Amd Arts 4 & 15-A, add Arts 7-B - 7-D, S1 of Chap 154 of 1921
Relates to the organization, open meetings, public hearings, financial reporting and disposition of property of the Port Authority of New York and New Jersey.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A8298
SPONSOR: Brennan (MS) TITLE OF BILL:
An act to amend chapter 154 of the laws of 1921 relating to the port
authority of New York and New Jersey, in relation to port authority
organization, open meetings, public hearings, financial reporting and
handling of property
PURPOSE:
This bill would enact the "Port Authority of New York and New Jersey
Transparency and Accountability Act of 2015."
SUMMARY OF PROVISIONS:
Section one of the bill would set forth the title of the Act as the
"Port Authority of New York and New Jersey Transparency and Accountabil-
ity Act of 2015.
Section two would amend Article IV of chapter 154 of the Laws of 1921 to
strengthen the governance of the Port Authority of New York and New
Jersey ("Port Authority") and implement stronger accountability measures
for the Port Authority's Board of Commissioners ("Commissioners), offi-
cers, and employees, including:
*Beginning upon the next hiring of a Chief Executive Officer but no less
than one year from the effective date of this act, the Chairperson and
Vice Chairperson shall be rotated for a term of two years among the
Board of Commissioners, beginning with a Chairperson appointed by the
Governor of New York, and the Vice Chairperson appointed by the Governor
of New Jersey, respectively;
*Prohibiting a Commissioner, including the Chairperson, from serving as
the Port Authority's Chief Executive Officer or as any other officer
while serving as a Commissioner;
*Appointing a Chief Ethics and Compliance Officer who shall enforce
compliance with applicable laws and best practices, bolstering the
authority of the Port Authority's Inspector General, and establishing a
whistleblower access and assistance program;
*Requiring Commissioners to execute a statement declaring their fiduci-
ary obligation to exercise independent judgment and act in the best
interest of the Port Authority, its mission, and the public;
*Adopting a Port Authority mission statement designed to meet the crit-
ical transportation infrastructure needs of the bi-state region's resi-
dents, businesses, and visitors by providing the highest quality and
most efficient transportation and port commerce facilities and services
to move people and goods within the region, provide access to the nation
and the world, and to promote the region's economic development;
*Establishing a clear recusal policy to prevent conflicts of interest,
requiring Commissioners, officers, and certain employees to
file.financial disclosures, and requiring all Commissioners, officers,
and employees to maintain records regarding contact with lobbyists; and
*Requiring public notice of Port Authority meetings and that such meet-
ings are open to the public.
Section three would amend Article 15-A of chapter 154 (L. 1921), as
added by chapter 275 (L. 1992) to define the terms "committee", "commit-
tees", and "news media". It would also require the Board of Commission-
ers to adopt rules and regulations concerning proper notice to the
public and the news media of its meetings.
Section four would add new Articles VII-B, VII-C, and VII-D to chapter
154 (L. 1921). Article VII-B would require the Port Authority to conduct
a needs assessment and public hearings before raising tolls and fares.
Article VII-C would require the Port Authority to provide enhanced annu-
al reports, to undergo financial audits, and to make public its capital
plan and debt issuance. Finally, Article VII-D would require the Port
Authority to make property dispositions in compliance with the laws of
the State in which the property is located, and to only sell, lease, or
otherwise alienate a property below fair market value in limited circum-
stances.
Section five would provide for severability.
Section six provides that the act shall take effect upon the enactment
by the state of New Jersey of legislation having an identical effect
with this bill.
EXISTING LAW:
These provisions are new.
STATEMENT IN SUPPORT:
Established almost a century ago, the Port Authority was created to
oversee the harbor interests shared by New Jersey and New York. Over the
decades, the Port Authority has expanded to manage new opportunities and
face new challenges, and currently operates a wide array of transporta-
tion programs under a multi-billion dollar yearly budget.
In August 2011, Governors Cuomo and Christie required the Port Authority
to undergo a comprehensive audit of its finances and operations. As a
result of those audit findings, the Port Authority has taken numerous
steps towards reform and positive change. In 2014, Governors Cuomo and
Christie created the bi-state Special Panel on the Future of the Port
Authority ("Special Panel") to further review the role and functionality
of the Port Authority. This legislation would statutorily codify reforms
the Port Authority has undertaken to ensure that its functions are open
and transparent, and includes other reforms recommended by the Special
Panel regarding the Port Authority's overall organization and its role
in the region.
BUDGET IMPLICATIONS:
None to the State.
EFFECTIVE DATE:
This act shall take effect upon the enactment into law by the state of
New Jersey of legislation having an identical effect with this Act.
