BILL NO A02118
SAME AS SAME AS S05115
SPONSOR Paulin (MS)
COSPNSR Colton, Roberts
MLTSPNSR Jacobs, Robinson, Skartados, Thiele, Wright
Amd S63, Exec L; amd N-PC L, generally; add S97-j, St Fin L
Prohibits officers and family members of such officers of public charities from
receiving compensation; requires reasonable compensation when allowed; sets
certain compensation; establishes the state board training consortium;
establishes the state board training consortium fund; increases certain filing
fees to fund the state board training consortium fund.
TITLE OF BILL: An act to amend the executive law and not-for-profit
corporation law, in relation to prohibiting certain individuals from
receiving compensation from public charities; requires reasonable
compensation when allowed; establishes the state board training
consortium; and to amend the state finance law, in relation to
establishing the state board training consortium fund
PURPOSE OR GENERAL IDEA OF BILL: To provide clear and concise
requirements and procedures to ensure that compensation paid to
executives at not-for-profits funded by the State are reasonable and
SUMMARY OF SPECIFIC PROVISIONS:
Section one adds a new subdivision 16 to section 63 of the executive
law to authorize the attorney general to make inquiry into any
documents prepared for compliance with section 727 of the
not-for-profit corporation law, relating to the compensation of
Section two amends subparagraph 12 of subparagraph (a) of the
not-for-profit corporation law ("NPCL") to state that compensation is
subject, where applicable, to section 727 of the not-for-profit
Section three amends section 701 of the NPCL to disqualify employees
and their relatives from sitting on the board of the directors of the
corporation where they are employed.
Section four amends paragraph (a) of section 702 of the NPCL to
provide that not-for-profit corporations with annual gross receipts in
an amount that would trigger an audit and not-for-profit corporations
with annual gross receipts equal to or above $250,000 must have at
least five directors on their board.
Section five amends paragraph (a) of section 706 of the NPCL to
clarify that removal of directors for cause is to include violations
of NPCL 717, duty of directors and officers, or violation of the
bylaws or violation of the conflict of interest policy contained in
Section six amends NPCL 708, action by the board, to allow for
Unanimous Consent in Lieu of a Meeting to occur via Email delivery.
Section seven amends NPCL 711, notice of meetings of the board, to
allow for Email delivery.
Section eight amends NPCL 712 to disallow the Executive Committee from
fixing the compensation of directors, officers, staff or agents of the
corporation, making this a full board function.
Section nine amends NPCL 713, to disallow officers from receiving
compensation and to disallow them from holding more than one office.
Section ten amends NPCL 713 to law to disqualify employees and their
relatives from being compensated for fulfillment of their duties
toward the corporation.
Sections eleven and twelve amend NPCL 715 to allow the board to fix
director compensation for private foundations only and to disallow the
fixing of compensation for directors for public charities, and to
disallow the compensation of officers at public charities.
Section thirteen amends NPCL 717 to mandate that if there is
compensation that said compensation must be reasonable and be subject
to the new Section 727.
Sections fourteen and fifteen amend NPCL 719 to append joint and
several liability to directors who vote for excess compensation and to
call for subrogation of their rights to the corporation if there is a
reimbursement or penalty.
Section sixteen amends NPCL 720 to make it actionable against the
director for not following the new Section 727.
Section seventeen adds a new section 727 to the NPCL. It defines
compensation to match the IRS definition surrounding "excess benefit
transactions," while also matching the testing analysis and the
individuals subject to the test who are paid by the corporation, while
also exempting from the testing any paid staffer at a nonprofit who
paid at or below the Level I of the Rates of Basic Pay for Executives
Schedule promulgated by the US OPM. It also calls for testing as to
whether compensation is reasonable or not for any salaries over this
standard, with the testing being done in-house and only made available
upon request of the AG or if there is a lawsuit alleging payment of
Section eighteen amends section 104-A of the NPCL to increase various
filing fees by ten dollars.
Section nineteen amends section 116 of the NPCL to create the state
board training consortium.
Section twenty amends section 97-j of the state finance law to create
the state board training consortium fund.
Section twenty-one provides the effective date.
JUSTIFICATION: This legislation will enhance public trust and
accountability in New York State's public charities, and improve their
sustainability in serving our communities. It takes a targeted,
balanced and fair approach to the issues associated with public
charities' compensation and promotes self-regulating accountability by
public charities' boards. It imposes workable, necessary restrictions
on public charities' staff expenditures and enhances board
responsibilities, while avoiding the imposition of undue burdens on
small public charities.
PRIOR LEGISLATIVE HISTORY: A.10508 of 2012 referred to governmental
operations. Same as S.7565 (Marcellino) of 2012 referred to
investigations and government operations.
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: None.
EFFECTIVE DATE: This act shall take effect on the one hundred
eightieth day after it shall have become law.
S T A T E O F N E W Y O R K
2013-2014 Regular Sessions
I N A S S E M B L Y
January 9, 2013
Introduced by M. of A. PAULIN, COLTON, ROBERTS -- Multi-Sponsored by --
M. of A. JACOBS, ROBINSON, SKARTADOS, THIELE, WRIGHT -- read once and
referred to the Committee on Governmental Operations
AN ACT to amend the executive law and not-for-profit corporation law, in
relation to prohibiting certain individuals from receiving compen-
sation from public charities; requires reasonable compensation when
allowed; establishes the state board training consortium; and to amend
the state finance law, in relation to establishing the state board
training consortium fund
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
1 Section 1. Section 63 of the executive law is amended by adding a new
2 subdivision 16 to read as follows:
3 16. MAKE INQUIRY INTO ANY DOCUMENTS PREPARED UNDER SECTION SEVEN
4 HUNDRED TWENTY-SEVEN OF THE NOT-FOR-PROFIT CORPORATION LAW FOR COMPLI-
5 ANCE WITH THAT SECTION, BUT NOT MORE THAN ANNUALLY, AND RESPOND TO ANY
6 INQUIRY REFERRED TO UNDER SUCH SECTION SEVEN HUNDRED TWENTY-SEVEN OFFI-
7 CIALLY WITHIN NINETY DAYS OF RECEIPT.
8 S 2. Subparagraph 12 of paragraph (a) of section 202 of the not-for-
9 profit corporation law is amended to read as follows:
