Section 46. Franchise for private construction, maintenance and operation

a. If or when the necessary consents have been obtained and the detailed
  plans  and  specifications  have  been  prepared   by   the   board   of
  transportation  for  a  railroad,  such  board, with the approval of the
  board of estimate and the mayor, may grant  a  franchise  to  construct,
  maintain  and operate such a railroad. The board of transportation shall
  have power to prescribe all such terms and conditions of such grant  and
  to  require  such  security  to  be  given and filed for the keeping and
  performance of such terms and conditions as it may deem to  be  for  the
  interest  of  the  public  and  of  the  city  and  may  provide that in
  connection with the construction of such railroad by the grantee at  its
  own  expense  any  galleries,  ways,  subways or tunnels for sub-surface
  structures which may be  included  in  any  such  plans  shall  be  also
  constructed  by  the grantee at the public expense, and in such case the
  sum to be paid therefor  shall  be  separately  stated  and  the  amount
  appropriated  and  paid  out  of  the  funds  hereafter authorized to be
  provided in case of  such  construction,  and  such  board  may  provide
  separately  for the maintenance, supervision, care and operation thereof
  as authorized by the provisions of section forty of this chapter.
    b. The grant shall provide that such railroad shall be constructed  by
  and at the expense of the grantee under the direction and supervision of
  the  board  of transportation and in accordance with such detailed plans
  and specifications; that the construction shall be begun within  a  time
  to   be  specified  and  shall  be  finished  within  a  specified  time
  thereafter; and that operation of such railroad shall be begun within  a
  specified  time,  and  may  fix  the  time within which portions of such
  railroad shall be begun and finished  and  put  in  operation,  and  may
  provide  that such board may extend the time of beginning, of completion
  and of operation of such railroad or portion thereof, and  that  if  the
  grantee  shall  fail to begin or to finish the construction or begin the
  operation of such road or portion thereof  at  or  within  any  time  so
  fixed,  or  shall  fail to comply with any of the terms or conditions of
  such grant, a penalty specified,  or  the  grant  and  any  construction
  pursuant thereto, may be forfeited to the city.
    c. Such grant shall contain a reservation to the city of the privilege
  upon  giving  a  specified  notice  to  terminate  such franchise and to
  purchase and take the plant and property of the grantee suitable to  and
  used  for  the purpose of such railroad at any time after the expiration
  of ten years from the date when operation of any part of  such  railroad
  shall  begin  upon  paying  an  amount  for  such  plant and property as
  property, excluding any value for the franchise, which amount shall  not
  exceed  actual  cost of such plant and property, plus fifteen per centum
  thereof, and shall  decrease  under  provisions  of  the  grant  as  the
  franchise  continues so that at the end of the full term of the grant no
  amount shall be paid except for equipment as hereinafter  provided.  The
  grant  shall  provide a method of ascertaining the amount to be paid for
  such plant and property upon termination by the city of  such  franchise
  and  for  the  equipment of such railroad 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. The grant shall make adequate provision for lien  upon
  plant  and property and by way of penalty or forfeiture of the grant and
  any construction pursuant thereto or otherwise to secure compliance with
  the terms of such grant, efficiency of service at reasonable  rates  and
  the  maintenance  of  the property in good condition throughout the full
  term of the grant.

