With passage of a revised bill in the Senate, the long legislative effort to reform public authorities has finally come to fruition, with modest changes from the earlier bill that passed the Legislature but was stalled by complaints, notably from Mayor Mike Bloomberg. This bill is expected to be signed by Governor David Paterson.
The legislation still binds authority board members to their fiduciary duty, rather than the bidding of the public official that appointed them, and still requires an appraisal of property before it's disposed of.
Selling assets below fair market value
But the language regarding selling assets at less than fair market value was tweaked to allow more flexibility. While such transfers are still allowed, the governor, the Senate, or the Assembly can veto such a proposed transfer.
Should a below fair market value asset transfer be proposed, not only is an appraisal required, but also a description of the expected benefits of the transfer and the names of the private parties participating in the transfer and the private parties who made an offer for the asset.
Also, the board must determine, in writing, that "there is no reasonable alternative to the proposed below-market transfer that would achieve the same purpose of such transfer."
As noted by WNYC, this was provision prompted by the Metropolitan Transportation Authority's initial Hudson Yards sale--and the issue has been raised repeatedly in the Atlantic Yards dispute.
So, had the bill passed before the MTA's Vanderbilt Yard deal, the latter would have prompted a lot more scrutiny and, perhaps, a denial.
The legislation still binds authority board members to their fiduciary duty, rather than the bidding of the public official that appointed them, and still requires an appraisal of property before it's disposed of.
Selling assets below fair market value
But the language regarding selling assets at less than fair market value was tweaked to allow more flexibility. While such transfers are still allowed, the governor, the Senate, or the Assembly can veto such a proposed transfer.
Should a below fair market value asset transfer be proposed, not only is an appraisal required, but also a description of the expected benefits of the transfer and the names of the private parties participating in the transfer and the private parties who made an offer for the asset.
Also, the board must determine, in writing, that "there is no reasonable alternative to the proposed below-market transfer that would achieve the same purpose of such transfer."
As noted by WNYC, this was provision prompted by the Metropolitan Transportation Authority's initial Hudson Yards sale--and the issue has been raised repeatedly in the Atlantic Yards dispute.
So, had the bill passed before the MTA's Vanderbilt Yard deal, the latter would have prompted a lot more scrutiny and, perhaps, a denial.
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