(Redirected from Public authority)A 'public benefit corporation' is a
public corporation chartered by a
state designed to perform some public service. A 'public authority' is a type of public benefit corporation that takes on a more bureaucratic role, such as the maintenance of public
infrastructure, that often has broad powers to regulate or maintain public property.
Authorities borrow from both
municipal corporations law (that is, the laws responsible for the creation of
cities,
towns, and other forms of
local government) and private corporations law. Other public benefit corporations resemble private non-profit organizations, and take on roles that private corporations might otherwise perform. These corporations often operate in heavily regulated industries, such as broadcasting and transportation.
Corporations such as these are often found in
common law jurisdictions such as Commonwealth countries, including
Canadian provinces and
U.S. states.
Origins
Although many associate corporations, sometimes negatively, with private business, corporations in theory began as means to serve public purposes. Corporate theory has its roots in primarily government and religious institutions, where the institution itself is identifiable independently of its membership's
mortality. For example, if the
Pope dies, the
Catholic Church continues to exist, just as it continues to exist as generations pass on and get replaced by new members.
Public benefit corporations likely have their direct roots in
mercantile capitalism. In the
early days of
European exploration and
colonization, a government or
monarch would sometimes grant a
charter to an entity allowing it to incorporate and make potentially risky investments. While certainly not public benefit corporations by today's standards, entities such as the
Massachusetts Bay Company,
Hudson Bay Company, and the
Dutch East India Company arguably are early prototypes of publicly-chartered (in this case, crown-chartered) corporations successfully making risky investments.
History
The first public authority on record is the
Port of London Authority, established 1908. According to the
Port of London Acts The Authority is a public trust established to "administer, preserve and improve the Port of London." The goal was to create an entity that would be run self-sufficiently like a private company yet remain under the control of the government. The name ''Authority'' is derived from the founding act of
Parliament which repeatedly stated that ''"Authority is hereby given...."''
Incorporation and powers
Public benefit corporations are generally governed by boards of directors, which are appointed, rather than elected, and, internally, reflect
bureaucratic forms. The corporation is government-owned and performs a specific, narrow function for the public good.
Public benefit corporations are most often created by
statute. In many
Commonwealth countries, public benefit corporations continue to receive charters from the
British monarchy. In the United States, they receive their charters usually from states, but possibly from the federal government.
Public authorities are usually created with a specific mandate, such as the construction of bridges,
mass transit, etc. Unlike
departments or ministries of the state, these corporations usually are enabled by
statute to raise revenues through bond issues.
For more information, read below about individual jurisdictions.
Public benefit corporations by location
United Kingdom
The
BBC is a public benefit crown corporation in the
United Kingdom. Many universities have charters going back centuries, and these too are in theory corporations.
Public authorities include:
★
Port of London Authority
★
Transport for London
Canada
VIA Rail in
Canada is an independent
crown corporation offering intercity passenger rail services in Canada. The
Canadian Broadcasting Corporation is another example.
The
Province of
Ontario shares two international public benefit corporations with the U.S. state of New York:
★
Buffalo and Fort Erie Public Bridge Authority [1] (also known as the Peace Bridge Authority) — international authority that maintains the
Peace Bridge link between
Buffalo,
New York, and
Fort Erie,
Ontario.
★
Niagara Falls Bridge Commission [2] — international public authority controlling various bridges in the
Niagara Falls. The Board of Commissioners has eight members — four appointed by the Ontario Premier, and four by the Governor of New York State.
United States
Under the
United States Constitution, per the
United States Supreme Court, the United States federal government is an entity of limited sovereignty that can only exercise those powers conferred upon it by the Constitution. The several states, on the other hand, have unlimited sovereignty. They can exercise any power that is not transferred to the federal government under the terms of the U.S. Constitution, provided it is not prohibited to them under their own constitutions.
Since the U.S. Constitution does not explicitly or implicitly empower the Government of the United States to create corporations outside of the confines of the federal government, the power to define and create corporations (other than as agencies of the U.S. government) is reserved to the individual states.
Private corporations were not so common in the early United States as they are today; corporations were often founded to create a public purpose, such as the maintenance of a toll bridge. Today, public benefit corporations are popular in some states in the United States, perhaps especially
New York State. Many
interstate compacts in the United States are public benefit corporations.
Public benefit corporations created, owned and operated by the U.S. Government include
Amtrak, the
United States Postal Service and the
Corporation for Public Broadcasting.
Many public authorities in the United States are
interstate compacts.
California
★
Los Angeles County Metropolitan Transportation Authority
★
Santa Clara Valley Transportation Authority
★
CPS Human Resource Services
Delaware
The
Delaware River and Bay Authority controls the
Delaware Memorial Bridge and the
Cape May-Lewes Ferry between Delaware and New Jersey, and is a bi-state agency created by an interstate compact with New Jersey.