    d. The grant shall provide  that  any  and  all  income  and  increase
  derived  by  the grantee or his assignee or any successive holder of the
  grant or on his or their behalf in any manner from or in connection with
  the enterprise of constructing, equipping and operating  such  railroad,
  after  deducting  operating  expenses,  taxes,  payments  to reserve and
  amortization funds as provided for in such grant, and not exceeding  six
  per  centum interest per annum payable quarterly upon the actual cost of
  construction and equipment of such road,  shall  be  divided  share  and
  share  alike  between  the  grantee  and  the  city,  and  that upon the
  expiration of the period specified in the grant the franchise shall  end
  and the plant and property suitable to and used for the purposes of such
  railroad,  except  equipment  as  defined in the grant, shall become the
  property of the city without compensation to the grantee, and that  such
  equipment shall also become the property of the city upon payment to the
  grantee  of  an  amount  to be ascertained as provided in the grant. The
  grant may also provide for assuring that  in  case  a  new  grant  of  a
  franchise  to  maintain and operate such railroad is made after any such
  determination of such franchise and purchase and taking  of  such  plant
  and property pursuant to such notice or after the expiration of the full
  term  of  the  grant,  that the title to and possession of the plant and
  property so taken and of the equipment at the end of such full term  may
  be  transferred  directly  to the new grantee upon his paying the amount
  required as aforesaid. At any time within one year  prior  to  the  date
  when the franchise shall be terminated or forfeited by the city or shall
  come  to  an  end  by  the  expiration  of  its full term or at any time
  thereafter, the board of transportation with the approval of  the  board
  of  estimate  and  the  mayor,  may  grant  a  new  franchise  under the
  provisions of this section for the construction wholly  or  in  part  of
  such  railroad  and  for  the maintenance and operation thereof from and
  after the date of such termination, forfeiture or end of such grant,  or
  the  board  of  transportation,  with  like  approval,  may  enter  into
  contracts for the equipment, maintenance or operation of such  railroad,
  or  may  itself operate such road, after such termination, forfeiture or
  end of such grant as provided in sections thirty-two, forty,  forty-one,
  forty-two  and  forty-three  of  this  chapter  in  respect of railroads
  constructed at the public expense.
    e. A certificate shall be prepared  by  the  board  of  transportation
  attested by its seal and the signature of its presiding officer, setting
  forth  in  detail  the  action  taken  and grant made by such board with
  respect to such railroad, and the terms and conditions  aforesaid  which
  shall  be  delivered to such grantee upon the receipt by such board of a
  written acceptance of the terms,  conditions  and  requirements  of  the
  grant  duly executed by such grantee so as to entitle it to be recorded.
  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 the county in which such  railroad  or  some  part  thereof  is
  situated. Upon the fulfillment by such grantee of such terms, conditions
  and  requirements  enumerated  in  such  certificate  as  such board may
  require to be fulfilled as a  condition  precedent  to  commencing  such
  work,  the  grantee  shall  in  such  cases  possess  in addition to its
  existing  powers,  all  the  powers  conferred  by  this  chapter   upon
  corporations receiving a grant of a franchise thereunder with respect to
  the  railroad  so authorized to be constructed and when such certificate
  shall have been duly filed, such grantee  may  construct  such  railroad
  with  all  the  rights  provided  in  such certificate but in every case
  subject to all the provisions and conditions of such  certificate.  Such
  certificate,  when  delivered  to and accepted by such grantee, shall be
  deemed to constitute a  contract  between  the  city  and  such  grantee

  according  to  the  terms  of  such  certificate. Such contract shall be
  enforceable by the board of transportation acting in the name of and  in
  behalf  of  the  city, or by the grantee according to the terms thereof,
  but  subject  to  the  provisions  of  this  chapter.  The terms of such
  contract, from time to time with like approval and with the  consent  of
  the grantee, may be modified by such board.
    f.  Any  existing  railroad corporation owning or actually operating a
  railroad wholly or in part within the limits of the city and approved by
  such board shall be competent and is hereby authorized to  bid  for  and
  receive  any  grant  pursuant  to the provisions of this section. If the
  successful bidder or bidders be not a corporation,  then  a  corporation
  may  be  organized under the railroad law by him or them for the purpose
  of receiving such grant and of constructing, equipping, maintaining  and
  operating a railroad pursuant to the terms of any such certificate and a
  corporation   so   organized  shall  not  be  required  to  procure  the
  certificate or approval of the public service commission as provided for
  in section nine of the railroad law or section fifty-three of the public
  service law.
