81. Connection with other railroads or transit facilities. a. The commission, from time to time, with the approval of the board of estimate and the mayor, upon application of any person owning, leasing, constructing or actually operating or having the right by contract to thereafter operate a railroad wholly or in part within the limits of the city, if in the judgment of such commission, the public interests so demand, may also fix and determine the route by which any such person may connect with other railroads, or the stations thereof, or with ferries or bridges, or may extend any line which he operates or has the right to operate as aforesaid within such city, or upon the application of a corporation organized under the railroad law for any of the purposes specified in subdivision 1 of section forty of this chapter, and agreeing to equip, maintain and operate or to procure to be equipped, maintained and operated, any road of the city in connection with any existing railroad of a railroad corporation and any extension thereof wholly within such city, on the basis of a division of income, earnings or profits as herein provided, the commission with like approval, if in its judgment the public interests so demand, may fix and determine the route by which such person may construct, maintain and operate such extension, and with like approval, may authorize such person to construct, maintain and operate any such extension, and may with like approval authorize any such person to lay an additional track on, above, under or contiguous to a portion or the whole of the route of his railroad within such city and to acquire terminal or other facilities necessary for the accommodation of the traveling public on any street except the place known as Battery Park on which such railroad shall be located. The commission, with like approval, may also authorize any such person to lay his tracks and operate his railroad to any terminal within such city, and to transport thereover passengers or freight or both, and to run either passenger trains or freight trains or mixed trains thereover. The commission, with like approval, shall fix and determine the locations and plans of construction of the railroads upon such facilities, the times within which they shall be respectively constructed, the compensation to be made therefor to the city by such person, and such other terms, conditions and requirements as to such commission and board of estimate with the approval of the mayor may appear just and proper. Every such determination, authorization and license shall be made upon the condition that such person, from the time of the commencement of the operation of any such railroad under such determination, authorization or license, shall annually pay to such city a sum or rental which may be a part or proportion of gross or net receipts, and that the amount of such sum or rental for a period of not more than twenty-five years, beginning with such operation of any such railroad shall be prescribed by the commission in such determination, authorization and license, and that every such determination, authorization and license shall provide for the readjustment of the amount of such sum or rental at the expiration of the period for which it shall be so prescribed and for readjustment from time to time in the future, to the end of the period of renewal, if any, of the amount of such annual payment at intervals each of not more than twenty years. Such determination, authorization or license may provide that for the whole or any portion of the life of the grant in lieu of such annual rental the gross or net receipts derived from the operation of such railroad owned, operated or to be operated by such person within the limits of such city, and from the operation of such connecting or extending facilities may be combined, and that the city may receive as such compensation at intervals named a specified part or proportion of the income, earnings or profits of the railroad, and the facilities whose receipts are so combined or of those and any other railroads which may be operated in connection therewith in like manner, which part or proportion may be deferred to a previous distribution to such person, which distribution may be cumulative. In such case such determination, authorization or license may apportion out of the amount so to be received by the city and shall specify a portion thereof which shall be deemed to be the rental for the use of such facilities. Such determination, authorization or license shall also provide for determining the amount of the income, earnings or profits of the railroad within the limits of the city and of the facilities whose receipts are so combined. It may also provide for readjustment of the proportion which the city shall receive or of the portion thereof which shall be deemed to be the rental for the use of such facilities at specified intervals. In addition, it may prescribe a method of determining by arbitration or by the court the amount which the city shall receive as its proportion of such income, earnings or profits or as such rental upon any such readjustment thereof. Such determination, authorization or license shall contain a reservation to the city of the privilege, upon giving a specified notice, to terminate the franchise, right or authority granted under this section as to all, and, if deemed advisable, as to any specified portion of such facilities, and to purchase and take the plant and property as defined in the grant at any time after the expiration of ten years from the date when operation of any part of such facilities or of such specified portion thereof shall actually begin, upon paying an amount for such plant and property as property, excluding any value for the franchise, right or authority, which amount shall not exceed actual cost as defined in the grant of such plant and property plus fifteen per centum thereof. Such amount shall decrease under provisions of the grant as the franchise continues, so that at the end of the full term of the grant or at the end of a period specified therein, no amount shall be paid except for betterments, additions, improvements and additional equipment as hereinafter provided. The grant shall provide a method of ascertaining the amount to be paid for such plant and property on termination by the city of such franchise, right or authority and for the betterments, additions, improvements and additional equipment at the end of the full term of the grant. The grant may provide for determining, from time to time in default of agreement by arbitration or by the court, a valuation of such plant and property or any part or portion thereof for any purpose under such grant. Such determination, authorization or license may also make suitable provision to the end that if the city, after so terminating such franchise, right or authority or at the end of the full term of the grant shall propose to give a new franchise, right or authority in the enjoyment of which such plant and property or any part thereof may be utilized, the title to and possession of such plant and property or any part thereof may be transferred directly to the grantee of any such new franchise, right or authority when such new grantee shall pay the amount so required. In the case of additional track added to any elevated rapid transit railroad, however, the determination, authorization or license may provide that such privilege of the city to terminate the franchise, right or authority therefor and to purchase and take the plant and property shall not be for railroad transit operation either by the city or by any other party, and shall be without prejudice to the rights of such person in the lines of such existing elevated railroad, and may make adequate provision for the protection of such rights. The commission, with like approval may authorize the re-location of any devices and appurtenances of such person in any street in which they exist, any such re-located structure to be held under all the terms and privileges of the original franchise.