STATE OF NEW YORK
________________________________________________________________________
8298
2015-2016 Regular Sessions
IN ASSEMBLY
June 18, 2015
___________
Introduced by M. of A. BRENNAN, HEASTIE, CUSICK, TITONE, COOK, ROSEN-
THAL, ROBINSON, KAVANAGH, ABINANTI, WEPRIN, BRONSON, ROZIC, OTIS,
AUBRY, BUCHWALD, TITUS, MILLER, GUNTHER, RODRIGUEZ, QUART, LINARES,
MALLIOTAKIS -- Multi-Sponsored by -- M. of A. ABBATE, ARROYO, BARRETT,
BENEDETTO, BICHOTTE, BLAKE, BRAUNSTEIN, BRINDISI, BROOK-KRASNY,
CAHILL, CLARK, COLTON, CRESPO, CYMBROWITZ, DAVILA, DenDEKKER, DILAN,
DINOWITZ, ENGLEBRIGHT, FAHY, FARRELL, GALEF, GANTT, GJONAJ, GLICK,
GOTTFRIED, HIKIND, HOOPER, JAFFEE, JEAN-PIERRE, JOYNER, KAMINSKY, KIM,
LAVINE, LENTOL, LIFTON, LUPARDO, MAGEE, MAGNARELLI, MARKEY, MAYER,
McDONALD, MORELLE, MOSLEY, MOYA, NOLAN, O'DONNELL, ORTIZ, PAULIN,
PEOPLES-STOKES, PERRY, PERSAUD, PICHARDO, PRETLOW, RAMOS, RICHARDSON,
RIVERA, ROBERTS, RUSSELL, RYAN, SANTABARBARA, SCHIMEL, SCHIMMINGER,
SEAWRIGHT, SEPULVEDA, SILVER, SIMON, SIMOTAS, SKARTADOS, SKOUFIS,
SOLAGES, STECK, STIRPE, THIELE, WEINSTEIN, WOERNER, WRIGHT, ZEBROWSKI
-- (at request of the Governor) -- read once and referred to the
Committee on Ways and Means
AN ACT to amend chapter 154 of the laws of 1921 relating to the port
authority of New York and New Jersey, in relation to port authority
organization, open meetings, public hearings, financial reporting and
handling of property
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Short title. This act shall be known and may be cited as
2 the "port authority of New York and New Jersey transparency and account-
3 ability act of 2015".
4 § 2. Article 4 of section 1 of chapter 154 of the laws of 1921 relat-
5 ing to the port authority of New York and New Jersey, as amended by
6 chapter 419 of the laws of 1930, is amended to read as follows:
7 ARTICLE IV
8 1. Commissioners. The port authority shall consist of twelve commis-
9 sioners, six resident voters from the state of New York, at least four
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD12032-04-5
A. 8298 2
1 of whom shall be resident voters of the city of New York, and six resi-
2 dent voters from the state of New Jersey, at least four of whom shall be
3 resident voters within the New Jersey portion of the district, the New
4 York members to be chosen by the state of New York and the New Jersey
5 members by the state of New Jersey in the manner and for the terms fixed
6 and determined from time to time by the legislature of each state
7 respectively, except as herein provided. Each commissioner may be
8 removed or suspended from office as provided by the law of the state
9 from which he shall be appointed.
10 2. Officers. a. The officers of the port authority shall be a chair-
11 person, a vice chairperson, a chief executive officer, a general coun-
12 sel, a chief financial officer, a chief ethics and compliance officer,
13 an inspector general, a treasurer, a comptroller, and a secretary.
14 Beginning upon the next hiring of a chief executive officer but no later
15 than a year from the effective date of the chapter of the laws of 2015
16 that amended this article, the positions of chairperson and vice chair-
17 person shall be rotated for a term of two years among commissioners
18 appointed by New York and New Jersey, with a chairperson elected first
19 from among those commissioners appointed by the governor of New York and
20 a vice chairperson elected first from among those commissioners
21 appointed by the governor of New Jersey, after which the next chair-
22 person shall be elected from among those appointed by the governor of
23 New Jersey and the next vice chairperson shall be elected from among
24 those appointed by the governor of New York and thereafter the positions
25 of chairperson and vice chairperson shall rotate every two years in the
26 same order as established herein provided that the failure of the board
27 of commissioners to elect a new chairperson and vice chairperson shall
28 not prevent the rotation of the positions of chairperson and vice chair-
29 person to the next succeeding state.
30 b. No commissioner, including the chairperson, shall serve as the port
31 authority's chief executive officer, general counsel, chief financial
32 officer, chief ethics and compliance officer, inspector general, or
33 comptroller, or hold any other equivalent position while serving as a
34 commissioner.
35 3. Role and responsibilities of commissioners. a. The commissioners
36 shall promulgate a commissioner's oath of office in consultation with
37 the chief ethics and compliance officer.
38 b. At the time that a commissioner of the port authority takes and
39 subscribes the commissioner's oath of office, or within sixty days after
40 the effective date of this subdivision if the commissioner has already
41 taken and subscribed the commissioner's oath of office, the commissioner
42 shall execute a statement declaring that the commissioner understands
43 the commissioner's independence and fiduciary obligation to perform
44 duties and responsibilities to the best of the commissioner's abilities,
45 in good faith and with proper diligence and care which an ordinarily
46 prudent person in like position would use under similar circumstances
47 and may take into consideration the views and policies of any elected
48 officials or bodies and ultimately apply independent judgment in the
49 best interest of the port authority, its mission, and the public,
50 consistent with the enabling compact, mission, and by-laws of the port
51 authority and the applicable laws of both states; and that the fiduciary
52 duty to the port authority is derived from and governed by its mission.
53 c. Individuals appointed to the board of commissioners shall partic-
54 ipate in training approved by the chief ethics and compliance officer in
55 consultation with the inspector general of the port authority regarding
56 their legal, fiduciary, financial and ethical responsibilities as direc-
A. 8298 3
1 tors of an authority within six months of appointment to the authority.
2 The commissioners shall participate in continuing training as may be
3 required to remain informed of best practices, regulatory and statutory
4 changes relating to the effective oversight of the management and finan-
5 cial activities of public authorities and to adhere to the highest stan-
6 dards of responsible governance.
7 d. (1) A commissioner shall not vote on or participate in any board or
8 committee discussions or decisions with respect to an item if the
9 commissioner, a member of the commissioner's immediate family, or a
10 business in which the commissioner has an interest has a direct or indi-
11 rect financial involvement that may reasonably be expected to impair the
12 commissioner's objectivity or independent judgment or that may reason-
13 ably create the appearance of impropriety. A commissioner shall report
14 such a need for recusal to the general counsel when it arises. The
15 public shall be informed of any recusals prior to any board action and
16 the minutes shall clearly reflect that recusal.
