Posted by: Patricia Salkin | October 25, 2010

NY Enacts Smart Growth Public Infrastructure Policy Act

The Smart Growth Public Infrastructure Act went into effect in New York on September 29, 2010 and requires most state agencies and all state authorities, prior to approving or funding any public infrastructure project,  to prepare and file a Smart Growth Impact Statement finding that the project is consistent with ten Smart Growth Criteria or justifying why it is not practicable to do so. The public infrastructure projects that are covered are defined very broadly as consisting of  “transportation, sewer and waste water treatment, water,  education,  housing  and  other  publicly  supported  infrastructure.”  That is a very broad net, especially when housing and education is factored in.  Unlike the State Environmental Quality Review Act, there are no exemptions for minor projects or ministerial approvals.

The new law also requires each covered state agency and authority to appoint from staff a “Smart Growth Advisory Committee” to investigate and prepare Smart Growth Impact Statements and to advise its agency/authority on how to promote smart growth goals. The following state agencies and authorities are subject to the Act whenever any of them consider whether to undertake, approve, support or finance the construction or reconstruction of new or expanded public infrastructure.:

  • Department of Environmental Conservation;
    ·       Department  of  Transportation;
    ·       Department of Education;
    ·       Department of Health;
    ·       Department of State;
    ·       New  York  State  Environmental  Facilities Corporation;
    ·       New York State Housing Finance Agency;
    ·       Housing Trust Fund Corporation;
    ·       Dormitory  Authority;
    ·       Thruway  Authority;
    ·       Port Authority of New York and New Jersey;
    ·       Empire State Development Corporation;
    ·       New York State Urban  Development Corporation;
    ·        “all other New York authorities;” and any subsidiary of, or  corporation  with the same members or directors as, a public benefit corporation that is included on the above list.

The term “New York agencies” is not defined.  Coverage is likely congruent with the list of “state authorities” regulated by the Authorities Budget Office as defined in Section 2 of the Public Authorities Law.  But it is possible that the Act also covers local authorities and IDA’s.

The ten Smart Growth criteria include topics such as:        

•       the use or  improvement  of existing infrastructure,
•       development in areas that are already developed or in areas that are designated for concentrated infill development in local land use plans, 

•       mixed land uses and compact development, 
•       preservation of open space,
•       improved public transport and reduced automobile dependency,  and
•       collaboration among state agencies and localities to promote intermunicipal and regional planning.

So far, there have not been any public statements or guidance issued by any of the covered agencies or authorities on whether and how they are implementing this requirement even though it likely impacts billions of dollars worth of pending public infrastructure  proposals.  The Act expressly denies private parties a right to sue a covered agency or authority for violating its requirements, but that provision would not prevent a government entity from suing to invalidate a project approval nor would it prevent other involved agencies, bond counsel, or lenders from denying necessary approvals or sign-offs due to  noncompliance with the Act.

 In addition to the covered agencies and authorities, this Act should be of interest to municipalities, school and utility districts that seek state funding and/or approvals for their public infrastructure projects, for private developers that require state approvals or funding for those parts of private developments that involve public infrastructure (i.e. public road improvements adjoining new retail development), and for private contractors, designers, architects, engineers, and lawyers seeking to plan, design, obtain regulatory approvals and money for, and/or build public infrastructure projects.

Here is a link to the Act, which is Chapter 433 of the Laws of 2010.  

Special thanks to Thomas J. Warth of Hiscock & Barclay for the summary.

Here is a link to the Hiscock & Barclay client alert on the Act:


  1. Great summary. Thanks for providing this.

  2. Bravo to New York State for taking a small but meaningful step toward embracing sustainable development. Passage of this legislation is recognition that the state’s development policies thus far have historically incentivized sprawl, which has led to unnecessary expenditure of funds to stretch public services to far-flung locales that could have been sited in closer proximity to population centers. Instead of requiring developers to invest and build on or near already existing infrastructure, communities have for too long viewed the arrival of a new subdivision or office park as a sign of “growth” while seeming to forget that tax dollars are subsidizing the developer’s profits through construction and maintenance of sewers, roads, and utilities. Under this new law, the state will hopefully begin leveraging its purchasing and funding power to steer public investment in a more sustainable direction.

    The traditional approach of building in “green fields” because of lower front-end construction costs is not only more expensive in terms of public services but, I believe, also contributing to the state’s economic decline. According Assemblymen Sam Hoyt, the smart growth bill’s sponsor, Upstate New York cities like Buffalo have tripled in land area over the last fifty years while their population’s have remained constant. The sprawl approach to community development is precisely the wrong direction for a state that is desperately trying to retain and attract young talent. The communities that have been the most successful at attracting young professionals are places where economic and cultural amenities can be accessed without necessarily dependent on a car. If Upstate and Long Island hope to compete for the workers of the future, they need to make a concerted effort to encourage investment in their inner core communities.

