New York State Capitol in Albany.

As with most recent Albany legislative sessions, 2017 was characterized by popular, emerging tech companies taking on long-standing and deeply rooted interests that are part of the Capitol's fabric. Despite soaring polling numbers for the services, Albany lawmakers for a year stalled approval of ride-hailing outside New York City. After a years-long campaign, the Legislature ultimately approved apps such as Uber and Lyft, despite animus from the taxi industry. But not all new tech companies were as lucky; companies including Tesla and Airbnb have faced consistent backlash from auto dealers and the hotel lobby.

And while it trailed other states such as California in embracing new industries, New York led the country in some other ways: In August, banking and insurance companies began complying with groundbreaking regulations enacted by the Department of Financial Services aimed at curbing cybersecurity attacks. New York's highest court also saw the installation of the first openly gay member, a breakthrough moment for the LGBT community. The installation of Paul Feinman, though, came as a result of heartbreak for the court with the death of Sheila Abdus-Salaam, its first African-American woman judge.

Emerging Tech Companies vs. Lawmakers, Regulators

• Ride-hailing app companies.

Despite widespread public approval and support from legislators on both sides of the aisle in Albany, ride-hailing apps including Uber and Lyft had failed to gain approval to operate in areas outside of New York City for years. The relatively new companies were met with resistance from the highly influential Trial Lawyers Association and the entrenched taxi and livery industry, who have longstanding relationships with state legislators.

That all changed this past spring when Gov. Andrew Cuomo and legislative leaders from the state Senate and Assembly included a provision in the state budget that would allow ride-hailing apps to commence operations all over the state in late June. Between January and June of 2017—as state lawmakers conducted the legislative session—Uber Technologies Inc. spent $1.8 million on lobbying and lobbying expenses, making the ride-hailing app the state's top lobbying spender.

• Driverless cars.

Tucked away in the state's $153 billion budget adopted in April is a provision allowing the testing of autonomous vehicles under a one-year pilot program. The measure requires that autonomous vehicles carry a minimum of $5 million in insurance coverage and supervision by State Police. Cuomo said in April that he wanted approval of driverless cars in the budget, along with the authorization to expand ride-hailing in an effort to expand commercial development in upstate cities where economies have been sputtering for decades.

German carmaker Audi was the first to receive approval to test driverless cars in New York State. Audi began testing driverless cars in Albany in mid-June. The company already has licenses to test autonomous vehicles in Nevada and California. Other companies, such as Google, Tesla, Uber and General Motors, also have received permits in California to test driverless cars. The push to test driverless cars has been opposed by the Upstate Transportation Association, which has argued that driverless cars and ride-hailing apps will drive upstate taxi companies out of business.

• Tesla versus car dealers.

California-based automaker Tesla made a last-minute push near the end of Albany's legislative session to expand its sales force in New York. Tesla, which sought to expand its sales locations from five to 20, immediately faced pushback from the auto dealers and their cadre of lobbyists. Unlike traditional car dealerships, Tesla sells cars directly to consumers rather than through an intermediary. The automobile lobby argued that Tesla's model of selling directly to consumers would hurt dealership franchises.

• Airbnb.

The ongoing battle between emerging technology companies and entrenched interests with long-standing lobbying presence in the state Capitol is most visible in the hotel industry's animus toward home-sharing platform Airbnb. The hotel industry and the union that represents hotel employees, which have deep roots in New York and considerable sway among legislators, have been in a bitter feud with San Francisco-based Airbnb.

Airbnb sued the state in federal court in October 2016 after Cuomo signed legislation into law that would impose higher fines on those who advertise units illegally. Airbnb has since dropped the lawsuit. The state's multiple dwelling law also requires that an apartment's primary resident cannot rent out a unit for fewer than 30 days unless the primary resident is present.

Despite the stringent laws against short-term leasing, the hotel industry, the union that represents hotel workers and some lawmakers have continued to be critical of Airbnb. In early November, Assemblywoman Linda Rosenthal, D-Manhattan, sent a letter to Airbnb CEO Brian Chesky asking that the home-sharing platform remove any illegal listings from its website and to share hosts' addresses with New York regulators. The letter came after it was revealed that President Donald Trump's former campaign manager, Paul Manafort, allegedly had illegally rented out a New York property on Airbnb. (A spokesman for Manafort later claimed that he never had an Airbnb account.)

Medical Marijuana Program Expansions

Since signed into law by Cuomo in 2014, New York's medical marijuana program has languished amid stringent regulations and lack of patient enrollment. Since the program became operational in 2016 and March, the state had collected $585,000 in tax revenue from the sale of medical marijuana in New York, far less than the $4 million in revenue from a 7 percent excise tax on medical marijuana the Cuomo administration had projected when the program began. As of last month, the tax collection from medical marijuana totaled $912,000 for the fiscal year, which began in April.

When Cuomo initially signed the legislation to create the medical marijuana program in 2014—which was billed as the most restrictive in the country—medical marijuana could only be used by patients suffering from illnesses such as cancer, HIV/AIDS, multiple sclerosis, Parkinson's disease and seizures.

