NY State Senate Bill 2023-S2958

Senate Bill S2958

2023-2024 Legislative Session

Requires certain business recipients of state aid to perform an annual assessment of the business' social and environmental impact as assessed against a third party standard

download bill text pdf

Current Bill Status - In Senate Committee Corporations, Authorities And Commissions 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

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2024	referred to corporations, authorities and commissions
Jan 26, 2023	referred to corporations, authorities and commissions

2023-S2958 (ACTIVE) - Details

Current Committee:: Senate Corporations, Authorities And Commissions
Law Section:: New York State Urban Development Corporation Act
Laws Affected:: Amd §§3, 30 & 30-a, UDC Act; add Art 23 §§450 - 452, Ec Dev L
Versions Introduced in Other Legislative Sessions:: 2015-2016: S7767
2017-2018: S1788, S7151
2019-2020: S2309
2021-2022: S2953

2023-S2958 (ACTIVE) - Summary

Requires certain business recipients of state aid to perform an annual assessment of the business' social and environmental impact as assessed against a third party standard.

2023-S2958 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S2958

SPONSOR: KAVANAGH
 
TITLE OF BILL:

An act to amend the New York state urban development corporation act and
the economic development law, in relation to requiring certain business
recipients of state aid to perform an annual assessment of the business'
social and environmental impact as assessed against a third party stand-
ard

 
PURPOSE:

To require entities that receive over $100K in Economic Development
assistance or tax benefits to complete a third party assessment,
approved by the Empire State Development Corporation (ESDC), measuring
their social and environmental impact.

 
SUMMARY OF PROVISIONS:

Section 1 defines "Third Party Standard" as a recognized standard for
defining, reporting, and assessing business' social and environmental

performance.

Assesses the effects of the business and its operations upon the follow-
ing:

* the employees and work force of the business, its subsidiaries, and
its suppliers;

* the interests of customers as beneficiaries of the business:

* community and societal factors, including those of each community in
which offices or facilities of the business, its subsidiaries, or its
suppliers are located;

* the local and global environment

Standards can't be developed by the state or the business whose social
and environmental impact is being assessed.

Entity that does assessment must:

* have access to necessary expertise to assess overall business social
and environmental performance; and

* use a balanced multi-stakeholder approach to develop the standard,
including a reasonable public comment period.

The following must be made publicly available:

* the criteria considered when measuring the overall social and environ-
mental performance of a business; and

* the relative weightings, if any, of those criteria.

The identity of the directors, officers, material owners, and the
governing body of the entity that developed and controls revisions to
the standard.
The process by which revisions to the standard and changes to the
membership of the governing body are made.

An accounting of the revenue and sources of financial support for the
entity, with sufficient detail to disclose any relationships that could
reasonably be considered to present a potential conflict of interest.

Section 2: Corporation must submit an annual report to the governor and
chairs of various Senate/Assembly committees on the social and environ-
mental impact of entities required to report. Such a report shall
include an analysis of the aggregate third party standard assessment
results including aggregate assessment results by funding level.

Section 3 requires anyone that receives over $100K in program assistance
or tax benefits to complete a third party assessment measuring their
social and environmental impact annually

Sections 4 adds the same requirements to the Economic Development Law.

Section 5 sets forth the effective date.

 
JUSTIFICATION:

In 2011, New York State enacted a law permitting the incorporation of
"benefit corporations," which must have a "general public benefit"
purpose, defined as a material, positive impact on society and the envi-
ronment, taken as a whole, as assessed against a third-party standard,
through activities that promote a combination of specific public bene-
fits.

Benefit corporations allow businesses to measure their success using
their positive impact on society, rather than just profits. To maximize
the potential of benefit corporations, this bill requires entities that
receive over $100K in economic development assistance or tax benefits to
complete a third party assessment, approved by ESDC, measuring their
social and environmental impact. New York will be able to choose from
multiple organizations who offer third party assessments that meet the
criteria of the bill. By getting a more accurate picture of the impact
of businesses on society, New York will ensure that businesses who
provide the greatest benefits receive assistance.

