New York Consolidated Laws, Public Authorities Law - PBA § 2041-e. Governmental capacity of the authority and municipalities

The authority, participating counties and other municipalities within the area of operation, in carrying out their respective powers and duties under this title, shall be deemed to be acting in a governmental capacity. The construction, operation and maintenance of any project financed in whole or in part by the authority, shall be deemed to be the performance of an essential government function by the authority acting in its governmental capacity, whether such project shall be owned or operated by the authority or by any person or other public corporation.