17 (2) For the purposes of this subdivision, the terms:
18 (i) "immediate family" shall mean: a spouse, parent, child, or
19 sibling; and
20 (ii) "interest" shall mean: (A) if the business organization is a
21 partnership, the board member or the board member's immediate family is
22 a partner or owner of ten percent or more of the assets of the partner-
23 ship, or (B) if the business organization is a corporation, the board
24 member or the board member's immediate family owns or controls ten
25 percent or more of the stock of the corporation, or serves as a director
26 or officer of the corporation.
27 e. (1) Notwithstanding any other provision of law to the contrary, the
28 commissioners, officers, and employees of the port authority shall file
29 annual financial disclosure statements as provided in this section.
30 (2)(i) The commissioners appointed by the governor of the state of New
31 York shall file annual financial disclosure statements pursuant to
32 section 73-a of the public officers law.
33 (ii) The commissioners appointed by the governor of the state of New
34 Jersey shall file annual financial disclosure statements as required by
35 New Jersey state law or executive order.
36 (iii) In addition to the financial disclosures required of the commis-
37 sioners, financial disclosures of employees shall, at a minimum, be
38 required of the chief executive officer, the chief ethics and compliance
39 officer, the chief financial officer, the general counsel, the comp-
40 troller, treasurer, and the inspector general, employees who hold poli-
41 cy-making positions as determined by the general counsel of the port
42 authority, and employees whose base salary, either in the current or
43 previous year, exceeds $150,000, which amount shall be adjusted for
44 inflation annually in accordance with the consumer price index for all
45 urban wage earners and clerical workers (CPI-W) as calculated by the
46 federal government. These financial disclosures shall be updated not
47 less than annually and shall be made available on the port authority's
48 website.
49 f. The board of commissioners shall:
50 (1) adopt a mission statement that the port authority's mission is to
51 meet the critical transportation infrastructure needs of the bi-state
52 region's people, businesses, and visitors by providing the highest qual-
53 ity and most efficient transportation and port commerce facilities and
54 services to move people and goods within the region, provide access to
55 the nation and the world, and promote the region's economic development;
A. 8298 4
1 (2) adopt a code of conduct applicable to commissioners, employees,
2 and vendors and other contractors with the port authority based upon the
3 recommendations of the chief ethics and compliance officer that shall,
4 at minimum, include the applicable standards established by law in each
5 state;
6 (3) establish a whistleblower access and assistance program protecting
7 employees from retaliation for disclosing information concerning acts of
8 wrongdoing, misconduct, malfeasance, or other inappropriate conduct
9 based upon the recommendations of the chief ethics and compliance offi-
10 cer;
11 (4) establish a policy requiring all commissioners, officers, and
12 employees with decision-making authority to maintain records regarding
13 contact with lobbyists. As used in this subsection: (i) "contact" means
14 any conversation, in person or by telephonic or other electronic means,
15 or correspondence between any lobbyist engaged in the act of lobbying
16 and any person within the port authority who can make or influence a
17 decision on the subject of the lobbying on the behalf of the port
18 authority, and shall include, at a minimum, all members of the board of
19 commissioners and all officers of the port authority, (ii) "lobbyist"
20 shall have the same meaning as defined in the laws or, rules or regu-
21 lations of either state, and (iii) "lobbying" shall mean and include any
22 attempt to influence: (a) the adoption or rejection of any rule or regu-
23 lation having the force and effect of law by the port authority, (b) the
24 outcome of any proceeding by the port authority to establish, levy or
25 collect fees, tolls, charges or fares, and (c) the authorization,
26 approval or award of any agreements, contracts or purchase orders,
27 including any settlement of port authority claims, or any extension,
28 amendment or modification of any existing agreement, contract or order;
29 and
30 (5) have an efficiency study of the port authority and its operations
31 conducted by an independent entity within three years of the effective
32 date of this section and thereafter upon the request of the governors of
33 New York and New Jersey, and if no request is made, no later than three
34 years after the most recent efficiency study was conducted.
35 4. Committee. a. The board of commissioners shall establish a commit-
36 tee structure that shall include, but need not be limited to, the
37 following responsibilities:
38 (1) a governance responsibility to be assigned to a committee
39 comprised of not fewer than three commissioners, who shall constitute a
40 majority on the committee, and who shall possess the necessary skills to
41 undertake the governance duties and functions. It shall be the responsi-
42 bility of the members of this committee to: keep the board informed of
43 current best governance practices; review corporate governance trends;
44 update the port authority's corporate governance principles; examine
45 ethical and conflict of interest issues; perform board self-evaluations;
46 investigate term limits, reappointments, and board responsibilities;
47 develop by-laws which include rules and procedures for the conduct of
48 board business; and advise the port authority on the skills and experi-
49 ences required of potential commissioners;
50 (2) an audit responsibility to be assigned to a committee comprised of
51 not fewer than three commissioners, who shall constitute a majority on
52 the committee, and who shall possess the necessary skills to undertake
53 the audit duties and functions. It shall be the responsibility of the
54 members of this committee to: recommend to the board the hiring of an
55 independent firm of certified public accountants to audit the financial
56 statements of the port authority; establish the compensation to be paid
A. 8298 5
1 to the accounting firm; and provide direct oversight of the annual inde-
2 pendent financial audit performed by the accounting firm hired for
3 auditing purposes. Members of this committee shall be familiar with
4 corporate financial and accounting practices and shall be financially
5 literate about applicable financial laws, rules, regulations, and stand-
6 ard industry practices; and
7 (3) a finance responsibility to be assigned to a committee comprised
8 of not fewer than three commissioners, who shall constitute a majority
9 on the committee, and who shall possess the necessary skills to under-
10 take the finance duties and functions. It shall be the responsibility of
11 the members of this committee to oversee and approve the issuance of
12 debt that the port authority or its subsidiaries issue.