10 (12) To elect or appoint officers, employees and other agents of the
11 corporation, define their duties, fix their reasonable compensation and
12 the reasonable compensation of directors, and to indemnify corporate
13 personnel. Such compensation shall be commensurate with services
14 performed AND SUBJECT, WHERE APPLICABLE, TO SECTION SEVEN HUNDRED TWEN-
15 TY-SEVEN (COMPENSATION OF EXECUTIVES).
16 S 3. Section 701 of the not-for-profit corporation law is amended by
17 adding a new paragraph (c) to read as follows:
18 (C) AN EMPLOYEE OR A SPOUSE, DOMESTIC PARTNER, SIBLING (BY WHOLE OR
19 HALF BLOOD), SPOUSE OR DOMESTIC PARTNER OF A SIBLING (BY WHOLE OR HALF
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
A. 2118 2
1 BLOOD), CHILD, GRANDCHILD, GREAT-GRANDCHILD, AND SPOUSE OR DOMESTIC
2 PARTNER OF A CHILD, GRANDCHILD, AND GREAT-GRANDCHILD OF THE EMPLOYEE AT
3 A PUBLIC CHARITY, AS THAT TERM MAY BE DEFINED BY THE INTERNAL REVENUE
4 SERVICE FROM TIME-TO-TIME, MAY NOT QUALIFY TO SIT ON THE BOARD OF DIREC-
5 TORS OF THE CORPORATION WHERE THEY ARE EMPLOYED REGARDLESS OF ANY STATE-
6 MENT TO THE CONTRARY IN THE CERTIFICATE OF INCORPORATION OR BYLAWS OF
7 THE CORPORATION. THE CERTIFICATE OF INCORPORATION OR THE BYLAWS MAY,
8 HOWEVER, PROVIDE FOR AN EMPLOYEE AT A PUBLIC CHARITY, AS THAT TERM MAY
9 BE DEFINED BY THE INTERNAL REVENUE SERVICE FROM TIME-TO-TIME, TO BE
10 EX-OFFICIO, A NON-VOTING MEMBER OF THE BOARD OF DIRECTORS.
11 S 4. Paragraph (a) of section 702 of the not-for-profit corporation
12 law is amended to read as follows:
13 (a) [The] FOR NOT-FOR-PROFIT CORPORATIONS WITH ANNUAL GROSS RECEIPTS
14 IN AN AMOUNT THAT WOULD TRIGGER AN AUDIT BY A CERTIFIED PUBLIC ACCOUNT-
15 ANT, THE number of directors constituting the entire board shall be not
16 less than FIVE, OTHERWISE THE ENTIRE BOARD SHALL NOT BE LESS THAN
17 three. Subject to such limitation, such number may be fixed by the
18 by-laws or, in the case of a corporation having members, by action of
19 the members or of the board under the specific provisions of a by-law
20 adopted by the members. [If] FOR NOT-FOR-PROFIT CORPORATIONS WITH ANNUAL
21 GROSS RECEIPTS EQUAL TO OR ABOVE TWO HUNDRED FIFTY THOUSAND DOLLARS, IF
22 not otherwise fixed under this paragraph, the number shall be FIVE,
23 OTHERWISE IT SHALL BE three. As used in this article, "entire board"
24 means the total number of directors entitled to vote which the corpo-
25 ration would have if there were no vacancies.
26 S 5. Paragraph (a) of section 706 of the not-for-profit corporation
27 law is amended to read as follows:
28 (a) Except as limited in paragraph (c) OF THIS SECTION, any or all of
29 the directors may be removed for cause, WHICH IS EITHER A VIOLATION OF
30 THE BYLAWS, THE DUTY OF DIRECTORS AND OFFICERS OF SECTION SEVEN HUNDRED
31 SEVENTEEN (COMPENSATION OF EXECUTIVES), OR AS OTHERWISE DEFINED IN THE
32 BYLAWS IN THE WRITTEN CONFLICT OF INTEREST POLICY OF THE CORPORATION, by
33 vote of the members, or by vote of the directors provided there is a
34 quorum of not less than a majority present at the meeting of directors
35 at which such action is taken.
36 S 6. Paragraph (b) of section 708 of the not-for-profit corporation
37 law, as amended by chapter 92 of the laws of 1983, is amended to read as
39 (b) Unless otherwise restricted by the certificate of incorporation or
40 the by-laws, any action required or permitted to be taken by the board
41 or any committee thereof may be taken without a meeting if all members
42 of the board or the committee consent in writing to the adoption of a
43 resolution authorizing the action, WHERE SAID WRITING, OR UNANIMOUS
44 CONSENT IN LIEU OF A MEETING, IS DELIVERED, SUBMITTED AND SIGNED SEPA-
45 RATELY BY ALL MEMBERS OF THE BOARD OR THE COMMITTEE AND SUBMITTED BY
46 ELECTRONIC-MAIL, OR OTHER ELECTRONIC MEANS WITH AN ELECTRONIC RETURNED
47 RECEIPT, OR SIMILAR MESSAGE ATTACHED, DEMONSTRATING THAT THE UNANIMOUS
48 CONSENT IN LIEU OF A MEETING WAS INDEED DELIVERED PROPERLY. The resol-
49 ution and the written consents thereto by the members of the board or
50 committee shall be filed with the minutes of the proceedings of the
51 board or committee.
52 S 7. Paragraphs (b) and (d) of section 711 of the not-for-profit
53 corporation law are amended to read as follows:
54 (b) The by-laws may prescribe what shall constitute notice of meeting
55 of the board, OR WAIVER OF NOTICE, AND MAY BE DELIVERED VIA ELECTRONIC-
56 MAIL, OR OTHER ELECTRONIC MEANS WITH AN ELECTRONIC RETURNED RECEIPT, OR
A. 2118 3
1 SIMILAR MESSAGE ATTACHED, DEMONSTRATING THAT THE NOTICE, OR WAIVER OF
2 NOTICE, WAS INDEED DELIVERED PROPERLY. A notice, or waiver of notice,
3 need not specify the purpose of any regular or special meeting of the
4 board, unless required by the by-laws.
5 (d) A majority of the directors present, whether or not a quorum is
6 present, may adjourn any meeting to another time and place. If the
7 by-laws so provide, notice of any adjournment of a meeting of the board
8 to another time or place shall be given to the directors who were not
9 present at the time of the adjournment, AND MAY BE DONE BY
10 ELECTRONIC-MAIL, OR OTHER ELECTRONIC MEANS WITH AN ELECTRONIC RETURNED
11 RECEIPT, OR SIMILAR MESSAGE ATTACHED, DEMONSTRATING THAT THE NOTICE, OR
12 WAIVER OF NOTICE, WAS INDEED DELIVERED PROPERLY, and, unless such time
13 and place are announced at the meeting, to the other directors.
