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Some recent public authorities court decisions

December 22, 2011

NY Empire State Development Corporation

  • The New York State Court of Appeals held that public authorities and state agencies, with appropriate legislative authorization, may provide grants and loans to private companies in an effort to spur economic development. [Bordeleau v. New York State, 2011 N.Y. Slip Op. 8444 (Nov. 21, 2011)] [Public Authorities Blog]
  • The Supreme Court of New York County upheld a clawback provision in an ESDC grant made under the World Trade Center Small Firm Attraction and Retention Grant Program. “Here, plaintiff, [ESDC], has established that defendant received a $21,000.00 grant from it. Plaintiff has further established that as part of defendant’s eligibility to retain the grant, it had to maintain its business, during a specific five year period, within a particular geographic area. Plaintiff has also provided sufficient evidence to establish that defendant moved its business outside of the required area within the applicable five year period. Finally, plaintiff has established that the consequence of defendants non-compliance with the terms of the grant, there is an express obligation to return the grant monies previously provided to it.” [New York State Urban Dev. Corp. v. Graham, Miller, Neandross Mullin & Roonan, LLC, 2011 NY Slip Op. 32976U (Sup. Ct., N.Y. Co. Nov. 10, 2011)]


  • The MTA doesn’t “own” possible future fares, so selling MetroCard swipes isn’t “larceny.” It’s still illegal though. [People v. Hightowner, 2011 NY Slip Op 8960 (N.Y. Dec. 13, 2011)] [Public Authorities Blog]
  • The Southern District of New York dismissed a lawsuit challenging the proposed location of the 86th Street entrance of the Second Avenue subway, holding that the action was time-barred under the National Environmental Policy Act. Having dismissed their federal claims, the court declined to exercise supplemental jurisdiction over the plaintiffs’ state environmental review claims. [Yorkshire Towers Co., L.P. v. U.S. Dept. of Transportation, 2011 U.S. Dist. LEXIS 137965 (S.D.N.Y. Dec. 1, 2011)]

NY Thruway Authority

  • The Grand Island Bridge, which is managed by the Thruway Authority, charges discounted rates for Grand Island residents and commuters, and the Northern District of New York held that these variable rates are constitutional and don’t violate the Commerce Clause or the right to travel. [Selevan v. New York Thruway Auth., 2011 U.S. Dist. LEXIS 136068 (N.D.N.Y. Nov. 28, 2011)]
  • A bicyclist’s negligence suit against the Thruway Authority for injuries caused by allegedly defective road conditions was dismissed because the complaint failed to adequately describe the place where the injuries occurred. [Wilson v State of New York, 2011 NY Slip Op 21436 (Ct. Cl. Oct. 28, 2011)

Public housing authorities

  • Public housing authorities are required under federal law to evict any tenants who engage in criminal activity that threatens the peaceful enjoyment of the premises by other tenants, and this includes circumstances where the criminal activity is perpetrated by the tenants’ household members or guests. To be evicted on this basis, moreover, a tenant need not be strictly in “control” of the household member or guest who engages in the criminal activity; “‘Control’ means only that the tenant has permitted access to the premises.” [Stevens v. Housing Authority of South Bend, 2011 U.S. App. LEXIS 23885 (7th Cir. Dec. 1, 2011)]
  • A state court upheld NYCHA’s decision to terminate the tenancy of a resident who failed to submit complete, accurate information of his income. [Matter of Hernandez v New York City Hous. Auth., 2011 NY Slip Op. 32947U (Sup. Ct. N.Y. Co., Oct. 27, 2011)]

Public utility authorities

  • The Mohawk Valley Water Authority wasn’t entitled to intervene in a court of claims case between a private hydroelectric facility and the New York State Canal Corporation because the Public Authorites Law doesn’t place jurisdiction over suits brought by the Mohawk Valley Water Authority in the court of claims. As the court explained, “Although intervention as an additional claimant is permissible in the Court of Claims, MVWA cannot use intervention to create subject matter jurisdiction over it as a defendant in the Court of Claims.” [Erie Blvd. Hydropower, LP v State of New York, 2011 NY Slip Op 9069 (3d Dept. Dec. 15, 2011)]
  • A state power authority that purchases its electricity at “unbundled” rates from a private power company is not entitled to the lower “bundled” rates charged for retail sales under the Federal Energy Regulatory Commission’s “comparability standard,” which requires all rates to be “just and reasonable.” [Alabama Municipal Electric Authority v. Federal Energy Regulatory Commission, 2011 U.S. App. LEXIS 24586 (D.C.Cir. Dec. 13, 2011)]
  • The Idaho Supreme Court ruled that a fee imposed by a local stormwater utility was an unauthorized and illegal tax because it was “a revenue generating tax created to benefit the general public by charging all property owners for the privilege of using the City’s preexisting stormwater system, regardless of whether they are using the stormwater system or not.” [Lewiston Indep. Sch. Dist. #1 v. City of Lewiston, 2011 Ida. LEXIS 148 (Nov. 7, 2011)]

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