13 b. Every committee established by the board of commissioners shall
14 promulgate a written charter to be approved by the board. Each charter
15 promulgated in accordance with this subdivision shall be made available
16 to the public and posted on the port authority's website.
17 5. Whistleblower access and assistance program. a. The chief ethics
18 and compliance officer shall recommend to the board of commissioners a
19 whistleblower access and assistance program to be administered by the
20 inspector general which shall include, but not be limited to:
21 (1) establishing toll-free telephone and facsimile lines available to
22 employees;
23 (2) offering advice regarding employee rights under applicable state
24 and federal laws and advice and options available to all persons; and
25 (3) offering an opportunity for employees to identify concerns regard-
26 ing any issue at the port authority. Any communication between an
27 employee and the inspector general pursuant to this section shall be
28 held strictly confidential by the inspector general, unless the employee
29 specifically waives in writing the right to confidentiality, except that
30 such confidentiality shall not exempt the inspector general from
31 disclosing such information, where appropriate, to the board of commis-
32 sioners and/or any law enforcement authority.
33 b. The port authority shall not fire, discharge, demote, suspend,
34 threaten, harass, or discriminate against an employee because of the
35 employee's role as a whistleblower, insofar as the actions taken by the
36 employee are legal.
37 c. As used in this subdivision:
38 (1) "Employees" means those persons employed at the port authority,
39 including but not limited to: full-time and part-time employees, those
40 employees on probation, and temporary employees.
41 (2) "Whistleblower" means any employee of the port authority who
42 discloses information concerning acts of wrongdoing, misconduct, malfea-
43 sance, or other inappropriate behavior by an employee or board member of
44 the port authority, concerning the port authority's investments, travel,
45 acquisition of real or personal property, the disposition of real or
46 personal property, or the procurement of goods and services.
47 6. Inspector general. a. The inspector general shall be responsible
48 for receiving and investigating, where appropriate, all complaints
49 regarding fraud, waste, and abuse by commissioners, officers, and
50 employees of the port authority or third-parties doing business with the
51 port authority. The inspector general shall also be responsible for
52 conducting investigations upon the inspector general's own initiative,
53 as the inspector general shall deem appropriate.
54 b. The inspector general shall inform the board of commissioners and
55 the chief executive officer of allegations received by the inspector
A. 8298 6
1 general and the progress of investigations related thereto, unless
2 special circumstances require confidentiality;
3 c. The inspector general shall determine with respect to allegations
4 received by the inspector general whether disciplinary action or civil
5 prosecution by the port authority is appropriate, and whether the matter
6 should be referred to an appropriate governmental agency for further
7 action;
8 d. The inspector general shall prepare and make available to the
9 public written reports of completed investigations, as appropriate and
10 to the extent permitted by law, subject to redactions to protect a need
11 for confidentiality. The release of all or portions of reports may be
12 deferred to protect the confidentiality of ongoing investigations.
13 e. The inspector general shall have the power to:
14 (1) administer oaths or affirmations and examine witnesses under oath;
15 (2) require the production of any books and papers deemed relevant or
16 material to any investigation, examination or review;
17 (3) notwithstanding any law to the contrary, examine and copy or
18 remove documents or records of any kind prepared, maintained or held by
19 the port authority and its subsidiaries;
20 (4) interview any officer or employee of the port authority or its
21 subsidiaries on any matter related to the performance of such officer or
22 employee's official duties. To the extent that any portion of this para-
23 graph is inconsistent with any current contractual obligations of the
24 port authority, this paragraph shall not be applicable to those obli-
25 gations until the earliest expiration of those terms under the contract;
26 (5) monitor the implementation by the port authority of any recommen-
27 dations made by the inspector general; and
28 (6) perform any other functions that are necessary or appropriate to
29 fulfill the duties and responsibilities of office.
30 7. Open meetings. a. All meetings of the port authority shall be open
31 to the public and members of the news media, individually and collec-
32 tively, for the purpose of observing the full details of all phases of
33 the deliberation, policy-making, and decision-making of the board,
34 except for an executive session initiated upon a majority vote taken in
35 an open meeting pursuant to a motion. The board of commissioners may
36 exclude the public only from that portion of a meeting at which the
37 board of commissioners discusses any:
38 (1) matter in which the release of information would impair a right to
39 receive funds from government of the United States;
40 (2) material the disclosure of which would constitute an unwarranted
41 invasion of individual or personal privacy;
42 (3) collective bargaining agreement, or the terms and conditions which
43 are proposed for inclusion in any collective bargaining agreement,
44 including the negotiation of the terms and conditions thereof with
45 employees or representatives of employees of the port authority;
46 (4) matter involving the purchase, lease, or acquisition of real prop-
47 erty with port authority funds, the proposed acquisition of securities,
48 the sale or exchange of securities held by the port authority, or the
49 investment of port authority funds, if public discussion of the matter
50 would adversely affect the public interest;
51 (5) matter which would imperil the public safety if disclosed;
52 (6) pending or anticipated litigation or contract negotiation in which
53 the port authority is, or may become, a party, or matters falling within
54 the attorney-client privilege, to the extent that confidentiality is
55 required for the attorney to exercise the attorney's ethical duties as a
56 lawyer;
A. 8298 7
1 (7) contract negotiations disclosure of which would imperil the port
2 authority's position or an outcome in the best interest of the authori-
3 ty, its mission, and the public;
4 (8) matter involving the employment, appointment, termination of
5 employment, terms and conditions of employment, evaluation of the
6 performance of, promotion or disciplining of any specific prospective
7 officer or employee or current officer or employee employed or appointed
8 by the port authority, unless all the individual employees or appointees
9 whose rights could be adversely affected request in writing that the
10 matter or matters be discussed at a public meeting; or
11 (9) deliberation of the port authority occurring after a public hear-
12 ing that may result in the imposition of a specific civil penalty upon
13 the responding party or the suspension or loss of a license or permit
14 belonging to the responding party as a result of an act of omission for
15 which the responding party bears responsibility.