14 S 8. Subparagraph 3 of paragraph (a) of section 712 of the not-for-
15 profit corporation law is amended to read as follows:
16 (3) The fixing of compensation of the directors OR OFFICERS for serv-
17 ing on the board or on any committee, AND THE FIXING OF COMPENSATION FOR
18 KEY EMPLOYEES, AS THAT TERM MAY BE DEFINED BY THE INTERNAL REVENUE
19 SERVICE FROM TIME-TO-TIME, OR OTHER AGENTS OF THE CORPORATION AT ANY
21 S 9. Paragraph (a) of section 713 of the not-for-profit corporation
22 law is amended to read as follows:
23 (a) The board may elect or appoint a president, one or more vice-pre-
24 sidents, a secretary and a treasurer, and such other officers as it may
25 determine, or as may be provided in the by-laws. These officers may be
26 designated by such alternate titles as may be provided in the certif-
27 icate of incorporation or the by-laws. [Any] NO two or more offices may
28 be held by the same person[, except the offices of president and secre-
29 tary, or the offices corresponding thereto].
30 S 10. Section 713 of the not-for-profit corporation law is amended by
31 adding a new paragraph (f) to read as follows:
32 (F) AN OFFICER OR A SPOUSE, DOMESTIC PARTNER, SIBLING (BY WHOLE OR
33 HALF BLOOD), SPOUSE OR DOMESTIC PARTNER OF A SIBLING (BY WHOLE OR HALF
34 BLOOD), CHILD, GRANDCHILD, GREAT-GRANDCHILD, AND SPOUSE OR DOMESTIC
35 PARTNER OF A CHILD, GRANDCHILD, AND GREAT-GRANDCHILD OF THE OFFICER AT A
36 PUBLIC CHARITY, AS THAT TERM MAY BE DEFINED BY THE INTERNAL REVENUE
37 SERVICE FROM TIME-TO-TIME, MAY NOT RECEIVE COMPENSATION OR REMUNERATION
38 OF ANY KIND WHATSOEVER, EXCEPT TO BE REIMBURSED FOR REASONABLE EXPENSES
39 IN THE FULFILLMENT OF THEIR DUTIES TOWARD THE CORPORATION, WHERE SAID
40 PROHIBITION CANNOT BE CONTRAVENED IN THE CERTIFICATE OF INCORPORATION OR
41 BY-LAWS OF THE CORPORATION.
42 S 11. Paragraph (e) of section 715 of the not-for-profit corporation
43 law, as amended by chapter 847 of the laws of 1970, is amended to read
44 as follows:
45 (e) Unless otherwise provided in the certificate of incorporation or
46 the by-laws, the board shall have authority to fix the compensation of
47 directors OF A PRIVATE FOUNDATION, AS THAT TERM MAY BE DEFINED BY THE
48 INTERNAL REVENUE SERVICE FROM TIME-TO-TIME, for services in any capaci-
49 ty. AT NO TIME MAY THE DIRECTORS OF A PUBLIC CHARITY, AS THAT TERM MAY
50 BE DEFINED BY THE INTERNAL REVENUE SERVICE FROM TIME-TO-TIME, RECEIVE
51 COMPENSATION OR REMUNERATION OF ANY KIND WHATSOEVER, EXCEPT TO BE REIM-
52 BURSED FOR REASONABLE EXPENSES IN THE FULFILLMENT OF THEIR DUTIES TOWARD
53 THE CORPORATION, WHERE SAID PROHIBITION CANNOT BE CONTRAVENED IN THE
54 CERTIFICATE OF INCORPORATION OR BY-LAWS OF THE CORPORATION.
A. 2118 4
1 S 12. Paragraph (f) of section 715 of the not-for-profit corporation
2 law, as amended by chapter 1057 of the laws of 1971, is amended to read
3 as follows:
4 (f) The fixing of salaries of officers, [if not done in or pursuant to
5 the by-laws, shall require the affirmative vote of a majority of the
6 entire board unless a higher proportion is set by the certificate of
7 incorporation or by-laws] IN PUBLIC CHARITIES, AS THAT TERM MAY BE
8 DEFINED BY THE INTERNAL REVENUE SERVICE FROM TIME-TO-TIME, IS STRICTLY
10 S 13. Paragraph (a) of section 717 of the not-for-profit corporation
11 law, as amended by chapter 490 of the laws of 2010, is amended to read
12 as follows:
13 (a) Directors and officers shall discharge the duties of their respec-
14 tive positions in good faith and with the care an ordinarily prudent
15 person in a like position would exercise under similar circumstances.
16 The factors set forth in subparagraph one of paragraph (e) of section
17 552 (Standard of conduct in managing and investing an institutional
18 fund), if relevant, must be considered by a governing board delegating
19 investment management of institutional funds pursuant to section 514
20 (Delegation of investment management). For purposes of this paragraph,
21 the term institutional fund is defined in section 551 (Definitions).
22 FURTHERMORE, ANY COMPENSATION PROVIDED TO DIRECTORS, OFFICERS, EMPLOYEES
23 AND OTHER AGENTS OF THE CORPORATION MUST BE REASONABLE AND, WHERE APPLI-
24 CABLE, IS SUBJECT TO SECTION SEVEN HUNDRED TWENTY-SEVEN (COMPENSATION OF
26 S 14. Paragraph (a) of section 719 of the not-for-profit corporation
27 law is amended by adding a new subparagraph 6 to read as follows:
28 (6) THE PROVISION OF EXCESSIVE COMPENSATION TO DIRECTORS, OFFICERS,
29 KEY EMPLOYEES, AS THAT TERM MAY BE DEFINED BY THE INTERNAL REVENUE
30 SERVICE FROM TIME-TO-TIME, AND OTHER AGENTS OF THE CORPORATION IN
31 VIOLATION OF SECTION SEVEN HUNDRED TWENTY-SEVEN (COMPENSATION OF EXECU-
32 TIVES), WHERE APPLICABLE.
33 S 15. Paragraph (d) of section 719 of the not-for-profit corporation
34 law is amended by adding a new subparagraph 6 to read as follows:
35 (6) UPON REIMBURSEMENT TO THE CORPORATION OF THE AMOUNT OF ANY EXCES-
36 SIVE COMPENSATION PROVIDED IN VIOLATION OF SECTION SEVEN HUNDRED TWEN-
37 TY-SEVEN (COMPENSATION OF EXECUTIVES), TO BE SUBROGATED TO THE RIGHTS OF
38 THE CORPORATION AGAINST A DIRECTOR, OFFICER, KEY EMPLOYEE, AS THAT TERM
39 MAY BE DEFINED BY THE INTERNAL REVENUE SERVICE FROM TIME-TO-TIME, OR
40 OTHER AGENT WHO RECEIVED THE EXCESSIVE COMPENSATION.
41 S 16. Clauses (A) and (B) of subparagraph 1 of paragraph (a) of
42 section 720 of the not-for-profit corporation law are amended to read as
44 (A) The neglect of, [or] THE failure to perform, or ANY other
45 violation of his OR HER duties in the management and disposition of
46 corporate assets committed to his charge.