    While it is encouraging that the state will have influence over “publicly supported infrastructure” projects in addition to “state owned” projects, very little of the statute’s language would appear to bind agencies to Smart Growth and the stipulation that no private entity may sue an agency for failure to follow its own Smart Growth requirements raises serious questions about accountability. In my view the effectiveness of the legislation will be determined by (1) how seriously state agencies and the new Governor get behind and support the policy, (2) the willingness of government entities, bond counsel, and lenders to seek Article 78 review of a state-sponsored infrastructure project that does not conform to the law’s SG criteria, and finally, (3) the type of scrutiny courts will apply to agency rationales for not following through with SG goals on a given project. My understanding is that state courts will uphold agency as long as it is rational and will overturn only when agency action is “arbitrary and capricious,” a very low standard.

    The next question for Smart Growth advocates will be how to get local governments behind this initiative. Aside from tying strings to project dollars and making the argument that SG is in everyone’s budgetary interest, it’s unclear to me what else can be done besides electing leadership that is more enlightened on the issue. I’m also interested to see the business community’s response to Smart Growth. While everyone wants to attract talent and see state and local governments spend less, will this law be viewed as another hurdle to project development in New York State and, if it is, how do we change that perception?

  3. While going over the new Public Infrastructure Act, the first question that came to my mind was what sort of burden this mandate could have on the named state agencies. Comments found in the bill jacket (obtained by FOIL request to the Governor’s Office) are illustrative. The moral to be drawn from these memoranda appears to be: we’ll just have to wait and see. Agencies likely to have substantial implementation influence such as DEC and DOT appear to have no substantial objection to the Act’s mandate. Others raise serious concerns of interpretation, noting the uncertain scope administrative consequences in implementing the mandate.

    Here are some selections:

    From the Division of the Budget, which recommended that the bill be vetoed:
    “The actions mandated in this legislation would consume significant portions of declining staff resources and would create new unfunded costs for agencies to implement its provisions. Agencies are experiencing significant staff reductions as a result of the 2010-11 Budget and the Early Retirement Incentive Program, requiring them to carefully prioritize the activities they undertake and to limit any new responsibilities. This bill fails to identify resources to carry out the new responsibilities.” More specifically, “[t]he bill requires that smart growth advisory committees be established for each and every State infrastructure agency . . .” which “would be redundant, overlapping and unnecessarily expensive.” Also, “[t]he bill would impose substantial unfunded mandates, indirectly, on school districts and public libraries,” and “the State Education Department (SED) could face the task of preparing smart growth impact statements for more than 4,500 school construction projects and 175 public libraries each year.” [It should be noted that no comments from SED were found among the numerous memoranda in the bill jacket.]

    From the Dormitory Authority of the State of New York (DASNY), also recommending a veto:
    “[I]t should be noted that nowhere does the bill define what constitutes “public infrastructure project” that would be subject to review by DASNY under SGPIPA. This deficiency is especially problematic. . . because DASNY issues billions of dollars of tax-exempt bonds for private hospitals, nursing homes, colleges, universities and other not-for-profit entities. . . . DASNY is not a land use planning entity [and] is not in a position to participate in community based planning and collaborations or to make substantive policy-based decisions regarding appropriate growth patterns in a municipality or region of the State.” The authority “believes that the factors to be considered in the proposed bill are those that should properly be considered by local planning entities, county planning boards and regional planning bodies. . .”

    From the Department of Environmental Conservation, which recommended passage:
    “The bill does not define what constitutes a ‘public infrastructure project,’ leaving it to each agency to determine which projects must meet the smart growth criteria. Nor does the bill provide a minimum threshold for the size of the project which would be subject to the Act’s additional scrutiny; the Act should only apply to projects that are of a scale or of a type so as to be consequential from a smart growth perspective. In addition, there is no mechanism for dealing with projects that are subject to overlapping agency jurisdiction. The legislation offers no funds for implementation of the Act within the infrastructure agencies. . .”

    From the Department of Transportation (NYSDOT), also recommending passage:
    “The goals of [SGPIPA] are consistent with NYSDOT’s objectives to consult with the public and to meet the various transportation needs of New York State’s citizens, while preserving past infrastructure investments and minimizing adverse environmental impacts. If the bill is enacted, [the] Commissioner would establish the advisory council required by the bill and designate appropriate staff, pursuant to Section 16 of the Transportation Law, to conduct the reviews and make the attestations, as appropriate pursuant to the ‘smart growth’ criteria outlined in the bill.”

    The Environmental Facilities Corporation supported the bill, without much comment.

    Other agencies objected to passage of the bill, or requested consideration of amendments, without reference to the potential addition of administrative tasks. The MTA, for instance, urged that the legislature do more to ensure that agencies could not be tied up in Article 78 proceedings due to their smart growth determinations. In another instance, the Economic Development Council objected to passage, arguing that the Act “would materially damage New York’s ability to attract economic development projects, especially those related to advanced manufacturing and R&D projects.”

  4. NYSDEC’s proposed revisions to the Short and Long Environmental Assessment Forms make no mention of the Act.

    It would be helpful to include in the EAF’s a question or two regarding the potential smart growth impact statement requirement in order to help applicants and involved agencies to identify the new requirement early on.

    -Tom Warth-

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