16 b. The port authority shall make meeting agendas available to the
17 public at least 72 hours before each meeting of the board and each meet-
18 ing of each committee. In addition, the port authority shall send via
19 electronic mail the agenda and public documents pertaining to a board or
20 committee meeting to the public information office of each state's
21 legislature at least 72 hours before the meeting. Public notice of the
22 time and place of a meeting shall be provided to appropriate media
23 outlets, shall be conspicuously posted in one or more designated areas,
24 and shall be conspicuously posted via the port authority's official
25 website at least five business days before the meeting.
26 c. The port authority shall make available to the public documents in
27 the following manner: the agenda and public documents pertaining to a
28 board or committee meeting shall be available for public inspection at
29 an office of the port authority; and the agenda and public documents
30 pertaining to a board or committee meeting shall be posted on the port
31 authority's website.
32 d. At each public meeting of the board and at each public meeting of
33 each committee, the public shall be allotted at least 30 minutes to
34 speak on any topic on the agenda. The board or committee shall expand
35 the comment time when necessary to provide a reasonable opportunity for
36 the public to comment. The public speaking period shall take place prior
37 to any board or committee action.
38 e. The port authority shall keep reasonably comprehensible minutes of
39 all its meetings showing the time and place, the members present, the
40 subjects considered, the actions taken, and the vote of each member. The
41 minutes shall be available to the public within two weeks from the date
42 of the meeting to the extent that public disclosure shall not be incon-
43 sistent with paragraph a of this subdivision. The minutes shall indicate
44 for each item on the agenda the vote or recusal of each board member in
45 attendance at an open meeting, or an executive session of the board or a
46 committee of the board. Each item on the agenda shall be voted on sepa-
47 rately.
48 8. Barrier-free access. The port authority shall make or cause to be
49 made all reasonable efforts to ensure that meetings are held in facili-
50 ties that permit barrier-free physical access to people with disabili-
51 ties. If the board determines to use video conferencing or similar tech-
52 nology to conduct its meeting, it shall provide an opportunity for the
53 public to attend, listen and observe such a meeting.
54 § 3. Subdivisions 2 and 3 of article 15-A of section 1 of chapter 154
55 of the laws of 1921 relating to the port authority of New York and New
A. 8298 8
1 Jersey, as added by chapter 275 of the laws of 1992, are amended to read
2 as follows:
3 2. As used in this act:
4 a. "Board" means the board of commissioners of the Port Authority of
5 New York and New Jersey.
6 b. "Committee" or "committees" means any standing committee estab-
7 lished by the board tasked with, including, but not limited to, the
8 audit responsibility, governance responsibility and finance responsibil-
9 ity required to be established pursuant to this act.
10 c. "Meeting" means any gathering, whether corporeal or by means of
11 communication equipment, which is attended by, or open to, the board,
12 held with the intent, on the part of the board members present, to
13 discuss or act as a unit upon the specific public business of the
14 authority. "Meeting" does not mean a gathering (1) attended by less than
15 a effective majority of the board, or (2) attended by or open to all the
16 members of three or more similar public bodies at a convention or simi-
17 lar gathering.
18 [c.] d. "News media" means persons representing major wire services,
19 television news services, radio news services and newspapers, whether
20 located in the state of New York or New Jersey or any other state.
21 e. "Public business" mean matters which relate in any way, directly or
22 indirectly, to the performance of the functions of the port authority of
23 New York and New Jersey or the conduct of its business.
24 3. a. The board shall, within six months of the effective date of the
25 chapter of the laws of 2015 that amended this subdivision, adopt [and
26 promulgate] appropriate rules and regulations concerning proper notice
27 to the public and the news media of its meetings and the right of the
28 public and the news media to be present at meetings of the authority.
29 The board may incorporate in its rules and regulations conditions under
30 which it may exclude the public from a meeting or a portion thereof.
31 b. Any rules or regulations adopted hereunder shall become a part of
32 the minutes of the port authority of New York and New Jersey and shall
33 be subject to the approval of the governor or New Jersey and the gover-
34 nor of New York.
35 § 4. Chapter 154 of the laws of 1921 relating to the port authority of
36 New York and New Jersey is amended by adding three new articles 7-B, 7-C
37 and 7-D to read as follows:
38 ARTICLE VII-B
39 1. Needs assessment. The port authority shall require that a needs
40 assessment be conducted by an independent entity prior to any increase
41 in tolls for the use of any port authority bridge or tunnel, or fares
42 for the use of the port authority trans-Hudson corporation rail system.
43 The assessment shall be presented by the independent entity to the board
44 of commissioners at a public meeting to be held at least ninety days
45 prior to any meeting of the board of commissioners to vote to any
46 increase in the tolls for the use of any port authority bridge or
47 tunnel, or fares for the use of the port authority trans-Hudson corpo-
48 ration rail system.