47 (B) The acquisition by himself OR HERSELF, transfer to others, loss or
48 waste of corporate assets due to any neglect of, [or] THE failure to
49 perform, or ANY other violation of his duties, INCLUDING VIOLATIONS OF
50 SECTION SEVEN HUNDRED TWENTY-SEVEN (COMPENSATION OF EXECUTIVES), PURSU-
51 ANT TO SECTION SEVEN HUNDRED SEVENTEEN (DUTY OF DIRECTORS AND OFFICERS).
52 S 17. The not-for-profit corporation law is amended by adding a new
53 section 727 to read as follows:
54 S 727. COMPENSATION OF EXECUTIVES.
55 (A) DEFINITIONS. FOR THE PURPOSES OF THIS SECTION, UNLESS OTHERWISE
56 EXPRESSLY STATED OR CONTEXT CLEARLY REQUIRES:
A. 2118 5
1 (1) "COMPENSATION" MEANS THE AGGREGATE VALUE OF ECONOMIC BENEFITS
2 CONFERRED IN EXCHANGE FOR THE PERFORMANCE OF SERVICES THAT ARE INCLUDED
3 FOR PURPOSES OF DETERMINING REASONABLENESS UNDER SECTION 26 U.S.C. 4958,
4 AS FURTHER SPECIFIED IN 26 CFR S53.4958-4(B)(II)(B), OR SUCCEEDING
6 (2) "EXECUTIVE" MEANS ANY PERSON IN A POSITION TO EXERCISE SUBSTANTIAL
7 INFLUENCE OVER THE AFFAIRS OF A PROVIDER OF SERVICES, THAT DOES NOT SIT
8 ON THE GOVERNING BODY OF THE TAX-EXEMPT ORGANIZATION AS REFERENCED IN 26
9 U.S.C. S4958(F)(1)(A) AND FURTHER SPECIFIED IN 26 CFR S53.4958-3(C), OR
10 SUCCEEDING PROVISIONS.
11 (3) "FAMILY MEMBER" MEANS A SPOUSE, DOMESTIC PARTNER, SIBLING (BY
12 WHOLE OR HALF BLOOD), SPOUSE OR DOMESTIC PARTNER OF A SIBLING (BY WHOLE
13 OR HALF BLOOD), CHILD, GRANDCHILD, GREAT-GRANDCHILD, AND SPOUSE OR
14 DOMESTIC PARTNER OF A CHILD, GRANDCHILD, AND GREAT-GRANDCHILD.
15 (B) COMPENSATION EXCHANGED BY A NOT-FOR-PROFIT CORPORATION FOR THE
16 PERFORMANCE OF SERVICES BY AN EXECUTIVE MUST NOT BE EXCESSIVE AND THE
17 GOVERNING BODY (I.E., THE BOARD OF DIRECTORS, BOARD OF TRUSTEES, OR
18 EQUIVALENT CONTROLLING BODY) SHALL CONSIDER FACTORS INCLUDING, BUT NOT
19 LIMITED TO: COMPENSATION LEVELS PAID BY SIMILARLY SITUATED NOT-FOR-PRO-
20 FIT CORPORATIONS AS DEFINED IN SECTION ONE HUNDRED TWO (DEFINITIONS);
21 THE AVAILABILITY OF SIMILAR SERVICES IN THE GEOGRAPHIC AREA OF THE
22 APPLICABLE PROVIDER OF SERVICES; CURRENT COMPENSATION SURVEYS COMPILED
23 BY INDEPENDENT FIRMS; AND ACTUAL WRITTEN OFFERS FROM SIMILAR INSTI-
24 TUTIONS COMPETING FOR THE SERVICES OF THE APPLICABLE EXECUTIVE.
25 FOR THE PURPOSES OF THIS SECTION, WHETHER AN ORGANIZATION IS SIMILARLY
26 SITUATED SHALL BE DETERMINED BASED ON FACTORS INCLUDING, BUT NOT LIMITED
27 TO: GROSS ANNUAL REVENUE; GEOGRAPHIC LOCATION; AND THE DIVERSITY AND
28 COMPLEXITY OF PROGRAMS.
29 (C) ANNUAL COMPENSATION EXCHANGED BY A NOT-FOR-PROFIT CORPORATION FOR
30 THE PERFORMANCE OF SERVICES BY AN EXECUTIVE SHALL BE CONSIDERED REASON-
31 ABLE IF IT FALLS AT OR BELOW THE LEVEL I OF THE FEDERAL GOVERNMENT'S
32 RATES OF BASIC PAY FOR THE EXECUTIVE SCHEDULE PROMULGATED BY THE UNITED
33 STATES OFFICE OF PERSONNEL MANAGEMENT AND NO OTHER ACTION UNDER THIS
34 SECTION NEEDS TO BE TAKEN.
35 (D) ANNUAL COMPENSATION EXCHANGED BY A NOT-FOR-PROFIT CORPORATION FOR
