be  construed  to  impose  any
liabilities, obligations or responsibilities of ANY such subsidiary upon
the  authority and the authority shall have no liability or responsibil-
ity therefor unless the authority expressly agrees to assume the same.
  (d) [Such] EACH SUCH subsidiary created pursuant to  this  subdivision
shall  be  subject  to any other provision of this chapter pertaining to
subsidiaries of public authorities.
  S 2. This act shall take effect immediately and shall  expire  and  be
deemed  repealed  July 1, 2012; provided however, that the expiration of
this act shall not impair or otherwise affect any of the powers, duties,
responsibilities, functions, rights or  liabilities  of  any  subsidiary
duly  created pursuant to subdivision twenty-five of section 1678 of the
public authorities law prior to such expiration.