NY State Senate Bill 2025-S6165

Senate Bill S6165

2025-2026 Legislative Session

Relates to the applicability of open meetings and freedom of information laws to certain not-for-profit corporations

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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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Mar 06, 2025	referred to corporations, authorities and commissions

2025-S6165 (ACTIVE) - Details

See Assembly Version of this Bill:: A173
Current Committee:: Senate Corporations, Authorities And Commissions
Law Section:: Not-for-Profit Corporation Law
Laws Affected:: Amd §§104, 402, 404 & 1411, N-PC L; amd §§2 & 2829, Pub Auth L
Versions Introduced in Other Legislative Sessions:: 2021-2022: S4339, A4575
2023-2024: S2727, A3715

2025-S6165 (ACTIVE) - Summary

Relates to the applicability of open meetings and freedom of information laws to certain not-for-profit corporations.

2025-S6165 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S6165

SPONSOR: SKOUFIS
 
TITLE OF BILL:

An act to amend the not-for-profit corporation law and the public
authorities law, in relation to the applicability of open meetings and
freedom of information laws to certain not-for-profit corporations

 
PURPOSE:

The purpose of this bill is to impose greater transparency and account-
ability on those not-for-profit corporations that engage in municipal
economic development and function as an instrument and subsidiary of
local government.

 
SUMMARY OF PROVISIONS:

Section 1: Adds a new subdivision (h) to section 104 of the not-for-pro-
fit corporation law, which would require the Department of State to
transmit to the Authorities Budget Office a copy of any filed certified
of incorporation, which indicates such a Certificate has been filed on

behalf or at the behest of a municipal corporation, public authority or
district.

Section 2: Amends section 402 of the not-for-profit corporation law by
requiring those wishing to file certificates of incorporation to note
whether they have received the relevant consent of the Authorities Budg-
et Office, if applicable.

Section 3: Amends section 402 of the not-for-profit corporation law by
adding subparagraph 9 to include a statement whether the corporation is
being incorporated.

Section 4: Amends section 404 of the not-for-profit corporation law by
requiring those wishing to incorporate certain types of corporations,
such as those corporations where a majority of the board elected offi-
cials of any municipal corporation to appoint members to obtain the
consent of the Authorities Budget Office prior to filing certificates of
incorporation.

Section 5: Amends subparagraph 2 of paragraph (d) of section 1411 of the
not-for-profit corporation law by making a technical change to account
for changes added in Section 8 of this bill.

Section 6: Amends subparagraph 4 of paragraph (d) of section 1411 of the
not-for-profit corporation law by making a technical change to account
for changes added in Section 8 of this bill.

Section 7: Amends paragraph (i) of section 1411 of the not-for-profit
corporation law by requiring, regarding the mandatory public hearing to
consider the sale or lease of municipal property to a local development
corporation, that such advanced notice of said meeting is given 21 days
in advance of the hearing; describe the property at issue; describe the
proposed consideration for the sale; include an estimated fair market
value of the property at issue; and include a statement of the intended
use of the property by the corporation.


Section 8: Amend subdivision 1 and 2 of section 2 of the public authori-
ties, law by expanding the definition of "local authority" to include
certain not-for-profit corporations, such as those corporations where a
majority of board members are appointed by elected officials of any
municipal corporation or those which pay staff of a local or state
government to provide administrative support.

Section 9: Amends the public authorities law by adding a new section,
2829, which would subject all state and local authorities to the open
meetings law and freedom of information laws, as well as require such
authorities to stream their meeting in real-time.

Section 10: Sets Effective Date.

 
JUSTIFICATION:

Local development corporations (LDCs), as well as other types of not-for
profit corporations like Health Research Incorporated, are often used by
governments as a means to indirectly finance government operations and
projects. These LDCs and similar private entities, however, are exempt
from many of the constitutional and statutory provisions that guide the
operations and financial transactions conducted by local governments,
despite how, as a practical matter, they often function as an instrument
and subsidiary of local government.

While such organizations mostly do great work in developing their local
economies and serve an essential quasi-governmental role, reports from
the Authorities Budget Office, the State Comptroller, and good govern-
ment groups have exposed that LDCs and other non-profits are too
frequently used solely to circumvent these constitutional and statutory
restrictions that apply to projects directly undertaken by a local
government, as well as to circumvent transparency and public scrutiny
laws through such entities status as private organizations. This lack of
transparency, accountability, and restraint has significantly wasted
taxpayer dollars and public resources.