b. A certificate shall be prepared by the commission, attested by its seal and the signature of its presiding officer, setting forth in detail the action taken by the commission with respect to such connecting or extended facilities, and the terms, conditions and requirements aforesaid, including provisions as to such annual payments and the future readjustments thereof. A like certificate shall be prepared in like manner upon every modification of the terms of the contract as provided in this chapter. Every such certificate shall prescribe the terms and conditions of the readjustments of such annual payments and may provide for the determination of such amount upon such readjustments by arbitration or by the supreme court. Such certificate shall be delivered to such person upon the receipt by such commission of a written acceptance of such terms, conditions and requirements, duly executed by such person so as to entitle it to be recorded.
c. Such certificate shall be filed in the office of the secretary of state, and a duly certified copy thereof shall be filed in the office of the clerk of each county to which such privileges granted hereunder pertain, and thereupon, and upon fulfillment, by such person so far as it relates to such facilities, of such of the requirements and conditions as are necessary to be fulfilled in such cases, under section seventeen of article three of the constitution. Upon fulfillment by such person of such other terms, conditions and requirements enumerated in such certificate, as the commission may require to be fulfilled as a condition precedent to commencing such work, such person shall in such cases possess in addition to existing franchises all the powers conferred by this chapter upon corporations with respect to his railroads authorized to be constructed as aforesaid. When any facilities, shall be so fixed and determined, and a certificate as aforesaid shall have been duly filed, such person may construct them with all the rights, and with like effect as though they had been a part of the original route of his railroad then in actual operation or in process of construction. A franchise, right or authority shall not be granted under this section to extend any railroad, make any connections, lay any additional track or acquire any terminal or other facilities for a longer period than the unexpired term of the original grant, franchise or contract of the railroad and any renewal thereof contained in such contract to which such facilities are added. Any such franchise, right or authority granted hereunder shall also be subject to be terminated by the city in like manner and under the same terms and conditions and at the same time as may be provided in such original grant for the termination or taking by the city of that grant if provision therefor be made.
d. The certificate prepared by the commission as aforesaid when delivered and accepted by such person shall be deemed to constitute a contract between such city and such person according to the terms of such certificate. Such contract shall be enforceable by the commission acting in the name of and in behalf of such city or by such person according to the terms thereof, but subject to the provisions of this chapter. The terms of such contract, from time to time with the consent of such person, may be modified by the commission. In the case of any grant under this section for the extension of any railroad or the making, laying or acquisition of facilities under the provisions of this section, the commission may make provision as a condition of such grant for the termination by the city of the original grant or franchise or contract, for the railroad to which such facilities are to be added and for the taking over at the same time of the plant and property of the grantee or holder of such original franchise or contract suitable to and used for the purpose of such original grant or contract in connection with the termination of the franchise, right or authority granted under this section, upon giving a specified notice and paying an amount for such plant and property, as property, excluding any value for the original franchise or contract, which amount shall not exceed actual cost of such plant and property plus fifteen per cent. thereof. Such amount shall decrease under the provisions of the grant made hereunder as the franchise or contract continues, so that at the end of the grant or contract no amount shall be paid except for equipment as defined in the grant. The grant shall provide a method of ascertaining the amount to be paid for such plant and property on termination by the city of such original franchise or contract or for equipment at the end of the full term thereof. The grant may provide for determining from time to time in default of agreement by arbitration or by the court a valuation of such plant and property or any part or portion thereof for any purpose under such grant. The grant in such case may also make suitable provision to the end that if the city shall after so terminating such original grant or franchise or at the end of the full term thereof propose to grant a a new franchise, right or authority in the enjoyment of which such plant and property or any part thereof may be utilized, the title to and possession of such plant and property or any part thereof may be transferred directly to the grantee of any such new franchise.
e. But the construction and operation of such facilities are hereby authorized only upon condition that the consent of the owners of one-half in value of the property bounded on, and the consent also of the board of estimate and of the mayor be first obtained, or in case the consent of such property owners cannot be obtained, the appellate division of the supreme court in the department in which they are proposed to be constructed, upon application, in the same manner, and on the same notice specified in section twenty-one of this chapter, may appoint three commissioners who shall determine after a hearing of all the parties interested whether such facilities ought to be constructed or operated, and their determination, confirmed by the court, may be taken in lieu of the consent of the property owners.
f. Every such certificate granting any franchise, right or authority, as aforesaid, except for additional track added to any elevated rapid transit railroad, shall provide that upon the expiration of a period fixed therein the franchise shall end and that upon such termination thereof all the rights of property of the grantee in the streets shall cease and terminate without compensation and shall further provide that upon such expiration of such franchise, right or authority the plant and property together with the appurtenances thereto, of the grantee, constructed pursuant to such certificate, except betterments, additions, improvements and additional equipment as defined in the grant, shall become the property of the city without further or other compensation to the grantee; and that such betterments, additions, improvements and additional equipment shall be and become the property of the city on paying the grantee the amount ascertained as provided pursuant to such certificate. The provisions of this section shall apply to any railroad constructed, constructing or contracted for under the provisions of section thirty-one of this chapter and to any person constructing or operating any such railroad.
Last modified: February 3, 2019