36 THE PERFORMANCE OF SERVICES BY AN EXECUTIVE THAT DOES EXCEED LEVEL I OF
37 THE FEDERAL GOVERNMENT'S RATES OF BASIC PAY FOR THE EXECUTIVE SCHEDULE
38 SHALL BE PRESUMED TO NOT BE EXCESSIVE IF EACH OF THE FOLLOWING FOUR
39 CONDITIONS OCCUR:
40 (1) THE COMPENSATION IS APPROVED IN ADVANCE BY THE GOVERNING BODY
41 (I.E., THE BOARD OF DIRECTORS, BOARD OF TRUSTEES, OR EQUIVALENT CONTROL-
42 LING BODY) OF THE NOT-FOR-PROFIT CORPORATION THAT IS COMPOSED ENTIRELY
43 OF INDIVIDUALS WHO DO NOT HAVE A CONFLICT OF INTEREST WITH RESPECT TO
44 THE COMPENSATION ARRANGEMENT.
45 (A) FOR THE PURPOSES OF DETERMINING WHETHER THE REQUIREMENTS OF THIS
46 PARAGRAPH HAVE BEEN MET WITH RESPECT TO A SPECIFIC COMPENSATION ARRANGE-
47 MENT, AN INDIVIDUAL IS NOT INCLUDED IN THE GOVERNING BODY WHEN IT IS
48 REVIEWING A TRANSACTION IF THAT INDIVIDUAL MEETS WITH OTHER MEMBERS ONLY
49 TO ANSWER QUESTIONS, AND OTHERWISE RECUSES HIMSELF OR HERSELF FROM THE
50 MEETING AND IS NOT PRESENT DURING DEBATE AND VOTING ON THE COMPENSATION
52 (B) A MEMBER OF THE GOVERNING BODY DOES NOT HAVE A CONFLICT OF INTER-
53 EST WITH RESPECT TO A COMPENSATION ARRANGEMENT ONLY IF THE MEMBER:
54 (I) IS NOT AN EXECUTIVE PARTICIPATING IN, OR ECONOMICALLY BENEFITING
55 FROM, THE COMPENSATION ARRANGEMENT;
A. 2118 6
1 (II) IS NOT IN AN EMPLOYMENT RELATIONSHIP SUBJECT TO THE DIRECTION OR
2 CONTROL OF ANY EXECUTIVE, OR THE FAMILY MEMBER OF ANY EXECUTIVE, PARTIC-
3 IPATING IN OR ECONOMICALLY BENEFITING FROM THE COMPENSATION ARRANGEMENT;
4 (III) DOES NOT RECEIVE COMPENSATION OR OTHER PAYMENT SUBJECT TO
5 APPROVAL BY ANY EXECUTIVE, OR THE FAMILY MEMBER OF ANY EXECUTIVE,
6 PARTICIPATING IN OR ECONOMICALLY BENEFITING FROM THE COMPENSATION
8 (IV) HAS NO MATERIAL FINANCIAL INTEREST AFFECTED BY THE COMPENSATION
9 ARRANGEMENT; AND
10 (V) DOES NOT APPROVE A TRANSACTION PROVIDING ECONOMIC BENEFITS TO ANY
11 EXECUTIVE, OR THE FAMILY MEMBER OF ANY EXECUTIVE, PARTICIPATING IN THE
12 COMPENSATION ARRANGEMENT, WHO IN TURN HAS APPROVED OR WILL APPROVE A
13 TRANSACTION PROVIDING ECONOMIC BENEFITS TO THE MEMBER.
14 (2) THE GOVERNING BODY OBTAINED AND RELIED UPON APPROPRIATE DATA AS TO
15 COMPARABILITY PRIOR TO MAKING ITS DETERMINATION AND GIVEN THE KNOWLEDGE
16 AND EXPERTISE OF ITS MEMBERS, IT HAS INFORMATION SUFFICIENT TO DETERMINE
17 WHETHER THE COMPENSATION ARRANGEMENT IN ITS ENTIRETY IS REASONABLE.
18 RELEVANT INFORMATION INCLUDES, BUT IS NOT LIMITED TO: COMPENSATION
19 LEVELS PAID BY SIMILARLY SITUATED NOT-FOR-PROFIT CORPORATIONS AS DEFINED
20 IN SECTION ONE HUNDRED TWO (DEFINITIONS); THE AVAILABILITY OF SIMILAR
21 SERVICES IN THE GEOGRAPHIC AREA OF THE APPLICABLE PROVIDER OF SERVICES;
22 CURRENT COMPENSATION SURVEYS COMPILED BY INDEPENDENT FIRMS; AND ACTUAL
23 WRITTEN OFFERS FROM SIMILAR INSTITUTIONS COMPETING FOR THE SERVICES OF
24 THE APPLICABLE EXECUTIVE.
25 (A) FOR PURPOSES OF THIS PARAGRAPH, CONTROL BY AN APPLICABLE NOT-FOR-
26 PROFIT CORPORATION MEANS:
27 (I) IN THE CASE OF A STOCK CORPORATION, OWNERSHIP (BY VOTE OR VALUE)
