2023 New York Laws › PBA - Public Authorities › Article 5 - Public Utility Authorities › Title 9 - New York City Transit Authority › 1203-A - Subsidiary Corporation.

§ 1203-a. Subsidiary corporation. 1. Notwithstanding the provisions of
this  title or of any general, special or local law to the contrary, the
city and the transit authority may enter into an agreement  which  shall
provide  that  any  omnibus  lines hereafter acquired by the city may be
leased by the city for operation and maintenance  to  a  public  benefit
corporation  which  shall  be a subsidiary of the transit authority. The
status of such officers and employees as shall be taken into the service
of such subsidiary corporation, including those who had been employed by
the  former  owner  of  any  such  omnibus  lines,  shall  be   governed
exclusively by the provisions of this section.
2.  A  public benefit corporation entitled Manhattan and Bronx surface
transit operating authority (hereinafter referred to as  the  subsidiary
corporation)   is   hereby  created.  The  purpose  of  said  subsidiary
corporation shall be  to  operate,  pursuant  to  the  powers  conferred
hereunder  and  for  a  temporary  period,  the  omnibus lines hereafter
acquired by the city, until the said omnibus  lines  shall  be  sold  or
otherwise  disposed  of to private or public operation. The directors of
such subsidiary corporation shall be the persons holding the offices  of
chairman  and  members of the transit authority or their successors. The
provisions of this  title  concerning  the  number  of  members  of  the
authority,  the  number  thereof  required  for a quorum and to transact
business, the powers and functions of the chairman and his authority  to
delegate  the  same,  and the effect which the tenure of the members and
chairman has upon the holding  of  other  public  office  shall  all  be
applicable  with  like  force  and  effect  to  the  directors  of  such
subsidiary corporation.
3. The subsidiary corporation shall have all of the powers  vested  in
the  transit  authority  by  section  twelve  hundred four of this title
except those contained in subdivisions five, six, eight, nine,  fourteen
and sixteen thereof. In addition, such subsidiary corporation shall have
the following powers:
(a)  pursuant  to  the  provisions  of  this  section, to maintain and
operate the omnibus lines transferred to it by the city;
(b)  to appoint officers and employees, assign powers  and  duties  to
them  and fix their compensation.  Said officers and employees shall not
become, for any purpose,  employees  of  the  city  or  of  the  transit
authority  and  shall not acquire civil service status or become members
of the New York  city  employees'  retirement  system  but,  shall,  for
purposes  of  subparagraph  (i)  of paragraph three of subsection (c) of
section six hundred twelve of the tax law be deemed to be  officers  and
employees of a subdivision of the state;
(c)  to  improve,  maintain and operate such buildings, structures and
facilities as may be necessary or convenient;
(d) with the consent  of  the  transit  authority,  to  use  officers,
employees,  agents  and  facilities  of  the  transit  authority  and to
reimburse the transit authority therefor;
(e) to utilize business methods and efficient  procedures  to  promote
the  safety and convenience of the traveling public, in the carrying out
of its corporate purposes;
(f) to operate omnibus lines on those routes in the city of  New  York
where  on  February  twenty-eighth,  nineteen hundred sixty-two, omnibus
lines were  operated  under  franchises  or  temporary  certificates  of
convenience and necessity which have been revoked, terminated, rescinded
or  condemned, or acquired by any other means, and to extend such routes
so  as  to  provide  the   complete   service   operated   on   February
twenty-eighth,  nineteen hundred sixty-two; and such operation, together
with the necessary extensions, shall be deemed to  constitute  operation
over  approved  routes  with  the  same  force and effect as if the said

routes had been duly approved by the board of estimate of the  city,  as
provided  by  law;  and to operate on such other routes as the board may
authorize by resolution adopted only after a public hearing  held  after
notice  thereof, and of the proposed route, and the proposed resolutions
authorizing the same, have been published in full for at  least  fifteen
days,  except  Sundays  and legal holidays, immediately prior thereto in
the City Record, and at least twice in two newspapers published  in  the
borough or boroughs affected, to be designated by the board.
4.  Such subsidiary corporation and any of its property, functions and
activities shall have all of the privileges, immunities, tax  exemptions
and other exemptions of the transit authority.