 
FISCAL IMPACT:

None.

 
LEGISLATIVE HISTORY:

2021-2022: S2953 (Kavanagh) - CORPORATIONS, AUTHORITIES AND COMMISSIONS

2019-2020: S2309 (Kavanagh) - CORPORATIONS, AUTHORITIES AND COMMISSIONS

2018: S7151 (Kavanagh) - CORPORATIONS, AUTHORITIES AND COMMISSIONS

2017: S1788 (Squadron) - CORPORATIONS, AUTHORITIES AND COMMISSIONS

2016: S7767 (Squadron) - CORPORATIONS, AUTHORITIES AND COMMISSIONS

 
EFFECTIVE DATE:
This act shall take effect immediately.

2023-S2958 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   2958
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             January 26, 2023
                                ___________
 
 Introduced  by Sen. KAVANAGH -- read twice and ordered printed, and when
   printed to be committed to the Committee on Corporations,  Authorities
   and Commissions
 
 AN ACT to amend the New York state urban development corporation act and
   the  economic  development law, in relation to requiring certain busi-
   ness recipients of state aid to perform an annual  assessment  of  the
   business'  social and environmental impact as assessed against a third
   party standard
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. Section 3 of section 1 of chapter 174 of the laws of 1968,
 constituting the New York state urban  development  corporation  act  is
 amended by adding a new subdivision 31 to read as follows:
   (31)  "THIRD  PARTY  STANDARD".  A  RECOGNIZED  STANDARD FOR DEFINING,
 REPORTING, AND ASSESSING BUSINESS' SOCIAL AND ENVIRONMENTAL  PERFORMANCE
 THAT:
   (A)  ASSESSES  THE EFFECTS OF THE BUSINESS AND ITS OPERATIONS UPON THE
 FOLLOWING:
   (I) THE EMPLOYEES AND WORK FORCE OF THE  BUSINESS,  ITS  SUBSIDIARIES,
 AND ITS SUPPLIERS;
   (II) THE INTERESTS OF CUSTOMERS AS BENEFICIARIES OF THE BUSINESS;
   (III) COMMUNITY AND SOCIETAL FACTORS, INCLUDING THOSE OF EACH COMMUNI-
 TY  IN WHICH OFFICES OR FACILITIES OF THE BUSINESS, ITS SUBSIDIARIES, OR
 ITS SUPPLIERS ARE LOCATED; AND
   (IV) THE LOCAL AND GLOBAL ENVIRONMENT; AND
   (B) IS DEVELOPED BY AN ENTITY OTHER THAN:
   (I) THE STATE; OR
   (II) THE BUSINESS WHOSE  SOCIAL  AND  ENVIRONMENTAL  IMPACT  IS  BEING
 ASSESSED AGAINST THE THIRD PARTY STANDARD; AND
   (III) SUCH ENTITY SHALL:
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD07222-01-3
 S. 2958                             2

