NY-PVH Private Housing Finance Law NY

Short title. This chapter shall be known and may be cited and

referred to as the "private housing finance law."

Definitions. The following terms, whenever used or referred to in

this chapter, shall have the following meaning, unless a different

meaning clearly appears from the context, or unless specifically defined

in any of the articles of this chapter:

1. "Area". A section of a municipality which is substandard or

insanitary. The term "substandard or insanitary area" shall mean and be

interchangeable with a slum, blighted, deteriorated or deteriorating

area, whether residential, non-residential, commercial, industrial, or

vacant, or any combination thereof and may include land and buildings or

improvements not in themselves insanitary or substandard, the inclusion

of which is necessary to effectuate a plan.

2. "Assessed valuation." The value of any parcel of real property with

respect to any local tax thereon, including therein buildings and

improvements as well as land, as assessed by the respective official,

bureau, board, commission or agency charged with assessing the same for

such local tax.

3. "Authority." A public corporation as defined in subdivision two of

section three of the public housing law.

4. "Banking institution." Any corporation, association or organization

organized under the banking laws of New York state or the United States

which is authorized to transact business in this state.

5. "City." A city in the state.

6. "Commissioner." The commissioner of housing of the state of New

York.

7. "Comptroller." The comptroller of the state of New York.

8. "Condemnation." The acquisition of real property in the manner

provided by any general, special or local law or city charter for the

acquisition of real property by the municipality in which such property

is to be taken.

8-a. "Federal government." The government of the United States of

America or any agency or instrumentality thereof.

9. "Foundation." Any organization, association or corporation

organized for charitable purposes which shall have received exemption

from federal taxation by virtue of its eleemosynary, religious or

educational functions.

9-a. "Home owners purchase note." A promissory note accepted by a

mutual company, mutual housing company, mutual redevelopment company, or

housing development fund company which is organized pursuant to the

business corporation law and article eleven of this chapter, as

consideration for the issuance of shares entitling a person or family to

occupancy of an apartment in a project of such mutual company, mutual

housing company, mutual redevelopment company, or housing development

fund company, as the case may be, payable over or within a period of ten

years.

10. "Insurance company." Any insurance company authorized to transact

business in this state.

11. "Labor union." Any organization organized under the laws of the

state of New York and which exists and is constituted for the purpose,

in whole or in part, of collective bargaining, or of dealing with

employers concerning grievances, terms or conditions of employment or of

other mutual aid or protection for its members.

12. "Local legislative body". In a city, the board of aldermen, common

council, commission, or other board or body now or hereafter vested with

jurisdiction to enact ordinances or local laws, except that if there be

in a city of one million population or more, a board of estimate, the

term shall mean only such board of estimate; in a town, the town board;

in a village, the board of trustees; in a county, the board of

supervisors.

13. "Mortgage." A mortgage, trust indenture, deed of trust, building

and loan contract or other instrument creating a lien on real property,

and the indebtedness secured by each of them.

14. "Multiple dwelling." An existing building, accommodating three or

more families living independently of each other.

14-a. "Mutual company," "mutual housing company" or "mutual

redevelopment company". A limited profit or limited dividend housing

company incorporated pursuant to the provisions of this chapter or a

redevelopment company incorporated pursuant to the provisions of this

chapter, and operated exclusively for the benefit of the persons or

families who are entitled to occupancy in a project of such company,

housing company or redevelopment company, as the case may be, by reason

of ownership of shares therein.

15. "Supervising agency." The comptroller in a municipality having a

comptroller; in a municipality having no comptroller, the chief fiscal

officer of such municipality; except that in the city of New York it

shall be the department of housing preservation and development.

16. "Municipal corporation," and "municipality". A city, town or

village, or a county having a county department of assessment with the

power to assess real property; the term "municipal" shall be deemed to

relate to a city, town or village, or to a county having a county

department of assessment with the power to assess real property.

17. "Municipally-aided project." A limited profit housing company

project, other than a state urban development corporation project, which

is aided by a municipal mortgage loan, a loan by the New York city

housing development corporation or tax exemption or both and is not

aided by any state mortgage loan or any mortgage loan made by the New

York state housing finance agency or any mortgage loan made by the

Battery Park city authority or any mortgage loan insured by the federal

government made for the purpose of refinancing a mortgage loan other

than a municipal mortgage loan or a mortgage loan made by the New York

city housing development corporation.

18. "Neighborhood unit." A primarily residential district having the

facilities necessary for well-rounded family living, such as schools,

parks, playgrounds, parking areas and local shopping districts.

19. "Persons of low income" and "families of low income." Persons or

families who are in the low income groups and who cannot afford to pay

enough to cause private enterprise in their municipality to build a

sufficient supply of adequate, safe and sanitary dwellings.

20. "Plan." A plan or undertaking for the clearance, replanning and

reconstruction or rehabilitation of a substandard and insanitary area or

areas and for recreational and other facilities incidental or

appurtenant thereto to effectuate the purposes of article eighteen of

the constitution.

21. "Planning commission." Any agency of a municipality authorized to

prepare, adopt or amend the map of the municipality or empowered to

prepare, adopt and from time to time modify a comprehensive or master

plan of the municipality, if there be one, or if there be none, the

local legislative body of the municipality.

22. "Project." A specific work or improvement to effectuate all or any

part of a plan. The term shall include the lands, buildings and

improvements acquired, owned, constructed, managed or operated

hereunder, to provide dwelling accommodations for persons of low income,

and such stores, offices and other non-housing facilities as well as

social, recreational or communal facilities, as may be deemed by the

authority or municipality to be incidental or appurtenant to a project.

Subject to the provisions of article eighteen of the constitution with

respect to state projects, such dwelling accommodations may be provided

in any section of the municipality, whether or not such section has

insanitary or substandard housing conditions.

22-a. "State urban development corporation project". A project

acquired, owned, constructed, managed or operated by a company organized

pursuant to articles two, four or eleven of this chapter which is a

subsidiary of the New York state urban development corporation, as the

term "subsidiary" is defined in the New York state urban development

corporation act.

22-b. "Battery Park city project." A project acquired, owned,

constructed, managed or operated by a company organized pursuant to

article two, article four or article eleven of this chapter and located

within the Battery Park project area, as defined in the battery park

city authority act.

23. "Project cost." The cost of any or all undertakings necessary for

planning, financing (including payment of carrying charges), land

acquisition, demolition, construction, equipment, and site development

of new buildings, reconstruction, repair or remodeling of existing

buildings, but not beyond the point of physical completion; and the cost

of tenant placement service in connection with a project.

24. "Real property" or "property." Lands and improvements and any

fixtures, equipment and article of personal property affixed to or used

in connection therewith, lands under water, waterfront property, the

water of any lake, pond or stream, and any and all easements, franchises

and hereditaments, corporeal or incorporeal, and every estate, interest

and right therein, legal and equitable, in lands or water, and right,

interest, privilege, easement and franchise relating to the same,

including terms for years and liens by way of judgment, mortgage or

otherwise.

25. "State." The state of New York.

26. "State-aided project". Any project other than a municipally-aided

limited profit housing company project, a redevelopment company project

or a redevelopment corporation project.

27. "Total carrying charges". All charges paid to the housing company

by a person or family living in a project under a lease for ninety-nine

years renewal, or in perpetuity, or by reason of ownership of stock in

such company. The word "rental" shall mean and be interchangeable with

"total carrying charges" when used in connection with a mutual company.

28. "Veterans' organization." Any organization of persons who have

served in the armed forces of the United States during time of war which

has been duly chartered as a veterans' organization under the laws of

the United States or of the state of New York.

29. "Annual income" or "income". The total income as reported in the

New York state income tax return, less such personal exemptions and

deductions for medical expenses as are actually taken by the taxpayer.

Provided, however, that federal old age, survivors, and disability

insurance benefits shall not be deemed income in articles two, four and

eleven of this chapter. This definition shall be employed in articles

two, four, eight and eleven of this chapter in the computation of

"probable aggregate annual income" as therein defined.

30. "Climate resiliency improvements." Improvements for the purpose of

protecting land or any structures thereon from damage resulting from or

which may result from changes in climate, including, but not limited to,

extreme weather events, abnormal temperatures, and sea level rise, or of

reducing the impact of the operation of such structures on climate

change, including, but not limited to, improvements that reduce energy

consumption or promote the efficient use of natural resources.

31. "Private lender." One or more banking organizations, foundations,

labor unions, credit unions, employers' associations, veterans'

organizations, colleges, universities, educational institutions, child

care institutions, hospitals, medical research institutes, insurance

companies, trustees or fiduciaries, trustees of pensions and retirement

funds and systems, corporations, partnerships, individuals or other

entities or any combination of the foregoing, and shall include any

public benefit corporation and the United States of America and any of

its agencies and departments. As used in this definition, the terms

"trustees" and "fiduciaries" shall include any fiduciary or fiduciaries

holding funds for investment and the term "banking organizations" shall

have the same meaning as in subdivision eleven of section two of the

banking law.

Short title. This article shall be known and may be cited and

referred to as the "limited-profit housing companies law."

Policy and purposes of article. It is hereby declared that there

exists in municipalities in this state a seriously inadequate supply of

safe and sanitary dwelling or non-housekeeping accommodations for

families and persons of low income, including accommodations for

handicapped persons of low income and aged care accommodations for aged

persons of low income; that such conditions are due, in large measure,

to over-crowding and concentration of the population, improper planning,

excessive land coverage, lack of proper light, air and space, improper

sanitary facilities and inadequate protection from fire hazards; that

such conditions constitute an emergency and a grave menace to the

health, safety, morals, welfare and comfort of citizens of this state,

necessitating speedy relief which cannot readily be provided by the

ordinary unaided operation of private enterprise and require that

provision be made by which private free enterprise may be encouraged to

invest in companies regulated by law as to rents, profits, dividends and

disposition of their property or franchises and engaged in providing

such housing facilities and other facilities incidental or appurtenant

thereto for families or persons of low income; that it is necessary that

provision be made for participation by the state, its municipalities and

the New York state housing finance agency in the financing of such

housing, for the acquisition by such companies of real property required

for such purposes and for public assistance to such companies by the

granting of tax exemptions; that the cooperation of the state, its

subdivisions and the New York state housing finance agency is necessary

to accomplish such purposes; that the provision of such adequate, safe

and sanitary housing accommodations by such companies jointly or

severally are public uses and purposes for which public money may be

loaned and private property may be acquired by and for such companies

and tax exemptions granted; that such conditions require the creation of

the companies hereinafter prescribed for the purpose of attaining the

ends herein recited; and the necessity in the public interest for the

provisions hereinafter enacted is hereby declared as a matter of

legislative determination.

Additional policy and purposes of article. 1. It is hereby

declared that the elimination of conditions causing a deterioration of

the quality of urban life in municipalities of the State and the

revitalization and improvement of the quality of urban life in such

municipalities through comprehensive programs and projects constituting

a total attack upon such conditions are the most critical problems

facing the municipalities, the state and the federal government, and are

vital to the health, well-being, safety and prosperity of the

inhabitants of the municipalities and the people of the state. Neither

the municipalities nor the state have adequate resources to undertake,

develop and operate the comprehensive programs and projects necessary

for the accomplishment of such purposes. The ordinary operations of

private enterprise cannot rectify such conditions or accomplish such

purposes. The elimination of such conditions and accomplishment of such

purposes require the participation and cooperation of the

municipalities, the State, the Federal government, private enterprise,

institutions of higher learning, community and civic groups, fraternal

and labor organizations, foundations, and all other responsible

components of the community.

2. Among the conditions causing such deterioration are: the residence

of large numbers of families, adults and children in slum ghettos;

insanitary and inadequate housing or other physical environment; a

severe shortage of decent healthful housing accommodations to meet the

needs of large numbers of families, adults and children; economic,

educational or community imbalance resulting from excessive migration of

economic or other groups to or from communities; depletion of job or

business opportunities because of migration of business and industry

from communities; and the existence of physical, social, and economic

blight and crime. Such conditions create and perpetuate slum ghettos,

blight and crime, cause a progressive deterioration of the quality of

urban life for all persons in the municipalities and the State, render

or tend to render the municipalities undesirable places in which to

live, work and raise families, impair the sound economic, cultural and

social growth of municipalities and communities thereof, break down the

ability of municipalities or communities thereof to grow, expand,

develop or continue as viable municipalities or communities, and

threaten the life, health, well-being, safety and prosperity of all

persons in municipalities and the people of the State.

2-a. It is hereby found that improvement of the physical environment

and revitalization of the quality of urban life in such municipalities

would be promoted by cooperative action by tenants who are persons or

families of low income to acquire ownership of their dwellings and to

operate them on a nonprofit basis; that such cooperative undertakings,

with their consequent pride and responsibility of ownership, would help

to stem the abandonment of deteriorating but structually sound

buildings, which contributes to a substantial loss of much needed

housing stock, and would lead to the stabilization and renewal of

deteriorating neighborhoods. It is found necessary, in order to assure

the feasibility of such cooperative undertakings, to make available to

such tenants long-term financing on a favorable basis and tax exemption

to enable them to purchase and maintain their dwellings at a reasonable

cost.

3. The rehabilitation or redevelopment of slum ghettos and other areas

into sound healthy balanced viable communities, the enhancement of the

physical environment, health, and social well-being of the inhabitants

and the expansion of their social and economic opportunity require among

other measures the attraction to the neighborhoods of varying economic

classes in addition to persons of low income and the availability

therein of a wide choice of housing from the standpoint of design and

amenities.

4. It is hereby further found that there are certain parts of

municipalities where conditions of blight are so extensive in area that,

notwithstanding a continued shortage of safe and sanitary dwelling

accommodations in the municipality for low and middle income families,

it is not economic for private enterprise to build limited profit

housing in such areas since it cannot supply proper housing at prices

within the economic reach of low-income families in such blighted areas

or attract tenants or buyers from other areas by offering rents and

prices which are competitive with rents and prices of housing in areas

of the municipality which are not blighted. It is found that there are

other locations in such municipalities where housing development is

desirable for sound community growth, but, similarly, where private

enterprise cannot build limited profit housing which is within the

economic reach of persons in the area who require such housing.

5. It is the purpose of this article to enable municipalities to

undertake projects directly or in combination with the Federal

government, private enterprise and any of the other responsible

components of the community, to accomplish the public purposes herein

described through the most effective and economical concentration and

coordination of Federal, State, local and private resources and efforts.

6. It is hereby further found and determined that the accomplishment

of the purposes herein described is a matter of public concern, a

governmental purpose, a city, town, and village purpose, and a public

purpose and a public use for the accomplishment of which (a) the money

and property of a city, town or village, may be given, loaned or

expended, (b) indebtedness may be contracted by a city, town or village,

and (c) eminent domain exercised by a city, town or village, as

hereinafter provided.

Definitions. As used in this article, the following terms shall

mean and include:

1. "Areas." A section of a municipality in which there is to be

located a project approved by the municipality as provided in paragraph

(a) of subdivision one and in subdivision five of section twenty-six of

article two of this chapter.

2. "Company". A limited-profit housing company duly incorporated

pursuant to the provisions of this article, or a company incorporated

pursuant to the not-for-profit corporation law and this article for the

purpose of providing housing and auxiliary facilities for staff members,

employees or students of a college, university, hospital or child care

institution and their immediate families or for aged or handicapped

persons of low income, pursuant to this article, or a municipally-aided

non-profit company as hereinafter defined, or a low income non-profit

housing company as hereinafter defined.

2-a. "Home owners purchase note." A promissory note accepted by a

mutual company as consideration for the issuance of stock entitling a

person or family to occupancy of an apartment in a project, payable over

or within a period of ten years.

2-b. "Mutual company." A company whose dwelling facilities, to the

extent of at least eighty per centum, are occupied by persons or

families who are entitled to such occupancy by reason of ownership of

shares in such company; provided however that a company that was not a

mutual company prior to July first, nineteen hundred ninety-five may

become a mutual company if its dwelling facilities, to the extent of at

least fifty per centum, are occupied by persons or families who are

entitled to such occupancy by reason of ownership of shares in such

company. The commissioner or supervising agency shall provide procedures

for such conversion of a company to a mutual company on or after July

first, nineteen hundred ninety-five; such procedures shall require the

submission of a plan for attaining eighty per centum owner occupancy.

2-c. "Urban Rental Company." A company whose project is located in or

adjacent to a municipality and whose housing accommodations are occupied

by persons or families who do not own the shares in such company.

3. "Occupancy date." The date defined in the contract between a

company and a municipality or the state, as the case may be, as the date

upon which the project is to be deemed ready for occupancy, or if such

term is not defined in such contract, the date of issuance of the

temporary certificate of occupancy.

4. "Plan." A plan or undertaking of an area or areas for providing low

rent housing for persons of low income, and for other facilities

incidental and appurtenant thereto.

5. "Project." A specific work or improvement, including lands,

buildings and improvements acquired, owned, constructed, rehabilitated,

improved, managed or operated by a company providing dwelling

accommodations, non-housekeeping accommodations, aged care

accommodations or accommodations for handicapped persons pursuant to

this article, or undertaken, planned, developed, constructed or owned

pursuant to section thirty-six-a of this article, and such business,

commercial, cultural, recreational, communal, dining, medical and

nursing treatment, day care or residential child care facilities or any

combination thereof, or other facilities as may be deemed by the

commissioner with respect to a project aided by a state loan or New York

state housing finance agency loan or by the supervising agency with

respect to a municipally-aided project or a project undertaken, planned,

developed, constructed or owned pursuant to section thirty-six-a of this

article, to be incidental and appurtenant thereto. In the case of a

state loan or New York state housing finance agency loan, a project

shall effectuate all or part of a plan, provided, however, that such

dwelling accommodations, non-housekeeping accommodations, aged care

accommodations or accommodations for handicapped persons may be provided

in any section of the municipality, whether or not such section has

insanitary or substandard housing conditions.

5-a. "State urban development corporation project". A project

acquired, owned, constructed, managed or operated by a limited-profit

housing company which is a subsidiary of the New York state urban

development corporation, as the term "subsidiary" is defined in the New

York state urban development corporation act.

5-b. "Battery Park city project." A project acquired, owned,

constructed, managed or operated by a company organized pursuant to this

article and located within the Battery Park project area, as defined in

the Battery Park city authority act.

6. "Project cost". The sum total of all costs incurred by a company

and, as approved by the commissioner in the case of a state-aided

project or a project aided by the New York state housing finance agency

or by the supervising agency in the case of a municipally-aided project

as reasonable and necessary for carrying out all works and undertakings

for the development of a project. These shall include but are not

necessarily limited to the carrying charges during construction and

before physical completion or rehabilitation, working capital not

exceeding three per cent of the estimated total cost or three per cent

of the actual total final cost, whichever is larger, the cost of all

necessary studies, surveys, plans and specifications, architectural,

engineering, or other special services, the cost of acquisition of land

and any buildings thereon, site preparation and development,

construction, reconstruction and equipment; the reasonable cost of

financing incurred by the investor in the course of development of the

project, up to and including the occupancy date; the fees imposed by the

commissioner or by the supervising agency or by both; other fees charged

in the course of the development of the project up to and including the

occupancy date, pursuant to the provisions of this article; the

necessary expenses in connection with the initial occupancy of the

project and where applicable, the cost of such training services as will

assist the residents of the project to acquire ownership and to operate

the project in an efficient and harmonious manner; and the cost of such

other items, including tenant relocation, as the commissioner, in the

case of a state-aided project or a project aided by the New York state

housing finance agency or the supervising agency, in the case of a

municipally-aided project shall determine to be reasonable and necessary

for the development of the project, less any and all net rents and other

net revenues received from the operation of the real or personal

property on the project site, or any part thereof, by the company on or

after the date on which the contract between the company and the state

or the New York state housing finance agency or municipality was entered

into and prior to the occupancy date. In the case of any project

purchased or leased by a company from a municipality pursuant to the

provisions of section thirty-six-a of this article, project cost shall

include the value of the lease or the purchase price paid or to be paid

by such company to such municipality.

7. "Local and municipal taxes". Taxes levied by a county, city,

village, town, school and special district but shall not include

assessments for local improvements.

8. "Child Care Institution"--A private, non-profit, resident agency,

association, corporation, institution or other organization, which is

incorporated or organized under the laws of this state for the care and

treatment of children, which actually has its place of business or plant

in this state and which submits and consents to the approval,

visitation, inspection and supervision of the Department of Social

Welfare, or a similar administrative department of the State of New York

as to any and all acts in relation to the welfare of children performed

or to be performed thereby.

9. "Housing". As used in this article the term includes:

(a) "Dwellings". "Dwelling accommodations". A room or rooms, with or

without cooking facilities, arranged for occupancy as a self-contained

unit.

(b) "Non-housekeeping accommodations". A room or rooms, without

cooking facilities, and with or without board designed for the occupancy

of staff members, employees or students of a college, university or

hospital.

(c) "Aged care accommodations". Non-housekeeping accommodations for

aged persons with board and aged care service as may be provided as an

incident to occupancy, provided however, that no such service shall be

of such a nature, kind or quality as to require licensing by the state

department of health under article twenty-eight of the public health

law.

(d) "Accommodations for handicapped persons." Dwelling accommodations

designed for the occupancy of handicapped persons or non-housekeeping

accommodations designed for the occupancy of handicapped persons with

board and such service as may be provided as an incident to occupancy,

provided however, that no such service shall be of such a nature, kind

or quality as to make the facility subject to the jurisdiction of any

other agency of the state.

10. "Persons of low income" and "families of low income". Persons or

families who are in the low income groups and who cannot afford to pay

enough to cause private enterprise in their municipality to build a

sufficient supply of adequate, safe and sanitary dwellings,

non-housekeeping accommodations or aged care accommodations.

11. "Preliminary Costs". Project costs approved by the supervising

agency as appropriate expenditures which may be incurred prior to

commitment and initial advance of the proceeds of a mortgage loan under

this article, including but not limited to: (a) payments for options to

purchase properties on the proposed housing project site, deposits on

contracts of purchase, or with prior approval of the supervising agency,

payments for the purchase of such properties; (b) legal and

organizational expenses, including payment of attorneys' fees, project

manager and clerical staff salaries, office rent and other incidental

expenses; (c) payment of fees for preliminary feasibility studies and

advances for planning, engineering and architectural work; (d) expenses

for tenant surveys and market analyses; (e) necessary application and

other fees; and (f) such other expenses incurred by the limited-profit

housing company as the supervising agency may deem appropriate to

effectuate the purposes of this article.

12. "Municipally-aided non-profit company." A non-profit housing

company duly incorporated pursuant to the not-for-profit corporation law

and this article, which is aided by a municipal mortgage loan, a loan by

the New York city housing development corporation or tax exemption or

both and is not aided by any state mortgage loan or any mortgage loan by

the New York state housing finance agency or a mortgage loan insured by

the federal government made for the purpose of refinancing a mortgage

loan other than a municipal mortgage loan or a mortgage loan made by the

New York city housing development corporation.

13. "Municipally-aided mutual company." A mutual company which is

aided by a municipal mortgage loan, a loan by the New York city housing

development corporation or tax exemption or both and is not aided by any

state mortgage loan or any mortgage loan by the New York state housing

finance agency or a mortgage loan insured by the federal government made

for the purpose of refinancing a mortgage loan other than a municipal

mortgage loan or a mortgage loan made by the New York city housing

development corporation.

14. "Low income non-profit housing company." A non-profit housing

company duly incorporated pursuant to the not-for-profit corporation law

and this article, whose principal purpose is to provide housing for

persons of low income and families of low income and which is aided by a

state mortgage loan or mortgage loan by the New York state housing

finance agency or a municipal mortgage loan or municipal tax exemption,

or both, or a mortgage loan insured by the federal government.

15. "Residual indebtedness." Where a mortgage loan is refinanced

pursuant to section twenty-three-a or subdivision twenty-two-a of

section six hundred fifty-four of this chapter, residual indebtedness

shall be the indebtedness of a company due on the original mortgage

loan, including all unpaid principal and all interest accrued thereon,

less an amount equal to the principal amount, when made, of the mortgage

insured by the federal government in connection with the refinancing.

Such indebtedness shall be secured by a mortgage which may be

subordinate to the lien of any mortgage insured by the federal

government and may contain such terms and conditions not inconsistent

with this article as may be approved by the supervising agency and as

the supervising agency may deem necessary or desirable to secure the

repayment of such residual indebtedness. Residual indebtedness shall not

be restricted by the provisions of this article relating to project

cost.

16. "Residual receipts obligations". Where a mortgage loan is

refinanced pursuant to section twenty-three-a or subdivision

twenty-two-a of section six hundred fifty-four of this chapter, residual

receipts obligations shall mean the amount of any additional loan to a

company, and any amounts paid other than by the company, to establish

escrow accounts or reserves or to satisfy minimum property standards or

to install life safety devices for the issuance of mortgage insurance by

the federal government in connection with the refinancing. With the

approval of the supervising agency and the consent of the company,

residual receipts obligations may be evidenced by non-interest bearing

residual receipts notes. Residual receipts obligations shall be payable

only after the payment in full of all residual indebtedness. Residual

receipts obligations shall not be restricted by the provisions of this

article relating to project cost and shall not include any amounts

deposited under an agreement with the federal government for the sharing

of claims paid by the federal government on account of insurance of

mortgages.

Limited-profit housing companies; how created. A company may be

created by three or more persons, approved by the commissioner, by

making, subscribing, acknowledging and filing with the secretary of

state a certificate which shall be entitled and endorsed "Certificate of

Incorporation of (name of company) pursuant to the Limited-Profit

Housing Companies Law"; provided that if the company is to be organized

to undertake a municipally-aided project the commissioner shall not

approve such persons unless they shall have been first approved by the

supervising agency; provided further that no company shall be created to

provide aged care accommodations or accommodations for handicapped

persons under this article, except under this article and the

not-for-profit corporation law. The certificate shall state:

1. The name of the proposed company.

2. The purposes for which it is to be formed which shall include among

other things a provision that the company is to plan, acquire,

construct, own, maintain, and operate projects pursuant to the terms and

provisions of this article.

3. Except in the case of a not-for-profit corporation, the amount of

the capital shares, and if any be preferred shares, the preference

thereof.

4. Except in the case of a not-for-profit corporation, the number of

shares of which capital shall consist, all of which shall have a par

value.

5. The municipality, as well as the county within this state, in which

its principal business office is to be located, and the address to which

the secretary of state shall mail a copy of process in any action or

proceeding against the corporation which may be served upon him.

6. Its duration, which shall be: (a) not less than the period for

which the loans contracted for under this article and the interest

thereon remain unpaid in whole or in part; and (b) not less than the

period for which tax exemption is granted pursuant to section

thirty-three of this article; and (c) in any event not less than

thirty-five years from the date of occupancy of any project, except as

may be provided in sections thirty-five and thirty-six of this article.

7. The number of directors, which shall not be less than three nor

more than twenty-one, and who shall be elected by the stockholders or

members of the corporation. Unless required by the certificate of

incorporation or the by-laws, directors need not be stockholders.

Directors appointed by the commissioner pursuant to subdivision fifteen

of this section or by the supervising agency pursuant to paragraph (c)

of subdivision sixteen of this section need not be stockholders or meet

other qualifications which may be prescribed by the certificate of

incorporation or the by-laws. In a corporation undertaking a state-aided

project one additional director may be designated by the commissioner,

and, in the case of all state-aided mutual companies, such additional

director shall be designated by the commissioner at the creation of the

company and shall serve from the time of such designation at least until

a board of directors has been elected by the tenants entitled to

occupancy in the project by reason of ownership of shares in such

company. In a corporation undertaking a municipally-aided project one

additional director may be designated by the supervising agency, and, in

the case of all municipally-aided mutual companies, such additional

director shall be designated by the supervising agency at the creation

of the company and shall serve from the time of such designation at

least until a board of directors has been elected by the tenants

entitled to occupancy in the project by reason of ownership of shares in

such company. The director appointed by the commissioner or the

supervising agency need not be a stockholder or meet other

qualifications which may be prescribed by the certificate of

incorporation or the by-laws. In the absence of fraud or bad faith the

director appointed by the commissioner hereunder or the supervising

agency or the directors appointed by the commissioner or by the

supervising agency pursuant to subdivision fifteen or paragraph (c) of

subdivision sixteen respectively of this section shall not be personally

liable for the debts, obligations or liabilities of the corporation.

Directors of a mutual housing company are to serve in that capacity

without salary but may be reimbursed for expenses incurred directly

relating to the duties of the director's office.

8. The names and post-office addresses of the directors until the

first annual meeting.

9. The names and post-office addresses of the subscribers to the

certificate, and a statement of the number of shares of stock which each

agrees to take in the company.

10. That, except in the case of a company to be aided by a loan from

the federal government or any agency or instrumentality thereof, or if

the mortgage or mortgage bonds which are to be used in financing the

company's project are to be insured by the federal government or any

agency or instrumentality thereof, the entire amount to be paid in cash

or property by the shareholders and income debenture holders shall be at

least five per centum of the project cost in the case of an urban rental

company and a mutual company. The provisions of this subdivision shall

not apply to a non-profit company incorporated pursuant to the

provisions of the not-for-profit corporation law and this article for

the purpose of providing housing for staff members, employees or

students of a college, university, hospital or child care institution

and their immediate families, or for aged or handicapped persons of low

income, nor to a municipally-aided non-profit company nor to a

municipally-aided mutual company, nor to a low income non-profit housing

company.

11. That, so long as this article shall remain applicable to any

project of the company, its real property shall not be sold,

transferred, encumbered or assigned except as permitted by the terms and

provisions of this article.

12. That all of the subscribers to the certificate are of full age,

that at least two-thirds of them are citizens of the United States, and

that at least one of the persons named as director is a citizen of the

United States and a resident of the state of New York.

13. That the company has been organized to serve a public purpose and

that it shall be and remain subject to the supervision and control of

the commissioner, or, if the company is organized to undertake a

municipally aided project, of the supervising agency, except as

otherwise provided in this article, so long as this article remains

applicable to any project of the company; that all real and personal

property acquired by it, and all structures erected or rehabilitated by

it, shall be deemed to be acquired, rehabilitated or created for the

proper effectuation of the purposes of this article, and that the

directors and subscribers of such company shall be deemed to have agreed

that they shall at no time receive or accept from such company in

repayment of their investment in its stock any sums in excess of the par

value of the stock, together with such dividends or other compensation

as are prescribed by or permitted under this article, and that, upon

dissolution of the company, any surplus remaining after the payment of

all its obligations shall be distributed and disposed of and title to

the property may be conveyed in fee, only as prescribed by this article.

14. The certificate may provide that in the event that income

debentures are issued by the company the owners thereof may be given the

same right to vote as they would have if possessed of certificates of

stock of the amount and par value of the income debentures held by them.

If provision is made for the issuance of income debentures interest

shall be paid by the company on income debentures only out of net

earnings of the company that would be applicable to payment of dividends

if there were no income debentures.

15. That in the event of a violation by a state-aided company of any

provision of the certificate of incorporation or of law or of the loan

or mortgage contract or any order of the commissioner or of any rules

and regulations duly promulgated pursuant to the provisions of this

article the commissioner may remove any or all of the existing directors

of the company and appoint such person or persons whom the commissioner

deems advisable, including officers and employees of the division of

housing and community renewal, as new directors to serve in the places

of those removed; that directors so appointed by the commissioner who

are officers or employees of the division of housing and community

renewal shall serve in such capacity without compensation; and that any

directors so appointed by the commissioner shall serve only for a period

coexistent with the duration of such violation or until the commissioner

is assured in a manner satisfactory to him against violations of a

similar nature.

16. If the company is organized to undertake a municipally-aided

project, such certificate shall contain:

(a) A declaration that the original directors, officers, subscribers

and income debenture holders possessing the right to vote, shall be

deemed at the time of accepting such offices, or subscribing to the

stock or income debentures to have agreed not to resign from the company

and not to sell their stock or income debentures prior to the completion

of the project and the certification of the total actual project cost by

the supervising agency, except with the consent of the supervising

agency.

(b) A declaration that the shares of stock and the income debentures

of the company shall be issued only in such amounts and form as may be

approved by the supervising agency and that no stock shall be redeemed,

purchased or retired and no income debentures shall be redeemed prior to

their dates of maturity or purchased or retired by the company during

the period in which the loan by the municipality is in force or for

which tax exemption is granted pursuant to section thirty-three of this

article, except with the consent of the supervising agency.

