Amd §5, Pub Serv L; amd §165, add §99-bb, St Fin L
Relates to state contracts being only with internet service providers compliant with net neutrality and establishes a revolving fund for the establishment of municipal internet service providers; appropriates $250 million therefor.
STATE OF NEW YORK
January 3, 2018
Introduced by Sen. PARKER -- read twice and ordered printed, and when
printed to be committed to the Committee on Finance -- committee
discharged, bill amended, ordered reprinted as amended and recommitted
to said committee
AN ACT to amend the public service law and the state finance law, in
relation to state contracts being only with internet service providers
compliant with net neutrality and establishes a revolving fund for the
establishment of municipal internet service providers; and making an
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. This act shall be known and may be cited as the "NYS Net
2 Neutrality Protection Act".
3 § 2. Subdivision 1 of section 5 of the public service law is amended
4 by adding a new paragraph i to read as follows:
5 i. To every broadband internet line which lies wholly within the state
6 and that part within the state of New York of every broadband internet
7 line which lies partly within and partly without the state and to the
8 persons or corporations owning, leasing or operating any such broadband
9 internet line.
10 § 3. Section 5 of the public service law is amended by adding a new
11 subdivision 7 to read as follows:
12 7. The commission shall require any person engaged in the provision of
13 broadband internet access service in New York state to report to the
14 commission, and publicly disclose annually, accurate information regard-
15 ing the network management practices, performance, and commercial terms
16 of its broadband internet access services sufficient for consumers to
17 make informed choices regarding use of such services and for content,
18 application, service, and device providers to develop, market, and main-
19 tain internet offerings.
20 § 4. Subdivision 1 of section 165 of the state finance law is amended
21 by adding three new paragraphs f, g and h to read as follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 is old law to be omitted.
S. 7175--A 2
1 f. A "net neutral source of internet services" shall mean an internet
2 service provider who adheres to the principles of net neutrality.
3 g. A "non-net neutral source of internet services" shall mean an
4 internet service provider who violates any of the principles of net
6 h. "The principles of net neutrality" shall mean the rules and regu-
7 lations under the open internet report and order on remand, declaratory
8 ruling, and order by the federal communications commission released
9 March twelfth, two thousand fifteen, GN Docket No. 14-28.
10 § 5. Section 165 of the state finance law is amended by adding a new
11 subdivision 9 to read as follows:
12 9. Prohibition on purchase of internet services from a non-net neutral
13 source of internet services.
14 a. (i) With respect to contracts described in subparagraphs (ii) and
15 (iii) of this paragraph, and in accordance with such subparagraphs, the
16 state and any governmental agency or political subdivision or public
17 benefit corporation or municipality of the state shall not contract for
18 the supply of internet services with any contractor who does not agree
19 to stipulate to the following, if there is another contractor who will
20 contract to supply internet services of comparable quality at a compara-
21 ble price or cost, the contractor and any individual or legal entity in
22 which the contractor holds a ten percent or greater ownership interest
23 and any individual or legal entity that holds a ten percent or greater
24 ownership interest in the contractor shall make lawful steps in good
25 faith to conduct any business operations as a net neutral source of
26 internet services.
27 (ii) In the case of contracts let by a competitive process, whenever
28 the responsive and responsible offerer having the lowest price or best
29 value offer has not agreed to stipulate to the conditions set forth in
30 this subdivision and another responsive and responsible offerer who has
31 agreed to stipulate to such conditions has submitted an offer shall
32 determine that the contract be awarded to the lowest price or best value
33 offer for internet services from a net neutral source of internet
35 (iii) In the case of contracts let by other than a competitive process
36 internet services involving an expenditure of an amount greater than the
37 discretionary buying threshold as specified in section one hundred
38 sixty-three of this article, the contracting entity shall not award to a
39 proposed contractor who has not agreed to stipulate to the conditions
40 set forth in this subdivision unless the entity seeking to use the
41 internet services determines that the internet services are necessary
42 for the entity to perform its functions and there is no other responsi-
43 ble contractor who will supply internet services of comparable quality
44 at a comparable price. Such determinations shall be made in writing and
45 shall be public documents.
46 b. Upon receiving information that a contractor who has made the stip-
47 ulation required by this subdivision is in violation thereof, the
48 contracting entity shall review such information and offer the contrac-
49 tor an opportunity to respond. If the contracting entity finds that a
50 violation has occurred, it shall take such action as may be appropriate
51 and provided for by law, rule or contract, including, but not limited
52 to, imposing sanctions, seeking compliance, recovering damages or
53 declaring the contractor in default.