5.  The  agreement  between the city and the subsidiary corporation by
which the said omnibus lines are leased shall provide as follows:
(a) for the rate or rates of fare to be charged on such omnibus lines,
provided, however, that from and after  March  first,  nineteen  hundred
sixty-eight,  the  subsidiary  corporation shall have full and exclusive
control over the setting of such rate or rates of fare;
(b) the subsidiary  corporation  shall  be  entitled  to  utilize  the
officers,  employees, agents, facilities and services of the city on the
same terms and conditions as  are  applicable  to  or  provided  to  the
transit authority;
(c)  capital  costs  not  now  charged  by  the  transit  authority as
operating expenses shall be paid by the city;  provided,  however,  that
from and after March first, nineteen hundred sixty-eight, the subsidiary
corporation  shall also have the right to incur capital costs in its own
name to the extent that capital funds are available to  it  pursuant  to
the  provisions of sections twelve hundred nineteen-a and twelve hundred
three-b of this chapter or of any other law, which capital  costs  shall
not be payable by the city; and provided, further, that no project to be
financed  by  the  use  of  such capital funds which is estimated by the
subsidiary corporation to  involve  an  expenditure  in  excess  of  one
million  dollars  shall  be  commenced unless the mayor and the board of
estimate shall each have been notified  in  writing  by  the  subsidiary
corporation  of  the  intent  of the subsidiary corporation to undertake
such project and of  the  nature  thereof.  No  such  project  shall  be
commenced  if  and  to the extent that either the mayor or a majority in
voting power of the members of the board of estimate shall find that  it
is incompatible with sound planning for the development or redevelopment
of  the city, provided such finding, together with the reasons therefor,
is set forth in a writing delivered to the subsidiary corporation within
thirty days of the receipt by the mayor or the board of estimate, as the
case may be, of the notification of the subsidiary corporation  relating
to  such project. Where the city is required to pay the capital costs of
the subsidiary corporation pursuant to such agreement, serial  bonds  or
capital  notes  may be issued by the city, pursuant to the local finance
law, to finance any such costs. The subsidiary corporation shall  submit
timely  requests  for  the  necessary capital funds to the city planning
commission and the mayor of the city;
(d) The initial working capital of the subsidiary corporation shall be
advanced by the city from any funds of the city (but not  from  borrowed
funds)  in  the  form of a grant or a loan in such amount as the parties
shall deem necessary but in no event shall the said amount  exceed  five
million  dollars. If in the form of a grant, the advance shall be deemed
to be in partial consideration  of  the  acceptance  by  the  subsidiary
corporation  of the initial transfer, in which case the sum shall not be
repaid, but if in the form of a loan, the amount of the advance shall be
repaid under such terms and conditions as shall be mutually agreed  upon
by the parties.
6.  The  provisions  of section twelve hundred seven, subdivision one,
sections twelve hundred  eight,  twelve  hundred  nine,  twelve  hundred
eleven,  twelve  hundred twelve, twelve hundred twelve-a, twelve hundred
thirteen, twelve hundred fifteen, twelve hundred sixteen, twelve hundred
twenty  and  twelve hundred twenty-one of this title, shall apply to the
subsidiary corporation in the same manner as to  the  transit  authority
and  the  term  "authority", as used in such sections shall be deemed to
apply to the subsidiary corporation.
7. Upon the written request of the mayor  the  subsidiary  corporation
shall permit reduced fares for one or more classes of omnibus line users
designated  by  the  mayor  upon the agreement of the city to assume the
burden of  the  resulting  differential,  together  with  the  attendant
administrative   costs   of  the  subsidiary  corporation,  pursuant  to
procedures satisfactory to the subsidiary corporation.
8. From and  after  March  first,  nineteen  hundred  sixty-eight,  no
substantial  or  general  change in the levels of service furnished upon
the facilities of the subsidiary corporation shall be instituted  except
upon  not  less than thirty days' written notice to the mayor and to the
board of estimate.
9. The subsidiary corporation shall establish and publish or cause  to
be  published  schedules for all passenger transportation services under
its operation. Such schedules shall include the estimated departure  and
arrival  time at each terminal point of each route except that, on lines
where the headway time during the period between six A.M. and seven P.M.
is less than ten minutes, such headway time alone may be listed for that
period. Such schedules shall also show the elapsed running time  between
the terminal and each station. Schedules shall be made available on each
omnibus operated on the line to which the schedule applies.
10.  No  acts  or  activities  taken  or  proposed  to be taken by the
subsidiary corporation pursuant to the provisions of  paragraph  (a)  of
subdivision five or subdivision seven of this section shall be deemed to
be  "actions" for the purposes or within the meaning of article eight of
the environmental conservation law.
11. The subsidiary  corporation  and  its  corporate  existence  shall
continue  until  terminated  by  law, provided however, that no such law
shall take effect so long as the subsidiary corporation or  the  transit
authority  or  any  other of its subsidiaries shall have outstanding any
notes or bonds or  lease,  sublease  or  other  contractual  obligations
issued  or  incurred  pursuant to section twelve hundred seven-m of this
title or issued or incurred in  connection  with  the  transfer  of  its
interest  in and the lease from the transferee of any property furnished
to it pursuant to  chapter  twelve  of  the  laws  of  nineteen  hundred
seventy-nine or section fifteen of chapter three hundred fourteen of the
laws  of nineteen hundred eighty-one, unless adequate provision has been
made for the payment or satisfaction of such outstanding  notes,  bonds,
lease, sublease or other contractual obligations.