28 OF MORE THAN FIFTY PERCENT OF THE STOCK IN SUCH CORPORATION;
29 (II) IN THE CASE OF A PARTNERSHIP, OWNERSHIP OF MORE THAN FIFTY
30 PERCENT OF THE PROFITS INTERESTS OR CAPITAL INTERESTS IN THE PARTNER-
32 (III) IN THE CASE OF A NONSTOCK ORGANIZATION (I.E., AN ENTITY IN WHICH
33 NO PERSON HOLDS A PROPRIETARY INTEREST), THAT AT LEAST FIFTY PERCENT OF
34 THE DIRECTORS OR TRUSTEES OF THE NOT-FOR-PROFIT CORPORATION ARE EITHER
35 REPRESENTATIVES (INCLUDING TRUSTEES, DIRECTORS, AGENTS, OR EMPLOYEES)
36 OF, OR DIRECTLY OR INDIRECTLY CONTROLLED BY, AN APPLICABLE TAX-EXEMPT
37 ORGANIZATION; OR
38 (IV) IN THE CASE OF ANY OTHER ENTITY, OWNERSHIP OF MORE THAN FIFTY
39 PERCENT OF THE BENEFICIAL INTEREST IN THE ENTITY.
40 (3) THE GOVERNING BODY ADEQUATELY DOCUMENTED THE BASIS FOR ITS DETER-
41 MINATION CONCURRENTLY WITH MAKING THAT DETERMINATION.
42 (A) FOR A DECISION TO BE DOCUMENTED ADEQUATELY, THE WRITTEN OR ELEC-
43 TRONIC RECORDS OF THE GOVERNING BODY MUST NOTE:
44 (I) THE TERMS OF THE TRANSACTION THAT WAS APPROVED, AND THE DATE IT
45 WAS APPROVED;
46 (II) THE MEMBERS OF THE GOVERNING BODY WHO WERE PRESENT DURING DEBATE
47 ON THE TRANSACTION THAT WAS APPROVED, AND THOSE WHO VOTED ON IT;
48 (III) THE COMPARABILITY DATA OBTAINED AND RELIED UPON BY THE GOVERNING
49 BODY, AND HOW THE DATA WAS OBTAINED; AND
50 (IV) ANY ACTIONS TAKEN WITH RESPECT TO CONSIDERATION OF THE TRANS-
51 ACTION BY ANYONE WHO IS OTHERWISE A MEMBER OF THE GOVERNING BODY BUT WHO
52 HAD A CONFLICT OF INTEREST WITH RESPECT TO THE TRANSACTION.
53 (B) IF THE GOVERNING BODY DETERMINES THAT THE EXECUTIVE'S COMPENSATION
54 FOR A SPECIFIC ARRANGEMENT IS HIGHER OR LOWER THAN THE RANGE OF COMPAR-
55 ABILITY DATA OBTAINED, THE GOVERNING BODY MUST RECORD THE BASIS FOR ITS
56 DETERMINATION. FOR A DECISION TO BE DOCUMENTED CONCURRENTLY RECORDS MUST
A. 2118 7
1 BE PREPARED BEFORE THE LATER OF THE NEXT MEETING OF THE GOVERNING BODY
2 OR SIXTY DAYS AFTER THE FINAL ACTION OR ACTIONS OF THE GOVERNING BODY
3 ARE TAKEN. RECORDS MUST BE REVIEWED AND APPROVED BY THE GOVERNING BODY
4 AS REASONABLE, ACCURATE AND COMPLETE WITHIN A REASONABLE TIME PERIOD
6 (4) THE COMPENSATION PROVIDED TO THE EXECUTIVE BY THE GOVERNING BODY
7 DOES NOT EXCEED THE HIGHEST COMPENSATION PROVIDED BY A SIMILARLY SITU-
8 ATED ORGANIZATION FOR SIMILAR SERVICES, AS IDENTIFIED IN THE COMPARABIL-
9 ITY DATA, BY MORE THAN TWENTY PERCENT.
10 (E) IF THE FOUR CONDITIONS OF PARAGRAPH (D) OF THIS SECTION ARE SATIS-
11 FIED, THEN THE PERSON OR ENTITY BRINGING AN ACTION FOR RELIEF PURSUANT
12 TO SECTION SEVEN HUNDRED TWENTY-SEVEN OF THIS ARTICLE MAY REBUT THE
13 PRESUMPTION THAT ARISES UNDER PARAGRAPH (D) OF THIS SECTION ONLY IF IT
14 DEVELOPS SUFFICIENT CONTRARY EVIDENCE TO REBUT THE PROBATIVE VALUE OF
15 THE COMPARABILITY DATA RELIED UPON BY THE GOVERNING BODY. WITH RESPECT
16 TO ANY FIXED PAYMENT, REBUTTAL EVIDENCE IS LIMITED TO EVIDENCE RELATING
17 TO FACTS AND CIRCUMSTANCES EXISTING ON THE DATE THE PARTIES ENTER INTO
18 THE CONTRACT PURSUANT TO WHICH THE PAYMENT IS MADE (EXCEPT IN THE EVENT
19 OF SUBSTANTIAL NONPERFORMANCE). WITH RESPECT TO ALL OTHER PAYMENTS,
20 REBUTTAL EVIDENCE MAY INCLUDE FACTS AND CIRCUMSTANCES UP TO AND INCLUD-
21 ING THE DATE OF PAYMENT.
22 (F) A NOT-FOR-PROFIT IS PROHIBITED FROM, AND MAY THUS BE REFERRED TO
23 THE ATTORNEY GENERAL FOR FURTHER INQUIRY TO BE OFFICIALLY RESPONDED TO
24 WITHIN NINETY DAYS OF RECEIPT, BY THE PERSON OR ENTITY BRINGING AN
25 ACTION FOR RELIEF PURSUANT TO THIS SECTION: (1) ENGAGING IN ANY ACT THAT
26 THE INTERNAL REVENUE SERVICE DETERMINES CONSTITUTES AN "EXCESS BENEFIT
27 TRANSACTION" UNDER SECTION 4958 OF THE INTERNAL REVENUE CODE; OR (2)
28 ENGAGING IN ANY ACT THAT WOULD CONSTITUTE AN "EXCESS BENEFIT TRANS-
29 ACTION" UNDER THE STANDARDS OF SECTION 4958 OF THE INTERNAL REVENUE
31 S 18. Section 104-A of the not-for-profit corporation law, as added by
32 chapter 591 of the laws of 1982, paragraphs (a), (c), (d), (e), (g),
33 (l), (m), (n) and (p) as amended by chapter 166 of the laws of 1991 and
34 paragraph (r) as amended by chapter 198 of the laws of 1984, is amended
35 to read as follows:
36 S 104-A. Fees.
37 Except as otherwise provided, the department of state shall collect
38 the following fees pursuant to this chapter:
39 (a) For filing a certificate of type of not-for-profit corporation
40 pursuant to section one hundred thirteen of this [chapter] ARTICLE,
41 thirty dollars.
42 (b) For the reservation of a corporate name pursuant to section three
43 hundred three of this chapter, ten dollars.
44 (c) For the resignation of a registered agent for service of process
45 pursuant to section three hundred five of this chapter, thirty dollars.
46 (d) For service of process on the secretary of state pursuant to
47 section three hundred six or three hundred seven of this chapter, forty
48 dollars. If the service is in an action brought solely to recover a sum
49 of money not in excess of two hundred dollars and the process is so
50 endorsed, or the process is served on behalf of a county, city, town or
51 village or other subdivision of the state, ten dollars.
52 (e) For filing a certificate of incorporation pursuant to section four
53 hundred two of this chapter, [seventy-five] EIGHTY-FIVE dollars.
54 (f) For filing a certificate of amendment pursuant to section eight
55 hundred three of this chapter, [thirty] FORTY dollars.
A. 2118 8
1 (g) For filing a certificate of change pursuant to section eight
2 hundred three-A of this chapter, [twenty] THIRTY dollars.
3 (h) For filing a restated certificate of incorporation pursuant to
4 section eight hundred five of this chapter, [thirty] FORTY dollars.
5 (i) For filing a certificate of merger or consolidation pursuant to
6 section nine hundred four of this chapter, [thirty] FORTY dollars.
7 (j) For filing a certificate of merger or consolidation of domestic
8 and foreign corporations pursuant to section nine hundred six of this
9 chapter, [thirty] FORTY dollars.
10 (k) For filing a certified copy of an order of approval of the
11 supreme court pursuant to section nine hundred seven of this chapter,
12 thirty dollars.
13 (l) For filing a certificate of dissolution pursuant to section one
14 thousand three of this chapter, thirty dollars.
15 (m) For filing a certificate of annulment of dissolution pursuant to
16 section one thousand twelve of this chapter, [thirty] FORTY dollars.