49 2. Public hearings. Not less than 30 days and not more than 90 days
50 prior to any vote or action taken by the board of commissioners relating
51 to any increase in the tolls for the use of any port authority bridge or
52 tunnel, or fares for the use of the port authority trans-Hudson corpo-
53 ration rail system, the port authority shall conduct at least six public
54 hearings in the manner prescribed as follows:
55 a. Locations for public hearings shall be selected in such a way as to
56 be geographically accessible to a majority of users of the facility or
A. 8298 9
1 facilities to be impacted by the toll or fare increase, as determined by
2 port authority data, provided that at least one hearing shall be held in
3 each state.
4 b. At least 72 hours before the first hearing held pursuant to this
5 section, the port authority shall make the following information avail-
6 able to the public, including posting on the port authority's official
7 website:
8 (1) a written explanation of why the increase in tolls or fares is
9 necessary;
10 (2) the amount of revenue expected to be generated from the increase
11 in tolls or fares; and
12 (3) a detailed explanation of how the revenues raised from the
13 increase in tolls or fares is expected to be spent.
14 c. Each hearing shall be attended by at least two commissioners from
15 New York and two commissioners from New Jersey in office at the time of
16 the hearing.
17 d. The port authority shall hold no more than one public hearing in a
18 single day, and at least one-half of the public hearings shall be sched-
19 uled to begin after 6:30 p.m., eastern standard time, on a weekday.
20 e. The port authority shall ensure that each of the requirements set
21 forth in this subdivision shall be complied with before placing on the
22 meeting agenda of the board of commissioners any item or matter relating
23 to an increase in tolls or fares.
24 3. Subsidiaries of the port authority. a. The port authority shall
25 provide notice to the governor of each state, the majority leader of
26 each house of the legislature of each state, the chair of the finance
27 committee of New York, the chair of the senate budget and appropriations
28 committee of New Jersey, the chair of assembly ways and means committee
29 of New York, and the chair of the budget committee of New Jersey that it
30 will be creating a subsidiary no less than 60 days prior to the forma-
31 tion of the subsidiary.
32 b. The creation of a subsidiary corporation shall be approved by the
33 board of commissioners.
34 c. On or before the first day of January, two thousand sixteen, and
35 annually thereafter, any subsidiary corporation, in cooperation with the
36 port authority, shall provide to the governor and legislature of each
37 state a report on the subsidiary corporation. Such report shall include
38 for each subsidiary:
39 (1) The complete legal name, address and contact information of the
40 subsidiary;
41 (2) The structure of the organization of the subsidiary, including the
42 names and titles of each of its members, directors and officers, as well
43 as a chart of its organizational structure;
44 (3) The complete by-laws and legal organization papers of the subsid-
45 iary;
46 (4) A complete report of the purpose, operations, mission and projects
47 of the subsidiary; and
48 (5) Any other information the subsidiary corporation deems important
49 to include in such report.
50 ARTICLE VII-C
51 1. Annual reporting. The port authority shall publish a comprehensive
52 annual financial report, submitted annually to the governors and state
53 legislatures of New York and New Jersey and made available on the port
54 authority's website within 120 days after the end of its fiscal year.
A. 8298 10
1 The annual report shall include the agency's financial statements,
2 statistical and other regional data, and a narrative of the agency's
3 activities during the year of the report. The annual report shall
4 include:
5 a. an introductory section including: (1) a letter of transmittal to
6 the governors of New York and New Jersey; (2) information regarding the
7 board of commissioners, port authority officers and executive manage-
8 ment; (3) a letter to the board of commissioners from the chief execu-
9 tive officer of the port authority highlighting important developments;
10 (4) a description of major agency activities undertaken during the prior
11 year; and (5) a letter to the board of commissioners from the chief
12 financial officer of the port authority with respect to the consolidated
13 financial statements of the port authority.
14 b. a financial section including: (1) an independent auditor's report;
15 (2) management's discussion and analysis; (3) financial statements; (4)
16 its financial reports certified by the chair and vice-chair of the
17 board, chief executive officer, and chief financial officer of the port
18 authority, including (a) audited financials in accordance with generally
19 accepted accounting principles, known as GAAP, and the accounting stand-
20 ards issued by the governmental accounting standards board, known as
21 GASB, (b) grant and subsidy programs, (c) current ratings, if any, of
22 its bonds issued by recognized bond rating agencies and notice of chang-
23 es in such ratings, and (d) long-term liabilities, including leases and
24 employee benefit plans; (5) a schedule of its bonds and notes outstand-
25 ing at the end of its fiscal year, together with a statement of the
26 amounts redeemed and incurred during such fiscal year as part of a sche-
27 dule of debt issuance that includes the date of issuance, term, amount,
28 interest rate and means of repayment including all refinancings, calls,
29 refundings, defeasements and interest rate exchange or other such agree-
30 ments; and (6) at a minimum a four-year financial plan, including (a) a
31 current and projected capital budget, and (b) an operating budget
32 report, including an actual versus estimated budget, with an analysis
33 and measurement of financial and operating performance.
34 c. a statistical section presenting additional information as context
35 for further understanding of the information in the financial state-
36 ments, note disclosures and schedules, including (1) financial trends;
37 (2) debt capacity; (3) operating and service data; (4) information on
38 port authority operating results; (5) information on port authority
39 capital program components; (6) information on port authority facility
40 traffic; and (7) selected statistical, demographic and economic data on
41 the New York-New Jersey metropolitan region.