    g. After  the  proposed  certificate  shall  have  been  prepared  and
  approved  as  to the form thereof by the board of estimate, the board of
  transportation, prior to the  granting  of  any  such  franchise,  shall
  advertise   for   proposals  or  bids  for  such  franchise  under  such
  certificate by a notice to be printed once a  week  for  two  successive
  weeks  in not less than two daily newspapers published in such city, and
  in such newspapers published elsewhere than in such city as  such  board
  shall determine, and may require security from bidders for the execution
  of their bids if accepted. Such notice shall set forth the points within
  such  city  between  which such railroad is proposed to be operated, the
  route in general terms to  be  followed,  and  such  other  details  and
  specifications  as  the board shall deem proper, and shall refer to such
  proposed certificate and such route, detailed plans  and  specifications
  on  file  in its office for further details. Such notice shall state the
  time and place at which proposals will be received and opened. All  such
  proposals  shall  refer to such proposed certificate and shall offer the
  terms upon  which  any  such  proposer  or  bidder  shall  undertake  to
  construct, maintain, equip and operate such railroad in so far as to set
  forth  all  or  any  of  the following matters as may be required by the
  board of transportation:
    1. The annual interest desired  upon  the  cost  of  construction  and
  equipment  prior  to  payment  of  any part of income or increase to the
  city;
    2. The period at the end of  which  the  plant  and  equipment  except
  equipment  as  aforesaid  shall  become the property of the city without
  compensation;
    3. The amount of money for which galleries for  subsurface  structures
  to  be paid for with public money in connection with the construction of
  such railroad will be constructed;
    4. Such transfer conveniences with other roads, specifications  as  to
  the  cost  of  construction and other provisions as such board may think
  proper to require.
    The board of  transportation  shall  attend  at  the  time  and  place
  specified  and  shall  publicly  open all proposals that shall have been
  received, but such board shall not be bound to accept any  proposals  so
  received,  but  may  reject  all  such  proposals  and  readvertise  for
  proposals in the manner hereinbefore provided, or may accept any of such
  proposals as will, in the judgment  of  such  board,  best  promote  the
  public  interest,  and  grant  a  franchise and execute such certificate

  accordingly, subject to the approval of the board of estimate and of the
  mayor.
    h. Every such corporation shall have power:
    1. To take and hold such voluntary grants of property as shall be made
  to  it, to aid in the construction, maintenance and accommodation of its
  railroad, but the real estate received by voluntary grant shall be  held
  and used for the purposes of such grant only.
    2.  To  purchase,  lease,  hold  and  use  all such property as may be
  necessary for the construction  and  maintenance  of  its  railroad  and
  necessary devices and appurtenances.
    3.  To  cross,  intersect,  join and unite its railroad with any other
  railroad at any point on its route and upon the grounds  of  such  other
  railroad company, with the necessary devices and appurtenances.
    4.  To  take  and  convey  persons and property on its railroad by the
  power or force of electricity or compressed air so used as to involve no
  combustion or impurity of air in tunnels or cars or any other  power  of
  like description approved by the board of transportation, and to receive
  compensation therefor.
    5.  To enter upon and underneath the several streets designated by the
  board of transportation and enter into and upon  the  soil  thereof;  to
  construct,  maintain,  operate  and  use,  in  accordance  with the plan
  adopted by such board, a railroad upon  the  route  and  to  the  points
  decided  upon,  and  to  secure  the necessary foundations and erect the
  structures which may be required to secure safety and stability  in  the
  construction  and maintenance of the railroads constructed upon the plan
  adopted by such board, and which may  be  necessary  for  the  operation
  thereof,  except  that  nothing  in  this  chapter  shall  authorize the
  construction of a railroad crossing the track of any steam  railroad  in
  actual  operation  at the grade thereof. It shall be lawful to make such
  excavations and openings along the route  through  which  such  railroad
  shall  be  constructed  as  shall be necessary from time to time. In all
  cases  the  surface  of  such  streets  around  such  foundations,   and
  structures  shall be restored to the condition in which they were before
  such excavations were made, as near as may be, and under  the  direction
  of  the  proper local authorities.   In all cases the use of the streets
  designated by such board, and the right of way  through  them,  for  the
  purpose  of  a  railroad,  as  herein  authorized and provided, shall be
  considered, and is hereby declared, to be a public use, consistent  with
  the uses for which the streets are publicly held. Such corporation shall
  not  have  the  right to acquire the use or occupancy of public parks or
  squares, or the use or occupancy of any of the streets, except  such  as
  may have been designated for the route of such railroad, and except such
  temporary  privileges  as  the  proper  authorities  may  grant  to such
  corporations to facilitate such construction.
