Bill Text: NY A10000 | 2019-2020 | General Assembly | Introduced

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Bill Title: Relates to the electronic open auction public bond sale pilot program; provides that the superintendent of financial services shall approve nationally recognized electronic securities bidding services for such program.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced - Dead) 2020-03-11 - reported referred to ways and means [A10000 Detail]

Download: New_York-2019-A10000-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          10000

                   IN ASSEMBLY

                                      March 4, 2020
                                       ___________

        Introduced by M. of A. THIELE -- read once and referred to the Committee
          on Local Governments

        AN  ACT  to  amend  the local finance law, in relation to the electronic
          open auction public bond sale pilot program

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section 1. Section 58.10 of the local finance law, as added by chapter
     2  643 of the laws of 2019, is amended to read as follows:
     3    §  58.10 Electronic open auction public bond sale pilot program. a. As
     4  used in this section:
     5    1. "Municipality" means a county with a  population  of  four  hundred
     6  thousand  or  more,  or  a city or town with a population of one hundred
     7  thousand or more that has issued at least twenty-five million dollars in
     8  bonds within at least one of the preceding three years.
     9    2. "Nationally recognized electronic securities bidding service" means
    10  a bidding service that is approved by  the  [state  comptroller]  super-
    11  intendent pursuant to subdivision b of this section.
    12    3.  "Open auction" means a bond sale procedure that allows a bidder to
    13  receive information with respect to the ranking of its bids prior to the
    14  conclusion of the bidding period in accordance with  the  municipality's
    15  notice  of  such  bond  sale  circulated  in  accordance with applicable
    16  requirements of this chapter.
    17    4. "Program" means the electronic open auction public bond sale  pilot
    18  program established pursuant to this section.
    19    5. "Superintendent" means the superintendent of financial services.
    20    b. 1. There is hereby established an electronic open auction bond sale
    21  pilot  program authorizing municipalities to conduct open auction public
    22  bond sales  through  any  nationally  recognized  electronic  securities
    23  bidding  service  approved  by  the  [state comptroller] superintendent.
    24  Nationally recognized electronic securities bidding services desiring to
    25  operate an electronic open auction  shall  apply  to  the  [state  comp-
    26  troller] superintendent for authorization to do so by filing an applica-
    27  tion  with  the  [state  comptroller]  superintendent.  The [state comp-
    28  troller] superintendent shall make available an  application  form  that

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD15544-01-0
        A. 10000                            2

     1  provides the [state comptroller] superintendent with information regard-
     2  ing  the  technology and security practices maintained by the nationally
     3  recognized electronic securities bidding service, the requirements to be
     4  established  for  bidding by bidders, the methods by which auction sales
     5  are conducted, the experience of the  nationally  recognized  electronic
     6  securities  bidding  service  in  conducting electronic open auctions of
     7  bonds, and other information the [state comptroller] superintendent  may
     8  deem relevant.
     9    2.  If  the  [state  comptroller]  superintendent  determines that the
    10  requirements and conditions of the open auction are in  accordance  with
    11  the  provisions  of  this  chapter  and  the  bidding service provides a
    12  secure, open and competitive opportunity for qualified bidders to submit
    13  proposals, the application shall be deemed approved.
    14    3. The  [state  comptroller]  superintendent  shall  post  information
    15  regarding   the  nationally  recognized  electronic  securities  bidding
    16  services that have been approved for use by municipalities on the [state
    17  comptroller] department of financial services website.
    18    c. If the chief fiscal officer of the municipality has authorized  the
    19  receipt  of  bids  in an electronic open auction format, such electronic
    20  bids may be submitted in the form of open auctions conducted  through  a
    21  nationally recognized electronic securities bidding service which entity
    22  shall  be  deemed  to  be  the  designated  receiving device pursuant to
    23  section 58.00 of this title. Notice of any bond sale shall  provide  for
    24  the manner in which the bidding period may be extended and the basis for
    25  determination of the winning bidder.
    26    d.  Notwithstanding the provisions of subdivision one of section three
    27  hundred five of the state technology law, if the notice of sale for  the
    28  open  auction  public  bond  contains a provision that bids will only be
    29  accepted electronically in the manner provided in such notice  of  sale,
    30  the  municipality shall not be required to accept non-electronic bids in
    31  any form.
    32    e. The  municipality's  chief  fiscal  officer  shall  administer  the
    33  program  and  shall publish its policies and procedures for the procure-
    34  ment of nationally recognized electronic securities bidding services  on
    35  the  municipality's internet website. Such policies and procedures shall
    36  include policies to prevent fraud. Except as modified by  this  section,
    37  the  municipal  program  shall  comply  with  this chapter and all other
    38  applicable laws, rules and regulations related to the sale of bonds.
    39    f. The municipality's chief fiscal officer shall review the electronic
    40  open auction bidding process to ensure that the bond sale was  completed
    41  in  a  timely  fashion;  the  sale was completed without errors; and the
    42  process was favorable as compared to the method currently  used  by  the
    43  municipality.
    44    g.  The municipality shall conduct evaluations of the program annually
    45  with a summary evaluation at the end of the two year program. The  muni-
    46  cipality  shall submit the evaluations to the [state comptroller] super-
    47  intendent, the temporary president of the senate and the speaker of  the
    48  assembly.  Such  report shall include, but not be limited to, any demon-
    49  strated evidence  that  sale  of  public  bonds  using  electronic  open
    50  auctions  is  comparable to the cost of issuing public bonds through the
    51  current sealed bid process, the fees associated with  nationally  recog-
    52  nized  electronic  securities bidding services, whether the use of elec-
    53  tronic open auctions resulted in an  increased  number  of  bidders  and
    54  whether  the  process  was favorable as compared to the method currently
    55  used by the municipality.
        A. 10000                            3

     1    § 2. This act shall take effect immediately; provided, that the amend-
     2  ments to section 58.10 of the local finance law made by section  one  of
     3  this act shall not affect the repeal of such section and shall be deemed
     4  to repeal therewith.