(c) A provision that in the event of a violation by the company of any

provision of the certificate of incorporation or of law or of the loan

or mortgage contract or of any rules and regulations duly promulgated

pursuant to the provisions of this article, the supervising agency may

remove any or all of the existing directors of the company and appoint

such person or persons which the supervising agency in its sole

discretion deems advisable, including officers or employees of the

supervising agency, as new directors to serve in the places of those

removed; that directors so appointed by the supervising agency who are

officers or employees of the supervising agency shall serve in such

capacity without compensation; and that any directors so appointed by

the supervising agency shall serve only for a period coexistent with the

duration of such violation or until the supervising agency is assured in

a manner satisfactory to it against violations of a similar nature.

(d) A provision that the supervising agency or its duly authorized

representative shall be notified in writing of and shall have the right

to attend all meetings of the board of directors or of the stockholders

and income debenture holders of the company.

(e) A provision that the sale of stock by a stockholder or the company

or the sale of income debentures, the holders of which possess the right

to vote, by any such holder or the company, shall be subject to the

consent of the supervising agency.

(f) Such other provisions, not inconsistent with law, as the

supervising agency may deem necessary to protect the investment of the

municipality and to carry out the purposes of this article.

17. The certificate of incorporation of a non-profit company

incorporated pursuant to the provisions of the not for-profit

corporation law and this article shall, in addition to all other matters

required by law to be stated therein, state:

a. That its purpose is to provide housing and auxiliary facilities for

staff members, employees or students of any college, university,

hospital, child care institution and their immediate families, for aged

or handicapped persons of low income, or for any one of the above

purposes, or to provide housing accommodations pursuant to the terms and

provisions of this article in the case of a municipally-aided non-profit

company, or to provide housing accommodations pursuant to the provisions

of this article in the case of a low income non-profit housing company;

b. That the directors or trustees are and at all times shall be

officers, directors or trustees of such college, university, hospital or

child care institution, or, in the case of a non-profit company

providing housing for aged or handicapped persons of low income or of a

municipally-aided non-profit company providing housing accommodations

pursuant to the terms and provisions of this article, or of a low income

non-profit housing company providing housing accommodations pursuant to

the provisions of this article, of a corporation organized pursuant to

the provisions of the not-for-profit corporation law;

c. That the property of such company shall upon dissolution vest in

such college, university, hospital, child care institution, or

not-for-profit corporation, and

d. That no part of the net earnings of such college, university,

hospital, child care institution or not-for-profit corporation shall

inure to the benefit of any private individual.

18. That the secretary of state is designated as the agent of the

company upon whom process in any action or proceeding against it may be

served.

The applicability of not-for-profit corporation law. 1. The

not-for-profit corporation law applies to every company heretofore or

hereafter formed under this article and the not-for-profit corporation

law, provided that:

(a) If any provision of the not-for-profit corporation law conflicts

with any provision of this article, the provision of this article shall

prevail and the conflicting provision of the not-for-profit corporation

law shall not apply in any such case. If any provision of this article

relates to a matter embraced in the not-for-profit corporation law but

is not in conflict therewith, both provisions shall apply.

(b) The following provisions of the not-for-profit corporation law

shall not apply to companies formed pursuant to this article and the

not-for-profit corporation law:

Paragraphs (7) and (8) of subdivision (a) of section one hundred

twelve, section one hundred thirteen, section one hundred fourteen,

section two hundred one, section three hundred four, section three

hundred seven, section four hundred four, subdivision (3) of paragraph

(a) of section five hundred ten, section six hundred nine, section six

hundred seventeen, paragraphs (a) and (b) of section eight hundred four,

article nine, section ten hundred eleven, section ten hundred twelve,

article thirteen, article fourteen.

2. Every corporation to which the not-for-profit corporation law is

made applicable by this section is a charitable corporation as defined

in paragraph (a) of section one hundred two (Definitions) of the

not-for-profit corporation law for all purposes of that law.

Verification of papers filed with supervising agency. Any

document required to be filed with the supervising agency regarding

rental units, either state or municipal, shall be duly verified under

oath of the corporation or individual filing the same. The commissioner

or head of such supervising agency may restrict the required

verification to such documents as relate to financial statements and all

other data submitted in support of an application for an increase of

rents.

Voting, election and referendum procedures. 1. Any shareholder

vote involving the election of board members, by-law amendments, or on

dissolution or reconstitution or conversion of a mutual housing company

including any votes for a special assessment pursuant to subdivisions

one, two or three of section thirty-five-a of this article shall be

conducted using secret ballots. Such ballots shall be cast in-person by

tenants entitled to vote in the project; unless such tenant casts such

ballot using an absentee ballot issued pursuant to subdivision two of

this section.

2. Any shareholder entitled to vote may request an absentee ballot to

cast a ballot in any shareholder vote. Such an absentee ballot may be

delivered or mailed only to the primary residence address of the

shareholder entitled to vote in the project. An absentee ballot cast

pursuant to this subdivision shall be sealed within two envelopes and

shall be mailed or delivered to a neutral third party not running for a

position on the board of directors. The outer envelope containing the

ballot shall instruct the shareholder to affix their signature to the

outer envelope only, and further instruct the shareholder not to sign

the ballot itself.

3. Proxy voting shall not be permitted in a vote for a position on a

board of directors, for dissolution or reconstitution of the mutual

housing company, for the authorization of a feasibility study, for the

authorization to develop and submit to the attorney general an offering

plan for dissolution and reconstitution of the mutual housing company,

for the authorization to develop and submit to the attorney general a

proxy statement or any other documents permitted by the attorney general

instead of such offering plan, or any other vote relating to dissolution

or reconstitution required by the regulations of the commissioner or

supervising agency, or for an assessment approved pursuant to section

thirty-five-a of this article to fund the development, submission,

completion, or distribution of any of the aforementioned documents.

4. All ballots shall produce a paper or electronic record which may be

audited in the case of a contested election result.

5. No otherwise-eligible person shall be prevented from being a

candidate for, being elected to, or serving on a board of directors

based solely on that person owing or having owed any amount of any form

of arrears to the mutual housing company, unless, at the time of

nomination, that person currently owes an amount of arrears greater than

the equivalent of two months of that person's monthly maintenance.

Nothing in this subdivision shall be construed to require or mandate any

mutual housing company to adopt bylaws, rules, policies, or procedures

restricting any person's eligibility to be nominated, elected, or serve

on a board of directors. No grounds other than the above arrearages in

excess of two months maintenance shall be a basis in itself to deny such

eligibility to any person unless specifically incorporated in

regulations promulgated by or procedures approved by the commissioner or

supervising agency. Neither a mutual housing company nor the

commissioner or the supervising agency may modify in any way the above

limitation so as to restrict eligibility on the basis of fewer than two

months of arrears.

Consent of commissioner to incorporation. Whenever any such

certificate shall be presented to the secretary of state, he shall not

file such certificate unless there shall accompany the same a

certificate of the commissioner that he consents to the filing of such

certificate; nor shall any amendment to the certificate of incorporation

be filed unless it is accompanied by a certificate of the commissioner

consenting thereto. If a company has entered into a contract with a

municipality for the construction of a municipally aided project, the

commissioner shall not issue a certificate consenting to an amendment of

the certificate of incorporation of such company, unless the supervising

agency has given its written consent to such amendment.

Participation by certain corporations and individuals. 1. (a)

One or more banking organizations, foundations, labor unions, employers'

associations, veterans' organizations, colleges, universities,

educational institutions, child care institutions, hospitals, medical

research institutes, insurance companies, trustees, fiduciaries or any

combination of the foregoing, shall have the power to organize a company

pursuant to the provisions of this article, and to purchase for cash or

to receive and hold in exchange for property, and to own the bonds of a

company and to invest, singly or jointly, or with the state or a

municipality or the New York state housing finance agency or the New

York city housing development corporation in a bond or note and single

participating mortgage, or in separate bonds or notes and mortgages, in

an amount not greater than ninety-five per centum of the total project

cost in the case of a mutual company, urban rental company or a

non-profit company incorporated pursuant to the provisions of the

not-for-profit corporation law and this article for the purpose of

providing housing for staff members, employees or students of a college,

university, child care institution, or hospital and their immediate

families and in the case of a non-profit company incorporated pursuant

to the not-for-profit corporation law and this article for the purpose

of providing housing for aged persons of low income or in the case of a

low income non-profit housing company such investment shall not be

greater than the total project cost. Where one or more banking

organizations, foundations, labor unions, employers' associations,

veterans' organizations, colleges, universities, educational

institutions, child care institutions, hospitals, medical research

institutes, insurance companies, trustees, fiduciaries, or the state or

a municipality or the New York state housing finance agency or the New

York city housing development corporation, shall participate in a loan

to a company secured by a single participating mortgage or by separate

mortgages, the interest of each shall have equal priority as to lien in

proportion to the amount of loan so secured, but need not be equal as to

interest rate, time or rate of amortization or otherwise. Banking

organizations, foundations, labor unions, employers' associations,

veterans' organizations, colleges, universities, educational

institutions, child care institutions, hospitals, medical research

institutes, insurance companies, trustees, fiduciaries or groups

thereof, may exercise any such power on such conditions, however, as to

banking organizations and as to insurance companies only to the extent

and upon such conditions as may be authorized by the state

superintendent of financial services. As used in this subdivision, the

terms "trustees" and "fiduciaries" shall include any fiduciary or

fiduciaries holding funds for investment, and the term "banking

organizations" shall have the same meaning as in subdivision eleven of

section two of the banking law.

(b) Notwithstanding the provisions of paragraph (a) of this

subdivision or of any general, special or local law, for the purpose of

completing the financing of project cost, in the event that a

municipality has made or contracted to make a loan to a company or to a

public benefit corporation to provide moneys to finance the project cost

of a project (1) the construction of which commenced prior to December

first, nineteen hundred seventy-five, (2) for which a temporary or

permanent certificate of occupancy was not issued prior to January

first, nineteen hundred seventy-three, and (3) which is assisted by a

contract with the secretary of housing and urban development of the

United States pursuant to section two hundred thirty-six of the national

housing act, as amended, covering all dwelling units therein, one or

more banking organizations as defined in paragraph (a) of this

subdivision, foundations, labor unions, credit unions, employers'

associations, veterans' organizations, colleges, universities,

educational institutions, child care institutions, hospitals, medical

research institutes, insurance companies, trustees or fiduciaries as

defined in paragraph (a) of this subdivision, trustees of pension and

retirement funds and systems, corporations, partnerships, individuals,

or other entities or any combination of the foregoing shall have the

power to participate in such loan or make or participate in a new loan

secured by a bond or note and a single participating mortgage, or by

separate bonds or notes and separate mortgages, or to invest, singly or

jointly, with the municipality in a bond or note and single

participating mortgage or in separate bonds or notes and mortgages, upon

such terms and conditions as may be approved by the supervising agency,

including but not limited to provisions providing that (i) priority may

be given to the payment of the principal of and interest on that portion

of the mortgage indebtedness attributable to participation in a loan or

an investment made by one or more of such entities or organizations,

(ii) the interest of the municipality created as a result of making a

mortgage loan may be subordinated to the interest that one or more of

such organizations or entities may have upon such participation or

investment, (iii) the interest of each upon such participation or

investment need not be of equal priority as to lien, nor be equal as to

interest rate, time or rate of amortization of principal or time of

payment of interest, or otherwise, provided, however, that the aggregate

amount of the loan or loans or investment made by one or more of such

organizations or entities shall not exceed thirty per centum of total

project cost and, further provided that the aggregate amount of the loan

or loans to a company does not exceed such amount as is authorized

pursuant to paragraph (a) of this subdivision. All or part of the

proceeds of such participation or investment pursuant to this paragraph

(b) may be applied to reduce or prepay the loan made by the

municipality. The provisions of subdivisions one and five of section

twenty-six of this article shall not apply to such participation in a

loan or investment pursuant to this paragraph (b) if undertaken in

connection with a project theretofore approved pursuant to said section

twenty-six.

Notwithstanding the provisions of this article or of any general,

special or local law, in the event that a municipality has made a loan

pursuant to this article prior to any participation pursuant to this

paragraph, the supervising agency shall have the power, upon the

mortgagor's consent, to modify the terms and conditions of the original

bond or bonds or note or notes and mortgage and any other documents

executed in connection with such initial loan, as the supervising agency

may deem necessary or desirable, to provide for such participation,

including but not limited to modification of the rate and time of

payment of the interest on the initial loan or rate of amortization of

principal thereof, and provision for the additional borrowing cost, if

any, with respect to that portion of the mortgage indebtedness

attributable to such participation, provided, that except to the extent

of any increase in the maximum principal amount of the original mortgage

loan, with regard to a company that has obtained a temporary or

permanent certificate of occupancy for part or all of a project financed

by a loan pursuant to this article before such participation in a loan

or investment is made, the sum of the payments of interest and principal

on the mortgage loan or loans which the company is obligated to make in

any year as a result of such modification and participation in a loan or

investment made pursuant to this paragraph, shall not exceed the sum of

the payments of interest and principal that such company would have been

obligated to make in such year under the original mortgage loan

agreement if the project had been fully financed under the original

mortgage loan agreement by the municipality at an interest rate equal to

the maximum rate per annum prescribed by the superintendent of financial

services pursuant to section fourteen-a of the banking law as of

December nineteenth, nineteen hundred seventy-five, or such higher rate

of interest as the secretary of housing and urban development of the

United States shall approve pursuant to an agreement to make interest

reduction payments pursuant to section two hundred thirty-six of the

national housing act, as amended, with respect to such project and that

the rental or carrying charges in such projects shall not be increased

as a result of such participation in a loan or investment and further

provided, that the company shall not seek or accept from the

municipality any subsidy, direct or indirect, excluding existing tax

exemption, to offset any increased borrowing costs, if any.

(c) Where the state or a municipality shall join with one or more

organizations of the kind hereinabove mentioned, in making a loan

secured by a single participating mortgage or by separate mortgages, the

state or a municipality is authorized, through the commissioner of

housing, or the supervising agency, as the case may be, to make

provision, either in the mortgage or mortgages or by separate agreement,

for the performance of such services as are generally performed by a

banking institution or insurance company which itself owns and holds a

mortgage or by a trustee under a trust mortgage. The commissioner and

the supervising agency are hereby authorized to act as trustee or to

consent to the appointment of a banking institution to act in such

capacity. Any agreement made by the commissioner under this provision

shall be subject to the approval by the state comptroller and the

attorney general as to form.

(d) In connection with any participation in a loan or investment

pursuant to paragraph (b) of this subdivision the municipality shall

have the power to assign or pledge, in whole or in part, to one or more

of the organizations or entities participating in such loan its right,

title and interest in and to any mortgage held pursuant to this article

and any contract or arrangement for the payment of subsidy with respect

to such loan and the right to receive and apply to repayment of such

loan and the interest thereon any payments made under such mortgage or

under such contract or arrangement.

2. Notwithstanding any other provision of law, any banking institution

or insurance company or a group thereof operating a company, or owning

all of the bonds of a company may exercise all the powers conferred by

this section and may enter into contracts contemplated by this article

and agree with the commissioner not to sell, assign, or otherwise

transfer such project or bonds or bond and mortgage or interest therein

of such company provided for pursuant to this article without the

consent of the commissioner.

Limited-profit housing companies; partnership relations.

Notwithstanding any provisions in this article to the contrary, but

subject to such regulations as may be prescribed by the commissioner or

the supervising agency, as the case may be:

1. (a) Any company may be a partner (general or limited) in a

partnership (general or limited) formed for the purpose of providing

such company with capital. Any company incorporated pursuant to the

provisions of this article may, with the consent of the commissioner or

the supervising agency as the case may be, become a partner (general or

limited) in a partnership (general or limited) upon the consent of the

company to the refinancing of its original mortgage loan by a mortgage

loan insured by the Federal government; such a partnership shall have

the same powers and duties as provided by this article as a partnership

formed for the purpose of providing a company with capital.

(b) Any partner (general or limited) of any partnership (general or

limited) in which a company is a partner (general or limited) may be the

owner or holder of any shares, bonds, income debentures, notes or other

securities of such company.

(c) Any company which is a partner (general or limited) in any such

partnership (general or limited) may exercise all the rights and powers

and shall be subject to all the duties and obligations of a company in

accordance with this article.

2. The capital structure of a company which is a partner (general or

limited) in a partnership (general or limited) formed pursuant to

paragraph (a) of subdivision one of section sixteen may include

withdrawals from the capital of such a partnership (general or limited).

The provisions of this article relating to shares and income

debentures shall be deemed to include withdrawals from the capital of a

partnership (general or limited) of which a company is a partner

(general or limited).

3. For the purposes of this section, the term partner shall be deemed

to include a member of a limited liability company, and the term

partnership shall be deemed to include a limited liability company,

provided there is disclosure of the identity of the managing member,

including the identity of the natural person who is responsible for the

housing development. Notwithstanding any provision of this section to

the contrary, any change in general partner of a partnership or managing

member of a limited liability company shall be subject to the prior,

written approval of the commissioner or supervising agency.

Powers. 1. Subject to the limitations of this article, a company

heretofore or hereafter organized under this chapter shall have the

powers and be subject to the limitations contained in the business

corporation law or the not-for-profit corporation law, as the case may

be, and shall have the following additional specific powers:

(a) To make and execute contracts and other instruments necessary or

convenient in the exercise of its powers;

(b) To acquire or contract to acquire from any person, firm,

corporation, municipality, federal or state agency, by grant, purchase,

condemnation or otherwise, leaseholds, real, personal or mixed property

or any interest therein, and to sell, assign, exchange, transfer,

mortgage or encumber the same;

(c) To own, hold, clear and improve, leasehold, real, personal or

mixed property or any interest therein;

(d) To construct, reconstruct, rehabilitate, improve, alter or repair

or provide for the construction, reconstruction, improvement, alteration

or repair of any project;

(e) To lease or rent any of the housing or other accommodations or any

of the lands, buildings, structures or facilities embraced in any

project and establish and revise the rents or charges therefor; or to

purchase or lease a project or a part thereof from an authority,

pursuant to the provisions of section fifty-eight or article twelve-b of

this chapter.

(f) To arrange or contract with a municipality for the planning,

replanning, opening, grading or closing of streets, roads, roadways,

alleys or other places or for the furnishing of facilities or for the

acquisition by a municipality of property or property rights or for the

furnishing of property or services in connection with a project;

(g) To insure or provide for the insurance of its property or

operations as required by law and also against such other risks as it

may deem advisable;

(h) To limit by contract the exercise of any of its powers;

(i) To invest any funds held in reserves or sinking funds, or any

funds not required for immediate disbursement in property or securities

in which savings banks may legally invest funds subject to their

control;

(j) To sue and be sued;

(k) To have a seal and alter the same at pleasure;

(l) To make and from time to time amend and repeal by-laws, rules and

regulations not inconsistent with the provisions of this article;

(m) To sell, lease, or otherwise convey all or any part of a project

to an authority upon such terms and conditions as shall have the prior

approval of the commissioner or the supervising agency, as the case may

be;

(n) A non-profit company incorporated pursuant to the not-for-profit

corporation law and this article for the purpose of providing housing

and auxiliary facilities for staff members, employees or students of any

college, university, hospital, child care institution and their

immediate families; for aged or handicapped persons of low income or for

any one of the above purposes, may, with the prior written consent of

the commissioner or the supervising agency, as the case may be, lease

its project or any part thereof to any colleges, universities,

hospitals, child care institutions or not-for-profit corporations. A

lessee of a project may sublease all or any part of the project to

institutions and not-for-profit corporations which would be an eligible

sponsor pursuant to the provisions of this chapter and to staff members,

employees, and students of any college, university, hospital, child care

institution, and to aged and handicapped persons of low income. Any

property so leased or subleased shall remain subject to the provisions

of this article and to the rules and regulations of the commissioner, or

supervising agency, as the case may be. A lease or sublease of the

entire project may provide for the assumption by the lessee or sublessee

of the management and control of the project, and all of the obligations

thereof, as well as the right to collect all revenues accruing thereto.

In any event, the lessee shall pay rental in an amount at least equal to

the interest and amortization due upon the mortgage of the property so

leased.

(o) To lease to any authority, or to a municipality in connection with

any federally-aided program to provide dwelling accommodations for

persons of low income, one or more dwelling units in a project upon such

terms and conditions as shall have the prior written approval of the

commissioner or the supervising agency, as the case may be.

(p) To lease, with or without an option to purchase, all or any part

of a project to any person, firm, partnership, trust or corporation,

subject to the prior written consent of the commissioner or the

supervising agency, as the case may be. Any property so leased shall

remain subject to the provisions of this article and to the rules and

regulations of the commissioner or the supervising agency, as the case

may be. Such lease may provide for the assumption by the lessee of the

management and control of the project, as well as the right of the

lessee to collect all revenues accruing thereto.

To do all other things necessary or convenient to carry out its

powers.

2. A company shall file with the commissioner or the supervising

agency, as the case may be, a copy of any by-laws, rules, regulations

and amendments thereto adopted by it from time to time, which shall

become effective upon approval by the commissioner or by the supervising

agency; provided, however, that if the commissioner or the supervising

agency shall fail to approve or disapprove such proposed by-laws within

three months after such filing, such by-laws shall become effective upon

the expiration of such three month period. These by-laws, rules,

regulations and amendments shall contain such provisions relating to the

management of its business, the regulation of its affairs, the calling

of meetings, the manner of selection of officers and trustees and such

other provisions as may be reasonable and necessary.

3. Notwithstanding the provisions of any law, general or special, a

mutual company may, with the approval of the commissioner or the

supervising agency, as the case may be, require a standard form and

procedure for the casting of proxies or absentee ballots in any matter

requiring a shareholder vote.

4. Notwithstanding the provisions of any law, general or special, a

board of directors of a mutual housing company created pursuant to the

provisions of this article shall:

(a) Hold at least four meetings of the board of directors annually.

Such meetings shall be open to all shareholders and residents, except

that they may include executive sessions open only to directors for the

sole purpose of discussing confidential personnel issues, legal advice

and counsel from an attorney to whom the mutual housing company is a

client, or confidential issues affecting individual shareholders or

residents, or contract negotiation. Any such board of directors meetings

held in addition to the minimum number of four as required by this

section shall be open to shareholders and residents, and subject to the

aforementioned exception regarding executive sessions.

(b) Maintain a record of any vote on a resolution of such board,

including specification of how each director voted. Such record shall be

a matter of public record which will be made available as a paper copy

at the request of a shareholder and will also be posted on a website

that is accessible by all shareholders maintained by the board of

directors, provided however, that there may be redactions to the extent

minutes would reflect the discussions held in executive session.

(c) Promptly post on a website available to all shareholders and

maintained by the board of directors to communicate with shareholders,

(i) any request by the mutual housing company to the commissioner or the

supervising agency, as the case may be, and any final resolution

regarding such request, when the request relates to a change in

regulations, a change in its real estate taxation, in a refinancing,

financing being offered by the commissioner, supervising agency, or any

other agency or, a proposed dissolution and reconstitution, (ii) any

deficiency letters issued by the office of the attorney general to the

mutual housing company regarding an offering plan for dissolution and

reconstitution of the mutual housing company, any deficiency letters

issued by the office of the attorney general to the mutual housing

company regarding a proxy statement or any other documents permitted by

the attorney general instead of such offering plan, and any of the

mutual housing company's resubmissions of such offering plan or proxy

statement or any other documents permitted by the attorney general

instead of such offering plan in response to such deficiency letters

issued by the office of the attorney general, or (iii) any offer of

financing from the commissioner, supervising agency, or any other agency

to the mutual housing company.

5. (a) No mutual housing company shall interfere with the right of a

shareholder or tenant to form, join or participate in the lawful

activities of any group, committee or other organization formed to

protect the rights of shareholders and tenants; nor shall any mutual

housing company harass, punish, penalize, diminish, or withhold any

right, benefit or privilege of a shareholder or tenant under their

proprietary lease or tenancy for exercising such right.

(b) Shareholder and/or tenants' groups, committees or other

shareholder and/or tenants' organizations shall have the right to meet

without being required to pay a fee in any location on the premises

including a community or social room where use is normally subject to a

fee which is devoted to the common use of all shareholders and/or

tenants in a peaceful manner, at reasonable hours and without

obstructing access to the premises or facilities. Nothing in this

subdivision shall be construed to limit or impede the authority of the

board of directors to act on behalf of the mutual housing company or

regulation by the commissioner or supervising agency with respect to the

recognition of a tenant group representing all tenants, or to require

the continued recognition of a cooperators' advisory council formed

pursuant to subdivision one of section thirty-two-a of this article when

superseded by the election of a board of directors.

Designation of and service of process on secretary of state and

registered agent. The provisions of sections three hundred four, three

hundred five and three hundred six of the business corporation law shall

apply to companies heretofore or hereafter organized pursuant to the

provisions of this article.

Consideration for issuance of stock, bonds or income debentures.

No company shall issue stock, bonds, or income debentures except for

money or property actually received for the use and lawful purposes of

the company, provided, however, that a mutual company may issue stock

for home owners purchase notes if the purchase transaction has received

the written endorsement of the commissioner in accordance with

supplementary rules and regulations of the commissioner made therefor

and if at least two hundred dollars in money or property is received by

such company toward the issuance of such stock. No stock, bonds or

income debentures shall be issued for property except upon a valuation

approved by the supervising agency or by the commissioner, as the case

may be, and such valuations shall be used in computing the estimated or

actual project cost.

Mortgages, mortgage bonds and notes. 1. Any company, subject to

the approval of the commissioner or of the supervising agency, as the

case may be, may borrow funds and secure the repayment thereof by bond

or note and mortgage or by an issue of bonds under a trust indenture.

2. Each loan made to a company shall relate to one or more specified

projects and shall be secured by a mortgage upon all of the real

property of which the project or projects, to which the loan relates,

consists, and upon all fixtures and articles of personal property

attached to or used in connection with the operation of such project or

projects. Such mortgages may contain such other clauses and provisions

as shall be approved by the commissioner, or the supervising agency, as

the case may be, including the right to assignment of rents and entry

into possession in case of default; but the operation of such project or

projects, in the event of such entry by a mortgagee or receiver, except

in the case of a mortgage loan insured or held by the federal

government, shall be subject to regulations promulgated by the

commissioner or the supervising agency. Provisions for the amortization

of the mortgage indebtedness and residual indebtedness of companies

formed under this article shall be subject to the approval of the

commissioner or the supervising agency, as the case may be. In the case

of an instrument or instruments evidencing residual indebtedness issued

pursuant to section twenty-three-a or section forty-four-b of this

chapter, the principal amount of such instrument or instruments and the

interest thereon, if any, shall be repaid over a period of time not

exceeding the term over which the mortgage loan insured by the federal

government is to be repaid, plus ten years, which period of time shall

commence at such time as the commissioner or the supervising agency

shall approve, provided, however, that such period of time shall not

expire more than fifteen years after the mortgage loan insured by the

federal government has been satisfied.

Capital structure. The capital structure of a company

undertaking a project and the proportionate amount of the project cost

to be represented by mortgages, bonds, notes, income debentures and

shares shall be subject to the approval of the commissioner except as

otherwise provided in section twenty-three with respect to a

municipally-aided project. The shares and income debentures issued by a

mutual company or urban rental company, other than a non-profit company

incorporated pursuant to the provisions of the not-for-profit

corporation law and this article for the purpose of providing housing

for staff members, employees or students of a college, university,

hospital or child care institution and their immediate families or for

aged or handicapped persons of low income, and other than a

municipally-aided non-profit company or a municipally-aided mutual

company, and other than a low income non-profit housing company, shall

not be less than the total of five per centum of the project cost. The

shares, bonds or notes, income debentures and mortgages covering any

project shall not exceed the actual project cost.

The provisions of this section with respect to the proportionate

amount of the project cost to be represented by mortgages, bonds, notes,

income debentures and shares shall not be applicable to any housing

company project, if funds made available by the federal government or

any agency or instrumentality thereof are used in financing the project,

in whole or in part, or if a mortgage or mortgage bonds issued with

respect to such project are insured by the federal government or any

agency or instrumentality thereof.

State loans. 1. The commissioner may enter into contracts for

loans to a company. All such contracts shall be subject to approval by

the state comptroller and by the attorney general as to form.

2. Loans by the state under such a contract shall be secured by a

first mortgage lien, and no such loan shall be made in an amount greater

than ninety-five per centum of the total project cost in the case of a

mutual company, urban rental company or a non-profit company

incorporated pursuant to the provisions of the not-for-profit

corporation law and this article for the purpose of providing housing

for staff members, employees or students of a college, university,

hospital or child care institution and their immediate families and in

the case of a non-profit company incorporated pursuant to the

not-for-profit corporation law and this article for the purpose of

providing housing for aged or handicapped persons of low income or in

the case of a low income non-profit housing company such loans shall not

be made in an amount greater than the total project cost. In case of a

loan in an amount greater than ninety-five per centum of the total

project cost, the commissioner may in his discretion require

satisfactory independent guarantees that the loan will be repaid

according to the terms of the company's bond or note and mortgage.

Notwithstanding any other provisions of law, if the company proposes to

sell or convey any part or parts of the mortgaged premises prior to the

sale by the state of the definitive bonds providing the funds for the

state loan, the comptroller, upon the application of the company and

with the prior written consent of the commissioner, may release from the

first mortgage lien any part or parts of the mortgaged premises not

acquired through condemnation and not required for the project, provided

that any net proceeds from the sale or conveyance of the said property

will be held by the company for the sole purpose of reducing, in

accordance with the requirements of the commissioner and comptroller,

the principal amount of the state loan outstanding, and provided further

that the unpaid principal amount of the state loan then outstanding, as

it may be reduced by the net proceeds, if any, derived from the sale or

conveyance, would not be in an amount greater than ninety-five per

centum of the total project cost and in the case of a non-profit company

incorporated pursuant to the provisions of the not-for-profit

corporation law and this article for the purpose of providing housing

for aged or handicapped persons of low income or in the case of a low

income non-profit housing company such amount shall not be greater than

the total project cost. The comptroller shall execute such release in

the usual form, which, when acknowledged, shall be recorded by the

county clerk and a minute thereof made upon a margin of the mortgage. A

company may, with the prior written consent of the commissioner, and

subject to the approval of the state comptroller and to the provisions

of any contract with noteholders and bondholders, lease any property not

acquired through condemnation and not required for the project, and may

apply the income of such lease to any use authorized for any other

rental income. Such lease shall contain restrictions to protect and

preserve the project.

3. The commissioner may make temporary loans or advances to a company

in anticipation of any permanent loans and no such temporary loans or

advances shall be deemed to constitute part of such permanent loans

unless such temporary loans or advances have been made out of the

proceeds of definitive housing bonds sold by the state pursuant to

chapters four hundred seven of the laws of nineteen hundred fifty-five

and nine hundred fifty-six of the laws of nineteen hundred fifty-eight.

4. The state shall have the power to invest jointly with the New York

state housing finance agency in a bond or note and single participating

mortgage, or in separate bonds or notes and mortgages of a company

organized pursuant to the provisions of this article. The interest of

each shall have equal priority as to lien in proportion to the amount of

loan so secured, but need not be equal as to interest rate, time or rate

of amortization or otherwise. In such a case the state, through the

commissioner of housing, is authorized to make provision, either in the

mortgage or mortgages or by separate agreement, for the performance of

such services as are generally performed by the New York state housing

finance agency itself owning and holding a mortgage. Any agreement made

by the commissioner under this subdivision shall be subject to the

approval of the state comptroller and the attorney general as to form.

Redevelopment loans. Notwithstanding any provision of this

article to the contrary, where a state-aided project undergoes a

comprehensive redevelopment plan, the commissioner may approve a loan

and encumbrance of such project in an amount in excess of actual project

cost within the meaning of section twenty-one of this article, provided

that such amount represents cost of capital improvements, redevelopment

or acquisition by a new owner, any consequent rent increase is not

unduly burdensome to the tenants, and the company enters into an

agreement to remain subject to the provisions of this article for a

period of no less than an additional fifteen years from issuance of the

loan and encumbrance.

Loans for state-aided limited-profit housing companies. 1.

Notwithstanding any provision of this article to the contrary, the

commissioner may for a period of one year from the effective date of

this act approve a loan and encumbrance in excess of the actual project

cost of a state-aided project comprising more than five thousand rental

units, provided that: (a) the rents paid by the tenants may not be

increased to pay for any consequent increase in indebtedness that is not

attributable to project cost; (b) the company enters into an agreement

to continue to remain subject to the provisions of this article for a

period of no less than an additional thirty years from issuance of the

loan and encumbrance; and (c) the greater of twenty-five percent of the

amount of such loan which exceeds such actual project cost or forty

million dollars of the proceeds of such loan must be dedicated to

capital improvements to existing structures and facilities.