    i. Every corporation which shall have taken or shall take or hold  any
  franchise  or  contract  to  construct,  maintain and operate a railroad
  under the provisions of this chapter shall have the right to acquire and
  hold such property or property rights appurtenant  thereto,  as  may  be
  necessary  to enable it to construct, maintain and operate such railroad
  and such as may be necessary for devices and appurtenances.  In case any
  such corporation cannot agree with the owner or owners of such  property
  it shall have the right to acquire title to the same in pursuance of the
  terms  and  in  the  manner  prescribed  in  the  condemnation  law. The
  existence of an easement acquired or reserved by  any  such  corporation
  for  any  of the purposes specified in this section, shall not be deemed
  an incumbrance under any law relating to investments in  mortgages  upon
  real  property  by  corporations,  trustees,  executors, administrators,
  guardians or other persons holding trust funds, but the effect  of  such

  an easement upon the real property which it affects, shall be taken into
  consideration  in  determining  the value thereof.  When any corporation
  authorized under any provision of this chapter to construct, maintain or
  operate  an additional track added to any elevated railroad in existence
  on the sixteenth day of June, nineteen hundred  ten,  or  to  construct,
  maintain or operate an extension of such railroad or to acquire terminal
  or  other  facilities for any such railroad or extension shall have duly
  instituted  condemnation  proceedings,  under  the  provisions  of   the
  condemnation  law, by serving a petition and notice in such proceedings,
  to acquire such property or property rights appurtenant thereto, as  may
  be  necessary  to  construct, maintain or operate such additional track,
  extension or terminal or other facilities, the court, upon  due  hearing
  had at a special term of the supreme court held in the judicial district
  where the property or some portion of it is situated, and upon notice in
  such  proceedings  served  upon  all the owners of the property at least
  eight days prior to such  hearing,  in  the  manner  prescribed  in  the
  condemnation  law for the service of the petition and notice, may, where
  it appears to  its  satisfaction  that  the  public  interests  will  be
  prejudiced  by  delay,  direct  that the plaintiff be permitted to enter
  immediately upon the property to be taken and devote it  temporarily  to
  the public use specified in the petition, upon depositing with the court
  such  sum  or  giving  an undertaking in such amount and subject to such
  conditions as the court may deem sufficient to secure the payment of the
  award that  may  be  made,  and  the  costs  and  the  expenses  of  the
  proceedings  and  for  the payment of any damages which the defendant in
  such proceedings may have sustained by such entry upon and  use  of  his
  property. The sum so deposited or undertaking so given shall be at least
  equal  to twice the assessed valuation, if any, of any real estate to be
  so taken. The court, at any time, upon like hearing and notice given  by
  either  party  to  such proceedings, may give such further directions in
  respect to any such deposit, undertaking or condition  as  it  may  deem
  just and proper, and in every case the owner may conduct the proceedings
  to  a  conclusion  if  the plaintiff delays or neglects to prosecute the
  same and if  the  sum  so  deposited  or  security  so  given  shall  be
  insufficient  to  pay such award and costs, expenses and damages, and if
  the plaintiff shall fail to pay the amount of such deficiency,  judgment
  shall  be  entered  against  the  plaintiff  for  the deficiency and the
  possession of the property shall be restored to the defendant.