42 d. a corporate information section providing: (1) a list of all real
43 property of the port authority; (2) a list and full description of real
44 property and personal property that has a sale price of over $10,000
45 disposed of during the period, including the price received by the port
46 authority and the name of the purchaser for all property sold by the
47 port authority during the period; (3) a compensation schedule that shall
48 include, by position, title and name of the person holding such position
49 or title, the salary, compensation, allowance and/or benefits provided
50 to any officer, director or employee in a decision making or managerial
51 position of such authority whose base salary is in excess of $150,000;
52 (4) biographical information, not including confidential personal infor-
53 mation, for all directors and officers and employees for whom salary
54 reporting is required; (5) a description of the authority and its board
55 structure, including (a) names of committees and committee members, (b)
56 lists of board meetings and attendance, (c) descriptions of major
A. 8298 11
1 authority units, subsidiaries, and (d) number of employees; (6) its
2 mission statement, charter, if any, and by-laws; and (7) a description
3 of any material pending litigation in which the port authority is
4 involved as a party during the reporting year.
5 2. Audits and financial statements. a. The port authority shall
6 prepare financial statements on an annual basis, in accordance with
7 generally accepted accounting principles, known as GAAP, and the
8 accounting standards issued by the governmental accounting standards
9 board, known as GASB.
10 b. The audit committee of the board of commissioners of the port
11 authority shall arrange for an independent firm of certified public
12 accountants to perform an audit of the financial statements of the port
13 authority each year, in accordance with generally accepted accounting
14 principles and standards referenced in paragraph a of this subdivision.
15 Each independent firm of certified public accountants that performs any
16 audit required by this article shall timely report to the audit commit-
17 tee of the port authority: (1) all critical accounting policies and
18 practices to be used; and (2) other material written communications,
19 that is not privileged or confidential, between the independent firm of
20 certified public accountants and the management of the port authority,
21 including the management letter along with management's response or plan
22 of corrective action, material corrections identified or schedule of
23 unadjusted differences.
24 c. Every financial statement prepared pursuant to this subdivision
25 shall be approved by the board of commissioners. As a condition to the
26 issuance of the annual financial statements of the port authority, the
27 chief executive officer and the chief financial officer of the port
28 authority shall be required to make a written certification to that
29 effect that, to the best of their knowledge and belief, the financial
30 and other information in the consolidated financial statements is accu-
31 rate in all material respects and has been reported in a manner designed
32 to present fairly the port authority's net assets, changes in net
33 assets, and cash flows, in accordance with generally accepted accounting
34 principles and standards referenced in paragraph a of this subdivision;
35 and, that on the basis that the cost of internal controls should not
36 outweigh their benefits, the port authority has established a comprehen-
37 sive framework of internal controls to protect its assets from loss,
38 theft, or misuse, and to provide reasonable (rather than absolute)
39 assurance regarding the reliability of financial reporting and the prep-
40 aration of the consolidated financial statements in accordance with
41 generally accepted accounting principles and standards referenced in
42 paragraph a of this subdivision.
43 d. Notwithstanding any other provision of law to the contrary, the
44 port authority shall not contract with an independent firm of certified
45 public accountants for audit services to the authority if the lead or
46 coordinating audit partner having primary responsibility for the audit,
47 or the audit partner responsible for reviewing the audit, has performed
48 audit services for the two previous fiscal years of such authority.
49 e. The port authority shall not contract with the independent firm of
50 certified public accountants performing the port authority's audit for
51 any non-audit services to such authority contemporaneously with the
52 audit, unless receiving previous written approval by the audit committee
53 including: (1) bookkeeping or other services related to the accounting
54 records or financial statements of such authority; (2) financial infor-
55 mation systems design and implementation; (3) appraisal or valuation
56 services, fairness opinions, or contribution-in-kind reports; (4) actu-
A. 8298 12
1 arial services; (5) internal audit outsourcing services; (6) management
2 functions or human services; (7) broker or dealer, investment advisor,
3 or investment banking services; and (8) legal services and expert
4 services unrelated to the audit.
5 f. The port authority shall not contract with an independent firm of
6 certified public accountants for any audit service if the chief execu-
7 tive officer, comptroller, chief financial officer, treasurer, or any
8 other person serving in an equivalent position for the authority, was
9 employed by that independent firm of certified public accountants and
10 participated in any capacity in the audit of the authority during the
11 one year period preceding the date of the initiation of the audit.
12 3. The port authority shall make accessible to the public via its
13 website an executive summary of its most recent independent audit report
14 unless such information is exempt from disclosure pursuant to either
15 state's freedom of information laws.
16 ARTICLE VII-D
17 1. Property disposition. Any sale of real property by the port author-
18 ity shall be undertaken and conducted pursuant to the provisions of the
19 existing laws governing the sale of real property by the port authority
20 in the state in which such real property is located and by approval of
21 the board of commissioners.
22 a. No disposition of real property, or any interest in real property,
23 shall be made unless an appraisal of the value of such real property has
24 been made by an independent appraiser and included in the record of the
25 transaction, and, provided further, that no disposition of any other
26 real property, which because of its unique nature or the unique circum-
27 stances of the proposed transaction is not readily valued by reference
28 to an active market for similar real property, shall be made without a
29 similar appraisal.
30 b. Disposal of real property for less than fair market value. No prop-
31 erty owned, leased, or otherwise in the control of the port authority
32 may be sold, leased, or otherwise alienated for less than its fair
33 market value unless:
34 (i) the transferee is a government or other public entity, and the
35 terms and conditions of the transfer require that the ownership and use
36 of the real property will remain with the government or any other public
37 entity; or
38 (ii) the purpose of the transfer is within the purpose, mission, or
39 governing statute of the port authority and a written determination is
40 made by the board of commissioners that there is no reasonable alterna-
41 tive to the proposed below-market transfer that would achieve the same
42 purpose of such transfer, prior to board approval of such a transfer.