2. Any company that enters into a loan pursuant to subdivision one of

this section shall create a plan within one year of the approval of the

loan. The plan shall include details of all capital improvements that

will occur as a result of the loan. Such company shall obligate the

funds dedicated to the capital improvements within three years of the

approval of the loan. Such company shall submit a copy of the plan

within one year of the approval of the loan and within three years of

the approval of the loan, a report that details the use of the loan

funds to the governor, the commissioner of the division of housing and

community renewal, the temporary president of the senate, the speaker of

the assembly, the minority leader of the senate, the minority leader of

the assembly, the chair of the senate finance committee, the chair of

the assembly ways and means committee, the chair of the senate housing,

construction, and community development committee, and the chair of the

assembly housing committee.

3. Such company shall participate in bimonthly meetings with elected

officials and the members of the project's residents' association or

other tenant organization that represents the majority of tenants in the

project in order to hear any advice or comments on the implementation of

the plan. The meetings shall occur on a regular basis until all of the

money set-aside for capital improvements in subdivision one of this

section has been spent.

Municipal loans and municipally aided projects. 1. A

municipality may make or contract to make loans to a company or to a

public benefit corporation providing housing for staff members,

employees or students of a college, university, hospital or child care

institutions and their immediate families in an amount not to exceed,

except in the case of a non-profit company incorporated pursuant to the

provisions of the not-for-profit corporation law and this article for

the purpose of providing housing for aged or handicapped persons of low

income, and except in the case of a company or public benefit

corporations providing housing for staff members, employees or students

of a college, university, hospital or child care institution and their

immediate families, and except in the case of a municipally-aided

non-profit company or of a municipally-aided mutual company, and except

in the case of a low income non-profit housing company, ninety-five per

centum of the project cost to be secured, except as provided in section

fifteen of this article, by a first mortgage lien and may make temporary

loans or advances to a company in anticipation of a permanent municipal

loan. In the case of a non-profit company incorporated pursuant to the

provisions of the not-for-profit corporation law and this article for

the purpose of providing housing for aged or handicapped persons of low

income and in the case of a company or public benefit corporations

providing housing for staff members, employees or students of a college,

university, hospital or child care institution and their immediate

families, and in the case of a municipally-aided non-profit company or

of a municipally-aided mutual company, and in the case of a low income

non-profit housing company, such loans may not exceed the total project

cost. Notwithstanding the foregoing, such loans to a municipally-aided

mutual company to assist in financing the acquisition of a building by

residents thereof may not exceed ninety-five per centum of the project

cost. Such mortgage, or bonds or notes secured thereby and such contract

may contain such terms and conditions not inconsistent with the

provisions of this article as the local legislative body may deem

necessary or desirable to secure repayment of its loan, the interest

thereon and other charges in connection therewith. In the case of a loan

in an amount greater than ninety-five per centum of the total project

cost the supervising agency may in its discretion require satisfactory

independent guarantees that the loan will be repaid according to the

terms of the company's bond or note and mortgage.

1-a. Notwithstanding any other provision of this article or any other

law, any such loan may be made to a company at such rate of interest, if

any, as the local legislative body may deem necessary or desirable to

carry out the policy and purposes of this article.

2. The supervising agency shall have exclusive power to promulgate

such supplementary rules and regulations with respect to a

municipally-aided project and a company formed to undertake or operate

any such project, as may be necessary to carry out the provisions of

this article. No assignment for collateral or pledge by a municipality

of its mortgage interest in a municipally-aided project to the state or

to any political subdivision thereof shall either affect the power of

the supervising agency granted herein or authorize the commissioner to

exercise any powers not otherwise granted in this article.

3. Prior to the date of approval by the local legislative body of the

contract between a municipality and a company for a municipally aided

project, the total estimated project cost of such project, the estimated

capital requirements of the company formed to undertake or operate such

project, the initial capital structure of such company and a

modification of any of the foregoing items, shall be subject to the

approval of the supervising agency and the commissioner. Any

modification of any of the foregoing items made after such date of

approval of the contract shall be subject solely to the approval of the

supervising agency. If after such date of approval of the contract, any

change is made in such contract which requires the approval of the local

legislative body, such change shall also be subject to the prior

approval of the commissioner.

4. The commissioner shall have the power, prior to the date of

approval by the local legislative body of a contract between a company

and the municipality for a municipally aided project, to approve the

proposed maximum average of the rentals to be charged for the dwellings

in the project, or any modifications thereof. After such date of

approval of the contract, the supervising agency shall have sole power

to increase or reduce the rental rate for the dwellings in the project

in the manner prescribed by section thirty-one of this article for the

variance of the rental rates. However, if a variance in such rental rate

is made necessary because of a change in the project which requires the

approval of the local legislative body, the prior approval by the

commissioner of such variance of the rental rate shall also be obtained.

5. The commissioner and the supervising agency shall each have full

power to investigate into and order a company undertaking or operating a

municipally aided project to furnish such reports and information as

each may require concerning the planning, construction, acquisition,

rehabilitation, management or operation of the project.

6. The commissioner shall have the power to audit the books of a

company undertaking or operating a municipally aided project solely as

to the legality of the expenditures and to disallow any expenditure

which the commissioner shall find has been made in violation of law or

any rule or regulation duly issued pursuant to this article. The

supervising agency shall have the full power to audit the books of any

such company as to the legality, reasonableness or necessity of its

expenditures. Any expenditure disallowed by the commissioner or the

supervising agency on such audits shall not be included in any

construction, management or operating costs in connection with any

application to increase or reduce the rents or carrying charges in a

project.

7. (a) At the direction of the supervising agency, with the consent

and approval of the mayor the municipality shall establish and keep a

separate fund known as the limited-profit mortgage reserve fund for the

purposes of insuring the municipality against any loss resulting from

the making of a mortgage loan, temporary loan or advance to a

municipality-aided project and to protect the municipality in the event

of delinquency in the repayment of such mortgage loan, temporary loan or

advance.

(b) There shall be paid into such fund the portions of fees allocated

to and directed to be deposited in such fund by the supervising agency

with the consent and approval of the mayor as provided for in

subdivision seven of this section. In addition, there shall be credited

to and deposited in such fund any portion of the unexpended balance

remaining in the housing fund as the supervising agency with the consent

and approval of the mayor may determine to be in excess of the amounts

needed to meet expenditures required to be paid from the housing fund.

(c) The monies in the limited-profit mortgage reserve fund shall be

deposited in one or more of the banks or trust companies designated, in

the manner provided by law, as depositories of the funds of such

municipal corporation. The comptroller or the chief fiscal officer may

invest the monies in such fund in obligations specified in paragraph d

of this subdivision. Any interest earned or capital gain realized on the

money so deposited or invested shall accrue to and become part of such

fund. The separate identity of such fund shall be maintained whether its

assets consist of cash or investments or both.

(d) Monies in such fund may be invested (1) in special time deposit

accounts in, or certificates of deposit issued by, a bank or trust

company located and authorized to do business in this state, provided,

however, that such time deposit account or certificate of deposit shall

be payable within such time as the proceeds may be needed to meet

expenditures for which such monies were obtained and provided further

that such time deposit account or certificate of deposit be secured by a

pledge of obligations of the United States of America or obligations of

the state of New York or obligations of any municipal corporation,

school district or district corporation of the state of New York; or (2)

in obligations of the United States of America, obligations of the state

of New York or obligations of the municipal corporation which has

established such mortgage insurance fund provided: (i) such obligations

are not tax exempt; (ii) such obligations shall be payable or redeemable

at the option of the owner within such times as the proceeds may be

needed to meet expenditures for purposes for which the monies so

invested were obtained, and (iii) such obligations, unless registered or

inscribed in the name of the municipal corporation for which such

investment is made, shall be purchased through, delivered to and held in

custody of a bank or trust company in this state and shall be sold or

presented for redemption or payment only by such bank or trust company

upon written instructions from the comptroller or chief fiscal officer.

(e) An expenditure shall be made from such fund only by an

authorization of the supervising agency with the consent and approval of

the mayor and only for one or more of the following purposes:

(i) Payment of expenses of establishing and administering the fund;

(ii) Payment of a delinquent installment or installments of interest

and principal due to the municipality under a mortgage loan, temporary

loan or advance to a municipally-aided project;

(iii) Payment of any loss sustained by the municipality as a result of

the making of a loan, temporary loan or advance to a municipally-aided

project, whether such loss consists of a deficiency upon a mortgage,

foreclosure sale as authorized by sections thirty-four and ninety-four

of this chapter or otherwise; except that in the event the municipality

acquires title to the project, payment for any loss or deficiency shall

be deferred until such time when the municipality shall dispose of title

to the project; any such loss or deficiency shall be diminished by the

municipality to the extent of the amount derived by the municipality

from such disposition plus any net operating income derived by the

municipality during its period of ownership or less any net operating

loss sustained by the municipality during such period and less any

amount of interest paid by the municipality to retire any bonded

indebtedness incurred in connection with the loan made to such project.

(iv) Payment of all costs entailed in procuring mortgage insurance in

such amounts, and from such insurers as the supervising agency deems

desirable to insure the municipality against any loss resulting from the

making of a mortgage loan to a municipality-aided project.

The payment from such fund of any delinquent installment or

installments due the municipality under a mortgage as provided in

subsection (ii) of this paragraph e shall not be deemed either a

remission or waiver of the right to such installment or installments and

such installment or installments shall continue to be due and payable to

the municipality and shall be deposited, together with interest accrued,

in the mortgage insurance fund when paid.

(f) The comptroller or chief fiscal officer shall keep a separate

account for the mortgage insurance fund. Such account shall show:

(i) The date and amount of each sum paid into the fund;

(ii) The interest earned by the fund;

(iii) The capital gains or losses resulting from the sale of

investments of the fund;

(iv) The interest or capital gains which have accrued to the fund;

(v) The amount and date of each withdrawal from the fund;

(vi) The assets of the fund indicating the cash balance therein and a

schedule of the amounts invested.

The comptroller or chief fiscal officer shall render a detailed report

of the operation and condition of such fund to the supervising agency

annually each fiscal year and at such other times as the supervising

agency or the mayor may require.

8. Whenever reference is made in this article to a municipal loan, a

loan by a municipality, a loan from a municipality, a contract for a

loan between a municipality and a company, or any similar term, with

respect to the territorial limits of the city of New York such term

shall be construed to refer to a loan made or to be made either by such

municipality or by the New York city housing development corporation,

whichever is applicable.

9. The city of New York shall have the power to invest jointly or

participate in a loan with the New York city housing development

corporation or with one or more organizations or entities mentioned in

section fifteen in a bond or note and single participating mortgage, or

in separate bonds or notes and separate mortgages of a company organized

pursuant to the provisions of this article upon such terms and

conditions as are provided in said section fifteen of this article.

10. A municipality with a population of less than one million may, by

action of its local legislative body concurred in by the commissioner,

provide for the supervision and regulation of any municipally-aided

project and the company carrying out such project by the commissioner in

lieu of the supervising agency. With respect to any such project and

company, the commissioner shall have, from and after the effective date

of such action, all of the powers and duties of a supervising agency

pursuant to this article. The company shall pay to the commissioner

fees, as prescribed by the commissioner, to cover the expenses of

examination, audit, and supervision of the company and the project.

Notwithstanding any other provision of law, funds collected pursuant to

such fees shall be deposited to the credit of the general fund.

The provisions of subdivisions one and eight of this section shall

apply only to projects financed in whole or in part by a mortgage loan,

temporary loan or advance by a municipality. The provisions of

subdivisions two, three, four, five, six and seven hereof shall apply to

all municipally-aided projects including projects financed in whole or

in part by a mortgage loan from the federal government or any agency or

instrumentality thereof or by a mortgage or mortgage bonds insured by

the federal government or any agency or instrumentality thereof.

Mortgage modifications, evidence of pre-existing indebtedness.

1. Notwithstanding the provision of any law, general or special, the

supervising agency shall have the power to:

(i) assign or pledge or contract to assign or pledge any mortgage

securing a loan, including any loan to finance the construction of a

project, and any note or bond evidencing indebtedness thereon, made by

the municipality in accordance with the provisions of this article, and

any contract or arrangement, including any subsidy contract or

arrangement, relating to such mortgage, and the receipts to be derived

from any of the foregoing, and may reacquire or accept and contract to

reacquire or accept any such mortgage, note, bond, contract or

arrangement, including any mortgage, note, bond, contract or arrangement

made in substitution thereof, and the receipts to be derived therefrom,

or

(ii) consent to and contract for the modification of any of the terms

of a mortgage, and note or bond secured thereby, made pursuant to

section twenty-three of this chapter for the purpose of obtaining

insurance of such mortgage loan by the federal government in order to

refinance all or any part of the indebtedness evidenced by such mortgage

and note or bond, or

(iii) satisfy such mortgage in order to enable the company to obtain

insurance by the federal government of a mortgage loan made for the

purpose of refinancing all or any part of the indebtedness evidenced by

such mortgage and note or bond.

2. In the event that the existing mortgage loan is satisfied pursuant

to this section, the supervising agency may in consideration of the

issuance of such satisfaction accept a new mortgage and note or bond

insured by the federal government in an amount equal to the maximum

principal amount of a mortgage loan the federal government will insure

or accept the proceeds available to the housing company as a result of

the refinancing.

3. In the event that there is residual indebtedness, the housing

company shall make and the supervising agency shall accept such

instruments evidencing such indebtedness as may be required by the

supervising agency as are consistent with the provisions of subdivision

fifteen of section twelve of this chapter, in such form and upon such

terms as the supervising agency may approve. In the event that there are

residual receipts obligations, the housing company may make and the

supervising agency may accept instruments evidencing such obligations in

accordance with the provisions of subdivision sixteen of section twelve

of this chapter.

4. Notwithstanding any other provisions of this article or any

general, special or local law, where the supervising agency has made the

findings required in subdivision one of section twenty-six or section

twenty-six-a and where a project has been approved pursuant to

subdivision five of section twenty-six of this chapter, the supervising

agency may make or contract to make a mortgage loan or exercise other

related powers pursuant to this section or section twenty-three-b or

subdivision twenty-two-a of section six hundred fifty-four of this

chapter without further findings by the supervising agency or further

approval by the local legislative body.

4-a. Notwithstanding the provisions of this article or any general,

special or local law to the contrary, where an existing mortgage loan is

modified or satisfied pursuant to this section and the supervising

agency has approved a new or modified mortgage or mortgages, including a

mortgage and note or bond insured by the federal government and a

mortgage to secure residual indebtedness, the supervising agency may

sell, assign, or otherwise dispose of, at public or private sale, on

such terms and conditions as shall be deemed appropriate by the

supervising agency subject to the approval of the comptroller or chief

fiscal officer of the municipality wherein such agency is located, such

new or modified mortgage or mortgages and related instruments.

4-b. Notwithstanding the provisions of this article or any general,

special or local law to the contrary, where an existing mortgage loan is

modified or satisfied pursuant to this section, the supervising agency

may pay or incur fees, costs, expenses and other amounts, whether or not

any amounts have been appropriated therefor in order to (1) meet a

municipality's obligations under an agreement with the federal

government on account of mortgage insurance, provided that a

municipality's share of any mortgage insurance claim paid by the federal

government shall not exceed fifty percent of the insurance benefits paid

by the federal government, and further provided that a municipality's

share of such claims under any contract or contracts entered into

between a municipality and the federal government shall not exceed five

percent of the outstanding principal amount of all mortgages of the

municipality at any time insured by the federal government and included

within such contract, (2) make loans for, or establish escrow accounts

for the issuance of mortgage insurance, (3) absorb discounts associated

with any sale, assignment or other disposition of a mortgage note or

bond insured by the federal government, (4) pay fees required by the

federal government as a condition for the issuance of mortgage

insurance, (5) install such life safety devices and satisfy such minimum

property standards, as may be required by the federal government which

devices or standards are in addition to any requirement imposed by the

municipality as mortgagee and to make loans for such purposes, (6) pay

closing and other costs related to obtaining mortgage insurance from the

federal government, (7) permit the municipality to issue obligations

secured by such mortgage or mortgages, (8) meet such other costs as the

federal government may from time to time impose, (9) pay any amounts not

previously advanced under a mortgage or mortgages modified or satisfied

pursuant to this section, and (10) hold an amount not to exceed twenty

million dollars at any one time in a revolving account for a period not

to exceed eighteen months from the time of the first deposit therein, to

pay fees, costs, expenses and other amounts attributable to making and

insuring mortgages pursuant to this section or attributable to issuing

obligations secured by such mortgages. If the municipality sells any

such mortgages insured by the federal government for an amount in excess

of the principal amount thereof at the time of such sale, or if the

municipality issues obligations secured by any such mortgages and the

yield on such mortgages is greater than the yield on such obligations

(the yield on such mortgages and obligations having been calculated in

accordance with section one hundred three of the internal revenue code

of the United States and regulations thereunder), then any such premium

and any such differential may be used by the municipality for any lawful

purpose, provided, however, that an amount equal to the annual sum of

such premium and such differential, to the extent such differential is

not paid to or for the benefit of the holders of such obligations, shall

be credited annually by the municipality, at such times as determined by

the supervising agency, as a payment by all municipally-aided projects

then having residual indebtedness, of the then accrued and unpaid

interest on such residual indebtedness. To the extent that any such

credit otherwise allocable to a project in any year exceeds unpaid

interest on the residual indebtedness of such project in that year, such

excess credit shall be allocated among all other eligible projects

having accrued and unpaid interest on residual indebtedness in that

year. Notwithstanding the provisions of the foregoing sentence of this

subdivision, if an eligible project has made cash payments in any year

for the sum of (i) interest on and principal of a federally insured

mortgage and (ii) interest on and principal of residual indebtedness and

(iii) all other payments on account of such insured mortgage, including

mortgage insurance premium and reserves, at least equal to the sum of

(i) interest and principal which would have been due annually on the

original mortgage loan for the project, at the interest rate in effect

at the time the project is refinanced, and (ii) all other required

annual payments on account of such original mortgage loan, such as

reserve requirements, then any excess credit allocable to such eligible

project shall be credited in the next succeeding year as a payment of

interest on residual indebtedness of such project before any cash

payment is required to be made for such interest. Subject to the

provisions of the preceding sentence of this subdivision, if the total

of such credit in any year available for all eligible projects exceeds

the total of all accrued and unpaid interest in that year on residual

indebtedness of all eligible projects then having residual indebtedness,

an amount equal to such excess credit shall be carried forward and

credited in future years as a payment of accrued and unpaid interest on

residual indebtedness of eligible projects in future years until such

time as no further interest remains unpaid with respect to any residual

indebtedness of eligible projects. The supervising agency shall divide

such credit among eligible projects on the basis of the respective

original principal amounts of the federally insured mortgages on

eligible projects; provided, however, that such credit shall be

allocated to projects which receive federal subsidies only to the extent

that such subsidies are not thereby reduced. When there is a

participation, new loan or investment pursuant to section twenty-three-b

of this article for which the consent of a company is required and which

will be substantially equivalent to a refinancing pursuant to section

twenty-three-a or subdivision twenty-two-a of section six hundred

fifty-four of this article, then for purposes of this subdivision the

interest of the municipality after such participation, new loan or

investment which is secured by a mortgage shall be deemed to be the

equivalent of residual indebtedness and the interest of entities or

organizations other than the municipality in such participation, new

loan or investment shall be deemed to be the equivalent of a federally

insured mortgage.

5. No company shall accept a mortgage loan to be insured by the

federal government made for the purpose of refinancing the existing

mortgage loan of a company which shall exceed the amount which can be

supported by the income derived from the operation of the project at the

rental rate determined by the supervising agency that would be necessary

to meet all necessary payments to be made by the company, of all

expenses including fixed charges, sinking funds, reserves and dividends

on outstanding stock, as authorized by the supervising agency, if the

principal amount of the original mortgage loan of the company were to be

fully repaid over the term of such mortgage loan by constant and equal

payments of principal and interest and if the interest rate on the

company's original mortgage loan was eight and one-half percent per

annum or, where the original mortgage loan provides for the payment of

interest at a maximum rate of less than eight and one-half percent per

annum, such maximum amount.

6. A company shall not accept a mortgage to be insured by the federal

government for the purpose of refinancing an existing mortgage loan of a

municipally-aided project unless the sum of interest and principal

payable in respect of such mortgage to be insured by the federal

government and in respect of any residual indebtedness, over the term of

such mortgage and residual indebtedness, shall be no more than the sum

of interest and principal that would be payable in respect of the

existing mortgage loan, over the term of such existing mortgage loan, at

an interest rate of eight and one-half percent per annum or where the

existing mortgage loan provides for a maximum interest rate of less than

eight and one-half percent, at such maximum interest rate.

7. The terms of any mortgage securing residual indebtedness of a

municipally-aided project shall include a provision to the effect that

so long as the project is subject to a mortgage insured or held by the

federal government (a) interest on and principal of such mortgage

securing residual indebtedness shall be payable only if and to the

extent to which surplus cash, as defined in a regulatory agreement

excecuted by the housing company and the federal government, is

available, and (b) the failure to pay interest and principal on such

mortgage securing residual indebtedness shall not constitute an event of

default unless surplus cash is available and not applied to such

payments of interest and principal.

8. Ten days before an initial application is filed with the federal

government to obtain insurance by the federal government of a mortgage

for the purpose of refinancing all or any part of a mortgage loan for a

municipally-aided project pursuant to section twenty-three-a or

subdivision twenty-two-a of section six hundred fifty-four of this

chapter, the supervising agency shall (a) mail to the president or other

representative of the tenants' association or cooperators' advisory

council, recognized by the supervising agency for such municipally-aided

project, written notice of the proposed refinancing, including a copy of

such initial application, and (b) make a copy of such initial

application available at its offices during business hours, for

inspection and copying by the residents of such municipally-aided

project. Ten days before the closing of a proposed participation, new

loan or investment with respect to a municipally-aided project pursuant

to section twenty-three-b of this article, the supervising agency shall

(a) mail to the president or other representative of the tenants'

association or cooperators' advisory council, recognized by the

supervising agency for such municipally-aided project, written notice of

such proposed participation, new loan or investment, including a summary

of the principal terms and conditions thereof, and (b) make a copy of

such summary available at its offices during business hours, for

inspection and copying by the residents of such municipally-aided

project. The unintentional failure of the supervising agency to comply

with the foregoing provisions of this subdivision shall not invalidate

or otherwise affect any such refinancing of a mortgage loan or any such

participation, new loan or investment.

Participation in loan or investment. Notwithstanding any other

provisions of this article or of any general, special or local law,

where a municipality has made or contracted to make a mortgage loan to a

company to finance a project: one or more banking organizations as

defined in subdivision eleven of section two of the banking law,

educational institutions, hospitals, medical research institutes,

insurance companies, trustees or fiduciaries, including fiduciaries

holding funds for investment, the New York city housing development

corporation, other public corporations, or other entities which

purchase, invest, or deal in first mortgage loans in the normal course

of their business, or any combination of the foregoing, shall have the

power to participate in such loan or make or participate in a new loan

secured by a bond or note and a single participating mortgage, or by

separate bonds or notes and separate mortgages, or to invest, singly or

jointly, with the municipality in a bond or note and single

participating mortgage or in separate bonds or notes and mortgages or in

a new mortgage or mortgages with respect to all or a portion of the loan

by a municipality to a company; and the supervising agency shall have

the power, upon the mortgagor's consent, to modify the terms and

conditions of the original bond or bonds or note or notes and mortgage

or mortgages and any other documents executed in connection with such

original loan, as the supervising agency may deem necessary or desirable

to provide for such participation, new loan or investment as provided in

this section, including but not limited to (i) modification of the rate

and time of payment of interest on the original loan or rate and time of

amortization of principal thereof, (ii) providing for priority for

payment of the principal of and interest on that portion of the mortgage

indebtedness attributable to such participation, new loan or investment

by one or more of such entities or organizations, (iii) subordination of

the interest of the municipality to the interest of one or more of such

organizations or entities in such participation, new loan or investment,

and (iv) otherwise providing that the interest of each upon such

participation, new loan or investment need not be of equal priority as

to lien, or be equal as to interest rate, time or rate of amortization

of principal or time of payment of interest or otherwise; provided,

however, that the aggregate amount of the loan or loans to a company

does not exceed the amount authorized pursuant to section twenty-three

of this article. When consent of a company is required for any

participation, new loan or investment pursuant to this section and such

participation, new loan or investment will be substantially equivalent

to a refinancing of indebtedness pursuant to section twenty-three-a or

subdivision twenty-two-a of section six hundred fifty-four of this

chapter, then; (i) the provisions of this article, including without

limitation the provisions of section twenty-three-a, limiting total

indebtedness of a company after a refinancing shall apply to total

indebtedness of the company after such participation, new loan or

investment; (ii) the provisions of this article applicable to a mortgage

of a company insured by the federal government in connection with such

refinancing shall apply to a mortgage securing the interest of entities

or organizations other than the municipality in such participation, new

loan or investment; (iii) the provisions of this article concerning

residual indebtedness, such residual indebtedness having been calculated

as if the mortgage referred to in clause (ii) of this sentence were a

federally insured mortgage, shall apply to an interest of the

municipality after such participation, new loan or investment which is

secured by a mortgage; (iv) the provisions of this article concerning

residual receipts obligations shall apply to an interest of the

municipality after such participation, new loan or investment which is

unsecured, and (v) the provisions of subdivision four-b of section

twenty-three-a of this article concerning the credit referred to therein

shall apply in a manner consistent with such subdivision. For purposes

of the foregoing sentence of this section, the term surplus cash

(referred to in subdivision seven of section twenty-three-a of this

article) shall be applied by the supervising agency in a manner

consistent with the definition of such term in regulatory agreements

with the federal government for the refinancing of indebtedness of

municipally-aided projects. The provisions of subdivisions one and five

of section twenty-six of this article shall not apply to such

participation in a loan or investment pursuant to this section if

undertaken in connection with a project theretofore approved pursuant to

section twenty-six of this article. Where the municipality shall join

with one or more organizations of the kind hereinabove mentioned, in

making a loan secured by a single participating mortgage or by separate

mortgages, the municipality is authorized, through its supervising

agency, to make provision, either in the mortgage or mortgages or by

separate agreement, for the performance of such services as are

generally performed by a banking institution or insurance company which

itself owns and holds a mortgage or by a trustee under a trust mortgage.

The supervising agency is hereby authorized to act as trustee or to

consent to the appointment of a banking institution to act in such

capacity. In connection with any participation in a loan or investment

pursuant to this section, the municipality through its supervising

agency shall have the power to assign or pledge, in whole or in part, to

one or more of the organizations or entities participating in such loan

or investment its right, title and interest in and to any mortgage held

by it pursuant to this article and any contract or arrangement for the

payment of subsidy relating to such mortgage, including the right to

receive and apply to repayment of such loan and the interest thereon any

receipts to be derived by it from such mortgage or from such contract or

arrangement.

Mortgage modifications. 1. For the purposes of this section,

the following terms shall have the meanings set forth below:

(a) "Existing mortgage" shall mean any mortgage held by the

municipality securing a loan made by such municipality in accordance

with the provisions of this article, and any note or bond evidencing

indebtedness thereon, including, but not limited to, any mortgage, note

or bond securing residual indebtedness and any mortgage, note or bond

securing a loan to finance the construction of a project.

b. "Non-recoverable debt service" shall mean, with respect to any

increase in indebtedness executed or approved pursuant to this section

that is not attributable to project cost, all payments of interest and

principal on such portion of the indebtedness.

(c) "Restrictive agreement" shall mean a binding agreement between a

company and the supervising agency, which (i) prohibits the dissolution

of the company pursuant to the provisions of section thirty-five of this

article for not less than six years from the date of such agreement, and

(ii) prohibits the consideration of non-recoverable debt service in any

rent increase pursuant to the provisions of section thirty-one of this

article at any time subsequent to the date of such agreement.

2. Notwithstanding the provisions of this article or the provisions of

any law, general or special, a company that enters into a restrictive

agreement on or after the effective date of a chapter of the laws of

2004 which added this subdivision, may, with the approval of such

supervising agency:

(a) substitute a new mortgage approved by the supervising agency for

any existing mortgage;

(b) extend or modify any existing mortgage in such manner and for such

term as shall be determined by the supervising agency;

(c) subordinate any existing mortgage in any manner approved by the

supervising agency to the lien of any mortgage held by a lender that is

authorized to participate in loans pursuant to section twenty-three-b of

this article; and

(d) borrow funds and secure the repayment thereof by note and mortgage

or in any other manner approved by the supervising agency.

Income debentures. 1. With the approval of the supervising

agency or of the commissioner, as the case may be, the certificate of

incorporation, or an amended certificate may authorize the issuance of

income debentures bearing no greater interest than six per centum per

annum except as otherwise provided in this article. After the

incorporation of a company, the directors thereof may, with the consent

of two-thirds of the holders of the preferred stock issued and

outstanding offer to the stockholders of the company, the privilege of

exchanging their stock in such quantities and at such times as may be

approved by the supervising agency or the commissioner, as the case may

be, for such income debentures. In no event, shall the amount of stock

of the company be less than a per centum of the total of stock and

income debentures, to be fixed by the supervising agency or by the

commissioner, as the case may be.

2. Such income debentures and any instrument under which they are

issued may contain such other provisions, including provision for

amortization by serial maturities, through the operation of a sinking

fund or otherwise, as may be approved by the supervising agency or by

the commissioner, as the case may be.

Working capital. The supervising agency or the commissioner, as

the case may be, may permit stock or income debentures to be issued for

working capital to be used in connection with such project to an amount

not exceeding three per centum of the estimated project cost or the

actual project cost, whichever is larger.

Conditions and security for loans. 1. No loan shall be made by

the state, the New York state housing finance agency, a municipality or

the New York city housing development corporation unless the

commissioner, with respect to a project aided by a state loan or New

York state housing finance agency loan, or the supervisory agency, with

respect to a municipally-aided project, finds that:

(a) The municipality has approved the project as provided in

subdivision five of this section and has enacted or will enact

regulations or appropriate restrictions adequately protecting the

project against future uses likely to depreciate unduly the value of

such project;

(b) The estimated revenues of the project will be sufficient to cover

all probable costs of operation and maintenance, of fixed charges and

operating reserves and depreciation reserves if any;

(c) The plans and specifications conform to the requirements of all

laws applicable thereto, and assure adequate light, air, sanitation and

fire protection;

(d) If the project is aided by a state loan, or a New York state

housing finance agency loan, the commissioner shall also find that the

project is in conformity with a plan or undertaking for providing low

rent housing facilities for persons of low income and for the clearance,

replanning, reconstruction or rehabilitation of a substandard and

insanitary area or areas, and for other facilities incidental or

appurtenant thereto as may be approved by the commissioner.

1-a. No company may be aided pursuant to this article by a mortgage

loan or tax exemption or both to finance the acquisition of a building

by residents thereof unless the commissioner or the supervising agency,

as the case may be, finds that:

(a) the condition of such building is deteriorating and the building

is located in a deteriorating area or in an area threatened with

deterioration by reason of economic, social or physical changes

occurring therein or in nearby areas;

(b) the building is not yielding sufficient revenues to cover costs of

operation and maintenance, of fixed charges and of reserves, if any, and

also a reasonable profit to the owner;

(c) the making of such loan will prevent further deterioration and

abandonment;

(d) at least two-thirds of the present residents consent to such

acquisition;

(e) financing for such acquisition is otherwise unavailable because of

the neighborhood, the age of the buildings, or other factors indicating

an inability of the private sector unaided to cause such acquisition to

be effected;

(f) the proceeds of such loan will not be used to refinance existing

debt in excess of a reasonable relationship to current value; and

(g) the term for repayment of such loan does not exceed the remaining

useful life of the building.

2. The principal of a loan made by the state shall be repaid by the

company over a period of not to exceed fifty years except in the case of

a loan to rehabilitate an existing building, in which case the period

shall not exceed thirty-five years, or the estimated life of the

project, whichever is shorter, in annual installments equal to the

amount payable by the state on the moneys borrowed for the project.

Such annual installment of principal need not be uniform in amount, but

may be so varied that the total payment of principal and interest shall

be approximately equal and constant during the period of the loan. Each

payment of principal and interest shall be made to the state comptroller

not later than five days before each payment by the state is required.