Florida
★
Miami-Dade Transit
★ Jacksonville Port Authority
★ Jacksonville Aviation Authority
★ Jacksonville Transportation Authority
Illinois
The
Bi-State Development Agency is a bi-state agency managing public transportation between southern
Illinois and
Missouri. It serves the
St. Louis metropolitan area.
Maine
In the state of
Maine, public benefit corporations
[3]:
★ are designated as a public benefit corporation by statute; or
★ are tax exempt under section 501(c)(3) of the Internal Revenue Code; or
★ are organized for a public or charitable purpose and is required to distribute assets to a similar tax exempt organization upon dissolution; or
★ have elected to be a public benefit corporation.
Maryland
★
Maryland Transit Administration
Massachusetts
★
Massachusetts Bay Transportation Authority
★
Massachusetts Port Authority
★
Massachusetts Turnpike Authority
Missouri
See ''
Bi-State Development Agency''.
New Jersey
The
New Jersey Turnpike Authority is a public benefit corporation in
New Jersey.
The
Delaware River and Bay Authority controls the
Delaware Memorial Bridge between Delaware and New Jersey, and is a bi-state agency. The
Delaware River Port Authority is a bi-state agency of New Jersey and
Pennsylvania.The
Port Authority of New York and New Jersey is a bi-state agency shared with New York.
Although "Public Benefit Corporation" is not a statutorily defined term under New Jersey Statutes or the New Jersey Administrative Code, such corporations are among those included within the statutorily defined term "State Agency".
New Hampshire
★
Manchester Transit Authority (New Hampshire)
New York State
The widespread use of public authorities in the United States was pioneered in
New York State by
Robert Moses. The approval of the
New York State Public Authorities Control Board is required in some cases when creating an authority. An authority may at times levy taxes and tolls; this means that they are not part of the usual state budgetary process, and gives them a certain independence. Furthermore, they may make
contracts; because of public authorities' corporate status, there is, generally, no remedy against the chartering State for the breach of such contracts. John Grace & Co. v. State University Constr. Fund, 44 N.Y.2d 84, 375 N.E.2d 377; 404 N.Y.S.2d 316 (1978). On the other hand, as agents of the state, public authorities are not subject to many laws governing private corporations, and are not subject to municipal regulation. Employees of public authorities usually ''are not'' state employees, but are employees of the authority. ''Ciulla v. State'', 191 Misc. 528; 77 N.Y.S.2d 545; (NY Court of Claims, 1948). Public authorities can also often condemn property. ''See Generally'' 87 NY Jur PUBLIC AUTHORITIES Section 1 ''et. seq..
Among the major
public benefit corporations in New York State, the
Port Authority of New York and
New Jersey, an interstate compact, and the
Metropolitan Transportation Authority, which manages most of the public transportation to, in, and around
New York City, might be the most famous. New York has hundreds of lesser-known public benefit corporations. The
Urban Development Corporation, founded to provide public housing, now has other priorities, and it boasts no less than 107 subsidiaries with devolved powers. One of these, the
Lower Manhattan Development Corporation has been receiving a lot of press, in the wake of the
September 11,
2001,
terrorist attacks.
New York likely has the most extensive number of public benefit corporations in the United States.
:See ''
New York State public benefit corporations''
Pennsylvania
The
Southeastern Pennsylvania Transportation Authority (SEPTA) provides public transportation in and around
Philadelphia.
The
Delaware River Port Authority is a bi-state agency of Pennsylvania and New Jersey.
Tennessee
Tennessee is arguably the banner state for the
Tennessee Valley Authority's (TVA's) operations, which span a region extending into seven states (most of Tennessee and parts of six others), but the TVA is actually a Federally-owned public authority. The TVA has been key in aiding the region's economic development, most notably in the 1930s during the
Great Depression.
Texas
★
Metropolitan Transit Authority of Harris County, Texas
★
Port of Houston
Vermont
Like
Maine, the state of
Vermont defines public benefit corporations broadly. They include public benefit corporations founded by the state and by private entities. The
Vermont Economic Development Authority[4] is an example of a state-owned public benefit corporation.
Washington
★
Port of Seattle
Other meanings
More broadly, a public benefit corporation could be any corporation that exists for a charitable purpose, though these are generally called
non-profit corporations if they aren't founded by a government. Some jurisdictions (the
U.S. State of
Maine, for instance) might define a public benefit corporation broadly. In
California, public benefit corporations are one of several types of non-profit corporations.
External links
★
Kevin R. Kosar, "Public Authorities and the Public Good," Metro Matter Newsletter, May-June 2004.
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