17 (n) For filing an application by a foreign corporation for authority
18 to do business in New York state pursuant to section thirteen hundred
19 four of this chapter, one hundred [thirty-five] FORTY-FIVE dollars.
20 (o) For filing a certificate of amendment of an application for
21 authority by a foreign corporation pursuant to section thirteen hundred
22 nine of this chapter, [thirty] FORTY dollars.
23 (p) For filing a certificate of change of application for authority by
24 a foreign corporation pursuant to section thirteen hundred ten of this
25 chapter, [twenty] THIRTY dollars.
26 (q) For filing a certificate of surrender of authority pursuant to
27 section thirteen hundred eleven of this chapter, thirty dollars.
28 (r) For filing a statement of the termination of existence of a
29 foreign corporation pursuant to section thirteen hundred twelve of this
30 chapter, thirty dollars. There shall be no fee for the filing by an
31 authorized officer of the jurisdiction of incorporation of a foreign
32 corporation of a certificate that the foreign corporation has been
33 dissolved or its authority or existence has been otherwise terminated or
34 cancelled in the jurisdiction of its incorporation.
35 (s) For filing any other certificate or instrument, thirty dollars.
36 S 19. The not-for-profit corporation law is amended by adding a new
37 section 116 to read as follows:
38 S 116. STATE BOARD TRAINING CONSORTIUM.
39 (A) NOT-FOR-PROFIT BOARD MEMBERS ARE ENTRUSTED WITH THE OVERALL
40 MANAGEMENT AND OVERSIGHT OF NON-PROFITS AND HAVE LEGAL AND ETHICAL OBLI-
41 GATIONS TO KEEP THEMSELVES FULLY INFORMED REGARDING THEIR ORGANIZATION,
42 ITS FINANCES AND ITS OVERALL OPERATION AND IN ASSURING THAT PROGRAM
43 STAFF AND ADMINISTRATION EFFECTIVELY CARRY OUT THE ORGANIZATION'S
44 MISSION. THE STATE BOARD TRAINING CONSORTIUM IS INTENDED TO EMPOWER
45 BOARD MEMBERS OF NOT-FOR-PROFIT ORGANIZATIONS WHO CONTRACT WITH THE
46 STATE OF NEW YORK WITH THE INFORMATION AND TOOLS NECESSARY TO CARRY OUT
47 THEIR VERY IMPORTANT RESPONSIBILITIES, ROLES AND OBLIGATIONS. THE STATE
48 BOARD TRAINING CONSORTIUM WILL BE A COMPREHENSIVE STATE-WIDE TRAINING
49 EFFORT, DELIVERED REGIONALLY, IN-PERSON, TOGETHER WITH A NUMBER OF
50 TAILORED AGENCY SPECIFIC ONSITE TRAININGS, SOME VIRTUAL WEBINARS, AND
51 THE LIKE, AND STATE WORKFORCE TRAININGS ON THE SAME OR SIMILAR SUBJECTS.
52 ANY TRAINING CONDUCTED UNDER THE AUSPICES OF THE STATE BOARD TRAINING
53 CONSORTIUM WILL BE FREE TO VERIFIED MEMBERS OF NOT-FOR-PROFIT BOARDS OF
54 DIRECTORS WHO CONTRACT WITH THE STATE OF NEW YORK.
55 (1) FEES GENERATED FROM THE TEN DOLLAR INCREASE IN THE FILING FEES
56 ASSOCIATED WITH CERTIFICATES OF INCORPORATION, AMENDMENT, CHANGE, MERGER
A. 2118 9
1 OR CONSOLIDATION, ANNULMENT OF DISSOLUTION, AUTHORITY BY A FOREIGN
2 CORPORATION, AN AMENDMENT OF SAME OR A CHANGE IN THE AUTHORITY OF A
3 FOREIGN CORPORATION PROMULGATED BY A CHAPTER OF THE LAWS OF 2013, SHALL
4 BE USED TO FUND THE STATE BOARD TRAINING CONSORTIUM.
5 (2) SAID FEES SHALL BE MAINTAINED IN THE STATE BOARD TRAINING CONSOR-
6 TIUM FUND, AS ESTABLISHED BY SECTION NINETY-SEVEN-J OF THE STATE FINANCE
7 LAW, TO SUPPORT THE STATE BOARD TRAINING CONSORTIUM ESTABLISHED BY THIS
9 (B) THE STATE BOARD TRAINING CONSORTIUM SHALL BE ADMINISTERED BY THE
10 DEPARTMENT OF STATE THROUGH A CONTRACT UNDER COUNSEL'S OFFICE. A QUALI-
11 FIED NOT-FOR-PROFIT CORPORATION WILL BE CONTRACTED WITH BY THE DEPART-
12 MENT OF STATE TO PROVIDE THE TRAINING AND ASSOCIATED SERVICES DELIVERED
13 UNDER THE STATE BOARD TRAINING CONSORTIUM, TOGETHER WITH MANAGING ALL
14 DAY-TO-DAY OPERATIONS, MARKETING EFFORTS, CURRICULUM UPDATES, PRINTING
15 AND RECORD-KEEPING. THE CONTRACT SHALL HAVE A FIVE YEAR TERM, RENEWABLE
16 FOR THREE ADDITIONAL YEARS, AND A STANDARD REQUEST FOR PROPOSALS/REQUEST
17 FOR QUALIFICATIONS PROCESS WILL BE UTILIZED AT THE INCEPTION OF EACH
19 (1) THE COMMISSIONERS OF THE OFFICE FOR PEOPLE WITH DEVELOPMENTAL
20 DISABILITIES, OFFICE OF MENTAL HEALTH, OFFICE OF ALCOHOLISM AND
21 SUBSTANCE ABUSE SERVICES, OFFICE OF CHILDREN AND FAMILY SERVICES, AND
22 DEPARTMENT OF HEALTH, HAVING PRIOR EXPERIENCE IN THE STATE BOARD TRAIN-
23 ING CONSORTIUM AS ADMINISTERED BY OFFICE OF ALCOHOLISM AND SUBSTANCE
24 ABUSE SERVICES, AND THE DEPARTMENT OF HEALTH, AIDS INSTITUTE, SHALL
26 (I) DEVELOP A CONTRACT FOR THE STATE BOARD TRAINING CONSORTIUM ALONG
27 THE LINES ALREADY PROMULGATED BY THEIR AGENCIES;
28 (II) ESTABLISH UNIFORM PROCEDURES TO MONITOR ATTENDANCE AT TRAININGS
29 CONDUCTED UNDER THE STATE BOARD TRAINING CONSORTIUM AND IN REPORTING THE
30 SAME TO THE ATTENDING BOARDS OF DIRECTORS.
31 (2) THE COMMISSIONERS OF OTHER AGENCIES, INCLUDING BUT NOT LIMITED TO