The loan shall bear the same rate of interest paid or to be paid by the

state for the definitive housing bonds issued on account of such loan.

The company shall pay to the state comptroller a proportionate share of

the cost of borrowing not later than thirty days after the state

comptroller has certified the amount of such share.

3. Any bonds or notes issued by the company and any mortgages relating

thereto may authorize the company, with the consent of the state

comptroller in the case of a state-aided project, or the supervising

agency in the case of a municipally-aided project, to prepay the

principal of the loan. Such bonds or notes and mortgages may contain

such other clauses and provisions as the commissioner in the case of a

state-aided project or the supervising agency in the case of a

municipally-aided project, shall require. Notwithstanding the provisions

of any general, special or local law, the principal of any loans made

pursuant to subdivision one of section fifteen of this article or the

principal of a loan made by a municipality pursuant to this article and

secured by a mortgage lien subordinate to the lien of a first mortgage

made pursuant to paragraph (b) of subdivision one of section fifteen of

this article may be amortized at such time or times or at such rate as

the supervising agency shall approve.

4. With respect to a state-aided project the commissioner may charge

the company reasonable fees for financing, regulation, supervision and

audit. Fees collected for such services shall be paid into and disbursed

from such fund or funds as may be provided by law.

5. (a) In a municipality where there is a planning commission, the

project shall first be submitted to it for approval. Where changes in

the city map and zoning amendments or variances are necessitated by such

project, such amendments, variances and changes shall be submitted

together with such project and considered as a part thereof. Such

planning commission, not later than ten weeks from the date of the

referral of the project to it, after a public hearing held on due

notice, notice of which shall be published at least ten days prior

thereto in the official publication of the municipality, or if none

exists, in a newspaper circulating in the municipality, shall submit its

report to the local legislative body certifying its unqualified

approval, its disapproval, or its qualified approval with

recommendations for modifications therein.

After public hearing held on due notice and after the report is

received or due from the planning commission, the local legislative body

may:

(i) if the planning commission shall have certified its unqualified

approval, approve the project by a majority vote;

(ii) if the planning commission shall have certified its disapproval

or shall have failed to make its report within ten weeks from the date

such project was submitted to it, nevertheless approve the project, but

only by a three-fourths vote;

(iii) if the planning commission shall have certified its qualified

approval together with recommendations for modifications, approve the

project together with the modifications recommended by the planning

commission by a majority vote, or approve the project without such

modifications but only by a three-fourths vote.

(b) In a municipality where there is no planning commission the

project shall be submitted to the local legislative body which, after

public hearing held on due notice, may either approve or disapprove the

project.

(c) Notwithstanding any other provision of law, changes in the city

map, zoning amendments, or variances contained in the plan shall be

deemed approved by the local legislative body when it approves the

project. Any such changes in the city map, zoning amendments, or

variances shall become effective on the date on which the supervising

agency shall file a resolution with the local legislative body in

implementation thereof.

6. The provisions of subdivisions one and five of this section shall

not apply to a state urban development corporation project or to any

loan made by the state or the state housing finance agency to such

project, notwithstanding anything to the contrary contained herein.

7. Notwithstanding anything to the contrary contained therein, the

provisions of subdivisions one and five of this section shall not apply

to a Battery Park city project or to any loan made by the state or the

New York state housing finance agency to such project.

Findings for municipally-aided projects.

No municipally-aided project aided solely by tax exemption shall be

approved by the supervising agency unless the agency shall have made the

findings set forth in subdivision one of section twenty-six.

Special provisions with respect to state urban development

corporation projects. 1. No loan shall be made by the state, the New

York state housing finance agency, or the state urban development

corporation for the acquisition, construction, reconstruction,

rehabilitation or improvement of a state urban development corporation

project, nor shall any such project be approved by the commissioner,

unless the commissioner finds that:

(a) the estimated revenues of the project will be sufficient to cover

all probable costs of all operations and maintenance, of fixed charges

and operating reserves and depreciation reserves, if any;

(b) the plans and specifications of the project assure adequate light,

air, sanitation and fire protection;

(c) the project is in conformity with a plan or undertaking for

providing low rent housing facilities for persons of low income and for

the clearance, replanning, reconstruction or rehabilitation of a

substandard and insanitary area or areas and for other facilities

incidental or appurtenant thereto as may be approved by the

commissioner.

2. Any state urban development corporation project shall comply with

the requirements of local laws, ordinances, codes, charters or

regulations applicable to the construction, reconstruction,

rehabilitation, alteration or improvement of such project, except where

the state urban development corporation, in its discretion, finds such

compliance not feasible or practicable, in which event such project

shall comply with the requirements of the state building construction

code, formulated by the state building code council pursuant to article

eighteen of the executive law, applicable to such construction,

reconstruction, rehabilitation, alteration or improvement. No county,

city, town or village shall have power to modify or change the drawings,

plans or specifications for the construction, reconstruction,

rehabilitation, or improvement of any such project or the construction,

plumbing, heating, lighting or other mechanical branch of work necessary

to complete the work in question, nor to require that any person, firm

or corporation employed on any such work shall perform any such work in

any other or different manner than that provided by such plans and

specifications, nor to require that any such person, firm or corporation

obtain any other or additional authority, approval, permit or

certificate from such county, city, town or village as a condition of

doing such work, nor shall any condition whatever be imposed by any such

county, city, town or village in relation to the work being done, and

the doing of any such work by any person, firm or corporation in

accordance with the terms of such drawings, plans, specifications or

contracts shall not subject said person, firm or corporation to any

liability or penalty, civil or criminal, other than as may be stated in

such contracts or incidental to the proper enforcement thereof; nor

shall any county, city, town or village have power to require that any

subsidiary of the New York state urban development corporation, or any

lessee therefrom or successor in interest thereto, obtain any other or

additional authority, approval, permit, certificate or certificate of

occupancy from such county, city, town or village as a condition of

owning, using, maintaining, operating or occupying any project acquired,

constructed, reconstructed, rehabilitated or improved by any such

subsidiary of the New York state urban development corporation.

3. Notwithstanding any other provision of this article, in the case of

a state urban development corporation project financed or to be financed

by a loan from the state urban development corporation, the corporation

shall exercise, with respect to such project and with respect to the

company carrying out such project, all of the powers and duties

exercised by the commissioner pursuant to this article with respect to

projects financed by the New York state housing finance agency until

such project, or any part thereof, is ready for initial occupancy as

determined by the commissioner, and thereafter, upon the issuance by the

commissioner of a certificate of assumption of supervision, such project

shall be subject to the supervision and control of the commissioner and

the New York state division of housing and community renewal, which

shall have the same powers and responsibilities with respect to such

project as they would have if such project were aided by a loan from the

state or the New York state housing finance agency under this article

and which shall assume the additional powers and responsibilities with

respect to such project theretofore conferred on the corporation by law

or contract. The corporation and the commissioner of housing and

community renewal shall take such actions and execute such documents as

may be necessary to implement this subdivision.

Special provisions with respect to Battery Park city projects.

1. No loan shall be made by the state or the New York state housing

finance agency for the acquisition, construction, reconstruction,

rehabilitation or improvement of a Battery Park city project, nor shall

any such project be approved by the commissioner, unless the

commissioner finds that:

(a) the estimated revenues of the project will be sufficient to cover

all probable costs of all operations and maintenance, of fixed charges

and operating reserves and depreciation reserves, if any;

(b) the plans and specifications of the project assure adequate light,

air, sanitation and fire protection;

(c) the project is in conformity with a plan or undertaking for

providing low rent housing facilities for persons of low income.

2. Notwithstanding any other provisions of this article, in the case

of a Battery Park city project financed or to be financed by a loan from

Battery Park city authority, all approvals, findings and consents which

are required to be given or made by the commissioner pursuant to this

article shall be given or made instead by Battery Park city authority,

and the authority shall exercise, with respect to such project and with

respect to the company carrying out such project, all of the powers and

duties exercised by the commissioner pursuant to this article with

respect to projects financed by the New York state housing finance

agency.

Limitations. No company shall:

1. Acquire any real property or interest therein unless it shall first

have obtained from the commissioner or the supervising agency, as the

case may be, a certificate that such acquisition is necessary or

convenient for the public purpose defined in this article.

2. Pay interest upon its income debentures at a rate higher than six

per centum per annum except as otherwise provided in this article.

3. Issue its stock, income debentures and bonds covering any project

in an amount greater in the aggregate than the actual project cost.

4. Without first having obtained the written consent of the

commissioner or the supervising agency, as the case may be:

(a) Construct, reconstruct, rehabilitate, improve or alter any

project, or enter into any contract therefor.

(b) Sell, transfer or assign any real property, except that no such

consent shall be necessary in any sale in foreclosure as herein

provided.

(c) Except as otherwise provided in this article, encumber, lease or

rent all or any part of its real property.

(d) Enter into contracts for the operation of the project.

(e) Make a guaranty of payment.

(f) Voluntarily dissolve.

(g) Enter into contracts for the payment of salaries to officers or

employees.

5. Pay interest on its mortgage indebtedness at a rate higher than six

per centum per annum, or at such higher rates as may be approved by the

commissioner, or the supervising agency, as the case may be, but in no

event shall any such rate exceed the rate of interest prescribed by the

superintendent of financial services pursuant to section fourteen-a of

the banking law or, in the case of a mortgage loan insured or held by

the federal government, the rate approved by the federal government;

provided, however, that in the case of a company carrying out a state

urban development corporation project or in the case of an instrument or

instruments securing the residual indebtedness of a company, which

indebtedness is secured by a mortgage on the real property of a project,

such rate shall not exceed the rate of interest prescribed by the

superintendent of financial services pursuant to section fourteen-a of

the banking law or nine per centum per annum, whichever is the higher;

and further provided, however, that, in the case of a company that is a

mortgagor under a mortgage assigned to or acquired by the New York city

housing development corporation pursuant to subdivision twenty-one of

section six hundred fifty-four of this chapter and whose project is

aided by a subsidy from the federal government, such rate shall be the

rate of interest approved by the supervising agency. Notwithstanding the

foregoing provisions of this section, the rate of interest that a

company shall have the power to pay on that portion of its mortgage

indebtedness attributable to an investment or participation in a loan

made pursuant to subdivision one of section fifteen by an organization

or entity mentioned in such subdivision, shall be the rate of interest

approved by the commissioner or the supervising agency, as the case may

be.

6. Notwithstanding the provisions of subdivision five of this section

twenty-seven, a company, which has obtained a mortgage loan from the New

York city housing development corporation or the New York state housing

finance agency and where it is necessary for additional bonds or notes

to be issued by the New York city housing development corporation or the

New York state housing finance agency (i) in order to obtain funds to

fulfill the mortgage loan commitment to such company, as such commitment

may be amended or (ii) to refund or renew notes issued in fulfillment

thereof, for a project partially or temporarily financed by bonds or

notes issued, in the case of the New York city housing development

corporation, prior to the first day of August, nineteen hundred

seventy-five, and in the case of the New York state housing finance

agency, prior to the thirty-first day of December, nineteen hundred

seventy-five , may pay interest on that portion of its mortgage

indebtedness, the funds for which were obtained by the New York city

housing development corporation or the New York state housing finance

agency through the issuance of such additional or refunding bonds or

notes, at a rate not in excess of the cost of financing incurred by the

New York city housing development corporation or the New York state

housing finance agency, as the case may be, to issue such additional or

refunding bonds or notes, provided that, with respect to the New York

city housing development corporation, such corporation determines that

such cost of financing is reasonable and the commissioner or the

supervising agency, as the case may be, shall approve such cost of

financing.

Payments from earnings. 1. There shall be paid annually out of

the earnings of the company, after providing for all taxes, assessments

and expenses, a sum for interest on and amortization of the mortgage

indebtedness of all mortgages of the company, depreciation charges and

reserves if, when and to the extent deemed necessary by the commissioner

or the supervising agency, as the case may be, plus a dividend of six

per centum on outstanding stock and interest not exceeding six per

centum on the outstanding income debentures of the company; the

obligation in respect of such payments shall be cumulative, and any

deficiency in interest, amortization, depreciation, reserves, if any,

and dividends in any year shall be paid either from any cash surplus

derived from earnings remaining in the treasury of the company in excess

of the amount necessary to provide such cumulative annual sums or from

the first available earnings in subsequent years. If, at the end of any

three year period, the gross receipts should exceed the payments or

charges necessary for the purposes of the project or projects and are

not needed for a sinking fund, reserves or other purposes, the balance

may be paid in further reduction of any indebtedness to the extent and

upon terms and conditions approved by the commissioner and the state

comptroller or by the supervising agency, as the case may be. A sinking

fund may be authorized by the commissioner or the supervising agency, to

purchase and retire bonds, income debentures or stock of the company at

a price approved by the commissioner or the supervising agency, as the

case may be, not exceeding par value thereof with accrued or unpaid

dividends or interest or if it be not practical to purchase such stock

or income debentures at a price so approved, the money in such sinking

fund may be added to the surplus of such company. Any stock or income

debentures purchased out of such sinking fund shall be cancelled and

shall not be reissued.

2. Anything contained in this article to the contrary notwithstanding,

a company which receives a loan from the state, the New York state

housing finance agency or a municipality after July first, nineteen

hundred sixty-nine, or a mutual company which has been duly authorized

to issue income debentures to finance the modernization or replacement

of project improvements or the acquisition and installation of energy

saving equipment and which is otherwise authorized to pay dividends upon

its shares or interest upon its income debentures, may, with the

approval of the commissioner or the supervising agency as the case may

be, pay such dividends or interest in excess of six per centum per

annum, but in no event shall any such rate exceed the interest rate

prescribed by the superintendent of financial services pursuant to

section fourteen-a of the banking law, provided, however, if the voting

stock of a mutual company has not been issued and delivered to the stock

subscribers, then the additional authorization of such stock subscribers

is required to be obtained by a majority vote.

3. No director or officer of a company shall receive, directly or

indirectly, any salary, compensation or emolument from such company, as

such director or officer or in any other capacity, unless authorized by

the commissioner or the supervising agency, as the case may be.

Acquisition of property.

(a) After a project, other than a state urban development corporation

project, has been been approved by the commissioner or the supervising

agency and the local legislative body, the commissioner or the

supervising agency as the case may be, shall issue a certificate

declaring that the acquisition of the property is necessary for the

public purpose defined in this article and the company may acquire the

property needed for the project or the municipality may, with respect to

a municipally-aided project or a project aided either by a state loan or

a loan from the New York state housing finance agency, take property by

condemnation for the company, pursuant to the provisions of article nine

of this chapter.

(b) after a state urban development corporation project has been

approved by the commissioner, the commissioner shall authorize the

company undertaking the project to acquire the property needed for such

project.

(c) Notwithstanding the provisions of subdivision (a) of this section,

in the case of a Battery Park city project financed or to be financed by

a loan from Battery Park city authority, the approval of the project and

the certificate declaring that the acquisition of the property is

necessary for the public purposes defined in this article shall be

issued by Battery Park city authority.

Transfer of real property. 1. Notwithstanding any requirement of

law to the contrary, every executor, administrator, trustee, guardian or

other person, holding trust funds or acting in a fiduciary capacity,

unless the instrument under which such fiduciary is acting expressly

forbids, the state, its subdivisions, municipalities, all other public

bodies, all public officers, persons, partnerships and corporations

organized under and governed as to investments by or pursuant to the

provisions of the banking law or organized under or subject to the

provisions of the insurance law, the superintendent of financial

services as conservator, liquidator or rehabilitator of any such person,

partnership or corporation, owning or holding any real property may

grant, sell, lease or otherwise transfer any such real property to a

company and receive and hold any cash, stock, bonds, notes, mortgages,

or other securities or obligations, secured or unsecured, exchanged

therefor by such company and may execute such instruments and do such

acts as may be deemed necessary or desirable by them or it and by the

company in connection with a project or projects. Notwithstanding the

provisions of any general, special or local law, charter or ordinance,

such grant, sale, lease or transfer may be made without public auction

or bidding.

2. Any banking institution, foundation, labor union, employers'

association, veterans' organization or insurance company, or any group

thereof, which has undertaken a project through direct ownership or

lease may transfer to the project any real property which it owns or

holds within an area. The market value of such property, as approved by

the commissioner or the supervising agency, as the case may be, shall be

included in the estimated or actual project cost.

3. Notwithstanding the provisions of any general, special or local

law, charter or ordinance, the local legislative body of a city having a

population of one million or more may, upon the request of or with the

approval of the board of education of such city's school district,

grant, sell, lease or otherwise transfer any lands or rights or

interests therein or thereto, including fee interest, easements, space

rights or air rights or other rights or interests owned by such city and

occupied or reserved for school purposes and needed therefor, to a

company where necessary for the joint development of a project and a

school or appurtenant facilities without public auction or bidding,

provided that no such sale, lease or transfer of lands or rights therein

or thereto is authorized where the development of a project contemplates

the erection of housing facilities over an existing school or

playground. The term of any such lease shall not be limited by any

provision of any general, special or local law or charter applicable to

such city limiting the period of time during which a lease or any

renewal thereof may run.

Rentals and selection of tenants. 1. (a) A company may, with the

approval of the commissioner or the supervising agency, as the case may

be, fix maximum rentals per room to be charged tenants of the dwellings,

the average of the rentals for the dwellings in any project not to

exceed the maximum average rentals determined by the commissioner or the

supervising agency, as the case may be, before any commitments are made

by the company for the construction of the project. The commissioner or

the supervising agency, upon his or its own motion, or upon application

by the company or of a stockholder, lienholder, a creditor, or of

holders of at least ten per centum of the bonds of the company, or by

the federal government where the mortgage loan of the company is insured

or held by the federal government, may vary such rental rate from time

to time so as to secure, together with all other income of the company,

sufficient income for it to meet within reasonable limits all necessary

payments to be made or projected to be made during the term of a lease

by the said company, of all expenses including fixed charges, sinking

funds, reserves and dividends on outstanding stock as authorized by the

commissioner or the supervising agency, as the case may be. Letting,

subletting or assignment of leases of apartments at greater rentals than

those approved by the commissioner or the supervising agency shall be

unlawful. Where the mortgage loan of a company is insured or held by the

federal government or where a project is owned by the federal

government, rental rates shall be varied without regard to the

provisions of any general, special or local law which would otherwise

limit or control such rental rates or the determination or variation

thereof for so long as such mortgage loan remains outstanding or the

project financed by such a mortgage loan is owned by the federal

government. No variation of a rental rate in a project financed by a

mortgage loan insured or held by, or owned by the federal government

shall be effective unless approved by the federal government.

(b) Unless any applicable regulation of or regulatory agreement with

the federal government shall otherwise provide, (i) the tenants in a

project financed by a mortgage loan insured or held by the federal

government shall be entitled and may elect to enter in a lease for a

term of up to three years at such rental rates as may be established by

the commissioner or the supervising agency, as the case may be, pursuant

to paragraph (a) of subdivision one of this section, (ii) the rental

rates to be charged under any such lease shall be established after

consideration of the term of such lease and may differ from the rental

rates to be charged under any other lease of a different term and (iii)

the commissioner or the supervising agency, as the case may be, shall in

establishing such rental rates consider the obligations of the company

under any instruments evidencing or securing any residual indebtedness.

Such leases shall contain a provision authorizing the variation of the

rental rates during the term of such leases upon an application made by

the federal government pursuant to paragraph (a) of subdivision one of

this section.

* (c) A company may, with the approval of the commissioner or the

supervising agency, as the case may be, fix maximum charges to be paid

by each occupant for the non-housekeeping accommodations, aged care

accommodations or non-housekeeping accommodations for handicapped

persons, which charges may include payment for board and such other

services as may be provided as an incident to occupancy, the average of

such charges for all the non-housekeeping accommodations, aged care

accommodations or non-housekeeping accommodations for handicapped

persons in any project not to exceed the maximum average charges for all

such non-housekeeping accommodations, aged care accommodations or

non-housekeeping accommodations for handicapped persons determined by

the commissioner or the supervising agency as the case may be, before

any commitments are made by the company for the construction of the

project. The commissioner or the supervising agency upon his or its own

motion, or upon application by the company or of a stockholder, lien

holder, a creditor or of holders of at least ten (10%) per centum of the

bonds of the company, may vary such charges from time to time so as to

secure, together with all other income of the company, sufficient income

for it to meet within reasonable limits all necessary payments to be

made by said company, of all expenses including fixed charges, sinking

funds, reserves and dividends on outstanding stock as authorized by the

commissioner or supervising agency as the case may be. It shall be

unlawful to make non-housekeeping accommodations, aged care

accommodations or non-housekeeping accommodations for handicapped

persons available at greater charges than those approved by the

commissioner or the supervising agency.

* NB There are 2 (c)'s

* (c) Disclosure of bases. The commissioner, administrator or

supervising agency, as the case may be, shall make available for

inspection and copying by the residents in any affected development, all

items and data and recommendations utilized as the various bases for the

decision on increases in rental or carrying charges, upon notification

of the decision to the applicant of the action taken.

* NB There are 2 (c)'s

2. (a) The dwelling or non-housekeeping accommodations without board

in a company project shall be available for persons or families of low

income whose probable aggregate annual income at the time of admission

and during the period of occupancy does not exceed, the greater of (i)

the median income for such persons or families for the metropolitan

statistical area in which the project is located, or if a project is

located outside a metropolitan statistical area, the median income for

such persons or families for the county in which the project is located,

as most recently determined by the United States department of housing

and urban development, in which case any person or family becoming

eligible for admission pursuant to this subparagraph shall pay, from the

time of admission, a rental surcharge as provided for in subdivision

three of this section, computed on the basis of the income limitations

applicable to such persons or families in the absence of this

subparagraph, or (ii) eight times the rental, including the value or

cost to them of heat, light, water and cooking fuel, of the dwellings

that may be furnished to such persons or families, except that in the

case of families with three or more dependents, such ratio shall not

exceed nine to one. Persons or families with two or less dependents

eligible for admission or continued occupancy pursuant to subparagraph

(ii) of this paragraph or subparagraph (ii) of this paragraph prior to

the effective date of a chapter of the laws of two thousand nineteen

that amended subparagraph (ii) of this paragraph, shall pay a rental

surcharge computed on the basis of an income limitation of seven times

the rental and families with three or more dependents eligible for

admission or continued occupancy pursuant to subparagraph (ii) of this

paragraph or subparagraph (ii) of this paragraph prior to the effective

date of a chapter of the laws of two thousand nineteen that amended

subparagraph (ii) of this paragraph, shall pay a rental surcharge

computed on the basis of an income limitation of eight times the cost of

the rental, including in each instance the value or cost to the persons

or families of heat, light, water and cooking fuel, of the dwellings

furnished to such persons or families.

The "probable aggregate annual income" in the case of dwelling

accommodations means the annual income of the chief wage earner of the

family, plus all other income of other members of the family over the

age of twenty-one years, plus a proportion of income of gainfully

employed members under the age of twenty-one years, the proportion to be

determined by the company as approved by the commissioner or the

supervising agency, as the case may be, excluding therefrom a deduction

of fifteen thousand dollars from the income of secondary wage earners of

the family or a larger deduction if approved by the commissioner or the

supervising agency, as the case may be, except that the company, as

approved by the commissioner or the supervising agency, as the case may

be, may exclude a proportion of the income of other members of the

family over the age of twenty-one years for the purpose of determining

eligibility for admission or continued occupancy, or for establishing

the rental of such family, or for all such purposes; in the case of such

non-housekeeping accommodations it means the annual income of the

occupant, provided that the commissioner or supervising agency, as the

case may be, may make rules and regulations relative to the allocation

of the income of a family among the members thereof for the purpose of

determining the income attributable to such occupant.

(b) For the purpose of determining maximum income to establish

eligibility for admission or continued occupancy of, or the imposition

of surcharges upon, tenant-cooperators in a mutual company project, or

for all such purposes, there may be added to the total annual carrying

charges an amount equal to six per centum of the investment of a person

or family in the equity obligations of such housing company and, where

not included in the carrying charges payable to such company, the value

or cost to them of heat, light, water and cooking fuel and, to the

extent authorized by the commissioner or the supervising agency as the

case may be, the value or cost to them of repainting and replacement of

fixtures and appliances.

(c) The non-housekeeping accommodations with board in a company

project including non-housekeeping accommodations with board designed

for the occupancy of handicapped persons shall be available for persons

of low income whose probable aggregate annual income at the time of

admission and during the period of occupancy does not exceed four times

the annual charges to be paid by such persons and in the case of aged

care accommodations two times the annual charges to be paid by such

persons. The "probable aggregate annual income" means the annual income

of the person occupying such non-housekeeping accommodations, aged care

accommodations or non-housekeeping accommodations for handicapped

persons, provided that the commissioner or supervising agency, as the

case may be, may make rules and regulations relating to the allocation

of the income of a family among the members thereof for the purpose of

determining the income attributable to such occupant.

(d) A company may, with the approval of the commissioner or the

supervising agency, as the case may be, lease dwellings in a project to

an authority, at rentals fixed for such dwellings pursuant to the

provisions of subdivision one of this section less an appropriate

adjustment for the increased tax exemption, if any, attributable to such

dwellings pursuant to subdivision three of section thirty-three of this

chapter, for occupancy by persons and families of low income who are

eligible and pay rents therefor pursuant to the provisions of the public

housing law.

(e) Notwithstanding the provisions of this subdivision, families whose

probable aggregate annual income does not exceed one hundred twenty-five

percent of the limitations as to income as determined pursuant to

paragraphs (a) and (b) of this subdivision, shall also be eligible for

admission to the dwelling or non-housekeeping accommodations without

board of a project on the understanding that any family becoming

eligible for admission by reason hereof shall pay, from the time of

admission, a rental surcharge as provided for in subdivision three of

this section, computed on the basis of the income limitations applicable

to such family in the absence of this subdivision. In applying the

provisions of subdivision three of this section to a family becoming

eligible by reason of this section, the maximum income prescribed by law

for admission or occupancy shall for all purposes be computed without

reference to this paragraph.

2-a. Notwithstanding any other provision of law, the commissioner or

supervising agency shall authorize and make provision in rules and

regulations for an immediate downward adjustment in surcharge upon a

showing of substantial decrease in income caused by events including,

but not limited to death, disability or illness.

3. In the event that the income of a person or family in occupancy

should increase and exceed the maximum prescribed by law for admission

or for continued occupancy, based on the latest existing rent, by more

than twenty-five per centum, such person or family shall be subject to

removal from the dwelling, non-housekeeping, aged care accommodations or

non-housekeeping accommodations for handicapped persons provided,

however, that such person or family may be permitted to remain in

occupancy until such income exceeds the maximum prescribed by law by

more than fifty per centum, if the company, with the approval of the

commissioner or the supervising agency, shall determine that removal

would cause hardship to such person or family. Any person or family in

occupancy whose income exceeds the maximum prescribed by law shall pay a

rental surcharge in accordance with a schedule of surcharges to be

promulgated by the company with the approval of the commissioner or the

supervising agency, as the case may be, provided, however, such rental

surcharge shall in no event exceed fifty per centum of the existing

rent.

4. Twenty-five per cent of rental surcharges collected pursuant to

this section on account of rentals payable prior to July first, nineteen

hundred eighty-one shall be paid by the company to the municipality

which has granted tax exemption pursuant to section thirty-three of this

article as a credit against the grant of tax exemption, the value of

such tax exemption and of such credit to be determined on an individual

dwelling, non-housekeeping, aged care accommodation or non-housekeeping

accommodations for handicapped persons unit basis. In the event that

such tax exemption has not been granted, or in the event that a sum

equal to the total of all accrued taxes as to individual dwelling,

non-housekeeping, aged care accommodation or non-housekeeping

accommodations for handicapped persons units where such tax exemption

was granted have been paid to the municipality, the excess if any, of

surcharges and all surcharges imposed after June thirtieth, nineteen

hundred eighty-one shall be applied to the expenses of operation and

management as approved by the commissioner or the supervising agency.

5. Notwithstanding the provisions of this section or of any other

general, special or local law, persons or families living in a project

under a lease for ninety-nine years renewable, or in perpetuity, or by

reason of ownership of stock in such company may, with the approval of

the commissioner or of the supervising agency, as the case may be, be

permitted to remain in occupancy for not more than three years after

such increase in income exceeds the maximum prescribed by law by more

than fifty per centum unless such occupancy is extended with the

approval of the commissioner or of the supervising agency, as the case

may be. Any such occupant required to remove from the project because of

excessive income as herein provided shall be discharged from liability

on any note, bond or other evidence of indebtedness relating thereto and

shall be reimbursed for all sums paid by such occupant to the company on

account of the purchase of stock or income debentures as a condition of

such occupancy.

6. Preference in admission to a project shall be given to families

displaced by a limited-profit housing project.

7. Preference in admission to a project with an open waiting list, as

determined by the commissioner or the supervising agency, shall be given

by a mutual company or an urban rental company or by the New York state

housing finance agency when subleasing dwellings in projects of such

companies pursuant to section forty-four-a of this chapter, to persons

or surviving spouses of persons who are veterans as such term is defined

pursuant to section eighty-five of the civil service law. The number of

persons given preference as a veteran or a surviving spouse of a veteran

shall be published adjacent to the application to be on such waiting

list. For projects with a closed list, as determined by the commissioner

or the supervising agency, such preference shall be given upon the

opening of the waiting list. Notwithstanding the foregoing, persons who

are residing in a limited-profit housing project shall be given first

priority for an internal transfer in the project in which they are

residing in accordance with rules and regulations promulgated by the

commissioner or the supervising agency.

7-b. Preference in admission to projects located in a city with a

population of one hundred thousand or more shall be given to members of

a police force of such city, provided such members otherwise qualify for

admission and provided, further, that such city has adopted a local law

authorizing such program.

8. Preference in admission to any project or to such portion of any

project which has been specifically designed for occupancy by aged or

handicapped persons, as the case may be, shall be given to such persons.

8-a. A company may rent one or more dwelling units to a social

services official or duly authorized agency, as defined in section three

hundred seventy-one of the social services law, for the operation of

agency boarding homes or group homes or to any public agency as defined

in section four hundred sixty-one of the general municipal law which

provides residences and social services to dependent aged persons.

9. (a) For the purpose of enabling lower income elderly persons to

continue in occupancy without paying rentals in excess of a fair

proportion of their income, any municipality having a population of less

than one million is authorized to make and to contract to make periodic

payments to a company in an amount not exceeding the difference between

the rent or carrying charges for the dwellings occupied by such lower

income persons and one-third of their net probable aggregate annual

income, where such rent or carrying charges exceed such one-third of

income; provided that the aggregate amount of periodic payments to be

made in accordance with contracts entered into by the municipality

during any fiscal year thereof pursuant to this subdivision, subdivision

seven of section eighty-five-a, section one hundred twenty-six and

section five hundred seventy-seven-a of this chapter shall not exceed

the aggregate amount of all real property taxes paid or payable during

such fiscal year by all companies organized pursuant to this article,

article IV, article V, and article XI of this chapter and the aggregate

estimated receipts of all such companies in such fiscal year from rental

surcharges collected or to be collected pursuant to this chapter.

(b) Such payments shall be made only on account of a person or family

in occupancy where the head of the household is sixty-two years of age

or older and is not a recipient of public assistance pursuant to the

social services law, and where the net probable aggregate annual income

of the person or family in occupancy does not exceed six thousand five

hundred dollars a year. Notwithstanding the provisions of subdivision

twenty-nine of section two of this chapter, net probable aggregate

annual income as used in this subdivision shall mean annual income of

family members from all sources after deduction of federal, state and

city income taxes; provided that any municipality may provide that

increases in benefits under the social security act which take effect

after such person or family has assumed occupancy shall not be taken

into account.

(c) A company having a contract with the municipality pursuant to this

subdivision may not collect from persons or families in occupancy on

whose account such payments are made any rentals in excess of the

amounts specified in such contract.

10. A housing company shall accept federal reimbursement under section

eight of the Housing and Community Development Act of 1974 in lieu of

such amount in rent payment for a person qualifying under such act and

residing in a project of such company. A housing company shall not

reject an applicant for an apartment solely on the basis that all or

part of the rent shall be paid under section eight of the Housing and

Community Development Act of 1974.

11. Every company subject to the provisions of this article shall on a

form prescribed by the commissioner or supervising agency annually

certify to such commissioner or supervising agency that all necessary

steps are being undertaken to ensure that all surcharges due pursuant to

this section are being properly billed, collected and remitted.

