July (pdf) - New York Power Authority

practicable, of any federal entity, to protect the security of critical infrastructure related to energy
generation and transmission located within New York State. The Director of Public Security is granted the
authority to review any audits or reports related to the security of such critical infrastructure, including audits
or reports conducted at the request of the PSC or any other agency or authority of the State or any political
subdivision thereof or, to the extent practicable, of any federal entity. The statute provides for periodic
reporting by the Director of Public Security to the Governor, the Temporary President of the New York
Senate, the Speaker of the New York Assembly, the Chairperson of the PSC and the chief executive of any
affected generating or transmission company or his or her designee. Such reports are to review the security
measures being taken regarding critical infrastructure related to energy generating and transmission facilities,
assess the effectiveness thereof, and include recommendations to the State Legislature or the PSC if the
Director of Public Security determines that additional measures are required to be implemented, considering,
among other factors, the unique characteristics of each energy generating or transmission facility.
The statute provides that ‘‘[e]xcept in the case of federally licensed electric generating facilities, the public
service commission shall have the discretion to require that the recommendations of the director of public
security be implemented by any owner or operator of an energy generating or transmission facility.’’ For
the purposes of the statute, ‘‘critical infrastructure’’ means systems, assets, or things, whether physical or
virtual, so vital to the State that the disruption, incapacitation or destruction of such systems, assets, places or
things could jeopardize the health, safety, welfare or security of the State, its residents or its economy.
(4) The ‘‘Public Authorities Accountability Act of 2005’’ (‘‘PAAA’’) was signed into law in 2006, and it
addresses a wide range of matters pertaining to many public authorities in the State, including the Authority.
Among other things, the PAAA increases the number of Trustees of the Authority from five to seven;
increases requirements applicable to public authorities’ annual reports; sets forth requirements relating to
independent audits and audit reports of public authorities; sets forth roles and responsibilities of public
authority board members and establishes certain restrictions on such board members; establishes certain rules
regarding board membership, including financial disclosure requirements; sets forth requirements pertaining to
public authorities’ disposition of real and personal property; and creates a State Authority Budget Office and a
State Inspector General’s Office. Additional public authority reform legislation took effect on March 1,
2010 which provides, among other things, for State Senate approval of various public authorities’ chief
executive officers, including the Authority, and grants the State Comptroller discretionary authority to
review and approve certain contracts entered into by public authorities, including the Authority.
(5) On October 1, 2010, the Governor signed into law the North Country Power Authority Act
(“Act”) creating in law the North Country Power Authority (“NCPA”). The NCPA’s purpose is to
finance and operate a municipal electric system serving a group of 24 municipalities in the New York
State counties of St. Lawrence and Franklin. It is anticipated that the NCPA would purchase certain
distribution and related assets from National Grid to provide utility service to this area. The Act provides
for the NCPA’s powers and duties, and authorizes the NCPA to, among other things, enter into contracts
to purchase power from the Authority and other available sources. It is unclear when the NCPA may
begin operations. It has no assets and many of the actions it must undertake in order to operate are
subject to approval of New York State regulatory bodies. Accordingly, at this time, it is uncertain what
effect if any the Act will have on the Authority’s operations.
Information on legislation affecting the Authority is also available from many sources in the public
domain, and potential purchasers of the 2011 Bonds should obtain and review such information.
EXECUTIVE ORDER NO. 111
In Executive Order No. 111, issued in 2001 (the ‘‘Executive Order’’), the Governor, among other
things, required State agencies and other affected entities, as defined in the Executive Order, with
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