54 c. As used in this subdivision, the term "contract" shall not include
55 contracts with governmental and non-profit organizations, contracts
56 awarded pursuant to emergency procurement procedures or contracts,
S. 7175--A 3
1 resolutions, indentures, declarations of trust or other instruments
2 authorizing or relating to the authorization, issuance, award, sale or
3 purchase of bonds, certificates of indebtedness, notes or other fiscal
4 obligations, provided that the policies of this subdivision shall be
5 considered when selecting a contractor to provide financial or legal
6 advice, and when selecting managing underwriters in connection with such
8 d. The provisions of this subdivision shall not apply to contracts for
9 which the state or other contracting entity receives funds administered
10 by the United States, except to the extent congress has directed to not
11 withhold funds from states and localities that choose to implement
12 selective purchasing policies based on an agreement to comply with the
13 principles of net neutrality, or to the extent that such funds are not
14 otherwise withheld by congress.
15 § 6. The state finance law is amended by adding a new section 99-bb to
16 read as follows:
17 § 99-bb. Municipal internet service provider revolving loan fund. 1.
18 There is hereby established in the joint custody of the comptroller and
19 the public service commission a fund to be known as the "municipal
20 internet service provider revolving loan fund". Such fund shall consist
21 of moneys made available pursuant to appropriation and any other sources
22 in order to provide support for municipalities attempting to create
23 their own internet service provider.
24 2. The account shall consist of all moneys appropriated for its
25 purpose, all moneys transferred to such account pursuant to law, and all
26 moneys required by this section or any other law to be paid into or
27 credited to this account, including all moneys received by the account
28 or donated to it, payments of principal and interest on loans made from
29 the account, and any interest earnings which may accrue from the invest-
30 ment or reinvestment of moneys from the account.
31 3. Moneys of the account, when allocated, shall be available to the
32 public service commission to make loans as provided in this section. Up
33 to five percent of the moneys of the account or two hundred fifty thou-
34 sand dollars, whichever is less, may be used to pay the expenses,
35 including personal service and maintenance and operation, in connection
36 with the administration of such loans.
37 4. (a) The public service commission may make, upon application duly
38 made, up to the amounts available by appropriation, loans for any and
39 all costs associated with the creation of a municipally owned broadband
40 internet service provider.
41 (b) The public service commission shall have the power to make such
42 rules and regulations as may be necessary and proper to effectuate the
43 purposes of this section.
44 5. (a) Application for loans may be made by a town, village, city or
45 county provided that the application is otherwise consistent with its
46 respective powers. Applications may also be submitted jointly by multi-
47 ple applicants provided that the application is otherwise consistent
48 with each applicant's respective powers.
49 (b) Every application shall be in a form acceptable to the public
50 service commission. Every application shall accurately reflect the
51 conditions which give rise to the proposed expenditure and accurately
52 reflect the ability of the applicant to make such an expenditure without
53 the proceeds of a loan under this section.
54 (c) (i) The public service commission shall give preference to those
55 applications which demonstrate the greatest need, joint applications,
56 and to those applications the proceeds of which will be applied toward
S. 7175--A 4
1 attaining compliance with federal and state laws and may disapprove any
2 application which contains no adequate demonstration of need or which
3 would result in inequitable or inefficient use of the moneys in the
5 (ii) In making determinations on loan applications, the public service
6 commission shall assure that loan fund moneys are equitably distributed
7 among all geographical areas of the state.
8 (d) The public service commission shall, to the maximum extent feasi-
9 ble, and consistent with the other provisions of this section, seek to
10 provide that loans authorized by this section reflect an appropriate
11 geographic distribution, are distributed equitably and encourage
12 regional cooperation.
13 § 7. The sum of two hundred fifty million dollars ($250,000,000), or
14 so much thereof as may be necessary, is hereby appropriated from any
15 moneys in the state treasury in the general fund to the credit of the
16 state purposes account for the initial capital of the municipal internet
17 service provider revolving loan fund in carrying out the provisions of
18 this act. Such sum shall be payable on the audit and warrant of the
19 state comptroller on vouchers certified or approved in the manner
20 provided by law. No expenditure shall be made from this appropriation
21 until a certificate of approval of availability shall have been issued
22 by the director of the budget and filed with the state comptroller and a
23 copy filed with the chairman of the senate finance committee and the
24 chairman of the assembly ways and means committee. Such certificate may
25 be amended from time to time by the director of the budget and a copy of
26 each such amendment shall be filed with the state comptroller, the
27 chairman of the senate finance committee and the chairman of the assem-
28 bly ways and means committee.
29 § 8. This act shall take effect immediately.