12. All municipally-aided projects shall post the first and last names

of all persons on each waiting list maintained by such project, in

chronological order, by such project's management office, or, if there

is no management office on the site of such municipally-aided project,

in such project's lobby.

13. The commissioner or supervising agency shall develop a written

procedure with regard to how applications for admission to a company are

processed and numbered, and how tenants are selected. Such procedure

shall be implemented and followed by all limited-profit housing

companies subject to the provisions of this article; provided, however,

that any limited-profit housing company may elect additional procedures

so long as such procedures are not inconsistent with the procedures

developed by the commissioner or supervising agency and any other

requirements set forth in this article.

14. The commissioner or supervising agency shall develop a procedure

whereby applicants are notified in the case that their application is

rejected by a limited-profit housing company subject to the provisions

of this article, and such procedure shall also include the appeal's

process available to the rejected applicant. The notification that shall

be sent to the applicant shall be in written form, include reasons why

the applicant was rejected, the appeal's process, and be sent to the

applicant within sixty days after the limited-profit housing company

decided to reject such applicant. Any limited-profit housing company may

elect additional procedures so long as such procedures are not

inconsistent with the procedures developed by the commissioner or

supervising agency and any other requirements set forth in this article.

For purposes of this subdivision, an applicant shall not be deemed

rejected if their application is still active on the limited-profit

housing company's waiting list and such waiting list is still open and

accepting applications.

15. The commissioner or the supervising agency shall develop and

require the use of a publicly available electronic automated system for

limited-profit housing companies to store, process, and maintain

applications and waiting lists. Waiting lists maintained by each such

company shall use a method that protects any personally identifiable

information of applicants from being publicly disclosed or accessible to

the public. Such electronic automated system shall also include general

information about each company, including, but not limited to: the name

and address of the company; the management office and address; the

number and size of all units in each building; and information on the

status of each waiting list, including whether the limited-profit

housing company is currently accepting applications and how long

applicants may have to wait.

Resale price of shares. Notwithstanding any other provision of

this article and subject to any regulation not inconsistent with this

section which may be promulgated by the commissioner or supervising

agency:

(a) The resale price of shares in a mutual company shall be fixed by

the mutual company, subject to the approval of the commissioner or

supervising agency and shall be equal to (1) the consideration the

selling tenant-cooperator paid for such shares and (2) any capital

assessments and voluntary capital contributions approved by the

commissioner or supervising agency and paid by the selling

tenant-cooperator to the mutual company, to the extent not already

included in the consideration paid for such shares, and, if established

by the mutual company, (3) a proportionate share of the actual aggregate

amortization paid on all existing and prior mortgages on the project in

reduction of total outstanding principal indebtedness during such period

as shall be fixed by the board of directors of the mutual company, to

the extent not already included in the consideration paid for such

shares, and (4) reasonable administrative charges.

(b) The aggregate amount to be paid to the selling tenant-cooperator

with respect to the sale of the selling tenant-cooperator's shares shall

be fixed by the board of directors of the mutual company, subject to the

approval of the commissioner or supervising agency, and shall be equal

to (1) the consideration the selling tenant-cooperator paid for such

shares, (2) any capital assessments and voluntary capital contributions

approved by the commissioner or supervising agency and paid by the

selling tenant-cooperator to the mutual company, to the extent not

already included in the consideration paid for such shares, and (3) a

proportionate share of the actual aggregate amortization paid by the

selling tenant-cooperator on all existing and prior mortgages on the

project in reduction of total outstanding principal indebtedness during

such period as shall be fixed by the board of directors pursuant to

subdivision (a) of this section, to the extent not already included in

the consideration paid for such shares. To the extent that a selling

tenant-cooperator may be entitled to an amount less than the resale

price of his shares, the difference shall be retained by the mutual

company.

(c) The board of directors may, subject to the approval of the

commissioner or supervising agency, establish a general policy pursuant

to which a selling tenant-cooperator who had occupied more than one

dwelling unit is paid an amount measured by his proportionate share of

the actual aggregate amortization paid during his period of occupancy on

all existing or prior mortgages on the project. To the extent that a

selling tenant-cooperator may be entitled to an amount greater than the

resale price of shares, the difference may be paid to the selling

tenant-cooperator by the mutual company.

(d) The "proportionate share of the actual aggregate amortization paid

on all existing and prior mortgages on the project" referred to in

subdivision (a) of this section shall be in the same ratio to such

actual aggregate amortization as the number of shares held by the

selling tenant-cooperator at the time of sale bears to the total number

of shares of issued and outstanding capital stock of the mutual company

during such period.

(e) Nothing contained in this section shall prohibit the continued use

of any method of calculating resale price adopted by a mutual company

and approved by the commissioner or supervising agency prior to the

effective date of this section.

(f) a mutual company shall provide, upon request of a

tenant-cooperator, a written statement providing the current value of

such tenant-cooperator's shares and equity in such mutual company;

Assignment or pledge of tenant cooperator's shares.

Notwithstanding any other provision of law, a tenant cooperator's shares

in a mutual company may be assigned or pledged as collateral for the

purpose of securing a loan for the purchase of such shares. The

commissioner or supervising agency, as the case may be, shall promulgate

regulations which provide that in the event of a default of such loan,

such shares may be resold, and the dwelling accommodations represented

by such shares may be occupied, only in accordance with the provisions

of this article.

Tenant-cooperators; application of shares. 1. No mutual

company shall require a current tenant-cooperator to use cash, loan or

mortgage to make an initial payment for shares that would entitle the

tenant-cooperator to occupancy upon transfer to another dwelling unit

within the mutual company's facilities, but instead, subject to

subdivision two of this section, shall first allow the tenant-cooperator

the option to apply the value of his or her shares and equity in the

mutual company toward any consideration required to be paid for such

shares.

2. Within one hundred eighty days of the effective date of this

section, the commissioner and the supervising agency, as the case may

be, shall each promulgate regulations authorizing a current

tenant-cooperator, entitled to occupancy by reason of ownership of

shares in such mutual company, to apply all or a portion of the value of

his or her shares and equity in the mutual company toward any

consideration required to be paid for shares which would entitle the

tenant-cooperator to occupancy of another unit owned and operated by the

mutual company, regardless of the sale of the tenant-cooperator's

current shares in such mutual company, but subject to such other charges

due and owing to the mutual company for which such tenant-cooperator may

be liable. Any dispute thereof may be determined by a court of

appropriate jurisdiction and any requirement to waive such right as a

condition of ownership or transfer shall be void as against public

policy.

Supervision and regulation. The commissioner or the supervising

agency as the case may be, may:

1. Examine a company and keep informed as to its general condition,

its capitalization and the manner in which its property is constructed,

acquired, rehabilitated, leased, operated or managed, and to its

compliance with all provisions of law and orders of the commissioner or

the supervising agency.

2. Require every company to file with him or it an annual report

setting forth such information as the commissioner or the supervising

agency may require, verified by the oath of any officer, general manager

or other person in control of the company. Such report shall be in a

form, cover a period, and be filed at a time as prescribed by the

commissioner or the supervising agency.

3. From time to time make, amend and repeal supplementary rules and

regulations for carrying into effect the provisions of this article

provided, however, that such supplementary rules and regulations shall

be strictly limited in their application to the means and methods of

compliance with the provisions of this article to which such power

relates.

4. Make such agreements with bondholders, mortgagees or creditors of a

company to do or refrain from doing any act, not inconsistent with law,

to protect the investment rights of the state of New York, the New York

state housing finance agency, the New York city housing development

corporation or of the municipality.

5 (a) Administer oaths, take affidavits, hear testimony and take proof

under oath at public or private hearings; (b) subpoena and require the

attendance of witnesses and the production of books and papers

pertaining to any investigations and inquiries authorized by this

article and examine them in relation to any matter concerning which the

power to investigate is granted; (c) issue commissions for the

examination of witnesses who are out of the state or unable to attend or

are excused from attendance; (d) investigate into the affairs of a

company and into the dealings, transactions or relationships of such

company with third persons and into the affairs of any person, firm,

corporation or other entity having a financial interest, whether direct

or indirect, in the design, construction, acquisition, reconstruction,

rehabilitation, improvement, financing or operation of any project

undertaken by a company; (e) intervene, as a matter of right, in any

action or proceeding of which notice shall be given affecting the

project of a company; (f) take such steps in such action or proceeding

as may be necessary to protect the public interest.

With regard to duties and liabilities arising out of this article the

state, the commissioner or the supervising agency may be sued in the

same manner as a private person. No costs shall be awarded against the

commissioner, the state, or the supervising agency, as the case may be,

in any such litigation.

6. In the event of a violation by a company of a provision of the

certificate of incorporation or of law or of the loan or mortgage

contract or of any rules and regulations duly promulgated pursuant to

the provisions of this article, the commissioner or the supervising

agency, as the case may be, may remove any or all of the existing

directors of the company and appoint such person or persons who the

commissioner or the supervising agency, as the case may be, in his or

its sole discretion deems advisable, including officers or employees of

the division of housing and community renewal or the supervising agency,

as new directors to serve in the places of those removed. Directors so

appointed need not be shareholders or meet other qualifications which

may be prescribed by the certificate of incorporation or by-laws. In the

absence of fraud or bad faith, directors so appointed shall not be

personally liable for debts, obligations or liabilities of the

corporation. Directors so appointed shall serve only for a period

coexistent with the duration of such violation or until the commissioner

or the supervising agency, as the case may be, is assured in a manner

satisfactory to him or it against violations of a similar nature.

Officers or employees of the division of housing and community renewal

or of the supervising agency who are so appointed as directors shall

serve in such capacity without compensation. No such removal may take

place without written notice and an opportunity for the affected

directors to appear and be heard before the agency or commissioner with

respect to any alleged violation and the respective parties may be

represented by counsel. Notwithstanding any inconsistent provision of

any general, special or local law or any limitation contained in the

provisions of any city charter, the state or a municipality acting by

and through the commissioner or the supervising agency, as the case may

be, shall save harmless and indemnify any officer or employee of the

division of housing and community renewal or the supervising agency so

appointed as a director, from financial loss arising out of any claim,

demand, suit or judgment by reason of alleged negligence or other act by

such director, provided that such director was acting in the discharge

of his duties and within the scope of his employment and that such loss

did not result from the willful and wrongful act or gross negligence of

such director and provided further that this save harmless and

indemnification provision shall not in any way impair, limit or modify

the rights and obligations of any insurer under any policy of insurance

and shall inure only to directors so appointed and shall not enlarge or

diminish the rights of any other party. No action or special proceeding

based on or arising out of alleged negligence or other act by such

director may be commenced against such director, municipality or the

state unless a notice of claim shall have first been served in a manner

consistent with service upon a municipality or the state, as the case

may be.

7. Whenever the commissioner, in the case of a company undertaking or

otherwise operating a state-aided project, or the supervising agency, in

the case of a company undertaking or otherwise operating a

municipally-aided project, shall be of the opinion that such company is

failing or omitting, or is about to fail or omit to do anything required

of it by law or by order of the commissioner or is doing or is about to

do anything, or permitting anything, or is about to permit anything to

be done, contrary to and in violation of law or of any order, regulation

or directive of the commissioner or the supervising agency, as the case

may be, or which is improvident or prejudicial to the interest of the

public, the lienholders, the stockholders, or the tenants, the

commissioner or the supervising agency, as the case may be, may, in

addition to such other remedies as may be available, commence an action

or proceeding in the supreme court of the state of New York in the name

of the commissioner or the supervising agency, as the case may be, for

the purpose of having such violations or threatened violations stopped

and prevented, and in such action or proceeding the court may appoint a

temporary or permanent receiver or both. Such action or proceeding shall

be commenced by a petition to the supreme court, alleging the violation

complained of and praying for appropriate relief. It shall thereupon be

the duty of the court to specify the time, not exceeding twenty days

after service of a copy of the petition, within which the company

complained of must answer the petition. In case of any default or after

answer the court shall immediately inquire into the facts and

circumstances in such manner as the court shall direct without other or

formal pleadings, and without respect to any technical requirements.

Such other persons or corporations as it shall seem to the court

necessary or proper to join as parties in order to make its order or

judgment effective, may be joined as parties. The final judgment in any

such action or proceeding shall either dismiss the action or proceeding

or direct that an order or an injunction, or both, issue, or provide for

the appointment of a receiver as prayed for in the petition, and grant

such other relief as the court may deem appropriate.

8. The commissioner or supervising agency may modify supervision of a

company upon finding that duplicative supervisory functions may impose

an undue regulatory burden or unnecessary expenditure of agency

resources, by taking such actions as are deemed appropriate, including

consolidating supervisory functions associated with different programs,

and entering into memoranda of understanding with other agencies for the

allocation of supervisory functions.

Additional supervision and regulation. The commissioner or the

supervising agency, as the case may be, shall:

1. Promulgate regulations providing for recognition of duly

constituted tenants' associations and cooperators' advisory councils by

the commissioner or supervising agency, as the case may be, and

providing that a housing company shall meet on a regular basis with

representatives of such an association or council at the specific

project involved to discuss matters relating to the project. A duly

constituted cooperators' advisory council shall only be such a council

in a mutual company project prior to the election of a board of

directors by the tenant-cooperators.

2. Require every company to file with him, her or it an annual

operating budget for each individual project in the manner prescribed by

the commissioner or supervising agency.

3. Require every company to file with him, her or it semi-annual or

quarterly financial statements and an annual financial statement. Each

annual financial statement shall be accompanied by a certificate of the

company's independent certified public accountant. Such financial

statements shall be filed at the times and in the manner prescribed by

the commissioner or supervising agency.

4. Afford tenants access to and an opportunity to acquire copies of

all operating budgets or financial statements respecting the project in

which such tenants reside, to the extent that such budgets and

statements are required by law to be kept by the commissioner or

supervising agency.

5. Permit any tenant, duly constituted tenants' association, duly

constituted cooperators' advisory council or his, hers or its duly

authorized representative to audit the books of the company and to have

access during normal business hours to the financial records upon which

the company's financial statements are based.

6. Promulgate regulations relating to managing agents, including

criteria for the eligibility for selection and the compensation of

managing agents by companies organized pursuant to this article. Such

regulations shall provide, among other things, that any contract with a

managing agent entered into after September first, nineteen hundred

seventy-seven shall be terminable for cause and shall be terminable,

with or without cause, at least every twelve months after commencement

of the term thereof, and that promptly upon termination the managing

agent shall turn over to the company all project records, rent rolls,

bills, cancelled checks, bank statements and other papers owned by such

company.

7. Require that every company file with him, her or it, within six

months of the effective date of regulations implementing this

subdivision and in such format as shall be prescribed by the

commissioner or the supervising agency after consultation with the state

energy office, an energy audit report which identifies potential

energy-saving building improvements, including alterations,

modifications and adjustments to the building structure, heating,

cooling, lighting and ventilation systems; their relative costs;

potential energy and cost savings; and simple payback periods, which for

the purpose of this subdivision shall mean that period of time within

which the estimated cost of such improvements, exclusive of the cost of

capital, would be recovered from the savings generated by reduced energy

consumption resulting from the improvements. The energy audit shall be

conducted by a public utility, an engineer or architect licensed by the

state, or the managing agent or other representative of the company if

such individual has attended an energy audit training workshop sponsored

by the commissioner or the state energy office. A copy of the energy

audit report, required herein, shall be given to any duly constituted

tenant's association or cooperator's advisory council and a copy shall

be available for inspection and copying by any individual tenant who

requests it. The commissioner or supervising agency shall also require

that every company certify by March thirty-first, nineteen hundred

eighty-four that all compatible conservation measures identified in the

energy audit report which have simple payback periods of one year or

less have been implemented; provided, however, if the commissioner or

supervising agency determines within sixty days of the date the energy

audit report is filed that one or more of such identified conservation

measures cannot be implemented by March thirty-first, nineteen hundred

eighty-four, given the projected rent revenues and other monies

available to the company from reserve funds, loans or grants from the

state or federal government or any other source, the implementation of

such conservation measures shall be provided for according to a schedule

prescribed by the commissioner or supervising agency.

8. Every tenant or resident, or a person acting on behalf of a tenant

or resident, shall be permitted to copy, by photographic means, any

document within the scope of this section pertaining to the project in

which such tenant or resident resides. A reasonable fee, subject to a

maximum therefor prescribed in regulations, may be charged for such

copies.

* 9. Require that within ten days of the filing of any reports or

financial statements with the commissioner or supervising agency, the

housing company shall transmit a copy of said report or financial

statement to a duly constituted resident board of directors, and if

there be none, to a cooperator's advisory council or a duly constituted

tenants association representing the project concerned. Where no such

council or association exists in a project, a notice shall be posted

informing the residents of the location on the premises of the project

where a copy of said report or financial statement is available for

inspection. The notice shall be posted within ten days of filing, in a

prominent place on the premises of the project concerned.

* NB There are 2 sb 9's

* 9. Promulgate regulations to require each tenant use their dwelling

unit as their primary residence to maintain their right of continued

occupancy or be subject to eviction in a court of competent jurisdiction

by a mutual housing company.

* NB There are 2 sb 9's

10. Require every voting member of a board of directors of a mutual

company subject to the provisions of this article, elected or appointed

for a term beginning on or after the effective date of this subdivision,

to complete, within the first year of his or her term and at least once

every three years thereafter, a minimum of two hours of training, in

person or virtually, as the commissioner or supervising agency, as the

case may be, may deem appropriate on the financial oversight,

accountability and fiduciary responsibilities of a board member; and to

require every voting member of a board of directors of a mutual company

subject to the provisions of this article, elected or appointed for a

term beginning before the effective date of this subdivision, to

complete such training within one year of the effective date of this

subdivision and at least once every three years thereafter.

11. Require every voting member of a board of directors of a mutual

company subject to the provisions of this article, elected or appointed

for a term beginning on or after the effective date of this subdivision,

to complete, within the first year of his or her term and at least once

every three years thereafter, in addition to the training required by

subdivision ten of this section, a training course, in person or

virtually, as the commissioner or supervising agency, as the case be,

may deem appropriate, to acquaint him or her with the powers, functions

and duties of a board of directors of a mutual company subject to the

provisions of this article, as well as the powers and duties of other

governing and administrative authorities affecting such companies; and

to require every voting member of a board of directors of a mutual

company subject to the provisions of this article, elected or appointed

for a term beginning before the effective date of this subdivision, to

complete such training within one year of the effective date of this

subdivision and at least once every three years thereafter.

12. Require each member of a board of directors of a mutual company

subject to the provisions of this article to demonstrate compliance with

the requirements set forth in subdivisions ten and eleven of this

section by filing a certificate of completion of such course or courses

on a form to be promulgated by the commissioner. Such form shall be

filed with the secretary of the mutual company and maintained by the

secretary as a corporate record and distributed annually to the

shareholders and upon the filing of any director with the mutual company

of the intention to seek re-election to the position. Sixty days prior

to any scheduled election of members of the board of directors, the

secretary of the mutual company shall furnish the commissioner or the

supervising authority, as the case may be, with a list of all incumbent

directors indicating which individuals have submitted certificates

required in this subdivision. Such course or courses shall be provided

by the commissioner or supervising agency, as the case may be, at no

cost to the trainee or the board to which the trainee has been elected.

13. Develop the curricula used for training required by subdivisions

ten and eleven of this section for which the supervising agency or the

commissioner may request and shall receive the cooperation and

assistance from any departments, divisions, boards, bureaus, commissions

or agencies of the state and political subdivisions thereof in

developing such curricula. These curricula may be offered together as a

single course or separately. The training required by this section may

be offered by providers approved by the commissioner or supervising

agency, as the case may be. In approving other providers for these

trainings, the commissioner or supervising agency shall consider a

potential provider's understanding of cooperative homeownership; laws,

rules and regulations affecting mutual companies subject to the

provisions of this article; and the fiduciary responsibilities of the

board of a residential cooperative, as well as the experience of the

provider in delivering such training.

14. Hold such meeting or meetings, in person or virtually as the

commissioner or supervisory agency shall deem appropriate, with the

board of a mutual company on the financial oversight, accountability and

fiduciary responsibilities of such board; the powers, functions and

duties of such board; and the powers and duties of other governing and

administrative authorities affecting such company.

Annual reports. The commissioner shall, on or before the first

day of July in each year, submit a report to the legislature, the state

comptroller, and the attorney general on the implementation of article

two of this chapter by the commissioner and the supervising agency and

the policy included therein. Such report shall include and not be

limited to rent and carrying charge levels, changes therein, operation

of the state capital grant program and federal subsidy programs, tax

abatement levels, total capital outlay, amortization, mortgage interest

rates, income levels served by the housing, surcharge billings and

collections and use of surcharge revenues, and vacancy rates. Such

report shall also include information regarding any limited-profit

housing company that has voluntarily dissolved in the preceding calendar

year, and any limited-profit housing company that has filed a notice of

intent to dissolve in the current calendar year with the commissioner

and the supervising agency. This information shall include, but not be

limited to, the name and address of the development, the number of units

in the development, a range of amounts of rent offered in the

development, the number of tenants in the development, the current

vacancy rate in the development, income levels served by the

development, how long the limited-profit housing company has

participated in the program, and any sales or transfers that have

occurred since the limited-profit housing company was created. For the

purpose of preparing such report, the commissioner may request, and

shall receive, from any municipality or supervising agency such data as

he deems necessary or desirable and such municipality or supervising

agency shall furnish the requested data within sixty days of such

request.

Tax exemptions. 1. (a) Upon the consent of the local legislative

body of any municipality in which a project is or is to be located, the

real property in a project shall be exempt from local and municipal

taxes, other than assessments for local improvements, to the extent of

all or part of the value of the property included in such project which

represents an increase over the assessed valuation of the real property,

both land and improvements, acquired for the project at the time of its

acquisition by the limited-profit housing company, provided, however,

that the real property in a project acquired for purposes of

rehabilitation shall be exempt to the extent of all or part of the value

of the property included in such project, and further provided that the

amount of such taxes to be paid shall not be less than ten per centum of

the annual shelter rent or carrying charges of such project except that

for projects located or to be located in a city of a population of one

million or more, the amount of such taxes shall be no more than five per

centum of the annual shelter rent or carrying charges of the project.

Upon the consent of the local legislative body of a municipality, other

than a city with a population of one million or more, in which the

project is located, the amount of such taxes may be further reduced to

five per centum or less of the annual shelter rent or carrying charges

of the project. Any such granted consent to reduce the amount of such

taxes shall expire every ten years. If such authorization is not

renewed, the rate of taxation shall revert to the level established

before the consent was granted. Shelter rent shall mean the total rents

received from the occupants of a project less the cost of providing to

the occupants electricity, gas, heat and other utilities. Total rents

shall include rent supplements and subsidies received from the federal

government, the state or a municipality on behalf of such occupants but

shall not include interest reduction payments pursuant to subdivision

(a) of section two hundred one of the Federal Housing and Urban

Development Act of nineteen hundred sixty-eight. The tax exemption shall

operate and continue so long as the mortgage loans of the company,

including any additional mortgage loan the proceeds of which are used

primarily for the residential portion of the project, which additional

loan is approved by the commissioner or the supervising agency, are

outstanding.

(b) Where a municipality acts on behalf of another taxing jurisdiction

in assessing real property for the purpose of taxation, or in levying

taxes therefor, the consent of the local legislative body of such

municipality shall have the effect of exempting the real property in a

project from local and municipal taxes, other than assessments for local

improvements, levied by or in behalf of both such taxing jurisdictions.

As used in this paragraph, the term "taxing jurisdiction" means any

municipal corporation or district corporation, including any school

district or any special district, having the power to levy or collect

taxes and benefit assessments upon real property, or in whose behalf

such taxes or benefit assessments may be levied or collected.

(c) Notwithstanding the provisions of paragraphs (a) and (b) of this

subdivision, the real property of a state urban development corporation

project acquired, owned, constructed, managed or operated by a company

incorporated pursuant to the not-for-profit corporation law and this

article shall be entitled to all the benefits provided by section four

hundred twenty-two of the real property tax law. The real property of a

state urban development corporation project, other than a state urban

development corporation project acquired, owned, constructed, managed or

operated by a company incorporated pursuant to the not-for-profit

corporation law and this article, shall be exempt from all local and

municipal taxes, other than assessments for local improvements, to the

extent of the value of the property included in such project as

represents an increase over the assessed valuation of the real property,

both land and improvements, acquired for the project on the date of its

acquisition by the limited-profit housing company, provided that the

amount of such taxes to be paid shall not be less than ten per centum of

the annual shelter rent or carrying charges of such project, as defined

in paragraph (a) hereof, except that in a city with a population of one

million or more, the amount of such taxes shall be no more than five per

centum of the annual shelter rent or carrying charges of the project.

Upon the consent of the local legislative body of the municipality,

other than a city with a population of one million or more, in which the

project is located, the amount of such taxes may be further reduced to

five per centum or less of the annual shelter rent or carrying charges

of the project. Any such granted consent to reduce the amount of such

taxes shall expire every ten years. If such authorization is not

renewed, the rate of taxation shall revert to the level established

before the consent was granted. The tax exemption shall operate and

continue so long as the mortgage loans of such limited profit housing

company, including any additional mortgage loan the proceeds of which

are used primarily for the residential portion of the project, which

additional loan is approved by the commissioner or the supervising

agency, are outstanding and the project is continued to be operated as a

limited-profit housing project. If a state urban development corporation

project qualifying for tax exemption pursuant to this paragraph is sold,

with the approval of the commissioner, to another limited-profit housing

company, such successor company shall be entitled to all the benefits of

this paragraph. In the event that such sale is to a company incorporated

pursuant to the not-for-profit corporation law and this article, such

successor company shall be entitled to all the benefits provided by

section four hundred twenty-two of the real property tax law.

(d) Notwithstanding the provisions of paragraphs (a) and (b) of this

subdivision, when a project is financed with a mortgage loan pursuant to

this article or article three of this chapter and (i) there is a

participation, new loan or investment pursuant to section twenty-three-b

of this article or (ii) such mortgage loan is assigned, modified or

satisfied pursuant to section twenty-three-a or forty-four-b or

subdivision twenty-two-a of section six hundred fifty-four of this

chapter, the real property of the project shall be exempt from all local

and municipal taxes, other than assessments for local improvements, to

the extent of the value of the real property included in such project

which represents an increase over the assessed valuation of the real

property, both land and improvements, acquired for the project on the

date of its original acquisition for the project by the original

mortgagor under a mortgage loan pursuant to this article or article

three of this chapter, provided that the amount of taxes to be paid on

the project shall not be less than ten per centum of the annual shelter

rent or carrying charges of such project, as defined in paragraph (a) of

this subdivision, except that in a city with a population of one million

or more, the amount of such taxes shall be no more than five per centum

of the annual shelter rent or carrying charges of the project. Upon the

consent of the local legislative body of the municipality, other than a

city with a population of one million or more, in which the project is

located, the amount of such taxes may be further reduced to five per

centum or less of the annual shelter rent or carrying charges of the

project. Any such granted consent to reduce the amount of such taxes

shall expire every ten years. If such authorization is not renewed, the

rate of taxation shall revert to the level established before the

consent was granted. Such tax exemption shall commence in each instance

from the date when the project becomes subject to a mortgage insured by

the federal government and shall operate and continue so long as a

mortgage on such project is insured or held by the federal government or

so long as the project is thereafter owned by the federal government or

so long as any residual indebtedness is outstanding, whichever is

longer. When there is a participation, new loan or investment pursuant

to section twenty-three-b of this article, such participation, new loan

or investment shall be deemed to be the equivalent of a federally

insured mortgage for purposes of this paragraph. Nothing contained in

this paragraph shall be construed to limit or otherwise impair the

benefits available to any company eligible for exemption from taxation

pursuant to section thirty-one or section thirty-six-a of this article,

section four hundred twenty-two or section four hundred sixty-seven-c of

the real property tax law, or section fifty-eight of the public housing

law. The foregoing shall not be deemed to authorize any company to

receive the benefits of any exemption from taxation in contravention of

the provisions of section two of article eighteen of the constitution.

(e) Notwithstanding the provisions of paragraph (a) of this

subdivision, a municipality, with the approval of the local legislative

body, may contract to exclude all or part of any rent subsidies received

from the federal government pursuant to section eight of the United

States Housing Act of nineteen hundred thirty-seven as amended in the

computation of total rents received.

(f) Notwithstanding the provisions of paragraph (a) of this

subdivision, if the number of units occupied by persons receiving the

benefit of rental assistance payments from the federal government

pursuant to section eight of the United States Housing Act of nineteen

hundred thirty-seven, as amended, with respect to any project increases

by more than one hundred percent within any twelve consecutive months

prior to nineteen hundred eighty-five over the number of units for which

such subsidies were available during the preceding twelve consecutive

months or as July first, nineteen hundred eighty, whichever is later,

taxes payable for such additional subsidized units and subsequent units

subsidized in the same manner shall be based solely upon that portion of

total rents received on account of such additional subsidized units that

is not funded by such rental assistance payments, provided, however,

that no project shall receive such additional tax exemption (i) unless a

minimum of seventeen percent of the units in the project receive the

benefit of such subsidies, or (ii) if any mortgage on such project is

insured or held by the federal government or if the project is owned by

the federal government. The amount of exemption to which a project is

entitled pursuant to this paragraph shall be certified annually by the

commissioner or the supervising agency, as the case may be.

2. Notwithstanding the provisions of subdivision one hereof, whenever

a dwelling in a project is leased to the New York state housing finance

agency pursuant to the provisions of section forty-four-a of this

chapter, so much of the assessed value of such project attributable to

such dwelling (including a pro rata portion of the value of the land and

common spaces) as represents an increase over the proportionate assessed

value of the real property, both land and improvements, acquired for

such project at the time of original acquisition therefor, shall be

exempt during the period of such lease from taxation for county, city,

town, village and school district purposes and special ad valorem

levies; provided that if in any year the aggregate amount of such taxes

and levies that would have been attributable to such dwelling but for

the exemption provided by this subdivision exceeds the amount payable

out of the low rent lease account pursuant to subdivision three of

section forty-four-a of this chapter with respect to the agency's rent

obligation for such dwelling, the agency shall make proportional

payments in lieu of such taxes and levies to the appropriate county,

city, town, village, school district or special district, or any

combination thereof as the case may be, in an aggregate amount equal to

one half of the sum of (a) the amount of such excess and (b) the amount,

if any, by which the rent paid to the agency under the sublease for such

dwelling exceeds the agency's rent obligation for such dwelling. Nothing

contained in this subdivision shall preclude the increase of the taxable

assessed value attributable to such dwellings as a result of a net

increase in the assessed valuation of the taxable property in the

assessing unit as a result of assessing such property at a higher ratio

of full value.

3. Notwithstanding the provisions of subdivision one hereof, whenever

a dwelling in a project is leased to an authority, pursuant to the

provisions of sections seventeen and thirty-one of this chapter, so much

of the assessed value of such project attributable to such dwelling

(including a pro rata portion of the value of the land and common

spaces) as represents an increase over the proportionate assessed value

of the real property, both land and improvements, acquired for such

project at the time of original acquisition therefor, shall be exempt

during the period of such lease from taxation for county, city, town,

village and school district purposes and special ad valorem levies.

Nothing contained in this subdivision shall preclude the increase of the

taxable assessed value attributable to such dwelling as a result of a

net increase in the assessed valuation of the taxable property in the

assessing unit as a result of assessing such property at a higher ratio

of full value.

4. Notwithstanding the provisions of subdivision one hereof, when a

mutual company is organized under this article to facilitate the

acquisition of a building by residents thereof, the amount of local and

municipal taxes, other than assessments for local improvements, to be

paid on the real property included in such project, both land and

improvements, shall not exceed twenty per centum of the annual shelter

rent or carrying charges of such project, as defined in paragraph (a) of

subdivision one hereof; provided, however, that where such acquisition

of a building by residents thereof involves the financing of

rehabilitation or other improvement as well as acquisition, upon the

consent of the local legislative body of the municipality in which the

project is located the amount of such taxes may be further reduced

provided that such amount shall not be less than ten per centum of the

annual shelter rent or carrying charges of the project, as defined in

paragraph (a) of subdivision one hereof; or the company may in lieu of

requesting such consent apply for the benefits of the local law, if any,

enacted pursuant to section four hundred eighty-nine of the real

property tax law. Notwithstanding any other provision of this

subdivision, in a city with a population of one million or more, the

amount of such taxes shall be no more than five per centum of the annual

shelter rent or carrying charges of the project. Upon the consent of the

local legislative body of the municipality, other than a city with a

population of one million or more, in which the project is located, the

amount of such taxes may be further reduced to five per centum or less

of the annual shelter rent or carrying charges of the project. Any such

granted consent to reduce the amount of such taxes shall expire every

ten years. If such authorization is not renewed, the rate of taxation

shall revert to the level established before the consent was granted.