In May, as the state was considering doubling the size of New York's medical marijuana program, the five companies who were initially awarded a license to grow and sell the drug sued the state seeking to stop the Department of Health from awarding additional licenses. The New York Medical Cannabis Industry Association filed a lawsuit in Albany County Supreme Court, New York Medical Cannabis Industry Association v. New York State Department of Health, 2848-17.1, claiming that awarding additional licenses will cannibalize an industry that has struggled to flourish in New York. In August, the state announced that the five additional licenses had been awarded to manufacture and dispense the drug, despite the complaints of the original five participants.

In the weeks following the announcement, the state's Department of Health announced its plan to soon make available marijuana-infused lotions, patches and chewables in an effort to improve the floundering program. In November, the governor signed a bill adding post-traumatic stress disorder to the list of conditions for which medical marijuana could be used.

New DFS Cybersecurity Rules Take Effect

In late August, banking and insurance companies in New York began complying with groundbreaking regulations established by the New York Department of Financial Services aimed at deterring cyberattacks.

The rule, first established in March, require banks and insurance companies regulated by DFS to have state-approved plans to deter cyberattacks and report any data breaches within 72-hours of when they occur. As part of the regulations, companies will also be required to re-evaluate and upgrade their security systems annually and require that boards of insurance companies or banks certify that they are in compliance with the security requirements by Feb. 15, a much more daunting deadline.

In late October, the National Association of Insurance Commissioner—a standard-setting organization governed by chief insurance regulators from all 50 states, D.C. and five U.S. territories—adopted a data security modeled after New York's recently enacted regulation.

AG's Equifax Data Breach Investigation

In September, Atlanta-based Equifax announced that hackers had gained access to sensitive personal information on roughly 143 million Americans—later increased to 145.5 million—and 209,000 individuals' credit card numbers. Following the breach, which affected roughly 8 million New Yorkers, Attorney General Eric Schneiderman's office and the Department of Financial Services opened investigations into the consumer credit monitoring company seeking more information about the breach.

Less than two weeks after news of the security breach, Cuomo proposed new regulations that would subject companies like Equifax, Transunion and Experian to the same cybersecurity rules the state enacted for banks and insurance companies earlier this year. The requirements under the proposed rule would mandate that consumer credit reporting agencies have DFS-approved plans to deter cyberattacks and report any such attack within 72 hours of the occurrence.

At a cybersecurity hearing held by the state Senate in late October, an official for the trade group representing credit reporting agencies told a panel of New York lawmakers that the state already has sufficient regulations in place and that policymakers should be focusing on how to prevent attacks instead. The hearing was held in an effort to solicit feedback and comments from the security industry on what should be included in possible legislation.

NY Court of Appeals Loses a Pioneer, Gains One

• Sheila Abdus-Salaam.

The body of Judge Sheila Abdus-Salaam of the New York Court of Appeals was found in the Hudson River in mid-April. Abdus-Salaam, 65, who lived in Harlem, had served on New York's highest state court since 2013 and became the first African-American woman to serve on the court since its formation in 1847. In July, the Office of Chief Medical Examiner officially deemed Abdus-Salaam's death a suicide caused by drowning. Abdus-Salaam's sudden death sent shockwaves throughout New York's legal community.

Although Abdus-Salaam's tenure on the state's highest court was short, she had authored decisions that have widespread influence, including one that redefined parenthood to include the one-time partners of same-sex biological parents of children. In another decision authored by Abdus-Salaam, it declared that skin tone, not just race, should be recognized as a basis for the discriminatory treatment of jurors in the state's courts.

• Paul Feinman.

In mid-June, as the Legislature was winding down the legislative session for the year, Cuomo announced that Paul Feinman, an appellate justice in Manhattan, would be his choice to fill the Court of Appeals seat left vacant by the death of Abdus-Salaam. Feinman, whom Cuomo elevated to the Appellate Division, First Department, in 2012, became the first openly gay member to serve on the state's highest court.

Feinman was sworn in as an associate judge of the state's Court of Appeals in October. In his speech to the courtroom during his swearing in ceremony, Feinman discussed the importance of leaders in the LGBT community.

Constitutional Convention Fails

New Yorkers in November overwhelmingly rejected holding a constitutional convention to consider changes to the state constitution. Voters were presented with the referendum question “Shall there be a convention to revise the constitution and amend the same,” which is presented to the New York electorate once every 20 years. The last time voters approved a state constitutional convention was in 1967, but the ballot measures have been rejected on each occasion since then.

Nearly 78 percent, or 2.78 million voters, voted no on the ballot measure, according to data compiled by the state's Board of Elections. On the other hand, 15.6 percent, or just over 558,324 voters, voted in favor of holding a convention.

The proposal made for strange alliances: The state's widely influential labor unions banded together with environmentalists, good government groups, liberals and conservatives to form a campaign against the measure. A review of campaign contributions found that the apparatus opposing a constitutional convention raised more than $3 million, far more than the roughly $500,000 spent by proponents.