NY State Senate Bill 2017-S5695

Senate Bill S5695

2017-2018 Legislative Session

Prohibits certain persons from receiving compensation for legal fees, consulting, or other work performed for an industrial development agency or an economic assistance corporation

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Archive: Last Bill Status - In Senate Committee Finance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Mar 19, 2018	notice of committee consideration - withdrawn notice of committee consideration - requested
Jan 03, 2018	referred to finance
Apr 26, 2017	referred to finance

co-Sponsors

2017-S5695 (ACTIVE) - Details

See Assembly Version of this Bill:: A7645
Current Committee:: Senate Finance
Law Section:: Public Officers Law
Laws Affected:: Amd §73, Pub Off L; amd §2825, Pub Auth L
Versions Introduced in 2019-2020 Legislative Session:: S97, A3018

2017-S5695 (ACTIVE) - Summary

Prohibits elected officials and persons in a leadership position of a party committee from receiving compensation for legal fees, consulting, or other work performed for an industrial development agency or an economic assistance corporation.

2017-S5695 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S5695

 TITLE OF BILL :  An act to amend the public officers law and the
public authorities law, in relation to prohibiting certain persons
from receiving compensation for legal fees, consulting, or other work
performed for an industrial development agency or an economic
assistance corporation

 SUMMARY OF PROVISIONS

Section 1 of the bill amends the Public Officers Law to prohibit
persons holding public office and political party officers from
receiving compensation for consulting or legal services from any state
or local authority. Such a violation is punishable by forfeiture of
any gains related to the prohibited action, as well as a civil penalty
of up to $40,000.

Section 2 of the bill makes a conforming amendment to the Public
Authorities Law reflecting the same prohibitions.

Section 3 of the bill is the effective date, which is immediate upon
enactment.

 JUSTIFICATION :

This legislation arises in response to an instance wherein a local

elected official collected hundreds of thousands of dollars in
consulting fees from local industrial development agencies (IDAs) and
local economic assistance corporations (LDCs) via outside employers
and consulting companies, which resulted in a Justice Department
indictment on eight criminal counts.

Even the State's auditor, the Comptroller, has encountered difficulty
- and even litigation - in auditing IDAs' and LDCs' finances. These
obstacles to basic transparency demonstrate these entities' power and
the potential for misconduct with respect to expenditure of public
dollars.

The current system seems to allow for a preference in appointments of
those consultants or attorneys who are politically connected, as
opposed to suitably qualified to advise the IDAs on issues that impact
taxpayers in the jurisdiction. The members of the IDA are authorized
to hire consultants to advise them in their decision-making capacity.
When those consultants or attorneys have conflicts of interest and/or
are not the best qualified candidate for the job, an injustice occurs
that must be rectified.

To address this issue, this legislation prohibits public officeholders
and party committee leaders from collecting consulting fees from state
and local authorities either directly or through companies in which
they have at least 10% ownership.

Elected officials can have significant influence over state and local
revenues and spending plans, and can have access to agencies that
private companies may not. It is time for them to choose whether they
want to serve the public or private clients.

 LEGISLATIVE HISTORY :

New bill.

 FISCAL IMPLICATIONS :

No negative impact anticipated. To the extent that public actions are
less affected by officials' private interests, it may reduce state and
local expenditures.
 EFFECTIVE DATE :
This act shall take effect immediately.

2017-S5695 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5695
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                              April 26, 2017
                                ___________
 
 Introduced  by Sen. KAMINSKY -- read twice and ordered printed, and when
   printed to be committed to the Committee on Finance
 
 AN ACT to amend the public officers law and the public authorities  law,
   in relation to prohibiting certain persons from receiving compensation
   for  legal fees, consulting, or other work performed for an industrial
   development agency or an economic assistance corporation
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subdivision 18 of section 73 of the public officers law, as
 amended  by  section  5 of part CC of chapter 56 of the laws of 2015, is
 amended to read as follows:
   18. (A) NO PERSON WHO HOLDS ANY PUBLIC OFFICE OR IS AN  OFFICER  IN  A
 PARTY COMMITTEE OR FIRM OR ASSOCIATION OF WHICH SUCH PERSON IS A MEMBER,
 OR CORPORATION, TEN PER CENTUM OR MORE OF THE STOCK OF WHICH IS OWNED OR
 CONTROLLED  DIRECTLY OR INDIRECTLY BY SUCH PERSON, SHALL RECEIVE COMPEN-
 SATION FOR LEGAL FEES, CONSULTING, OR ANY OTHER CONTRACTUAL  EXPENDITURE
 FOR  SERVICES,  WHETHER ACTUALLY PERFORMED OR NOT, FROM A STATE OR LOCAL
 AUTHORITY AS DEFINED IN SECTION TWO OF THE PUBLIC AUTHORITIES LAW.
   (B) FOR THE PURPOSES OF THIS SUBDIVISION, THE TERM  "PARTY  COMMITTEE"
 SHALL HAVE THE SAME MEANING AS IN SECTION 2-100 OF THE ELECTION LAW.
   19.  In  addition  to  any penalty contained in any other provision of
 law, any person who knowingly and intentionally violates the  provisions
 of subdivisions two through five, seven, seven-a, eight, twelve or four-
 teen  through [seventeen] EIGHTEEN of this section shall be subject to a
 civil penalty in an amount not to exceed forty thousand dollars and  the
 value  of  any gift, compensation or benefit received in connection with
 such violation. Assessment of a civil penalty hereunder shall be made by
 the state oversight body with jurisdiction over  such  person.  A  state
 oversight  body  acting  pursuant to its jurisdiction, may, in lieu of a
 civil penalty, with respect to a violation of subdivisions  two  through
 five,  seven  or  eight  of  this section, refer a violation of any such
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD10931-03-7

 S. 5695                             2
 
 subdivision to the appropriate prosecutor and upon such conviction  such
 violation shall be punishable as a class A misdemeanor.
   §  2.  Subdivision 1 of section 2825 of the public authorities law, as
 amended by chapter 766 of the laws  of  2005,  is  amended  to  read  as
 follows:
   1.  No  public officer or employee shall be ineligible for appointment
 as a trustee or member of the governing body of a state or local author-
 ity, as defined in section two of this chapter, and any  public  officer
 or  employee  may  accept  such appointment and serve as such trustee or
 member without forfeiture of any other  public  office  or  position  of
 public  employment  by reason thereof. PROVIDED, ADDITIONALLY, NO PERSON
 WHO HOLDS ANY PUBLIC OFFICE OR IS AN OFFICER IN A  PARTY  COMMITTEE,  OR
 FIRM  OR  ASSOCIATION  OF WHICH SUCH PERSON IS A MEMBER, OR CORPORATION,
 TEN PER CENTUM OR MORE OF THE STOCK WHICH IS OWNED OR CONTROLLED DIRECT-
 LY OR INDIRECTLY BY SUCH PERSON, SHALL RECEIVE  COMPENSATION  FOR  LEGAL
 FEES,  CONSULTING,  OR  ANY  OTHER CONTRACTUAL EXPENDITURE FOR SERVICES,
 WHETHER ACTUALLY PERFORMED OR NOT, FROM A STATE OR LOCAL AUTHORITY.  FOR
 THE  PURPOSES OF THIS SUBDIVISION, THE TERM "PARTY COMMITTEE" SHALL HAVE
 THE SAME MEANING AS IN SECTION 2-100 OF THE ELECTION LAW.
   § 3. This act shall take effect immediately.

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Senate Bill S5695

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Sponsored By

Todd Kaminsky