Such tax exemption, if any, granted pursuant to this article shall

operate and continue so long as a loan made under this article or any

subsequent loan approved by the commissioner or the supervising agency

to enhance the residential portion of the project and the project is

continued to be operated for the purposes set forth in this article is

outstanding.

5. Bonds, mortgages, notes, income debentures and obligations of a

company are declared to be issued for a public purpose and to be public

instrumentalities and together with interest thereon shall be exempt

from tax including but not limited to the mortgage recording taxes

imposed by article eleven of the tax law.

6. Any project that received a tax exemption under paragraphs (a), (c)

and (d) of subdivision one, and subdivision four of this section may,

upon the expiration of the tax exemption period, be granted an

additional tax exemption period of up to fifty years, or until such time

as the project is no longer operated under the restrictions and for the

purposes set forth in this article, whichever is sooner.

Foreclosure and judgments. 1. Any action or proceeding to

foreclose a mortgage upon a company project, shall be in accordance with

the applicable provisions of section ninety-four of this chapter.

2. In the event of an unsatisfied judgment against a company any

action not pertaining to the collection of a mortgage indebtedness,

shall be in accordance with the applicable provision of section

ninety-five of this chapter.

3. For the purpose of this section, wherever reference is made in

sections ninety-four and ninety-five of this chapter to a housing

company, it shall be deemed to refer to a company as defined in this

article.

Voluntary dissolution. 1. A company aided by a loan made prior

to May first, nineteen hundred fifty-nine, may voluntarily be dissolved,

with the consent of the commissioner or of the supervising agency, as

the case may be, not less than thirty-five years after the occupancy

date upon the payment in full of the remaining balance of principal and

interest due and unpaid upon the mortgage held by the state or a

municipality pursuant to this article and payment to the municipality of

a sum equal to the total of all accrued taxes for which tax exemption

was granted and received pursuant to section thirty-three of this

article, provided however that such payment of accrued taxes shall be

waived if a company is voluntarily dissolved subsequent to the original

maturity date of any mortgage held by the state or a municipality

pursuant to this article.

2. A company aided by a loan made after May first, nineteen hundred

fifty-nine, may voluntarily be dissolved, without the consent of the

commissioner or of the supervising agency, as the case may be, not less

than twenty years after the occupancy date upon the payment in full of

the remaining balance of principal and interest due and unpaid upon the

mortgage or mortgages and of any and all expenses incurred in effecting

such voluntary dissolution.

3. Upon such dissolution, title to the project may be conveyed in fee

to the owner or owners of its capital stock or to any corporation

designated by it or them for the purpose, or the company may be

reconstituted pursuant to appropriate laws relating to the formation and

conduct of corporations, provided, however, that prior to any such

dissolution and conveyance or reconstitution, payment shall be made of

all current operating expenses, taxes, indebtedness and all accrued

interest thereon and the par value of and accrued dividends on the

outstanding stock of such company. If after making such payments, and

after conveyance of the project, a surplus remains in the treasury of

the company, such surplus, except in the case of a project aided by a

state loan made after May first, nineteen hundred fifty-nine, shall upon

dissolution, be paid into the general fund of the municipality which

granted tax exemption. After such dissolution and conveyance, or such

reconstitution, the provisions of this article shall become and be

inapplicable to any such project and its owner or owners and any tax

exemption granted with respect to such project pursuant to section

thirty-three hereof shall cease and terminate.

4. (a) Notwithstanding any contrary provision of subdivision one or

three of this section or of any other law or local law, consent to

dissolve a company aided by a loan made prior to May first, nineteen

hundred fifty-nine shall be given by the commissioner or the supervising

agency, as the case may be, thirty-five years or more after the

occupancy date, provided that:

(i) such company's project or projects is or are located in a city of

less than one million and more than three hundred thousand persons;

(ii) the dissolution of such company is part of a refinancing plan to

continue the operation of the existing project or projects under this

chapter by a new company organized pursuant to the provisions of this

article in corporate, partnership, or individual ownership form as the

existing stockholders shall agree;

(iii) if the refinancing is done by a new first mortgage, the new

company shall be bound to pay from the proceeds of such refinancing the

remaining balance of the principal and interest on the original mortgage

and any interest due to debenture holders if such interest cannot first

be paid out of the original company's surplus or reserves; or if the

refinancing is done by a second mortgage, the new company shall be bound

to pay from the proceeds of such refinancing the interest due to

debenture holders if such interest cannot first be paid out of the

original company's surplus or reserves; and

(iv) the new company shall be bound to use at least fifty percent of

the net proceeds, which remain from such refinancing after having paid

the legal fees and development costs connected therewith and after

having made the payments required by subparagraph (iii) of this

paragraph, to finance the costs of refurbishing the existing housing

units of the project, or to build and operate under this chapter

additional housing units for persons of low or moderate income or for

disabled persons, within the same municipality wherein the original

project is or projects are located, or to do both such refurbishing of

existing units and such building and operating of such additional units;

any portion of the net proceeds remaining after utilization of at least

fifty percent thereof for the foregoing purposes shall be distributed or

used as the stockholders, partners or sole owner (as the case may be) of

the new company shall decide.

(b) The New York state housing finance agency and the state of New

York mortgage agency are hereby authorized and empowered to finance such

first or second mortgages for the foregoing refinancing purposes upon

such terms and conditions as each such agency deems appropriate.

(c) A company which is voluntarily dissolved in accordance with this

subdivision shall not be required to pay the taxes referred to in

subdivision one of this section nor any surplus remaining in its

treasury as referred to in subdivision three of this section to the

municipality which grants the tax abatement for such project or

projects, but instead, such surplus and all reserve accounts and

debenture rights, titles, interests, contracts, accounts receivable,

accounts payable, and all other assets and liabilities of the dissolved

company shall be transferred to the new company organized for such

refinancing purposes pursuant to such refinancing plan, and such new

company shall be considered for all the purposes of this chapter as a

company aided by a loan made subsequent to May first, nineteen hundred

fifty-nine, with the first date of occupancy deemed to be the date of

the closing of the new first or the second mortgage entered into as part

of the refinancing plan described in subparagraphs (ii), (iii) and (iv)

of paragraph (a) of this subdivision; and any tax abatement granted by

such municipality for such project or projects shall continue to be

applied unless or until such municipality shall act to extend, modify,

enlarge or remove such tax abatement.

Requirements regarding dissolution. Mutual housing companies

considering dissolution and/or reconstitution pursuant to section

thirty-five of this article shall be subject to the following

requirements:

1. Any preliminary vote to authorize a feasibility study, or to

approve a special assessment to fund such feasibility study shall

require the approval of a minimum of two-thirds of all dwelling units

for which shares have been issued by the mutual housing company,

regardless of whether such dwelling units are occupied or vacant,

provided however, that where the shareholder of record is deceased, any

vote attributable to the dwelling unit shall be discounted, both in the

number of votes cast and in the total number of dwelling units upon

which the vote is calculated, until such time as a new shareholder of

record is determined for that dwelling unit.

2. Except as provided for in subdivision seven of this section, any

vote to authorize the funding, development, and submission to the

attorney general of an offering plan for dissolution and reconstitution

of the mutual housing company, or to authorize the funding, development,

and submission to the attorney general of a proxy statement, or any

other documents permitted by the attorney general instead of such

offering plan, or any other preliminary vote for review by the

commissioner or supervising agency relating to the dissolution or

reconstitution required by the regulations of the commissioner or

supervising agency, shall require the approval of eighty percent of all

dwelling units for which shares have been issued, regardless of whether

such dwelling units are occupied or vacant, provided however, that where

the shareholder of record is deceased, any vote attributable to the

dwelling unit shall be discounted, both in the number of votes cast and

in the total number of dwelling units upon which the vote is calculated,

until such time as a new shareholder of record is determined for that

dwelling unit.

3. No funds from the operating budget of the mutual housing company

shall be used for the preparation or distribution of a feasibility

study, a preliminary or filed offering plan for dissolution and

reconstitution of the mutual housing company, a proxy statement or any

other documents permitted by the attorney general instead of such

offering plan, or a notice of intent to dissolve, or to pay for any

services related to evaluation of, preparation for, or execution of

dissolution and/or reconstitution pursuant to section thirty-five of

this article, including but not limited to legal services, but such

funds may only be raised by special assessment voted on and applicable

to all shareholders using such procedures as required by regulations of

the commissioner or the supervising agency which shall not allow

proxies.

4. Except as provided for in subdivision seven of this section, any

vote authorized by the regulations promulgated by the commissioner or

the supervising agency that constitutes the vote for submission of a

certificate of no objection, consent to dissolution or reconstitution,

for submission to the attorney general of an offering plan for

dissolution and reconstitution of the mutual housing company, or for

submission to the attorney general of a proxy statement or any other

documents permitted by the attorney general instead of such offering

plan shall require the approval of eighty percent of all dwelling units

for which shares have been issued by the mutual housing company,

regardless of whether such dwelling units are occupied or vacant,

provided however, that where the shareholder of record is deceased, any

vote attributable to the dwelling unit shall be discounted, both in the

number of votes cast and in the total number of dwelling units upon

which the vote is calculated, until such time as a new shareholder of

record is determined for that dwelling unit.

5. No vote as set forth pursuant to subdivision one, two, three or

four of this section, shall occur within five years following a vote

undertaken pursuant to such subdivisions that failed to pass. No vote as

set forth pursuant to subdivision seven of this section shall occur

within three years following a vote undertaken pursuant to such

subdivision that failed to pass.

6. For any vote pursuant to subdivision one, two, three or seven of

this section, the proposal to be voted on shall state that the cost of

the action to be approved will be paid by a special assessment on

shareholders, that approval of the proposal authorizes the mutual

housing company to impose the assessment, and shall include the total

dollar amount of the proposed assessment and the dollar amount per

dwelling unit that will be imposed to fund the action if it is approved.

Once an assessment has been so approved by shareholder vote, the mutual

housing company shall not increase the amount of the approved assessment

except by further vote subject to the same procedures and threshold for

approval as were required for the vote initially approving the

assessment.

7. Notwithstanding any other provision to the contrary, any final or

preliminary vote regarding dissolution and reconstitution that involves

a conversion to a housing company organized under article eleven of this

chapter including, but not limited to, votes on the authorization to

fund, develop, and submit any required filing to the attorney general,

which pursuant to the conversion shall remain under the supervision of

the commissioner or the supervising agency, shall only require a vote of

a minimum of two thirds of the dwelling units for which shares have been

issued by the mutual housing company regardless of whether such dwelling

units are occupied or vacant, provided however, that where the

shareholder of record is deceased, any vote attributable to the dwelling

unit shall be discounted, both in the number of votes cast and in the

total number of dwelling units upon which the vote is calculated, until

such time as a new shareholder of record is determined for that dwelling

unit. Provided further however, that any dissolution and reconstitution

to a housing company organized under article eleven of this chapter as

provided by this subdivision shall not utilize funds from the operating

budget of such housing company to fund the preparation, creation or

distribution of any materials required for a vote to authorize any

dissolution and reconstitution to a housing company organized under

article eleven of this chapter as provided by this subdivision, and the

preparation, creation or distribution of such materials shall be

financed by special assessment voted on and applicable to all

shareholders as provided by subdivision three of this section, unless

such housing company took any actions toward dissolution or

reconstitution prior to the date this section took effect.

Sale of project prior to termination of tax exemption. 1.

Except as otherwise provided in this article and prior to the expiration

of thirty-five years from the date of occupancy, a project, other than a

project aided by a loan made after May first, nineteen hundred

fifty-nine, shall not be sold except to a company organized pursuant to

the provisions of this article; prior to the expiration of twenty years

from the date of occupancy, a project aided by a loan made after May

first, nineteen hundred fifty-nine, shall not be sold except to a

company organized pursuant to the provisions of this article. Such

successor company shall acquire such project subject to all the

provisions of the loan and mortgage contract and the provisions of this

article, and shall be entitled to all the benefits provided in such

contract or granted under this article, and a company so conveying all

its projects may be dissolved with the consent of the commissioner or

the supervising agency, as the case may be.

2. In the event of any sale described in this section, the

stockholders of the dissolving company shall in no event receive more

than the par value of their stock with accrued and unpaid dividends upon

such stock.

Additional powers of municipalities. In addition to any other

powers granted to a municipality by law, and notwithstanding the

provisions of any other law, a municipality acting by its local

legislative body shall have power:

1. To undertake, plan, develop, construct or enter into contracts for

the planning, development or construction of, or to own one or more

projects or any part thereof, or to engage in one or more of such

activities in respect to one or more projects or any part thereof. For

any of the purposes of this subdivision, a municipality may contract

either with a housing company incorporated under this article or with a

housing development fund company incorporated pursuant to article eleven

of this chapter.

2. (a) Acquire by purchase, gift, devise, lease, condemnation or

otherwise, in accordance with the provisions of the appropriate general,

special or local law applicable to the acquisition of real or personal

property by such municipality, real or personal property or any interest

therein necessary for or incidental to a project, including but not

limited to air rights, and easements or other rights of user necessary

for the use and development of such air rights, to be developed as air

rights sites for a project; provided, however, that the acquisition of

any air rights over railroad tracks, rights of way or facilities and

easements or other rights of user necessary for the use and development

of such air rights are to be subject to the provision of section

fifty-one-a of the railroad law. The acquisition of real property

pursuant to a plan shall in every case be deemed to be and constitute a

continuous rather than separate takings.

(b) Property so acquired by a municipality shall be exempt from

taxation until sold, leased for a term not exceeding ninety-nine years

or otherwise disposed of in accordance with the provisions of this

section; provided however, that any such municipality shall have the

power and authority, with respect to such property, to pay or transfer,

out of funds available to it for the effectuating of such program or

project annual sums in lieu of taxes to any taxing jurisdiction

providing services to the project area, or to the part or portion

thereof within such taxing jurisdiction, in order that no such taxing

jurisdiction shall suffer an inequitable loss of revenue by virtue of

such project; provided, further, that the amount so paid or transferred

for any year with respect to any such property shall not exceed the

lesser of (1) the sum last levied for the benefit of such taxing

jurisdiction as an annual tax on such property prior to the time of its

acquisition for project purposes or (2) such amount as shall be approved

by the commissioner pursuant to such rules, regulations, limitations and

conditions as he may prescribe, as an eligible and proper charge against

such project. Upon the sale, lease or disposition of such property to

any person, firm or corporation, not entitled to an exemption from

taxation or entitled to only a partial tax exemption such property shall

immediately become subject to taxation in whole or in part, as the case

may be, and shall be taxed pro rata for the unexpired portion of the

taxable year.

As used in this paragraph, the term "taxing jurisdiction" means any

municipal corporation or district corporation, including any school

district or any special district, having the power to levy or collect

taxes and benefit assessments upon real property, or in whose behalf

such taxes or benefit assessments may be levied or collected.

3. To sell or lease for a term not exceeding ninety-nine years any

such project, or part thereof, at any stage before or at the date of or

after the physical completion of such project, to a company which will

undertake, plan, construct, own, manage or operate such project in

accordance with the plan and the provisions of this article. In the

event of a sale or lease of any such project prior to the physical

completion thereof, the municipality may agree to complete and may

complete construction and development of such project or cause the same

to be completed. Any such sale or lease may be made without public

bidding, public sale or public offering pursuant to such negotiated

contract, agreement or lease, containing such provisions, limitations,

requirements, terms and conditions, price or rental as the governing

body of the municipality may deem necessary or desirable to effectuate

the plan and the public policy and public purposes described in sections

eleven and eleven-a of this article.

4. Notwithstanding the provisions of section thirty-three of this

article the real property in a project sold or leased as provided in

this section, when the transfer thereunder becomes effective, shall be

exempt from local and municipal taxes, other than assessments for local

improvements to such extent as may be granted by the local legislative

body of the municipality. The tax exemption shall operate and continue

so long as capital loans of the company to which such project shall have

been sold or leased or any additional loan the proceeds of which are

primarily used for the residential portion of the project, which

additional loan is approved by the commissioner or the supervising

agency are outstanding.

Notes, bonds, mortgages and other obligations of such a company are

declared to be issued for a public purpose and to be public

instrumentalities and, together with interest thereon, shall be exempt

from tax.

5. The provisions of section thirteen of this article requiring the

approval by the commissioner of housing of the persons incorporating a

limited-profit housing company and the provisions of section fourteen of

this article requiring the consent of the commissioner of housing to the

filing of the certificate of incorporation of such a company in the

office of the secretary of state and the amendment thereof shall not

apply to a corporation created pursuant to this article on a cooperative

basis for the purchase or lease of a project pursuant to this section;

nor shall any of the provisions of this article conferring upon the

commissioner of housing any powers in respect of limited-profit housing

companies apply to such a corporation. The application of this

subdivision shall be limited to corporations undertaking a project with

the aid of a municipal loan under this article.

6. A project or part of a project sold or leased to a housing company

pursuant to the provisions of this section thirty-six-a shall be owned

or operated by such housing company in accordance with the provisions of

this article and in accordance with an agreement of sale or lease to be

entered into by the municipality and such housing company. Each such

agreement shall contain, in addition to such other terms and conditions

as may lawfully be agreed upon by the parties, the following provisions,

which shall be subject to any approvals which may be required by this

article:

(a) Establishing a schedule of maximum rents which may be charged by

the housing company.

(b) Prescribing the method by which tenants are to be selected for the

project and criteria of tenant eligibility.

(c) Any such agreement of lease may provide for the transfer of title

of the real property so leased to the housing company at the end of the

term or lease.

7. A housing company shall have the power, in addition to any other

powers under this article to enter into and carry out the provisions of

any agreement authorized under this section or under section

twenty-three-a or twenty-three-b of this article, and to enter into and

carry out agreements in order to obtain insurance by the federal

government of a mortgage for the purpose of refinancing all or any part

of a mortgage loan pursuant to section twenty-three of this article.

8. Any project that received a tax exemption under this section may,

upon the expiration of the tax exemption period, be granted an

additional tax exemption period of up to fifty years, or until such time

as the project is no longer operated under the restrictions and for the

purposes set forth in this article, whichever is sooner.

Separability clause. 1. Except as specifically provided in this

article, nothing contained therein shall be deemed to limit or restrict

any power or authority granted to banking institutions, foundations,

labor unions, veterans' organizations, or insurance companies or to any

other corporation or to any fiduciary by any other provision of law

heretofore or hereafter enacted.

2. If any clause, sentence, paragraph, section or part of this article

shall be adjudged by any court of competent jurisdiction to be invalid

such judgment shall not affect, impair or invalidate the remainder

thereof, but shall be confined in its operation to the clause, sentence,

paragraph, section or part thereof directly involved in the controversy

in which such judgment shall have been rendered.

Short title. This article may be cited as the "New York state

housing finance agency act."

Statement of legislative findings and purposes. 1. There

continues to exist in the state a seriously inadequate supply of safe

and sanitary dwelling accommodations, non-housekeeping accommodations,

aged care accommodations or accommodations for handicapped persons

within the financial reach of families and persons (including aged and

handicapped persons) of low income. This condition is contrary to the

public interest and threatens the health, safety, welfare, comfort and

security of the people of the state.

2. The ordinary operations of private enterprise cannot provide an

adequate supply of safe and sanitary dwelling accommodations,

non-housekeeping accommodations, aged care accommodations and

accommodations for handicapped persons at rentals which families and

persons of low income can afford. In order to encourage the investment

of private capital and provide such dwelling accommodations,

non-housekeeping accommodations, aged care accommodations and

accommodations for handicapped persons provision should be made for

mortgage loans, at low interest rates, to housing companies which,

subject to state regulation as to rents, profits, dividends and

disposition of their property, supply multiple dwelling accommodations,

non-housekeeping accommodations, aged care accommodations and

accommodations for handicapped persons, and other facilities incidental

or appurtenant thereto, to such families and persons. For that purpose

there should be created a corporate governmental agency of the state, to

be known as the "New York state housing finance agency," which, through

the issuance of its bonds, notes or other obligations to the private

investing public, may attract a broad base of investment by the greatest

number of the general public and obtain the funds necessary to make or

finance the making of such mortgage loans. Thus, private capital will be

encouraged to enter this field of investment and will help meet the

housing needs of families and persons of low income. Provision should

also be made for the New York state housing finance agency to lease such

dwelling accommodations and to receive appropriations from the state, in

aid of providing housing in limited profit housing company projects for

persons and families of low income who would otherwise be eligible for

occupancy in low rent public housing.

* 2-a. Programs to attract capital to provide dwelling accommodations

which families and persons of low and moderate income can afford may not

be economically feasible without adequate subsidy where all of the units

in the multiple dwelling accommodations to be financed are regulated as

to rents, profits, dividends and disposition of the owner's property. In

such cases the New York state housing finance agency should provide

residential units for such families and persons by making loans, or

financing the making of such loans, to the owners of housing

developments which will be required to supply, for a reasonable period

of time, a portion of residential units to such families and persons at

rentals they can afford. Further it is the policy of the state through

the New York state housing finance agency to maximize as fully as

possible consistent with the economic feasibility of each housing

development the affordability, period of occupancy, and number of units

in those portions of each housing development which are designed to be

affordable to persons of low and moderate income.

* NB Repealed July 23, 2027

3. There is also threatened in the state an inadequate supply of

academic buildings and other facilities at the state-operated

institutions and statutory and contract colleges under the jurisdiction

of the state university of New York when needed and when scheduled under

the approved master plan of the state university. In order to encourage

the investment of private capital in such academic buildings and other

facilities and to assure their timely construction, acquisition,

reconstruction, rehabilitation and improvement, the New York state

housing finance agency should also be empowered, through the issuance of

its bonds, notes or other obligations to the private investing public,

to obtain a portion of the funds necessary to finance such academic

buildings and other facilities at the state-operated institutions and

statutory and contract colleges under the jurisdiction of the state

university of New York.

4. Further, it is the policy of the state to promote the redevelopment

and reconstruction of municipal urban renewal areas in a manner that

will serve the civic, cultural and recreational needs of the community

as a whole. The ordinary operations of private enterprise cannot provide

adequate financing for the construction of civic, cultural and

recreational structures and facilities and other non-profit capital

development projects invested with a public interest, which are needed

in connection with urban renewal programs. In order to encourage the

investment of private capital in such projects, and to assure the

expeditious undertaking, financing and completion of the redevelopment

and reconstruction of urban renewal areas in the municipalities of the

state, the New York state housing finance agency should also be

empowered, through the issuance of its bonds, notes or other obligations

to the private investing public, to obtain the funds necessary to make

mortgage loans, at low interest rates, to non-profit community

development corporations for the acquisition and construction of such

projects, structures and facilities.

5. Prompt provision of well-equipped, modern hospitals, schools and

other facilities related to the care, maintenance and treatment of

mentally ill persons, mental defectives and epileptics is also needed in

the state. In order to encourage the investment of private capital in

such hospitals, schools and other mental hygiene facilities and to

assure their timely construction, acquisition, reconstruction,

rehabilitation and improvement, the New York state housing finance

agency should be empowered, through the issuance of its bonds, notes or

other obligations to the private investing public, to obtain a portion

of the funds necessary to finance the same and to meet the needs of

patients and staff at such facilities.

6. A serious shortage of safe and sanitary nursing home accommodations

providing therein nursing care, lodging and board by or under the

supervision of a duly licensed physician to sick, invalid, infirm,

disabled or convalescent persons of low income or providing

health-related service as defined in article twenty-eight of the public

health law to persons of low income or any combination of the foregoing,

and in addition thereto, providing nursing care and health-related

service, or either of them, to persons of low income who are not

occupants of the project, whose need for such facilities and services

cannot readily be provided by the ordinary unaided operation of private

enterprise, exists in many communities throughout the state that it is

the policy of the state to promote the provision of such nursing home

accommodations, including such other facilities as may be incidental and

appurtenant thereto; that there is need for non-profit corporations and

limited-profit corporations to construct, acquire, reconstruct,

rehabilitate and improve such low cost nursing home accommodations. In

order to encourage the investment of private capital in such nursing

homes, the New York state housing finance agency should also be

empowered, through the issuance of its bonds, notes or other obligations

to the private investing public, to obtain funds necessary to finance

nursing homes.

7. There is a serious shortage throughout the state of facilities

suitable for use for the care of children especially those of pre-school

age and primary school age whose parents are unable to provide such care

for all or a substantial portion of the day or post-school day. A

similar shortage of residential child care facilities also exists.

Existing day care and residential child care facilities are overcrowded

with long waiting lists. Many such facilities are so located that they

are not accessible to families in need of such services. The absence of

adequate day care and residential child care facilities is contrary to

the interest of the people of the state, is detrimental to the health

and welfare of the child and his parents and often prevents the gainful

employment of persons, who are otherwise qualified, because of the need

to provide such care in their home. In order to encourage the investment

of private capital in such facilities and to assure their timely

construction, acquisition, reconstruction, rehabilitation and

improvement, the New York state housing finance agency should be

empowered, through the issuance of its bonds, notes or other obligations

to the private investing public, to obtain a portion of the funds

necessary to finance such facilities and to meet the needs of the

community.

8. Prompt provision of new and improved community mental health and

developmental disabilities facilities is required for the care and

treatment of the increasing number of persons afflicted with mental

illness, mental deficiencies, epilepsy and behavior or emotional

disorders; that such facilities should be located close to the people

they serve in order to speed rehabilitation and restoration and to

provide for out-patient and in-patient care, including after care,

diagnostic and rehabilitative services and residential accommodations

for operation as hostels; that it is the policy of the state to promote

the provision of such community mental health and developmental

disabilities facilities; that there is a need for non-profit

corporations to construct low cost community mental health and

developmental disabilities facilities. In order to encourage the

investment of private capital in such community mental health and

developmental disabilities facilities, and to assure the expeditious

completion of such community mental health and developmental

disabilities facilities, the New York state housing finance agency

should be empowered, through the issuance of its bonds, notes or other

obligations to the private investing public, to obtain funds necessary

to make mortgage loans, at low interest rates, to non-profit

corporations for the construction, acquisition, reconstruction,

rehabilitation or improvement of such mental health and developmental

disabilities facilities.

9. Many hospitals and other health facilities throughout the state are

becoming obsolete and are no longer adequate to meet the needs of modern

medicine. As a result of rapid technological changes, such facilities

require substantial structural or functional changes. Others are

unsuited for continued use by virtue of their location and the physical

characteristics of their existing plants and should be replaced. Such

inadequate and outmoded facilities deny to the people of the state the

benefits of health care of the highest quality efficiently and promptly

provided and at a reasonable cost. Their replacement and modernization

is essential to protect and prolong the lives of the state's population

and cannot be readily accomplished by the ordinary unaided operation of

private enterprise. It is the policy of the state to encourage the

provision of modern, well-equipped health facilities, including such

other facilities as may be incidental and appurtenant thereto. In

furtherance of this end and in order to obtain the investment of private

capital in such hospitals and other health facilities, the New York

state housing finance agency should also be empowered through the

issuance of its bonds, notes or other obligations to the private

investing public, to obtain the funds necessary to finance such hospital

and health facilities.

10. Prompt provision of new and improved community senior citizens

facilities is required for the increasing number of persons who are in

need of programs and services for the aging. Such facilities should be

located close to the people they serve and should supplement the

programs and services provided for such persons by the office for the

aging pursuant to title one of article two of the elder law; that it is

the policy of the state to promote the provision of such facilities;

that there is need for non-profit corporations to construct low cost

community senior citizens facilities. In order to encourage the

investment of private capital in such community senior citizens

facilities, and to assure the expeditious completion of such facilities,

the New York state housing finance agency should be empowered, through

the issuance of its bonds, notes or other obligations to the private

investing public, to obtain funds necessary to make mortgage loans, at

low interest rates, to non-profit corporations for the construction,

acquisition, reconstruction, rehabilitation or improvement of such

facilities.

11. It is frequently appropriate to combine and coordinate the

development, rehabilitation and provision of housing with the

development, rehabilitation and provision of health and health related

facilities such as intermediate care, skilled nursing, aged treatment,

and hospice facilities for which there is also a need. In order to

encourage the investment of private capital in non-profit housing and

health facilities, and to assure the expeditious completion of such

facilities, the New York state housing finance agency should be

empowered, through the issuance of its bonds, notes or other obligations

to the private investing public, to obtain funds necessary to finance

loans, for the construction, acquisition, reconstruction, rehabilitation

or improvement of such facilities.

Definitions. As used or referred to in this article, unless a

different meaning clearly appears from the context:

1. "Agency" shall mean the corporate governmental agency created by

section forty-three of this article.

1-a. "Amortized value" shall mean, when used with respect to

securities purchased at a premium above or a discount below par, the

value as of any given date obtained by dividing the total amount of the

premium or discount at which such securities were purchased by the

number of days remaining to maturity on such securities at the time of

such purchase and by multiplying the amount so calculated by the number

of days having passed since the date of such purchase; and (a) in the

case of securities purchased at a premium, by deducting the product thus

obtained from the purchase price, and (b) in the case of securities

purchased at a discount, by adding the product thus obtained to the

purchase price.

2. "Bonds" and "notes" shall mean bonds and notes respectively, issued

by the agency pursuant to this article.

3. "Equity bonds" and "equity notes" shall mean bonds and notes

respectively, issued by the agency pursuant to subdivision four of

section forty-six of this article.

4. "Equity loan" shall mean a loan made by the agency to a mutual

company, mutual housing company, mutual redevelopment company, or

housing development fund company which is organized pursuant to the

business corporation law and article eleven of this chapter, in an

amount not to exceed nine per centum of project cost and not in excess

of the aggregate face value of home owners purchase notes received by

such mutual company, mutual housing company, mutual redevelopment

company, or housing development fund company, as the case may be, for

the issuance of shares.

4-a. "Federally-aided mortgage loan" shall mean a loan secured by a

first mortgage lien on the real property of which a project consists and

the personal property attached to or used in connection with the

construction, acquisition, reconstruction, rehabilitation, improvement

or operation of the project, made or financed by the agency to the owner

of such property, which loan is insured or co-insured by the federal

government or in connection with which there has been assigned or

pledged to the agency the right to receive housing assistance payments

to be made by the federal government under a contract entered into

pursuant to section eight of the United States housing act of nineteen

hundred thirty-seven, as amended or supplemented, provided, however,

that such term shall not include mortgage loans made by the agency and

insured by the federal government pursuant to subsection (f) of section

two hundred twenty-three of such act, to refinance mortgage loans made

by the agency or the state prior to the first day of June, nineteen

hundred seventy-nine or theretofore or thereafter, amended, modified, or

increased or loans provided for pursuant to subdivision twenty-nine-a of

section forty-four of this article. Where all or part of the cost of

acquiring any real property included in the project is to be financed by

a federally-aided mortgage loan the term "owner" shall mean the owner

upon such acquisition. Nothing contained herein shall limit or prohibit

the agency from consenting to the modification of any instrument

executed in connection with a federally-aided mortgage loan, provided

that such modification will not materially reduce the value of the

security for such mortgage loan.

4-b. "Federally guaranteed security" means any security, investment or

evidence of indebtedness which is issued pursuant to the national

housing act or any successor provision of law, as amended, which is

either, directly or indirectly, insured or guaranteed in full as to the

repayment of principal and interest by the United States of America or

any instrumentality thereof.

5. "Home owners purchase note" shall mean home owners purchase note as

defined in article one of this chapter.

5-a. "Insured mortgage reserve fund" shall mean the fund created by

section fifty-seven of this chapter.

6. "Mortgage loan" shall mean a loan made by the agency to a company

in an amount not to exceed ninety per centum of the project cost, except

that in the case of a mutual company, an urban rental company which has

not been aided by any loan made prior to September first, nineteen

hundred sixty-eight, or a non-profit company incorporated pursuant to

the provisions of the not-for-profit corporation law and this chapter

for the purpose of providing housing for staff members, employees or

students of a college, university, hospital or child care institution

and their immediate families or in the case of a community development

corporation the loan shall not exceed ninety-five per centum of the

project cost and in the case of a non-profit company incorporated

pursuant to the provisions of the not-for-profit corporation law and

this chapter for the purpose of providing housing for aged or

handicapped persons of low income or in the case of a low income

non-profit housing company the loan shall not exceed the total project

cost, and secured by a first mortgage lien on the real property of which

the project consists and the personal property attached to or used in

connection with the construction, acquisition, reconstruction,

rehabilitation, improvement or operation of the project. "Company,"

"mutual company," "urban rental company," "project cost" and "project"

shall mean company, mutual company, urban rental company, project cost

and project, respectively, as defined in article two of this chapter.