When organizations rely on taxpayer resources to operate, they should be
subject to strong oversight and be held accountable. With such entities
holding presently around $20 billion in outstanding debt, New York's
taxpayers deserve far more accountability and responsibility for how
their money is being spent and leveraged by such entities. To protect
the interests of the taxpayer, our localities, and the state, this bill
seeks to subject these LDCS and other similar not-for-profits to greater
governmental accountability and public transparency, as well as to reign
in some of their more problematic activities.

 
LEGISLATIVE HISTORY:

Senate

2021: S4339B, Amend and Recommit to Corporations, Authorities, and
Commissions

2022: S4339B, Passed Senate

2023: S2727B, Passed Senate

2024: S2727B, Passed Senate
Assembly

2021: A4575B, Amend and Recommit to Rules

2022: A45758, Ordered to Third Reading

2023: A3715C, Ordered to Third Reading Rules

2024: A3715C, Referred to Ways and Means

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect on the thirtieth day after it shall have
become a law; provided, however, that the provisions of subparagraph 2
of paragraph (d) and paragraph (i) of section 1411 of the not-for-profit
corporation law, as amended by sections five and seven of this act shall
not apply retroactively to contracts or agreements between a local
development corporation and a municipal corporation, state or local
authority or district entered into prior to the effective date of this
act.

2025-S6165 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   6165
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                               March 6, 2025
                                ___________
 
 Introduced  by  Sen. SKOUFIS -- read twice and ordered printed, and when
   printed to be committed to the Committee on Corporations,  Authorities
   and Commissions
 
 AN  ACT  to  amend  the  not-for-profit  corporation  law and the public
   authorities law, in relation to the applicability of open meetings and
   freedom of information laws to certain not-for-profit corporations
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Section  104  of  the  not-for-profit  corporation law is
 amended by adding a new paragraph (h) to read as follows:
   (H) THE DEPARTMENT SHALL TRANSMIT ELECTRONICALLY  TO  THE  AUTHORITIES
 BUDGET  OFFICE  A  COPY  OF  EVERY CERTIFICATE OF INCORPORATION FILED OR
 DELIVERED WHERE THE INCORPORATOR HAS INDICATED ON THE  CERTIFICATE  THAT
 SUCH  INCORPORATOR  IS  FILING  SAID CERTIFICATE ON THE BEHALF OR AT THE
 BEHEST  OF  A  MUNICIPAL  CORPORATION,  STATE  OR  LOCAL  AUTHORITY,  OR
 DISTRICT.
   §  2. Subparagraph 2-b of paragraph (a) of section 402 of the not-for-
 profit corporation law, as added by chapter 23 of the laws of  2014,  is
 amended to read as follows:
   (2-b) If it is not formed to engage in any activity or for any purpose
 requiring  consent or approval of any state official, department, board,
 agency or other body, OR DOES NOT REQUIRE CONSENT PURSUANT TO  PARAGRAPH
 (W)  OF  SECTION 404 (APPROVALS, NOTICES AND CONSENTS) OF THIS ARTICLE a
 statement that no such consent or approval is required.  Such  statement
 shall  be  deemed conclusive for purposes of filing by the department of
 state. If subsequent to submitting the certificate of incorporation  for
 filing,  the  corporation  plans  to  engage  in  any activity requiring
 consent or approval pursuant to  section  404  [(approvals]  (APPROVALS,
 notices  and  consents) of this [chapter] ARTICLE, the corporation shall
 obtain such consent or approval and accordingly amend its certificate of
 incorporation pursuant to article eight of this chapter.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD00315-01-5