 
   (A)  HAVE  ACCESS  TO  NECESSARY EXPERTISE TO ASSESS OVERALL BUSINESS'
 SOCIAL AND ENVIRONMENTAL PERFORMANCE; AND
   (B) USE A BALANCED MULTI-STAKEHOLDER APPROACH TO DEVELOP THE STANDARD,
 INCLUDING A REASONABLE PUBLIC COMMENT PERIOD; AND
   (C) MAKES THE FOLLOWING INFORMATION PUBLICLY AVAILABLE:
   (I)  THE  CRITERIA  CONSIDERED  WHEN  MEASURING THE OVERALL SOCIAL AND
 ENVIRONMENTAL PERFORMANCE OF A BUSINESS;
   (II) THE RELATIVE WEIGHTINGS, IF ANY, OF THOSE CRITERIA;
   (III) THE IDENTITY OF THE DIRECTORS, OFFICERS,  MATERIAL  OWNERS,  AND
 THE  GOVERNING  BODY OF THE ENTITY THAT DEVELOPED AND CONTROLS REVISIONS
 TO THE STANDARD;
   (IV) THE PROCESS BY WHICH REVISIONS TO THE STANDARD AND CHANGES TO THE
 MEMBERSHIP OF THE GOVERNING BODY ARE MADE; AND
   (V) AN ACCOUNTING OF THE REVENUE AND SOURCES OF FINANCIAL SUPPORT  FOR
 THE  ENTITY,  WITH  SUFFICIENT DETAIL TO DISCLOSE ANY RELATIONSHIPS THAT
 COULD REASONABLY BE CONSIDERED TO PRESENT A POTENTIAL CONFLICT OF INTER-
 EST.
   § 2. Section 30 of section 1 of chapter  174  of  the  laws  of  1968,
 constituting  the  New  York  state urban development corporation act is
 amended by adding a new subdivision (d) to read as follows:
   (D) REPORT.  IN ADDITION TO ANY OTHER REQUIREMENTS IMPOSED BY THE  ACT
 OR  OTHERWISE  REGARDING  EVALUATIONS  OF  PROGRAMS  ADMINISTERED BY THE
 CORPORATION, THE CORPORATION SHALL REPORT ON AN ANNUAL  BASIS  BEGINNING
 OCTOBER FIRST, TWO THOUSAND TWENTY-TWO, AND ON EACH OCTOBER FIRST THERE-
 AFTER,  TO  THE  GOVERNOR,  THE CHAIRPERSONS OF THE SENATE COMMITTEES ON
 FINANCE, COMMERCE, ECONOMIC DEVELOPMENT AND SMALL BUSINESS,  AND  CORPO-
 RATIONS,  AUTHORITIES  AND COMMISSIONS, THE CHAIRPERSONS OF THE ASSEMBLY
 COMMITTEES  ON  WAYS  AND  MEANS,  ECONOMIC  DEVELOPMENT,  CORPORATIONS,
 AUTHORITIES  AND COMMISSIONS, AND SMALL BUSINESS ON THE SOCIAL AND ENVI-
 RONMENTAL IMPACT OF ENTITIES REQUIRED TO REPORT UNDER SUBDIVISION (J) OF
 SECTION THIRTY-A OF THIS ACT. SUCH REPORT SHALL INCLUDE AN  ANALYSIS  OF
 THE  AGGREGATE  THIRD PARTY STANDARD ASSESSMENT RESULTS INCLUDING AGGRE-
 GATE ASSESSMENT RESULTS BY FUNDING LEVEL.
   § 3. Section 30-a of section 1 of chapter 174 of  the  laws  of  1968,
 constituting  the  New  York  state urban development corporation act is
 amended by adding a new subdivision (j) to read as follows:
   (J) THE CORPORATION SHALL, UPON APPROVAL OF AN APPLICATION  OR  FORMAL
 REQUEST  FOR  FUNDING,  IN  AN AMOUNT OF ONE HUNDRED THOUSAND DOLLARS OR
 MORE, OR TAX BENEFIT ASSISTANCE FOR ANY ENTITY OR PROJECT, REQUIRE  SUCH
 RECIPIENT  TO  PERFORM AN ANNUAL ASSESSMENT OF THEIR SOCIAL AND ENVIRON-
 MENTAL IMPACT AS ASSESSED AGAINST A THIRD PARTY STANDARD, AS DEFINED  IN
 SUBDIVISION  THIRTY-ONE  OF  SECTION  THREE OF THIS ACT. SUCH ASSESSMENT
 SHALL BE SUBMITTED TO THE CORPORATION BY THE ENTITY RECEIVING FUNDING OR
 TAX BENEFIT ASSISTANCE APPROVED BY THE CORPORATION NINETY DAYS AFTER THE
 FIRST YEAR FROM THE DATE OF APPROVAL AND ANNUALLY THEREAFTER. THE CORPO-
 RATION SHALL SELECT AN INDEPENDENT THIRD PARTY STANDARD  AS  DEFINED  IN
 SUBDIVISION THIRTY-ONE OF SECTION THREE OF THIS ACT. SUCH STANDARD SHALL
 BE  CHOSEN  WITHIN  ONE  HUNDRED EIGHTY DAYS AFTER THE EFFECTIVE DATE OF
 THIS SUBDIVISION. THE CORPORATION MAY USE ANY FUNDS NECESSARY TO  ADMIN-
 ISTER AND IMPLEMENT THIS SECTION.
   §  4.  The economic development law is amended by adding a new article
 23 to read as follows:
                                ARTICLE 23
                       FUNDING RECIPIENT ASSESSMENT
 SECTION 450. DEFINITION.
         451. REPORT.
 S. 2958                             3
 