6-a. "Mortgage loan" shall also mean a loan made by the agency to a

community senior citizens center and services company in an amount not

to exceed the total project cost of a project undertaken by such company

pursuant to article seven-A of this chapter, and secured by a first

mortgage lien on the real property of which the project consists and the

personal property attached to or used in connection with the

construction, acquisition, reconstruction, rehabilitation, improvement

or operation of the project.

6-b. "Mortgage loan" shall also mean a loan made by the agency to an

eligible borrower as defined in article twenty-eight-B of the public

health law in an amount not to exceed the total hospital project cost

and secured by a first mortgage lien on the real property of which the

hospital project consists and the personal property attached to or used

in connection with the construction, acquisition, reconstruction,

rehabilitation, improvement or operation of the hospital project. Such

loan may be further secured by such a lien upon other real property

owned by the eligible borrower. Notwithstanding the foregoing provisions

of this subdivision or any other provisions of this article to the

contrary, any personal property may be excluded from the lien of the

mortgage provided (a) the commissioner of health finds that such

property is not essential for the rendition of required hospital

services as such term is defined in article twenty-eight of the public

health law, and (b) the agency consents to such exclusion. "Hospital

project cost" and "hospital project" shall mean hospital project cost

and hospital project, respectively, as defined in article twenty-eight-B

of the public health law.

6-c. "Mortgage loan" shall also mean a loan made by the agency to a

limited-profit nursing home company incorporated pursuant to the

provisions of article twenty-eight-A of the public health law in an

amount not to exceed ninety-five per centum of the nursing home project

cost, and in the case of a non-profit nursing home company incorporated

pursuant to the provisions of article twenty-eight-A of the public

health law and the not-for-profit corporation law in an amount not to

exceed the total nursing home project cost, and secured by a first

mortgage lien on the real property of which the nursing home project

consists and the personal property attached to or used in connection

with the construction, acquisition, reconstruction, rehabilitation,

improvement or operation of the nursing home project. Notwithstanding

the foregoing provisions of this subdivision or any other provision of

this article to the contrary, any personal property may be excluded from

the lien of the mortgage provided (a) the commissioner of health finds

that such property is not essential for the nursing home project as such

term is defined in article twenty-eight-A of the public health law, and

(b) the agency consents to such exclusion. "Nursing home company",

"limited-profit nursing home company", "non-profit nursing home

company", "nursing home project cost" and "nursing home project" shall

mean nursing home company, limited-profit nursing home company,

non-profit nursing home company, nursing home project cost and nursing

home project, respectively, as defined in article twenty-eight-A of the

public health law.

6-d. "Mortgage loan" shall also mean a loan made by the agency to a

company incorporated pursuant to the provisions of the not-for-profit

corporation law in an amount not to exceed the total community mental

health services project cost or community developmental disabilities

services project cost, and secured by a first mortgage lien on the real

property of which the community mental health services project or

community developmental disabilities services project consists and the

personal property attached to or used in connection with the

construction, acquisition, reconstruction, rehabilitation, improvement

or operation of the community mental health services project or

community developmental disabilities services project. "Community mental

health services company," "community developmental disabilities services

company," "community mental health services project cost," "community

developmental disabilities services project cost," "community mental

health services project" and "community developmental disabilities

services project" shall mean community mental health services company,

community developmental disabilities services company, community mental

health services project cost, community developmental disabilities

services project cost, community mental health services project and

community developmental disabilities services project, respectively.

6-e. "Mortgage loan" shall also mean a loan made by the agency to a

non-profit corporation which is an eligible borrower as defined in title

five-A of article six of the social services law in an amount not to

exceed the total youth facilities project cost, and secured by a first

mortgage lien on the real property of which the youth facilities project

consists and the personal property attached to or used in connection

with the construction, acquisition, reconstruction, rehabilitation,

improvement or operation of the youth facilities project. "Youth

facilities project cost" and "youth facilities project" shall mean youth

facilities project cost and youth facilities project, respectively, as

defined in title five-A of article six of the social services law.

6-f. "Mortgage loan" shall also mean an instrument or instruments made

by a company to evidence residual indebtedness, which instrument or

instruments are secured by a mortgage on the real property of the

project.

* 6-g. "Mortgage loan" shall also mean a loan secured by a first

mortgage lien on the real property of which a project consists and the

personal property attached to or used in connection with the

construction or rehabilitation of the project, made or financed by the

agency to the owner of such property, which property a municipal housing

authority, constituted, created or established pursuant to article

thirteen of the public housing law, has agreed to purchase upon the

completion of such construction or rehabilitation.

* NB There are 2 sb 6-g's

* 6-g. "Mortgage loan" shall also mean a loan made by the agency to a

mutual housing company for the purpose of refinancing the existing

mortgage indebtedness of such company in an amount not to exceed the

cost of refinancing the existing mortgage indebtedness of such company

and necessary funds for the replacement, improvement and rehabilitation

of the project owned by such company, all costs incurred by such company

relating to the refinancing of the existing mortgage indebtedness

including amounts required to establish escrow accounts, reserves and

working capital as determined by the agency, and such other amounts as

are permitted by article four of this chapter, and secured by a first

mortgage lien on the real property of which the project consists and the

personal property attached to or used in connection with the

construction, acquisition, reconstruction, rehabilitation, improvement

or operation of the project.

* NB (Operative pending ruling by Internal Revenue Service)

* NB There are 2 sb 6-g's

7. "Mutual company", "mutual housing company" and "mutual

redevelopment company" shall mean mutual company, mutual housing company

and mutual redevelopment company as defined in articles two, four and

five, respectively, of this chapter.

8. "Non-profit company" shall mean a company incorporated pursuant to

the provisions of the not-for-profit corporation law and article two of

this chapter for the purpose of providing housing for staff members,

employees or students of a college, university, hospital or child care

institution and their immediate families or for handicapped or aged

persons of low income or housing for persons of low income or housing

for families of low income as defined under article two of this chapter.

9. "Community development corporation" shall mean a corporation

incorporated pursuant to the provisions of the not-for-profit

corporation law and article six-A of this chapter.

10. "Non-profit project bonds" and "non-profit project notes" shall

mean bonds and notes respectively, issued by the agency for the purposes

of making mortgage loans to mutual companies, non-profit companies or

community development corporations paying interest on such bonds and

notes, establishing reserves to secure such bonds and notes, and paying

of all other expenditures of the agency incident to and necessary or

convenient for the making of such mortgage loans.

11. "Hospital and nursing home project bonds" and "hospital and

nursing home project notes" shall mean bonds and notes respectively,

issued by the agency for the purposes of making mortgage loans to

hospital corporations which are eligible borrowers as defined in article

twenty-eight-B of the public health law or nursing home companies,

paying interest on such bonds and notes, establishing reserves to secure

such bonds and notes, and paying of all other expenditures of the agency

incident to and necessary or convenient for the making of such mortgage

loans.

12. "Urban rental project bonds" and "urban rental project notes"

shall mean bonds and notes respectively, issued by the agency after

August thirty-first, nineteen hundred sixty-eight, for the purposes of

making mortgage loans to urban rental companies, paying interest on such

bonds and notes, establishing reserves to secure such bonds and notes,

and paying of all other expenditures of the agency incident to and

necessary or convenient for the making of such mortgage loans.

13. "Youth facilities project bonds" and "youth facilities project

notes" shall mean bonds and notes, respectively, issued by the agency

for the purposes of making mortgage loans to non-profit corporations

which are eligible borrowers as defined in title five-A of article six

of the social services law, paying interest on such bonds and notes,

establishing reserves to secure such bonds and notes, and paying of all

other expenditures of the agency incident to and necessary or convenient

for the making of such mortgage loans.

14. "Community mental health services and developmental disabilities

services project bonds" and "community mental health services and

developmental disabilities services project notes" shall mean bonds and

notes, respectively, issued by the agency for the purposes of making

mortgage loans to companies incorporated pursuant to the not-for-profit

corporation law, paying interest on such bonds and notes, establishing

reserves to secure such bonds and notes, and paying of all other

expenditures of the agency incident to and necessary or convenient for

the making of such mortgage loans.

14-a. "Community mental health services and developmental disabilities

services project revenue bonds" and "community mental health services

and developmental disabilities services project revenue notes" shall

mean bonds and notes, respectively, issued by the agency for the purpose

of making mortgage loans to companies incorporated pursuant to the

not-for-profit corporation law and article seventy-five of title E of

the mental hygiene law, paying interest on such bonds and notes,

establishing reserves to secure such bonds and notes, and paying of all

other expenditures of the agency incident to and necessary or convenient

for the making of such mortgage loans.

15. "Community senior citizens services project bonds" and "community

senior citizens services project notes" shall mean bonds and notes,

respectively, issued by the agency for the purposes of making mortgage

loans to companies incorporated pursuant to the not-for-profit

corporation law and article seven-A of this chapter, paying interest on

such bonds and notes, establishing reserves to secure such bonds and

notes, and paying of all other expenditures of the agency incident to

and necessary or convenient for the making of such mortgage loans.

16. "State of New York municipal bond bank agency bonds" and "State of

New York municipal bond agency notes" shall mean bonds and notes,

respectively, issued by the state of New York municipal bond bank agency

for the purposes of purchasing municipal bonds from municipalities.

17. "New York state medical care facilities finance agency bonds" and

"New York state medical care facilities finance agency notes" shall mean

bonds and notes, respectively, issued by the New York state medical care

facilities finance agency for the corporate purposes of the New York

state medical care facilities finance agency.

18. "New York state project finance agency bonds" and "New York state

project finance agency notes" shall mean bonds and notes, respectively,

issued by the New York state project finance agency for the corporate

purposes of the New York state project finance agency.

19. "Residual indebtedness." Residual indebtedness shall be

indebtedness of a company in an amount equal to the unpaid principal

balance due on the original mortgage plus all interest accrued thereon

at such time as the mortgage is refinanced less an amount equal to the

principal amount, when made, of the mortgage insured by the federal

government in connection with the refinancing of a project. Such

indebtedness shall be secured by a mortgage which may be subordinate to

the lien of any mortgage loan insured by the federal government and may

contain such terms and conditions not inconsistent with this article as

may be approved by the commissioner, and as the agency may deem

necessary or desirable to secure the repayment of such residual

indebtedness.

* 20. "Revenue housing bonds" shall mean bonds issued by the agency

after May thirty-first, nineteen hundred seventy-six for the purpose of

making mortgage loans to mutual companies, non-profit companies, or

urban rental companies, funding non-profit project notes and urban

rental project notes issued for the purpose of making such mortgage

loans, paying interest on such bonds, establishing reserves to secure

such bonds and paying all other expenditures of the agency incident to

and necessary or convenient for the making of such mortgage loans or the

funding of such notes.

* NB (Effective until ruling by Internal Revenue Service)

* 20. "Revenue housing bonds" shall mean bonds issued by the agency

after May thirty-first, nineteen hundred seventy-six for the purpose of

making mortgage loans to mutual companies, mutual housing companies,

non-profit companies, or urban rental companies, funding non-profit

project notes and urban rental project notes issued for the purpose of

making such mortgage loans, paying interest on such bonds, establishing

reserves to secure such bonds and paying all other expenditures of the

agency incident to and necessary or convenient for the making of such

mortgage loans or the funding of such notes.

* NB (Effective pending ruling by Internal Revenue Service)

21. "Special revenue housing coverage reserve funds" shall mean the

funds created by section fifty-eight of this article.

22. "Bond reserve insurance fund" shall mean the fund created by

section fifty-nine of this article.

* 23. "Lending institution" shall mean any bank or trust company or

savings bank, or any corporation, association or other entity which is

owned or controlled by any one or more such bank or trust company or

savings bank, or any savings and loan association, credit union, federal

national mortgage association approved mortgage banker, national banking

association, federal savings and loan association, federal savings bank,

public pension fund, pension fund with assets over fifty million

dollars, insurance company, federal credit union or other financial

institution or governmental agency of the United States which

customarily makes, purchases, holds, insures or services residential

mortgages.

* NB Effective until July 23, 2027

* 23. "Lending institution" shall mean any bank or trust company or

savings bank, or any corporation, association or other entity which is

owned or controlled by any one or more such bank or trust company or

savings bank, or any savings and loan association, industrial bank,

credit union, federal national mortgage association approved mortgage

banker, national banking association, federal savings and loan

association, pension fund, insurance company, federal credit union or

other financial institution or governmental agency of the United States

which customarily makes, purchases, holds or services residential

mortgages.

* NB Effective July 23, 2027

* 24. "Housing development" shall mean a specific work or improvement,

whether or not to effectuate all or any part of a plan, and consisting

of five or more residential units, and including the lands, buildings

and improvements acquired, owned, constructed, managed or operated to

provide such units and such incidental and appurtenant commercial,

recreation, cultural, communal, dining, medical and nursing treatment,

day care or residential child care and community facilities as may be

approved by the agency. As used in connection with the term housing

development, the term residential unit shall refer to units suitable for

residential use or accommodations included within the term housing as

defined in subdivision nine of section twelve of this chapter.

* NB Repealed July 23, 2027

25. "Housing and non-profit health facility" shall mean a specific

work or improvement, whether or not to effectuate all or any part of a

plan consisting of five or more residential units, and at the election

of the agency such additional health and health related facilities as

the agency may approve; and including the lands, buildings and

improvements acquired, owned, constructed, managed or operated to

provide such units and health, or health related facilities and such

incidental and appurtenant commercial, recreation, cultural, communal,

dining, parking, day care or residential child care, senior citizen and

community facilities as may be approved by the agency acquired, owned,

constructed, rehabilitated, improved, managed or operated by a

non-profit company except that any portion thereof meeting the

definition of a housing development set forth in subdivision twenty-four

hereof may be separately owned by a for profit owner approved by the

agency. As used in connection with the term housing and non-profit

health facility, the term residential unit shall refer to units suitable

for residential use or accommodations included within the term housing

as defined in subdivision nine of section twelve of this chapter, and

the term non-profit company shall mean a company incorporated pursuant

to the provisions of the not-for-profit corporation law for the purpose

of providing housing for staff members, employees, students or users of

a hospital, health, health related facility and their immediate families

or for the purpose of providing a hospital, health, or health related

facility.

New York state housing finance agency. 1. There is hereby

created the "New York state housing finance agency". The agency shall be

a corporate governmental agency constituting a public benefit

corporation. Its membership shall consist of the commissioner of

housing and community renewal, the director of the budget, the

commissioner of taxation and finance, one member appointed by the

temporary president of the senate, and one member appointed by the

speaker of the assembly. In addition, there shall be four members to be

appointed by the governor with the advice and consent of the senate. The

members first appointed by the governor shall serve for terms ending

three, four, five and six years respectively from January first next

succeeding the date of their appointment. Their successors shall serve

for terms of six years each. Members shall continue in office until

their successors have been appointed and qualified. The members

appointed by the temporary president of the senate and the speaker of

the assembly shall serve at the pleasure of the temporary president of

the senate and the speaker of the assembly respectively. In the event of

a vacancy occurring in the office of any member by death, resignation or

otherwise, such vacancy shall be filled, for the unexpired term, if

applicable, in the same manner as the original appointment. The

provisions of section thirty-nine of the public officers law shall apply

to such members.

2. The governor shall designate from among the members appointed by

him or her a chairman, who shall serve as such during his or her term as

member. The members, including the chairman, shall serve without salary

or other compensation, but each member, including the chairman, shall be

entitled to reimbursement for actual and necessary expenses incurred in

the performance of his or her official duties and in the event that the

chairman shall also be a full time officer or employee of the agency,

the chairman shall receive no salary as chairman but shall receive only

his or her regular salary as officer or employee, not to exceed the

average of the salaries paid to the appointed commissioners of the state

departments or the regular salary such officer or employee was receiving

at the time of his or her appointment as chairman, whichever is greater.

3. Such members other than the commissioner of housing and community

renewal, the director of the budget, the commissioner of taxation and

finance and the chairman if he be a full time officer or employee of the

agency, may engage in private employment, or in a profession or

business, subject to the limitations contained in sections seventy-three

and seventy-four of the public officers law. The agency shall, for the

purposes of sections seventy-three and seventy-four of the public

officers law, be a "state-agency," and such members shall be "officers"

of the agency for the purposes of said sections.

4. Notwithstanding any inconsistent provisions of law, general,

special or local, no officer or employee of the state, or of any civil

division thereof, shall be deemed to have forfeited or shall forfeit his

office or employment by reason of his acceptance of membership on the

agency created by this section; provided, however, a member who holds

such other public office or employment shall receive no additional

compensation or allowance for services rendered pursuant to this

article, but shall be entitled to reimbursement for his actual and

necessary expenses incurred in the performance of such services.

5. The governor may remove any member for inefficiency, neglect of

duty or misconduct in office after giving him a copy of the charges

against him, and an opportunity to be heard, in person or by counsel, in

his defense, upon not less than ten days' notice. If any such member

shall be removed, the governor shall file in the office of the

department of state a complete statement of charges made against such

member, and his findings thereon, together with a complete record of the

proceeding. The holding of office by the commissioner of housing shall

continue to be governed by the provisions of section eleven of the

public housing law.

6. The agency and its corporate existence shall continue until

terminated by law, provided, however, that no such law shall take effect

so long as the agency shall have bonds, notes and other obligations

outstanding. Upon termination of the existence of the agency, all its

rights and properties shall pass to and be vested in the state.

7. The powers of the agency shall be vested in and exercised by no

less than six of the members thereof then in office. The agency may

delegate to one or more of its members, or its officers, agents and

employees, such powers and duties as it may deem proper.

8. The commissioner of housing and community renewal, the director of

the budget and the commissioner of taxation and finance each may appoint

a person from their respective division or department to represent such

member, respectively, at all meetings of the agency from which such

member may be absent. Any such representative so designated shall have

the power to attend and to vote at any meeting of the agency from which

the member so designating him as a representative is absent with the

same force and effect as if the member designating him were present and

voting. Such designation shall be by written notice filed with the

chairman of the agency by each of the said members. The designation of

such persons shall continue until revoked at any time by written notice

to the chairman by the respective member making the designation. Such

designation shall not be deemed to limit the power of the appointing

member to attend and vote at any meeting of the agency.

Powers of the agency. Except as otherwise limited by this

article, the agency shall have power:

1. To sue and be sued;

2. To have a seal and alter the same at pleasure;

3. To make and execute contracts and all other instruments necessary

or convenient for the exercise of its power and functions under this

article;

4. To make and alter by-laws for its organization and internal

management and, subject to agreements with noteholders or bondholders,

to make rules and regulations governing the use of its property and

facilities, which rules and regulations shall be filed with the

department of state in the manner provided by section one hundred two of

the executive law;

5. To acquire, hold and dispose of personal property for its corporate

purposes;

6. To appoint officers, agents and employees, prescribe their duties

and fix their compensation, subject to the provisions of the civil

service law and to the rules and regulations of the civil service

commission of this state;

7. To borrow money and issue negotiable notes, bonds or other

obligations and to provide for the rights of the holders thereof;

8. Subject to any agreements with noteholders or bondholders, to

invest any funds held in reserve or sinking funds, including the insured

mortgage reserve fund and any special revenue housing coverage reserve

fund or any monies not required for immediate use or disbursement, at

the discretion of the agency, in obligations of the state or the United

States government or obligations the principal and interest of which are

guaranteed by the state or the United States government, or in any other

obligations in which the comptroller of the state of New York is

authorized to invest pursuant to section ninety-eight of the state

finance law;

9. Subject to the approval of the commissioner in the case of mortgage

loans to other than hospital corporations which are eligible borrowers

as defined in article twenty-eight-B of the public health law or nursing

home companies, non-profit corporations which are eligible borrowers as

defined in title five-A of article six of the social services law, or

companies incorporated pursuant to the not-for-profit corporation law

and article seventy-five of the mental hygiene law, who shall be guided

by the provisions governing state loans contained in article two of this

chapter, to make mortgage loans, to participate with the state in making

mortgage loans and to undertake commitments to make any such mortgage

loans;

9-a. Subject to the approval of the commissioner of social services of

the state of New York, to make mortgage loans and to undertake

commitments to make mortgage loans to community senior citizens centers

and services companies under and pursuant to article seven-A of this

chapter.

10. Subject to the approval of the commissioner of housing and

community renewal, the state commissioner of health, the state

commissioner of mental hygiene or the state commissioner of social

services, as the case may be, to sell, at public or private sale, any

mortgage or other obligation securing a mortgage loan made by the

agency;

* 10-a. To acquire and to contract to acquire, by assignment or

otherwise, any mortgage securing a loan and any note or bond made by a

mutual housing company and to modify or satisfy such mortgage, bond or

note and accept or make a new mortgage and other instruments for the

purpose of refinancing the existing indebtedness of such company.

* NB (Effective pending ruling by Internal Revenue Service)

11. (a) In connection with the making or financing the making of

mortgage loans and commitments therefor, except mortgage loans and

commitments made with hospital corporations which are eligible borrowers

as defined in article twenty-eight-B of the public health law, nursing

home companies, non-profit corporations which are eligible borrowers as

defined in title five-A of article six of the social services law, or

companies incorporated pursuant to the not-for-profit corporation law

and article seventy-five of the mental hygiene law, to make and collect

such fees and charges, including but not limited to reimbursement of all

costs of financing by the agency, service charges and insurance

premiums, as the agency shall determine to be reasonable and as shall be

approved by the commissioner of housing;

(b) In connection with the making of mortgage loans and commitments

therefor to hospital corporations which are eligible borrowers as

defined in article twenty-eight-B of the public health law or nursing

home companies, to make and collect from such corporations and companies

such fees and charges, including but not limited to reimbursement of all

costs of financing by the agency, service charges and insurance

premiums, as the agency shall determine to be reasonable;

(c) In connection with the making of mortgage loans and commitments

therefor to non-profit corporations which are eligible borrowers as

defined in title five-A of article six of the social services law, to

make and collect from such corporations such fees and charges, including

but not limited to reimbursement of all costs of financing by the

agency, service charges and insurance premiums as the agency shall

determine to be reasonable.

(d) In connection with the making of mortgage loans and commitments

therefor to companies incorporated pursuant to the not-for-profit

corporation law and article seventy-five of the mental hygiene law, to

make and collect from such companies such fees and charges, including

but not limited to reimbursement of all costs of financing by the

agency, service charges and insurance premiums, as the agency shall

determine to be reasonable.

11-a. In connection with the making of mortgage loans and commitments

therefor to companies incorporated pursuant to the not-for-profit

corporation law and article seven-A of this chapter, to make and collect

from such companies such fees and charges, including but not limited to

reimbursement of all costs of financing by the agency, service charges

and insurance premiums, as the agency shall determine to be reasonable.

11-b. To make or finance the making of federally-aided mortgage loans

pursuant to section forty-four-c of this article and, in connection with

such mortgage loans, to exercise such powers and undertake such

responsibilities as may be required by any law, regulation or other

requirement of the federal government.

11-c. Subject to the provisions of any contract with noteholders and

bondholders (a) to make and contract for the making of mortgage loans

for the construction or rehabilitation of projects which a municipal

housing authority, constituted, created or established pursuant to

article thirteen of the public housing law, has agreed to purchase on a

turnkey basis in accordance with a federally assisted program for the

production of public housing as authorized by the United States housing

act of nineteen hundred thirty-seven as amended to the date of enactment

of this subdivision of this section, upon the completion of such

construction or rehabilitation and (b) to make and to contract for the

making of loans to, or to purchase loans from banking or other lending

institutions for the purpose of financing such construction or

rehabilitation.

12. In connection with any property on which it has made or financed a

mortgage loan, to foreclose on any such property or commence any action

to protect or enforce any right conferred upon it by any law, mortgage,

contract or other agreement, and to bid for and purchase such property

at any foreclosure or at any other sale, or acquire or take possession

of any such property; and in such event the agency may complete,

administer, pay the principal of and interest on any obligations

incurred in connection with such property, dispose of, and otherwise

deal with, such property, in such manner as may be necessary or

desirable to protect the interests of the agency therein;

13. To enter into agreements to pay annual sums in lieu of taxes to

any political subdivision of the state with respect to any real property

owned by the agency; provided, however, that the amount so paid for any

year upon any such property shall not exceed the sum last paid as taxes

on such property prior to the time of its acquisition by the agency;

14. To procure insurance against any loss in connection with its

property and other assets (including mortgages, mortgage loans and

federally guaranteed securities secured by such mortgage loans) in such

amounts, and from such insurers, as it deems desirable;

15. (a) Subject to the approval of the commissioner and to the

provisions of any contract with noteholders or bondholders, except with

any holders of hospital and nursing home project bonds or notes or youth

facilities project bonds or notes, or community mental health services

and developmental disabilities services project bonds or notes, whenever

it deems it necessary or desirable in the fulfillment of the purposes of

this article, to consent to the modification, with respect to rate of

interest, time of payment of any installment of principal or interest,

security, or any other term, of any mortgage, mortgage loan, mortgage

loan commitment, contract or agreement of any kind to which the agency

is a party, except such mortgages, mortgage loans, mortgage loan

commitments, contracts or agreements as may have been entered into with

hospital corporations which are eligible borrowers as defined in article

twenty-eight-B of the public health law, nursing home companies or

non-profit corporations which are eligible borrowers as defined in title

five-A of article six of the social services law or companies

incorporated pursuant to the not-for-profit corporation law and article

seventy-five of the mental hygiene law;

(b) Subject to the provisions of any contract with holders of hospital

and nursing home project bonds or notes, whenever it deems it necessary

or desirable in the fulfillment of the purposes of this article, to

consent to the modification, with respect to rate of interest, time of

payment of any installment of principal or interest, security, or any

other term of any mortgage, mortgage loan, mortgage loan commitment,

contract or agreement of any kind between the agency and a hospital

corporation which is an eligible borrower as defined in article

twenty-eight-B of the public health law or a nursing home company;

(c) Subject to the provisions of any contract with holders of youth

facilities project bonds or notes, whenever it deems it necessary or

desirable in the fulfillment of the purposes of this article, to consent

to the modification, with respect to rate of interest, time of payment

of any installment of principal or interest, security, or any other term

of any mortgage, mortgage loan, mortgage loan commitment, contract or

agreement of any kind between the agency and a non-profit corporation

which is an eligible borrower pursuant to title five-A of article six of

the social services law.

(d) Subject to the provisions of any contract with holders of

community mental health services and developmental disabilities services

project bonds or notes, whenever it deems it necessary or desirable in

the fulfillment of the purposes of this article, to consent to the

modification, with respect to rate of interest, time of payment of any

installment of principal or interest, security, or any other term of any

mortgage, mortgage loan, mortgage loan commitment, contract or agreement

of any kind between the agency and a company incorporated pursuant to

the not-for-profit corporation law and article seventy-five of the

mental hygiene law.

15-a. Subject to the provisions of any contract with holders of

community senior citizens services project bonds or notes, whenever it

deems it necessary or desirable in the fulfillment of the purposes of

this article, to consent to the modification, with respect to rate of

interest, time of payment of any installment of principal or interest,

security, or any other term of any mortgage, mortgage loan, mortgage

loan commitment, contract or agreement of any kind between the agency

and a company incorporated pursuant to the not-for-profit corporation

law and article seven-A of this chapter.

16. To accept any gifts or grants or loans of funds or property or

financial or other aid in any form from the federal government or any

agency or instrumentality thereof or from the state or from any other

source and to comply, subject to the provisions of this article, with

the terms and conditions thereof;

17. To engage the services of private consultants on a contract basis

for rendering professional and technical assistance and advice;

18. Subject to the approval of the commissioner of housing and

community renewal, to make equity loans to mutual companies, mutual

housing companies, mutual redevelopment companies, and housing

development fund companies which are corporations organized pursuant to

the business corporation law and article eleven of this chapter, in

amounts not to exceed the aggregate face value of home owners purchase

notes accepted by such mutual companies, mutual housing companies,

mutual redevelopment companies, or housing development fund companies,

as the case may be, as consideration for the issuance of shares pursuant

to the provisions of section nineteen of article two of this chapter,

section seventy-eight of article four of this chapter, section one

hundred eight of article five of this chapter, or subdivision four of

section five hundred seventy-three of article eleven of this chapter, as

the case may be; such loans shall be repaid over or within such period

and shall be secured in such manner as the agency shall require and the

commissioner shall approve.

19. Subject to the approval of the commissioner of health pursuant to

the provisions of article twenty-eight-A of the public health law, to

make mortgage loans to non-profit nursing home companies incorporated

pursuant to the provisions of article twenty-eight-A of the public

health law and the not-for-profit corporation law and to make mortgage

loans to limited-profit nursing home companies incorporated pursuant to

the provisions of article twenty-eight-A of the public health law and to

undertake commitments to make any such mortgage loans.

20. Subject to the approval of the commissioner, to purchase or to

contract to purchase from a mutual company, or from any shareholder

thereof, as the case may be, the shares appertaining to the dwellings

leased by it for the purposes set forth in section forty-four-a of this

article, to hold such shares or to sell or to contract to sell such

shares to the sublessees of the agency who are residents in such

dwellings, or to the designees of the mutual company. Such shares shall

be purchased or sold by the agency for the par value thereof. The terms

under which such shares may be sold, or be contracted to be sold shall

be subject to the approval of the commissioner. Shares owned by the

agency may not be voted.

21. Subject to the approval of the commissioner of social services

pursuant to the provisions of title five-A of article six of the social

services law, to make mortgage loans to non-profit corporations which

are eligible borrowers pursuant to the provisions of the aforesaid title

five-A and to undertake commitments to make any such mortgage loans.

21-a. Subject to the approval of the commissioner of social services

of the state of New York pursuant to the provisions of article seven-A

of this chapter, to make mortgage loans to companies incorporated

pursuant to the provisions of such article and the not-for-profit

corporation law and to undertake commitments to make any such mortgage

loans.

22. Subject to the approval of the commissioner of mental hygiene

pursuant to the provisions of article seventy-five of the mental hygiene

law, to make loans to companies incorporated pursuant to the provisions

of article seventy-five of the mental hygiene law and the not-for-profit

corporation law and to undertake commitments to make any such mortgage

loans. No such loan or commitment made on or after June first, nineteen

hundred eighty-two, shall be made primarily for a purpose other than the

refinancing of existing indebtedness pursuant to subdivision four of

section 75.05 of the mental hygiene law.

23. Subject to the approval of the commissioner of health pursuant to

the provisions of article twenty-eight-B of the public health law, to

make mortgage loans to hospital corporations which are eligible

borrowers as defined in article twenty-eight-B of the public health law

and to undertake commitments to make any such mortgage loans.

24. To contract with the state of New York municipal bond bank agency

to render such services as the agency may deem appropriate, including

but not limited to the use of the premises, personnel and personal

property of the agency and to charge the reasonable costs thereof and

provide for the reimbursement to the agency for any expenses necessarily

incurred by the agency in carrying out the terms of such contract. Any

such contract shall be subject to the separate approval of the director

of the budget.

25. To contract with the New York state medical care facilities

finance agency to market and service any New York state medical care

facilities finance agency bonds and New York state medical care

facilities finance agency notes approved by the New York state medical

care facilities finance agency, and to contract to render such other

services as the New York state medical care facilities finance agency

may request, including but not limited to the use of the premises,

personnel and personal property of the agency, and to provide for

reimbursement to the agency from the New York state medical care

facilities finance agency for any expenses necessarily incurred by the

agency in carrying out the terms of any such contract. Any such contract

shall be subject to the separate approval of the director of the budget.

26. To contract with the New York state project finance agency to

market and service any New York state project finance agency bonds and

New York state project finance agency notes approved by the New York

state project finance agency, and to contract to render such other

services as the New York state project finance agency may request,

including but not limited to the use of the premises, personnel and

personal property of the agency, and to provide for reimbursement to the

agency from the New York state project finance agency for any expenses

necessarily incurred by the agency in carrying out the terms of any such

contract. Any such contract shall be subject to the separate approval of

the director of the budget.