32 THE OFFICE FOR THE AGING, DEPARTMENT OF AGRICULTURE AND MARKETS, COUNCIL
33 ON THE ARTS, OFFICE OF COURT ADMINISTRATION, DIVISION OF CRIMINAL
34 JUSTICE SERVICES, EMPIRE STATE DEVELOPMENT, DEPARTMENT OF ENVIRONMENTAL
35 CONSERVATION, OFFICE OF GENERAL SERVICES, NEW YORK STATE CANAL CORPO-
36 RATION AND THE OFFICE OF TEMPORARY AND DISABILITY ASSISTANCE SHALL
37 ESTABLISH PROCEDURES TO MONITOR ATTENDANCE AT TRAININGS CONDUCTED UNDER
38 THE STATE BOARD TRAINING CONSORTIUM AND IN REPORTING THE SAME TO THE
39 ATTENDING BOARDS OF DIRECTORS.
40 (C) ALL NOT-FOR-PROFIT CORPORATIONS THAT CONTRACT WITH THE STATE OF
41 NEW YORK MAY ATTEND THE STATE BOARD TRAINING CONSORTIUM TRAININGS FREE
42 OF CHARGE.
43 S 20. The state finance law is amended by adding a new section 97-j to
44 read as follows:
45 S 97-J. STATE BOARD TRAINING CONSORTIUM FUND. 1. THERE IS HEREBY
46 ESTABLISHED IN THE JOINT CUSTODY OF THE COMMISSIONER OF TAXATION AND
47 FINANCE AND THE COMPTROLLER A FUND TO BE KNOWN AS THE "STATE BOARD
48 TRAINING CONSORTIUM FUND."
49 2. SUCH FUND SHALL CONSIST OF FEES GENERATED FROM THE TEN DOLLAR
50 INCREASE IN FILING FEES IN PARAGRAPHS (E), (F), (G), (H), (I), (J), (M),
51 (N), (O) AND (P) OF SECTION ONE HUNDRED FOUR-A OF THE NOT-FOR-PROFIT
52 CORPORATION LAW, ASSOCIATED WITH CERTIFICATES OF INCORPORATION, AMEND-
53 MENT, CHANGE, MERGER OR CONSOLIDATION, ANNULMENT OF DISSOLUTION, AUTHOR-
54 ITY BY A FOREIGN CORPORATION, AN AMENDMENT OF SAME OR A CHANGE IN THE
55 AUTHORITY OF A FOREIGN CORPORATION, PROMULGATED BY THE CHAPTER OF THE
56 LAWS OF TWO THOUSAND THIRTEEN THAT ADDED THIS SECTION, AND ALL OTHER
A. 2118 10
1 MONEYS CREDITED OR APPROPRIATED FOR TRANSFER THERETO FROM ANY OTHER FUND
2 OR SOURCE ACCORDING TO LAW.
3 3. MONEYS IN THE STATE BOARD TRAINING CONSORTIUM FUND SHALL BE KEPT
4 SEPARATE AND SHALL NOT BE COMMINGLED WITH ANY OTHER MONEYS IN THE CUSTO-
5 DY OF THE STATE COMPTROLLER. MONEYS IN THE FUND MAY BE INVESTED BY THE
6 COMPTROLLER PURSUANT TO THE PROVISIONS OF SECTION NINETY-EIGHT-A OF THIS
7 ARTICLE AND ANY INCOME RECEIVED BY THE COMPTROLLER FROM SUCH INVESTMENTS
8 SHALL BE ADDED TO AND BECOME PART OF, AND SHALL BE USED FOR THE PURPOSES
9 OF SUCH FUND. ALL DEPOSITS OF SUCH MONEY SHALL, IF REQUIRED BY THE COMP-
10 TROLLER, BE SECURED BY OBLIGATIONS OF THE UNITED STATES OR OF THE STATE
11 OF MARKET VALUE EQUAL AT ALL TIMES TO THE AMOUNT OF THE DEPOSIT AND ALL
12 BANKS AND TRUST COMPANIES ARE AUTHORIZED TO GIVE SUCH SECURITIES FOR
13 SUCH DEPOSITS.
14 4. MONEYS IN THE FUND, FOLLOWING APPROPRIATION BY THE LEGISLATURE,
15 SHALL BE ALLOCATED UPON A CERTIFICATE OF APPROVAL OF AVAILABILITY BY THE
16 DIRECTOR OF THE BUDGET SOLELY FOR THE PURPOSES SET FORTH IN THIS
18 5. ALL MONEYS IN THE FUND SHALL BE MADE AVAILABLE PURSUANT TO APPRO-
19 PRIATION FOR USE IN FUNDING THE STATE BOARD TRAINING CONSORTIUM ESTAB-
20 LISHED PURSUANT TO SECTION ONE HUNDRED SIXTEEN OF THE NOT-FOR-PROFIT
21 CORPORATION LAW.
22 S 21. (a) This act shall take effect on the one hundred eightieth day
23 after it shall have become law.
24 (b) The commissioners of the office for people with developmental
25 disabilities, office of mental health, office of alcoholism and
26 substance abuse services, office of children and family services,
27 department of health, office for the aging, and the division of criminal
28 justice services shall immediately take the necessary actions to ensure
29 that forms and regulations required by section nine of this act are in
30 place on such effective date. Further, whereas the authority to promul-
31 gate regulations and make rules is derived from an express or implicit
32 statutory grant provided by the legislature, all agencies, divisions and
33 departments of the state are hereby prohibited from promulgating regu-
34 lations and making rules pursuant to 9 NYCRR 8.38, or that otherwise
35 address the extent and nature of a provider's administrative costs and
36 executive compensation, except as required and necessary to implement
37 the provisions of section six of this act.
38 (c) Absent explicit language expressly and unequivocally stating a
39 legislative intent to the contrary, all provisions of this act are irre-
40 futably presumed to operate in a wholly prospective manner. Provisions
41 shall be considered to operate retroactively, and therefore in violation
42 of this act, if applied in such a manner as to alter, change, affect,
43 impair or defeat any rights, obligations, duties or interests accrued,
44 incurred or conferred prior to the effective date of this act. Further-
45 more, the provisions of this act shall neither apply to, nor be applied
46 based upon the occasion of, acts occurring prior to it becoming law.