43 c. The board shall adopt, within six months of the effective date of
44 this article, appropriate rules and regulations concerning disposition,
45 acquisition, and transfer of real property or any interest in real prop-
46 erty by the port authority which shall, at a minimum, include a require-
47 ment that the following information be made available to the board of
48 commissioners at the meeting where approval of such a disposition,
49 acquisition or transfer is scheduled:
50 (i) a full description of the property;
51 (ii) a description of the purpose of the disposition, acquisition, or
52 transfer;
53 (iii) a statement of the value to be received from such a disposition,
54 acquisition, or transfer;
A. 8298 13
1 (iv) the names of any private parties participating in the disposi-
2 tion, acquisition, or transfer; and
3 (v) in the case of a property disposition for less than fair market
4 value, an explanation and a written determination by the board of
5 commissioners that there is no reasonable alternative to the proposed
6 below-market value that would achieve the same purpose of such disposi-
7 tion.
8 d. Not less than ten days in advance of any meeting of the board of
9 commissioners of the port authority at which the board of commissioners
10 is to consider an action to authorize the sale of real property owned by
11 the port authority, the chief executive officer of the port authority
12 shall provide public notice of such proposed action along with relevant
13 material terms and provisions of such sale including, but not limited
14 to, the information made available pursuant to paragraph c of this
15 subdivision, by posting on the port authority's website.
16 e. The chief executive officer may authorize or arrange for contracts
17 for the sale of personal property owned by the port authority or arrange
18 for contracts for the sale of personal property owned by the port
19 authority upon such terms and conditions as the chief executive officer
20 may deem proper and execute the same on behalf of the port authority
21 where the value of such personal property is not in excess of one
22 million dollars; provided, however, that personal property valued at
23 more than $250,000 shall not be sold by authority of the chief executive
24 officer other than to the highest bidder after public advertisement.
25 Where the value of such personal property is in excess of $1,000,000,
26 the sale of such property must be authorized by the board of commission-
27 ers of the port authority upon such terms as the board of commissioners
28 may deem proper.
29 f. The port authority may retain brokers or third-party vendors that
30 facilitate online auctions, or assist in disposing of surplus real and
31 personal property of the port authority.
32 2. Debt issuance. a. The issuance of any bonds, notes or other
33 instruments of indebtedness by the port authority shall be undertaken in
34 a manner consistent with applicable laws governing the port authority
35 and covenants with the holders of the port authority's bonds, notes or
36 other instruments of indebtedness.
37 b. At least sixty days prior to the end of its fiscal year, the port
38 authority shall submit to the governor, state comptroller, and legisla-
39 ture of each state a statement of intent in regards to the issuance of
40 and overall amount of bonds, notes, or other debt obligations antic-
41 ipated, at the time the statement is submitted, during the next fiscal
42 year.
43 3. Capital plan. The port authority shall adopt a ten-year capital
44 plan that is developed using a comprehensive planning process and risk-
45 based prioritization that considers asset condition, operational and
46 revenue impact, threat assessment, customer service, regional benefit,
47 and regulatory or statutory requirements. The capital plan shall be
48 dependent upon the availability of sufficient funding and other
49 resources to pursue the capital projects proposed for the ten-year peri-
50 od. Performance progress and revisions to reflect changes in programs,
51 policies and projects and the environment in which the port authority
52 operates shall be reviewed regularly by a committee designated by the
53 board of commissioners, and the capital plan shall be revised period-
54 ically as necessary and appropriate, and shall be reviewed with the
55 board of commissioners annually. The port authority shall publish an
56 annual report on the status of the capital program and such report shall
A. 8298 14
1 be made publicly available on the port authority's website. Prior to
2 adoption of a capital plan, the port authority shall make such proposed
3 plan available for public review and comments on its public website for
4 at least two weeks prior to approval, and all comments received are to
5 be distributed to the board of commissioners for review prior to consid-
6 eration of the capital plan.
7 4. Operating budget. The port authority shall prepare a detailed annu-
8 al operating budget beginning with the fiscal year commencing after the
9 effective date of the chapter of the laws of 2015 which added this arti-
10 cle. A preliminary annual operating budget shall be made publicly avail-
11 able on the port authority's website in July of every fiscal year and a
12 final annual operating budget shall be made publicly available in Febru-
13 ary of each fiscal year.
14 § 5. Severability clause. If any clause, sentence, paragraph, subdivi-
15 sion, section or part of this act shall be adjudged by any court of
16 competent jurisdiction to be invalid, such judgment shall not affect,
17 impair, or invalidate the remainder thereof, but shall be confined in
18 its operation to the clause, sentence, paragraph, subdivision, section
19 or part thereof directly involved in the controversy in which such judg-
20 ment shall have been rendered. It is hereby declared to be the intent of
21 the legislature that this act would have been enacted even if such
22 invalid provisions had not been included herein.
23 § 6. This act shall take effect upon the enactment into law by the
24 state of New Jersey of legislation having an identical effect with this
25 act, but if the state of New Jersey shall have already enacted such
26 legislation this act shall take effect immediately. The chairperson of
27 the port authority shall notify the legislative bill drafting commission
28 upon the enactment into law of such legislation by both such states in
29 order that the commission may maintain an accurate and timely effective
30 data base of the official text of the laws of the state of New York in
31 furtherance of effecting the provisions of section 44 of the legislative
32 law and section 70-b of the public officers law.