 S. 6165                             2
 
   § 3. Paragraph (a) of section 402 of  the  not-for-profit  corporation
 law is amended by adding a new subparagraph 9 to read as follows:
   (9)  A  STATEMENT WHETHER THE CORPORATION IS BEING INCORPORATED ON THE
 BEHALF OR AT THE BEHEST OF ANY MUNICIPAL  CORPORATION,  STATE  OR  LOCAL
 AUTHORITY,  OR  DISTRICT.  IF  SO,  THE INCORPORATOR SHALL IDENTIFY SUCH
 MUNICIPAL CORPORATION, STATE OR LOCAL AUTHORITY, OR DISTRICT.
   § 4. Section 404 of the not-for-profit corporation law is  amended  by
 adding a new paragraph (w) to read as follows:
   (W)  EVERY  CERTIFICATE  OF  INCORPORATION  WHICH  INCLUDES ANY OF THE
 FOLLOWING SHALL HAVE ENDORSED THEREON OR ANNEXED THERETO THE CONSENT  OF
 THE DIRECTOR OF THE AUTHORITIES BUDGET OFFICE:
   (1)  INDICATES  THAT  ONE OR MORE INDIVIDUALS WHO SERVE AS OFFICERS OR
 EMPLOYEES OF ANY MUNICIPAL CORPORATION, STATE  OR  LOCAL  AUTHORITY,  OR
 DISTRICT  SHALL: (I) SELECT EITHER A MAJORITY OF THE CORPORATION'S BOARD
 OF DIRECTORS OR THE CORPORATION'S CHIEF EXECUTIVE OFFICER; (II)  CONSTI-
 TUTE A MAJORITY OF THE VOTING STRENGTH THAT SELECTS EITHER A MAJORITY OF
 THE  CORPORATION'S  BOARD OF DIRECTORS OR THE CORPORATION'S CHIEF EXECU-
 TIVE OFFICER; OR (III) SERVE AS: (A) A  MAJORITY  OF  THE  CORPORATION'S
 BOARD OF DIRECTORS; OR (B) IN THEIR OFFICIAL CAPACITY, THE CORPORATION'S
 CHIEF EXECUTIVE OFFICER; OR
   (2)  INDICATES  THAT  SUCH  CORPORATION  IS  BEING INCORPORATED ON THE
 BEHALF OR AT THE BEHEST OF ANY MUNICIPAL  CORPORATION,  STATE  OR  LOCAL
 AUTHORITY, OR DISTRICT.
   THE DIRECTOR SHALL MAKE SUCH INQUIRY INTO THE PURPOSES OF THE PROPOSED
 CORPORATION AS THE DIRECTOR SHALL DEEM ADVISABLE.
   §  5.  Subparagraph 2 of paragraph (d) of section 1411 of the not-for-
 profit corporation law is amended to read as follows:
   (2) Notwithstanding the provisions of any general,  special  or  local
 law,  charter  or  ordinance  to the contrary, such sale or lease may be
 made without appraisal (EXCEPT AS MAY BE NECESSARY IN REGARD TO SUBPARA-
 GRAPH (4) OF THIS PARAGRAPH), public notice[,] (except  as  provided  in
 subparagraph (4) OF THIS PARAGRAPH), or public bidding for such price or
 rental  and  upon  such  terms as may be agreed upon between the county,
 city, town or village and said local development corporation;  provided,
 however,  that  in case of a lease the term may not exceed [ninety-nine]
 TWENTY-FIVE years and provided, further, that in cities having  a  popu-
 lation of one million or more, no such sale or lease shall be made with-
 out the approval of a majority of the members of the borough improvement
 board of the borough in which such real property is located.
   §  6.  Subparagraph 4 of paragraph (d) of section 1411 of the not-for-
 profit corporation law is amended to read as follows:
   (4) Notice of such hearing shall be published at least  [ten]  TWENTY-
 ONE  days before the date set for the hearing in such publication and in
 such manner as may be designated by the local legislative body,  or  the
 board  of estimate as the case may be. SUCH NOTICE SHALL ALSO INCLUDE: A
 DESCRIPTION OF THE PROPERTY AT ISSUE; THE VALUE OF THE PROPOSED  CONSID-
 ERATION TO BE RECEIVED FROM THE SALE OR LEASE; THE ESTIMATED FAIR MARKET
 VALUE  OF  THE ASSET; AND A STATEMENT OF THE INTENDED USE OR DISPOSITION
 OF THE PROPERTY BY THE LOCAL DEVELOPMENT CORPORATION.
   § 7. Paragraph (i) of section 1411 of the  not-for-profit  corporation
 law is amended to read as follows:
   (i)  CONTRACTS  BETWEEN  A MUNICIPAL CORPORATION, PUBLIC AUTHORITY, OR
 DISTRICT AND A LOCAL DEVELOPMENT CORPORATION.
   ANY CONTRACT OR OTHER AGREEMENT BETWEEN  A  LOCAL  DEVELOPMENT  CORPO-
 RATION  AND A MUNICIPAL CORPORATION, STATE AUTHORITY OR LOCAL AUTHORITY,
 OR DISTRICT FOR ONE OR MORE OF THE PURPOSES ENUMERATED IN PARAGRAPH  (A)
 S. 6165                             3
 
