Prohibits public utility company revenues from being paid to any officer or director contingent upon a change in control (merger, acquisition, etc.) of such public utility; requires severance pay to be fully deductible as a business expense for federal tax purposes.
STATE OF NEW YORK
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2799
2011-2012 Regular Sessions
IN ASSEMBLY
January 20, 2011
___________
Introduced by M. of A. JACOBS, BRENNAN -- Multi-Sponsored by -- M. of A.
COLTON, DINOWITZ, ENGLEBRIGHT, GALEF, GOTTFRIED, HOOPER, McENENY,
WEINSTEIN, WEISENBERG -- read once and referred to the Committee on
Corporations, Authorities and Commissions
AN ACT to amend the public service law, in relation to the use of reven-
ues by public utilities
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The public service law is amended by adding a new section
2 107-a to read as follows:
3 § 107-a. Use of revenues by public utility companies. 1. No public
4 utility company shall use revenues received from the rendition of public
5 service within the state to enter into or amend, directly or indirectly,
6 any agreement containing provisions which increase, directly or indi-
7 rectly, the current or future compensation of any officer or director of
8 such public utility company, where the effectuation of such agreement is
9 contingent upon a change in control of such public utility company or
10 upon the existence of any tender offer or request or invitation for
11 tenders of any class or series of shares of such public utility company.
12 2. For purposes of this section, "change in control" means (a) any
13 merger or consolidation of a public utility company with any other
14 corporate entity; (b) any transfer of a substantial portion of the
15 assets of a public utility company without the approval of a majority of
16 the board of directors of such utility; (c) acquisition by any person or
17 entity of more than twenty-five per centum of the voting securities of a
18 public utility company; (d) appointment of a receiver for a public util-
19 ity company; or (e) a change in the composition of the board of direc-
20 tors of a public utility company which removes the current directors
21 from a majority.
22 3. In no event shall the consent and approval of the public service
23 commission be granted for any agreement for severance compensation of
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD04286-01-1
A. 2799 2
1 any officer or director of a public utility company unless its cost is
2 fully deductible as a business expense from federal taxation.
3 4. The provisions of this section shall not prohibit routine increases
4 in compensation, or other routine compensation agreements, undertaken in
5 the ordinary course of business of a public utility company.
6 § 2. This act shall take effect immediately.