         452. ANNUAL ASSESSMENT.
   §  450. DEFINITION. "THIRD PARTY STANDARD" MEANS A RECOGNIZED STANDARD
 FOR DEFINING, REPORTING, AND ASSESSING  BUSINESS'  SOCIAL  AND  ENVIRON-
 MENTAL PERFORMANCE THAT:
   (A)  ASSESSES  THE EFFECTS OF THE BUSINESS AND ITS OPERATIONS UPON THE
 FOLLOWING:
   (I) THE EMPLOYEES AND WORK FORCE OF THE  BUSINESS,  ITS  SUBSIDIARIES,
 AND ITS SUPPLIERS;
   (II) THE INTERESTS OF CUSTOMERS AS BENEFICIARIES OF THE BUSINESS;
   (III) COMMUNITY AND SOCIETAL FACTORS, INCLUDING THOSE OF EACH COMMUNI-
 TY  IN WHICH OFFICES OR FACILITIES OF THE BUSINESS, ITS SUBSIDIARIES, OR
 ITS SUPPLIERS ARE LOCATED; AND
   (IV) THE LOCAL AND GLOBAL ENVIRONMENT; AND
   (B) IS DEVELOPED BY AN ENTITY OTHER THAN:
   (I) THE STATE; OR
   (II) THE BUSINESS WHOSE  SOCIAL  AND  ENVIRONMENTAL  IMPACT  IS  BEING
 ASSESSED AGAINST THE THIRD PARTY STANDARD; AND
   (III) SUCH ENTITY SHALL:
   (A)  HAVE  ACCESS  TO  NECESSARY EXPERTISE TO ASSESS OVERALL BUSINESS'
 SOCIAL AND ENVIRONMENTAL PERFORMANCE; AND
   (B) USE A BALANCED MULTI-STAKEHOLDER APPROACH TO DEVELOP THE STANDARD,
 INCLUDING A REASONABLE PUBLIC COMMENT PERIOD; AND
   (C) MAKES THE FOLLOWING INFORMATION PUBLICLY AVAILABLE:
   (I) THE CRITERIA CONSIDERED WHEN  MEASURING  THE  OVERALL  SOCIAL  AND
 ENVIRONMENTAL PERFORMANCE OF A BUSINESS;
   (II) THE RELATIVE WEIGHTINGS, IF ANY, OF THOSE CRITERIA;
   (III)  THE  IDENTITY  OF THE DIRECTORS, OFFICERS, MATERIAL OWNERS, AND
 THE GOVERNING BODY OF THE ENTITY THAT DEVELOPED AND  CONTROLS  REVISIONS
 TO THE STANDARD;
   (IV) THE PROCESS BY WHICH REVISIONS TO THE STANDARD AND CHANGES TO THE
 MEMBERSHIP OF THE GOVERNING BODY ARE MADE; AND
   (V)  AN ACCOUNTING OF THE REVENUE AND SOURCES OF FINANCIAL SUPPORT FOR
 THE ENTITY, WITH SUFFICIENT DETAIL TO DISCLOSE  ANY  RELATIONSHIPS  THAT
 COULD REASONABLY BE CONSIDERED TO PRESENT A POTENTIAL CONFLICT OF INTER-
 EST.
   §  451.  REPORT.  IN ADDITION TO ANY OTHER REQUIREMENTS IMPOSED BY THE
 ACT OR OTHERWISE REGARDING EVALUATIONS OF PROGRAMS ADMINISTERED  BY  THE