 OF THIS SECTION SHALL: (1) CAUSE THE LOCAL DEVELOPMENT CORPORATION TO BE
 DEFINED  AS A LOCAL AUTHORITY PURSUANT TO SUBDIVISION TWO OF SECTION TWO
 OF THE PUBLIC AUTHORITIES LAW; (2)  PROVIDE  FOR  THE  MUNICIPAL  CORPO-
 RATION,  STATE AUTHORITY OR LOCAL AUTHORITY, OR DISTRICT TO RECEIVE FAIR
 AND ADEQUATE CONSIDERATION; (3) BE SUBJECT TO THE REQUIREMENTS OF  ARTI-
 CLE  FIVE-A  OF  THE  GENERAL  MUNICIPAL LAW; AND (4) HAVE A TERM NOT TO
 EXCEED TWENTY-FIVE YEARS, SUBJECT TO ONE OR MORE SUBSEQUENT RENEWALS FOR
 A TERM NOT TO EXCEED TWENTY-FIVE YEARS EACH UPON THE MUTUAL  CONSENT  OF
 THE  PARTIES;  PROVIDED  HOWEVER THAT A CONTRACT WITH A MUNICIPAL CORPO-
 RATION SHALL NOT BE USED TO FINANCE THE  MUNICIPAL  CORPORATION'S  OPER-
 ATIONS OR TO ACQUIRE OR IMPROVE AN ASSET FOR USE OF THE MUNICIPAL CORPO-
 RATION.
   (J)  Effect of section.
   Corporations  incorporated  or reincorporated under this section shall
 be organized and operated exclusively for  the  purposes  set  forth  in
 paragraph  (a)  OF  THIS  SECTION, shall have, in addition to the powers
 otherwise conferred by law, the powers conferred  by  paragraph  (c)  OF
 THIS SECTION and shall be subject to all the restrictions [and], limita-
 tions  AND  OBLIGATIONS imposed by [paragraph] PARAGRAPHS (e) [and para-
 graph], (g) AND (I) OF THIS SECTION.   In so far as  the  provisions  of
 this  section  are  inconsistent  with  the provisions of any other law,
 general or special, the provisions of this section shall be  controlling
 as to corporations incorporated or reincorporated hereunder.
   §  8. Subdivisions 1 and 2 of section 2 of the public authorities law,
 subdivision 1 as added by chapter 766 of the laws of 2005  and  subdivi-
 sion  2  as  amended  by chapter 257 of the laws of 2011, are amended to
 read as follows:
   1. "state authority" shall mean (A) a public authority or public bene-
 fit corporation created by or existing under this chapter or  any  other
 law  of the state of New York, with one or more of its members appointed
 by the governor or who serve as members by virtue  of  holding  a  civil
 office of the state, other than an interstate or international authority
 or  public  benefit  corporation,  including subsidiaries of such public
 authority or public  benefit  corporation;  OR  (B)  CERTAIN  MEMBERSHIP
 CORPORATIONS  AS DEFINED IN PARAGRAPH (D) OF SUBDIVISION FIVE OF SECTION
 FIFTY-THREE-A OF THE STATE FINANCE LAW.
   2. "local authority" shall mean (a) a public authority or public bene-
 fit corporation created by or existing under this chapter or  any  other
 law of the state of New York whose members do not hold a civil office of
 the  state,  are  not  appointed by the governor or are appointed by the
 governor specifically upon the recommendation of the local government or
 governments; (b) a not-for-profit corporation, OTHER THAN A FIRE  CORPO-
 RATION, A PUBLIC GROUP SELF-INSURER REGULATED UNDER THE WORKERS' COMPEN-
 SATION  LAW,  STATEWIDE  ASSOCIATION OF LOCAL GOVERNMENTS OR LOCAL OFFI-
 CIALS, OR BUSINESS IMPROVEMENT DISTRICT, affiliated with, sponsored  by,
 or  created  by  a county, city, town or village government; (c) a local
 industrial developmental agency or authority or other local public bene-
 fit corporation; (d) an affiliate of such local authority;  [or]  (e)  a
 land  bank  corporation  created pursuant to article sixteen of the not-
 for-profit corporation law; OR (F) A NOT-FOR-PROFIT  CORPORATION,  OTHER
 THAN A FIRE CORPORATION, A PUBLIC GROUP SELF-INSURER REGULATED UNDER THE
 WORKERS'  COMPENSATION LAW OR STATEWIDE ASSOCIATION OF LOCAL GOVERNMENTS
 OR LOCAL OFFICIALS, OR  BUSINESS  IMPROVEMENT  DISTRICT,  THAT  (I)  HAS
 ISSUED  OR  HAS  THE AUTHORITY TO ISSUE TAX EXEMPT DEBT OR (II) PROVIDES
 STATE OR MUNICIPAL TAX EXEMPTIONS THROUGH ITS PARTICIPATION IN A PROJECT
 UNDERTAKEN IN FURTHERANCE OF ITS PURPOSES.
 S. 6165                             4
 
