N.Y. Pub. Auth. Law § 2041-e

§ 2041-e. Governmental capacity of the authority and municipalities.\nThe authority, participating counties and other municipalities within\nthe area of operation, in carrying out their respective powers and\nduties under this title, shall be deemed to be acting in a governmental\ncapacity. The construction, operation and maintenance of any project\nfinanced in whole or in part by the authority, shall be deemed to be the\nperformance of an essential government function by the authority acting\nin its governmental capacity, whether such project shall be owned or\noperated by the authority or by any person or other public corporation.\n