 DEPARTMENT, THE COMMISSIONER AND THE DEPARTMENT SHALL REPORT ON AN ANNU-
 AL  BASIS  BEGINNING OCTOBER FIRST, TWO THOUSAND TWENTY-TWO, AND ON EACH
 OCTOBER FIRST THEREAFTER, TO  THE  GOVERNOR,  THE  CHAIRPERSONS  OF  THE
 SENATE  COMMITTEES  ON FINANCE, COMMERCE, ECONOMIC DEVELOPMENT AND SMALL
 BUSINESS, AND CORPORATIONS,  AUTHORITIES  AND  COMMISSIONS,  THE  CHAIR-
 PERSONS  OF THE ASSEMBLY COMMITTEES ON WAYS AND MEANS, ECONOMIC DEVELOP-
 MENT, CORPORATIONS, AUTHORITIES AND COMMISSIONS, AND SMALL  BUSINESS  ON
 THE SOCIAL AND ENVIRONMENTAL IMPACT OF ENTITIES REQUIRED TO REPORT UNDER
 SECTION  FOUR  HUNDRED  FIFTY-TWO  OF  THIS  ARTICLE.  SUCH REPORT SHALL
 INCLUDE AN ANALYSIS OF THE AGGREGATE  THIRD  PARTY  STANDARD  ASSESSMENT
 RESULTS INCLUDING AGGREGATE ASSESSMENT RESULTS BY FUNDING LEVEL.
   §  452.  ANNUAL ASSESSMENT. THE COMMISSIONER AND THE DEPARTMENT SHALL,
 UPON APPROVAL OF AN APPLICATION OR FORMAL REQUEST  FOR  FUNDING,  IN  AN
 AMOUNT  OF  ONE HUNDRED THOUSAND DOLLARS OR MORE, OR TAX BENEFIT ASSIST-
 ANCE FOR ANY ENTITY OR PROJECT, REQUIRE SUCH  RECIPIENT  TO  PERFORM  AN
 ANNUAL  ASSESSMENT  OF THEIR SOCIAL AND ENVIRONMENTAL IMPACT AS ASSESSED
 AGAINST A THIRD PARTY STANDARD, AS DEFINED IN SECTION FOUR HUNDRED FIFTY
 OF THIS ARTICLE. SUCH ASSESSMENT SHALL BE SUBMITTED TO THE DEPARTMENT BY
 THE ENTITY RECEIVING FUNDING OR TAX BENEFIT ASSISTANCE APPROVED  BY  THE
 S. 2958                             4
 
 DEPARTMENT  NINETY  DAYS  AFTER THE FIRST YEAR FROM THE DATE OF APPROVAL
 AND ANNUALLY THEREAFTER. THE  DEPARTMENT  SHALL  SELECT  AN  INDEPENDENT
 THIRD  PARTY  STANDARD  AS DEFINED IN SECTION FOUR HUNDRED FIFTY OF THIS
 ARTICLE.    SUCH STANDARD SHALL BE CHOSEN WITHIN ONE HUNDRED EIGHTY DAYS
 AFTER THE EFFECTIVE DATE OF THIS SECTION. THE  DEPARTMENT  MAY  USE  ANY
 FUNDS NECESSARY TO ADMINISTER AND IMPLEMENT THIS SECTION.
   § 5. This act shall take effect immediately.

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