   FOR THE PURPOSES OF PARAGRAPH (B) OF THE  OPENING  PARAGRAPH  OF  THIS
 SUBDIVISION,  "AFFILIATED  WITH,  SPONSORED  BY, OR CREATED BY A COUNTY,
 CITY, TOWN OR VILLAGE GOVERNMENT" SHALL ALSO INCLUDE, BUT NOT BE LIMITED
 TO, ENTITIES:  (A) WHERE ONE OR MORE INDIVIDUALS WHO SERVE  AS  OFFICERS
 OR  EMPLOYEES  OF  ANY COUNTY, CITY, TOWN, VILLAGE:  (I) SELECT EITHER A
 MAJORITY OF THE NOT-FOR-PROFIT CORPORATION'S BOARD OF DIRECTORS  OR  THE
 NOT-FOR-PROFIT  CORPORATION'S CHIEF EXECUTIVE OFFICER; (II) CONSTITUTE A
 MAJORITY OF THE VOTING STRENGTH THAT SELECTS EITHER A  MAJORITY  OF  THE
 NOT-FOR-PROFIT  CORPORATION'S  BOARD  OF  DIRECTORS OR THE CORPORATION'S
 CHIEF EXECUTIVE OFFICER; OR (III) SERVE AS: (1) A MAJORITY OF  THE  NOT-
 FOR-PROFIT  CORPORATION'S  BOARD  OF DIRECTORS; OR (2) IN THEIR OFFICIAL
 CAPACITY, THE NOT-FOR-PROFIT CORPORATION'S CHIEF EXECUTIVE  OFFICER;  OR
 (B)  WHICH  PAY  STAFF  OF A STATE OR LOCAL GOVERNMENT OR STATE OR LOCAL
 AUTHORITY TO PROVIDE ADMINISTRATIVE OR OPERATIONAL SUPPORT.
   § 9. Section 2829 of the public authorities law, as added by section 1
 of subpart B of part SS of chapter 58 of the laws of 2024, is amended to
 read as follows:
   § 2829. State and local authorities subject to the open  meetings  and
 freedom  of  information  laws. All state and local authorities, as such
 terms are defined in section two of this chapter, as well as all subsid-
 iaries AND AFFILIATES of such state and local authorities, as such terms
 are defined in section two of this chapter,  shall  be  subject  to  the
 provisions of articles six and seven of the public officers law relating
 to  the  freedom of information and open meetings laws respectively. All
 state and local authorities, as well as all subsidiaries AND  AFFILIATES
 of  such  state and local authorities, shall, to the extent practicable,
 stream all open meetings and public hearings on their website  in  real-
 time,  post video recordings of all open meetings and public hearings on
 their website within five business days of the meeting  or  hearing  and
 maintain such recordings for a period of not less than five years.
   §  10.  This act shall take effect on the thirtieth day after it shall
 have become a law; provided, however, that the  provisions  of  subpara-
 graph  2  of paragraph (d) and paragraph (i) of section 1411 of the not-
 for-profit corporation law, as amended by sections  five  and  seven  of
 this  act  shall  not  apply  retroactively  to  contracts or agreements
 between a local development corporation  and  a  municipal  corporation,
 state  or  local authority, or district entered into prior to the effec-
 tive date of this act.

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