27. To contract with the New York state urban development corporation

to market and service any New York state urban development corporation

bonds and New York state urban development corporation notes approved by

the New York state urban development corporation and to contract to

render such other services as the New York state urban development

corporation may request, including but not limited to the use of the

premises, personnel and personal property of the agency, and to provide

for reimbursement to the agency from the New York state urban

development corporation for any expenses necessarily incurred by the

agency in carrying out the terms of any such contract. Any such contract

shall be subject to the separate approval of the director of the budget.

28. To participate in federal programs for the insurance of mortgage

loans including programs which require the agency to share any loss

arising out of any mortgage loan insured by the federal government,

provided that the agency's share of any such loss shall not exceed fifty

percent thereof.

28-a. To acquire and enter into commitments to acquire any federally

guaranteed security to finance the making of mortgage loans pursuant to

section forty-four-c of this article and to pledge or otherwise use any

such federally guaranteed security in such manner as the agency deems in

its best interest to secure or otherwise provide a source of repayment

on bonds issued to finance the making of such mortgage loans.

29. To do any and all things necessary or convenient to carry out its

purposes and exercise the powers expressly given and granted in this

article.

* 29-a. (1) Subject to the provisions of any contract with noteholders

and bondholders (a) to make and contract for the making of loans for the

acquisition, construction or rehabilitation of housing developments for

the purpose of providing residential units for occupancy by persons and

families for whom the ordinary operations of private enterprise cannot

provide an adequate supply of safe, sanitary and affordable housing

accommodations or for residential units located in an area designated as

blighted pursuant to article fifteen or sixteen of the general municipal

law, and (b) to make and to contract for the making of loans to or to

purchase loans from lending institutions for the purpose of financing

loans for such acquisition, construction or rehabilitation. No loans may

be financed pursuant to this subdivision unless the agency finds that

portions of the housing developments are to be occupied by persons or

families of low or moderate income. In determining whether the portions

of housing developments will be so occupied, the agency may consider and

rely upon the fact that the housing developments will be occupied by

persons and families in accordance with requirements for the interest on

obligations issued to finance them to be exempt from taxation pursuant

to section 103(b)(3) or 103(b)(4)(A) of the Internal Revenue Code of

1954, as amended.

(2) With regard to any loan made pursuant to this subdivision and

notwithstanding the provisions of, or any regulation promulgated

pursuant to, the emergency housing rent control law, the local emergency

housing rent control act, or local law enacted pursuant thereto, the

rent stabilizaton law of nineteen hundred sixty-nine, or the emergency

tenant protection act of nineteen seventy-four, the owner of a housing

development otherwise subject to any such law or act, with the approval

of the agency, may establish the initial rent for each dwelling unit

within the project. If the initial rents are to be established pursuant

hereto, the agency shall notify occupants of the housing development, if

any, of any such proposed rental establishment and offer to meet at

least once with the occupants prior to its approval.

(3) The powers granted by this subdivision may be exercised only if

(a) obligations of the agency have been issued to fund the loan made or

purchased by the agency and such obligations have received an investment

grade rating from a recognized rating agency; (b) the loan made or

purchased by the agency is fully secured as to principal and interest by

insurance or a commitment to insure issued by the state of New York

mortgage agency or by the general credit of a bank, national bank, trust

company, savings bank, savings and loan association, insurance company,

governmental agency of the United States, or any combination thereof; or

(c) obligations of the agency are purchased by a bank, national bank,

trust company, savings bank, savings and loan association, insurance

company, governmental agency of the United States, which for purposes of

this subdivision, include the federal home loan mortgage corporation,

the federal national mortgage association, the governmental national

mortgage association, and any successor of the foregoing, or any

wholly-owned subsidiary or combination thereof.

* NB Repealed July 23, 2027

29-b. To carry out its powers and responsibilities with respect to

permanent housing projects for homeless families as provided for in

article three-A of this chapter.

30. (1) Subject to the provisions of any contract with noteholders and

bondholders (a) to make and contract for the making of loans for the

acquisition, refinancing, construction or rehabilitation of housing and

non-profit health facilities and (b) to make and to contract for the

making of loans to or to purchase loans from lending institutions for

the purposes of financing loans for such acquisition, construction or

rehabilitation.

(2) The powers granted by this subdivision may be exercised only if:

(a) the commissioner of health has approved any health and health

related facilities which are in addition to the residential unit and

housing portion of the facility, pursuant to section twenty-eight

hundred two of the public health law in any case where the facility is

subject to the provisions of such section or has approved the facility

according to the guidelines prescribed in any other case; (b) with

respect to any portion thereof owned by a for profit owner, the agency

makes the finding required to finance housing developments under

paragraph one of subdivision twenty-nine-a of this section; (c) (i)

obligations of the agency have been issued to fund the loan made or

purchased by the agency and such obligations have received an investment

grade rating from a recognized rating agency, or (ii) the loan made or

purchased by the agency is fully secured as to principal and interest by

insurance or a commitment to insure issued by the state of New York

mortgage agency or by the general credit of a bank, national bank, trust

company, savings bank, savings and loan association, insurance company,

the college construction loan insurance association, the student loan

marketing association, or a governmental agency of the United States;

and (d) approval from the applicable state agencies as to the need for

the project has been obtained prior to joint financing.

31. To and shall develop, promote and ensure that, where possible,

minority groups which traditionally have been disadvantaged, and women

are afforded equal opportunity for contracts in connection with

development and construction contracts for developments, facilities and

projects financed by the issuance of bonds, notes and other obligations

of the agency.

32. To transfer funds in an amount to be agreed upon, at the request

of the director of the division of the budget, to the state treasury for

deposit to the general fund as an expense of the agency. Such transfer

shall be made in such amounts and at such times as specified in an

agreement or agreements executed between the agency and the director of

the budget with copies to be provided to the chairman of the assembly

ways and means committee and the chairman of the senate finance

committee.

Low rent dwelling accommodations. 1. Subject to the approval

of the commissioner and to the provisions of any contract with

noteholders and bondholders, the agency shall have the power to lease

dwellings in a project, not to exceed twenty per centum of the dwellings

in such project, from a company, except that in the case of a project

located in an area in which the commissioner finds that unusually

difficult housing conditions exist, the number of dwellings which may be

leased by the agency shall not exceed fifty per centum, and except that

the agency may lease all or any portion of the dwellings in a non-profit

company project designed or intended for occupancy by aged persons, at

such rentals as may be fixed therefor by such company and approved by

the commissioner or the supervising agency, as the case may be, pursuant

to the provisions of subdivision one of section thirty-one of this

chapter less an appropriate adjustment for the increased tax exemption,

if any, attributable to such dwellings pursuant to subdivision two of

section thirty-three of this chapter; and to sublet such dwellings, in

accordance with subdivision two of this section, to persons or families

eligible therefor in accordance with the provisions of paragraph (a) of

subdivision two of section thirty-one of this chapter, except that

dwellings in a non-profit company project designed or intended for

occupancy by the aged shall be sublet only to aged persons, and except

that in the case of mutual companies, dwellings may be leased only when

the agency shall purchase the shares appertaining to such dwellings.

2. The rental of any dwelling sublet in accordance with subdivision

one of this section shall be fixed at an amount equal to twenty per

centum of the probable aggregate annual income of the occupants thereof,

determined in accordance with section thirty-one of this chapter, at the

time of the execution of such sublease and at a time thereafter

proximate to each anniversary date of the execution of such sublease and

at the time of any renewal or extension of such sublease, provided that

no such dwelling shall be sublet (a) at an average rental of less than

fifteen dollars per room per month or at a rental less than that of

comparable dwellings in new state-aided public housing projects in the

community, whichever is greater, or (b) to a person or family whose

probable aggregate annual income exceeds five times the rental fixed

therefor by the company pursuant to subdivision one of section

thirty-one of this chapter, provided however, such person or family may

continue to occupy such dwelling and pay to the agency such fixed

rental, including any surcharges which would otherwise be authorized if

such person or family were a tenant of the company, until the company

shall have entered into a lease with such person or family or until such

person or family has vacated or has been caused to vacate such dwelling.

3. Subject to the approval of the commissioner and to the provisions

of any contract with noteholders and bondholders, the agency shall have

the power to lease dwellings, within areas designated to receive

benefits under the federal demonstration cities and metropolitan

development act of nineteen hundred sixty-six, in a multiple dwelling

receiving benefits and subject to control of its rents under article

eight of this chapter from the owner thereof at such rentals as may be

approved by the governmental agency having jurisdiction pursuant to the

provisions of section four hundred five of this chapter; and to sublet

such dwellings to persons or families eligible therefor in accordance

with the provisions of subdivision three of section four hundred one of

this chapter. The rental of any dwelling sublet pursuant to this

subdivision shall be fixed at an amount equal to twenty per centum of

the probable aggregate annual income of the occupants thereof,

determined in accordance with subdivision three of section four hundred

one of this chapter, at the time of the execution of such sublease and

at the time of each anniversary of the execution of such sublease and at

the time of any renewal or extension of such sublease, provided that no

such dwelling shall be sublet (a) at an average rental of less than

fifteen dollars per room per month or at a rental less than that of

comparable dwellings in new state-aided public housing projects in the

community, whichever is greater, or (b) to a person or family whose

probable aggregate annual income exceeds five times the rental fixed

therefor pursuant to section four hundred five of this chapter.

4. The agency shall create and establish a special account, to be

known as the low rent housing assistance account, and shall pay into

such account all monies appropriated and made available by the state for

the purposes of such account and any other monies which may be made

available to the agency for the purposes of such account from any other

source or sources. All monies held in the low rent housing assistance

accounts shall be used by the agency (a) to meet, together with rentals

received therefor from the occupants, the agency's rent obligation to

the company or owner of a multiple dwelling with respect to dwellings

leased pursuant to this section; (b) to make housing assistance payments

pursuant to subdivision five of this section; (c) for the payment of

administrative and other expenses of the agency allocable to its

activities pursuant to this section, and (d) to reimburse the division

of housing and community renewal the reasonable costs of services

performed by the commissioner of housing and community renewal and the

division of housing and community renewal in carrying out the provisions

of this section pursuant to section fifty-five of this article. Any

monies held in the low rent housing assistance account not required for

immediate disbursement may be invested in the manner permitted by

subdivision eight of section forty-four of this article. Any income or

interest earned by, or increment to such account shall be added to the

monies held in such account for the purposes herein provided.

5. (a) In lieu of leasing and subleasing housing accommodations

pursuant to subdivisions one through three of this section, the agency

may provide housing for persons and families of low income by making

housing assistance payments to the company owning a project.

(b) A housing assistance payment pursuant to this subdivision may be

made only with respect to occupants of a dwelling in a project who would

be eligible for a sublease under the provisions of this section.

(c) Tenants receiving housing assistance payments shall pay a rent to

the company equal to the rent they would pay under a sublease pursuant

to this section. Housing assistance payments equal to the difference

between such rent and the rental fixed for the dwelling pursuant to

section thirty-one of this chapter shall be made by or on behalf of the

agency to the company.

(d) The agency and the division of housing and community renewal may

make such regulations, not inconsistent with the provisions of this

section, and enter into such agreements with the owners of projects as

may be necessary or proper to carry out the provisions of this

subdivision. Such agreements may, in the case of a project the mortgage

on which is held by the agency, provide for the making of housing

assistance payments in the form of a credit against the company's

payments thereon.

Mortgage modifications, evidence of pre-existing indebtedness.

1. Notwithstanding the provision of any law, general or special, the

agency shall have the power to:

(i) consent to and contract for the modification of any of the terms

of a mortgage, and note or bond secured thereby, made pursuant to this

article for the purpose of obtaining insurance of such mortgage loan by

the federal government in order to refinance all or any part of the

indebtedness evidenced by such mortgage and note or bonds, or

(ii) satisfy such mortgage loan in order to enable the company to

obtain insurance by the federal government of a mortgage loan made for

the purpose of refinancing all or any part of the indebtedness evidenced

by such mortgage and note or bond.

Notwithstanding the provisions hereof, the agency on or after June

fifteen, nineteen hundred seventy-six, shall not modify or satisfy a

mortgage loan, pursuant to this subdivision one, where the principal

amount of the mortgage loan insured by the federal government is less

than eighty-five per centum of the principal amount outstanding on the

original mortgage loan at the time such original mortgage loan is

refinanced, unless such modification or satisfaction is first approved

by the New York state public authorities control board created pursuant

to article one-A of the public authorities law.

2. In the event that the existing mortgage loan is satisfied pursuant

to this section, the agency may in consideration of the issuance of such

satisfaction accept a new mortgage and note or bond insured by the

federal government in an amount equal to the maximum principal amount of

a mortgage loan the federal government will insure or accept the

proceeds available to the housing company as a result of the

refinancing.

3. In the event that there is residual indebtedness, the housing

company shall make and the agency shall accept an instrument evidencing

such indebtedness in such form and upon such terms as the agency may

approve, provided that such terms are not inconsistent with subdivision

two of section twenty of this chapter.

4. Notwithstanding any other provisions of this article where the

commissioner has made the findings required in subdivision one of

section twenty-six and where a project has been approved pursuant to

subdivision five of section twenty-six of this chapter, the agency may

make or contract to make a mortgage loan pursuant to subdivision two or

three of this section without further findings by the commissioner or

further approval by the local legislative body.

5. No company shall accept a mortgage loan to be insured by the

federal government made for the purpose of refinancing the existing

mortgage loan of a company which shall exceed the amount which can be

supported by the income derived from the operation of the project at the

rental rate determined by the commissioner that would be necessary to

meet all necessary payments to be made by the company, of all expenses

including fixed charges, sinking funds, reserves and dividends on

outstanding stock as authorized by the commissioner, if the principal

amount of the original mortgage loan of the company were to be fully

repaid over the term of such mortgage loan by constant and equal

payments of principal and interest and if the interest rate on the

company's original mortgage loan was eight and one-half percent per

annum.

Federally-aided mortgage loans. 1. In addition to the powers

of the agency to make mortgage loans to companies organized pursuant to

article two of this chapter and notwithstanding any limitations

contained in such article or in this article in connection with mortgage

loans made to such companies, the agency may make or finance the making

of a federally-aided mortgage loan to the owner of a project upon such

terms and conditions not inconsistent with the provisions of this

section as it shall require, the proceeds of which are substantially to

be used to finance the construction, reconstruction, rehabilitation or

improvement of a project intended to be occupied by three or more

families. A federally-aided mortgage loan made or financed by the agency

shall not exceed an amount equal to the lesser of (i) the maximum

mortgage loan authorized or approved by the federal government or (ii)

one hundred percent of the development cost of the project approved by

the agency.

2. No federally-aided mortgage loan shall be made or financed to a

company organized pursuant to article two of this chapter unless the

commissioner has made the findings required by such article. No

federally-aided mortgage loan shall be made or financed to any other

person, firm, corporation, partnership or association unless (a) the

commissioner finds that (i) the project is consistent with the needs of

the state and the county, city, town or village in which it is located,

or with a plan or undertaking for the clearance, replanning,

reconstruction or rehabilitation of a substandard and insanitary area or

areas, and (ii) the plans and specifications for the project conform to

all applicable federal, state and local laws, ordinances, rules,

regulations or requirements, (in making such finding the commissioner

may rely upon approvals, consents and certifications of governmental

authorities exercising jurisdiction over the project, including the

federal and state government, and any subdivision, agency, bureau, board

or commission thereof), and (b) the agency finds that (i) the estimated

revenues of the project will be sufficient to cover all probable costs

of operations and maintenance, all installments of principal and

interest on the indebtedness relating to the project, taxes, and such

other expenses, including the maintenance of reserves, as may be

projected or required by the agency or the federal government, and (ii)

the project is to be substantially occupied by persons or families of

low-income. In determining whether a project will be substantially

occupied by persons or families of low-income the agency may consider

and rely upon the purpose of the federal program of mortgage insurance,

co-insurance, or housing assistance payments in connection with which

the mortgage loan is made.

3. A company organized pursuant to article two of this chapter which

subsequent to the first day of June, nineteen hundred seventy-nine has

obtained a commitment from the agency to make or finance the making of a

federally-aided mortgage loan and the project of such company shall not

be subject to any restrictions, limitation or procedure imposed by or

pursuant to such article relating to any matter which is the subject of

any restriction, limitation or procedure imposed by or pursuant to any

applicable law, regulation or requirement of the federal government or

agreement entered into pursuant thereto.

4. As used in this section or in connection with a federally-aided

mortgage loan the term project shall mean a specific work or

improvement, whether or not to effectuate all or any part of a plan, and

shall include the lands, buildings and improvements acquired, owned,

constructed, managed or operated to provide dwelling accommodations and

such incidental and appurtenant commercial, recreational and community

facilities as may be approved by the agency.

Transfer of officers and employees. Officers and employees of

state departments and agencies may be transferred to the agency and

officers and employees of the agency may be transferred to state

departments and agencies without examination and without loss of any

civil service status or rights. No such transfer may, however, be made

except with the approval of the head of the state department or division

involved and the director of the budget and the chairman of the agency,

and in compliance with the rules and regulations of the civil service

commission of the state.

Housing trust fund corporation. 1. There is hereby established

a public benefit corporation known as the "housing trust fund

corporation" as a subsidiary corporation of the agency.

2. The agency may transfer to such subsidiary corporation any real,

personal or mixed property in order to carry out the purposes of article

eighteen of this chapter. Such subsidiary corporation shall have all the

privileges, immunities, tax exemption and other exemptions of the agency

to the extent the same are not inconsistent with this section.

3. The membership of such subsidiary corporation shall consist of the

members identified pursuant to subdivision one of section forty-three of

this article, and the powers of such subsidiary corporation shall be

vested in and exercised by no less than six of its members thereof then

in office. The subsidiary corporation may delegate to one or more of its

members, or its officers, agents and employees, such powers and duties

as it may deem proper.

3-a. The chairman of the agency may appoint an officer or employee of

the agency to represent him at all meetings of the corporation from

which he may be absent. Any such representative so designated shall have

the power to attend and to vote at any meeting of the corporation from

which the chairman of the agency is absent with the same force and

effect as if the chairman of the agency were present and voting. Such

designation shall be by written notice filed with the chairperson of the

corporation. The designation of such person shall continue until revoked

at any time by written notice to such chairperson. Such designation

shall not be deemed to limit the power of the chairman of the agency to

attend and vote at any meeting of the corporation.

4. No officer or member of the corporation shall receive any

additional compensation, either direct or indirect, other than

reimbursement for actual and necessary expenses incurred in the

performance of his duties, by reason of his serving as a member,

director, or trustee of such subsidiary corporation.

5. Notwithstanding any inconsistent provisions of law, general,

special or local, no officer or employee of the state, or of any civil

division thereof, or any public benefit corporation, shall be deemed to

have forfeited or shall forfeit his office or employment by reason of

his acceptance of membership on the corporation created by this section.

6. The fiscal year of such subsidiary corporation shall begin with the

first day of April of each year and end with the next following

thirty-first day of March.

7. The corporation shall have the power to:

(a) Sue and be sued;

(b) Have a seal and alter the same at pleasure;

(c) Make and alter by-laws for its organization and internal

management and make rules and regulations governing the use of its

property and facilities;

(d) Make and execute contracts and all other instruments necessary or

convenient for the exercise of its powers and functions under this

chapter;

(e) Acquire, hold and dispose of real or personal property for its

corporate purposes;

(f) Engage the services of private consultants on a contract basis for

rendering professional and technical assistance advice;

(g) Procure insurance against any loss in connection with its

activities, properties and other assets, in such amount and from such

insurers as it deems desirable; and

(h) Invest any funds of the corporation, or any other monies under its

custody and control not required for immediate use or disbursement, at

the discretion of the corporation, in obligations of the state or the

United States government or obligations the principal and interest of

which are guaranteed by the state or the United States government, or in

any other obligations in which the comptroller of the state is

authorized to invest pursuant to section ninety-eight of the state

finance law.

8. The corporation will encourage the creation of local housing

partnerships; such partnerships may include but not be limited to

members of the business community, the financial community, housing

developers, builders, not-for-profit organizations and community leaders

who are committed to the development of low income housing within such

community.

9. The corporation will facilitate the coordination of local housing

partnerships and existing state, federal and local programs which

promote the development of low income housing.

10. The corporation is a public housing agency as defined in the

United States housing act of 1937, as amended, and may receive and

administer funds including but not limited to subsidies, loans and fees

made available through federal programs under such act.

(a) The corporation shall be the sole entity with authority in the

state to undertake any statewide or regional multi-state contract for

performance based annual contributions contract administration issued

under authority granted in 42 U.S.C. section 1437f or any replacement

program or contract, whether called an annual contributions contract or

other name, that requires substantially the same administration or

support services offered nationally, regionally or statewide. The

corporation may in its discretion subcontract such activities as it may

require. The division of housing and community renewal shall be the

entity responsible for such statewide or regional multi-state contract

administration with all powers and responsibilities which would

otherwise be available to the corporation in the event the corporation

is unable or unwilling to act as such entity.

(b) The powers vested in the corporation and the division of housing

and community renewal pursuant to paragraph (a) of this subdivision are

coincident to the powers of any municipal or other local public housing

agency or public housing authority operating within the state on the

effective date of this paragraph. The authority of the corporation and

the division of housing and community renewal to operate on a statewide

basis shall not limit the authority of such municipal public housing

agency or local public housing authority to operate, service, administer

or enter into any project based section 8 contract or contracts where

the project is located within a political subdivision of the state in

which such public housing agency or public housing authority was

operating on such effective date.

11. The corporation may do any and all things necessary or convenient

to carry out and exercise the powers given and granted by this section

and article eighteen of this chapter including, but not limited to

contracting with the commissioner of the division of housing and

community renewal to administer any of the provisions of the special

needs housing act of 1988 and articles eighteen and eighteen-A of this

chapter.

12. The division of housing and community renewal and all other state

officers, departments, boards, divisions, commissions, public

authorities and public benefit corporations may render such services to

the corporation within their respective functions as may be requested by

the corporation.

13. Notwithstanding the provisions of article one-A of the public

authorities law, contracts entered into by the corporation pursuant to

articles eighteen and eighteen-A of this chapter shall not be subject to

the provisions of article one-A of the public authorities law.

Affordable housing corporation. 1. There is hereby established

a public benefit corporation known as the "affordable housing

corporation" as a subsidiary corporation of the agency.

2. The agency may transfer to such subsidiary corporation any real,

personal or mixed property in order to carry out the purposes of article

nineteen of this chapter. Such subsidiary corporation shall have all the

privileges, immunities, tax exemption and other exemptions of the agency

to the extent the same are not inconsistent with this section.

3. The membership of such subsidiary corporation shall consist of the

members identified pursuant to subdivision one of section forty-three of

this article, and the powers of such subsidiary corporation shall be

vested in and exercised by no less than six of its members thereof then

in office. The subsidiary corporation may delegate to one or more of its

members, or its officers, agents and employees, such powers and duties

as it may deem proper.

3-a. The commissioner of housing and community renewal, the director

of the budget and the commissioner of taxation and finance each may

appoint a person from their respective division or department to

represent such member, respectively, at all meetings of the corporation

from which such member may be absent. Any such representative so

designated shall have the power to attend and to vote at any meeting of

the corporation from which the member so designating him as a

representative is absent with the same force and effect as if the member

designating him were present and voting. Such designation shall be by

written notice filed with the chairman of the corporation by each of the

said members. The designation of such persons shall continue until

revoked at any time by written notice to the chairman by the respective

member making the designation. Such designation shall not be deemed to

limit the power of the appointing member to attend and vote at any

meeting of the corporation.

4. No officer or member of the corporation shall receive any

additional compensation, either direct or indirect, other than

reimbursement for actual and necessary expenses incurred in the

performance of his duties, by reason of his serving as a member,

director, or trustee of such subsidiary corporation.

5. Notwithstanding any inconsistent provisions of law, general,

special or local, no officer or employee of the state, or of any civil

division thereof, or any public benefit corporation, shall be deemed to

have forfeited or shall forfeit his office or employment by reason of

his acceptance of membership on the corporation created by this section.

6. The fiscal year of such subsidiary corporation shall begin with the

first day of April of each year and end with the next following

thirty-first day of March.

7. The corporation shall have the power to:

(a) Sue and be sued;

(b) Have a seal and alter the same at pleasure;

(c) Make and alter by-laws for its organization and internal

management and make rules and regulations governing the use of its

property and facilities;

(d) Make and execute contracts and all other instruments necessary or

convenient for the exercise of its powers and functions under this

chapter;

(e) Acquire, hold and dispose of real or personal property for its

corporate purposes;

(f) Engage the services of private consultants on a contract basis for

rendering professional and technical assistance advice;

(g) Procure insurance against any loss in connection with its

activities, properties and other assets, in such amount and from such

insurers as it deems desirable; and

(h) Invest any funds of the corporation, or any other monies under its

custody and control not required for immediate use or disbursement, at

the discretion of the corporation, in obligations of the state or the

United States government or obligations the principal and interest of

which are guaranteed by the state or the United States government, or in

any other obligations in which the comptroller of the state is

authorized to invest pursuant to section ninety-eight of the state

finance law.

8. The corporation may do any and all things necessary or convenient

to carry out and exercise the powers given and granted by this section

and article nineteen of this chapter including, but not limited to

contracting with the commissioner of the division of housing and

community renewal to administer any of the provisions of article

nineteen of this chapter.

9. The agency and all other state officers, departments, boards,

divisions, commissions, public authorities and public benefit

corporations may render such services to the corporation within their

respective functions as may be requested by the corporation.

10. Notwithstanding the provisions of article one-A of the public

authorities law, contracts entered into by the corporation pursuant to

article nineteen of this chapter shall not be subject to the provisions

of article one-A of the public authorities law.

Homeless housing and assistance corporation. 1. There is

hereby established a public benefit corporation known as the "homeless

housing and assistance corporation" as a subsidiary corporation of the

agency.

2. The agency may transfer to such subsidiary corporation any real,

personal or mixed property in order to carry out the purposes of title

one of article two-A of the social services law. Such subsidiary

corporation shall have all the privileges, immunities, tax exemption and

other exemptions of the agency to the extent the same are not

inconsistent with this section.

3. The membership of such subsidiary corporation shall consist of the

commissioner of social services, who shall also serve as its

chairperson, the chairperson of the agency and one additional member to

be appointed by the chairperson of the homeless housing and assistance

corporation, who shall serve at the pleasure of such chairperson. The

powers of the corporation shall be vested in and exercised by no less

than two of the members thereof then in office. The corporation may

delegate to one or more of its members, or its officers, agents and

employees, such duties and powers as it may deem proper.

3-a. The commissioner of social services, and the chairman of the

agency may each appoint an individual to represent them at all meetings

of the corporation from which they may be absent. Any such

representative so designated shall have the power to attend and to vote

at any meeting of the corporation as if the commissioner of social

services or chairperson of the agency were present and voting. Such

designation shall be by written notice filed with the chairperson of the

corporation. The designation of such person shall continue until revoked

at any time by written notice to such chairperson. Such designation

shall not be deemed to limit the power of the commissioner of social

services or the chairperson of the agency to attend and vote at any

meeting of the corporation.

4. No officer or member of the corporation shall receive any

additional compensation, either direct or indirect, other than

reimbursement for actual and necessary expenses incurred in the

performance of his duties, by reason of his serving as a member,

director, or trustee of such subsidiary corporation.

5. Notwithstanding any inconsistent provisions of law, general,

special or local, no officer or employee of the state, or of any civil

division thereof, or any public benefit corporation, shall be deemed to

have forfeited or shall forfeit his office or employment by reason of

his acceptance of membership on the corporation created by this section.

6. The fiscal year of such subsidiary corporation shall begin with the

first day of April of each year and end with the next following

thirty-first day of March.

7. The corporation shall have the power to:

(a) Sue and be sued;

(b) Have a seal and alter the same at pleasure;

(c) Make and alter by-laws for its organization and internal

management and make rules and regulations governing the use of its

property and facilities;

(d) Make and execute contracts and all other instruments necessary or

convenient for the exercise of its powers and functions under this

chapter;

(e) Acquire, hold and dispose of real or personal property for its

corporate purposes;

(f) Engage the services of private consultants on a contract basis for

rendering professional and technical assistance advice;

(g) Procure insurance against any loss in connection with its

activities, properties and other assets, in such amount and from such

insurance as it deems desirable; and

(h) Invest any funds of the corporation, or any other monies under its

custody and control not required for immediate use or disbursement, at

the discretion of the corporation, in obligations of the state or the

United States government or obligations the principal and interest of

which are obligations in which the comptroller of the state is

authorized to invest pursuant to section ninety-eight of the state

finance law.

8. The corporation may do any and all things necessary or convenient

to carry out and exercise the powers given and granted by this section

and title one of article two-A of the social services law including, but

not limited to contracting with the commissioner of social services to

administer any of the provisions of title one of article two-A of the

social services law.

9. The agency and all other state officers, departments, boards,

divisions, commissions, public authorities and public benefit

corporations may render such services to the corporation within their

respective functions as may be requested by the corporation.

10. Notwithstanding the provisions of article one-A of the public

authorities law, contracts entered into by the corporation pursuant to

title one of article two-A of the social services law shall not be

subject to the provisions of article one-A of the public authorities

law.

Notes and bonds of the agency. 1. (a) Subject to the provisions

of section forty-seven of this article, the agency shall have power and

is hereby authorized from time to time to issue its negotiable bonds and

notes in conformity with applicable provisions of the uniform commercial

code in such principal amount as, in the opinion of the agency, shall be

necessary to provide sufficient funds for achieving its corporate

purposes, including the making or financing the making of mortgage

loans, the payment of interest on bonds and notes of the agency,

establishment of reserves to secure such bonds and notes, and all other

expenditures of the agency incident to and necessary or convenient to

carry out its corporate purposes and powers;

(b) The agency shall have power, from time to time, to issue renewal

notes, to issue bonds to pay notes and whenever it deem refunding

expedient, to refund any bonds by the issuance of new bonds, whether the

bonds to be refunded have or have not matured, and to issue bonds partly

to refund bonds then outstanding and partly for any other purpose. The

refunding bonds shall be sold and the proceeds applied to the purchase,

redemption or payment of the bonds to be refunded;

(c) Except as may otherwise be expressly provided by the agency, every

issue of its notes or bonds shall be general obligations of the agency

payable out of any revenues or monies of the agency, subject only to any

agreements with the holders of particular notes or bonds pledging any

particular receipts or revenues;

2. a. The notes and bonds, except as provided in paragraph (c) of

subdivision four of this section, shall be authorized by resolution of

the members, shall bear such date or dates, and shall mature at such

time or times, in the case of any such note, or any renewals thereof,

issued for achieving its corporate purposes other than the making or

financing the making of mortgage loans, not exceeding the term of any

applicable lease or sublease, and in the case of any such note, or any

renewals thereof, issued for the purpose of making or financing the

making of mortgage loans, not exceeding the term for the repayment of

the mortgage loan or the federally guaranteed securities acquired to

finance such mortgage loan, and in the case of any such bond not

exceeding fifty years from the date of issue, as such resolution or

resolutions may provide.

b. In no event, however, shall any such note mature, in the case of a

note or any renewals thereof, issued for the purpose of achieving its

corporate purposes other than the making or financing the making of

mortgage loans, later than eight years from the date of issue of such

original note, and, in the case of a note or any renewals thereof,

issued for the purpose of making or financing the making of mortgage

loans, later than ten years from the date of issue of such original

note, unless in each year at least that amount of principal is required

to be paid as would be required if (i) the principal of and interest on

any such note were payable in such manner that the total annual charges

required for the payment of principal and interest were approximately

equal and constant for the period of such lease, sublease or mortgage,

as the case may be, and (ii) at the expiration of the term of such

lease, sublease or mortgage, the total of such required payments were

sufficient to pay the full principal amount of such note; provided

however, that such manner of payment of principal shall be required only

from the date of the issuance of such note or from the commencement of

the lease or sublease term in the case of a lease or sublease and from

the occupancy date in the case of a mortgage whichever later occurs.

Such payment of principal may be made either to the holder of such note

or into a sinking fund. Notwithstanding the foregoing, no such note

shall be issued pursuant to this paragraph b unless the state director

of the budget has approved the issuance of any such note in writing

prior to such issuance.

c. The notes and bonds shall bear interest at such rate or rates, be

in such denominations, be in such form, either coupon or registered,

carry such registration privileges, be executed in such manner, be

payable in such medium of payment, at such place or places and be

subject to such terms of redemption as such resolution or resolutions

may provide. The notes and bonds of the agency may be sold by the

agency, at public or private sale, at such price or prices as the agency

shall determine. No notes or bonds of the agency may be sold by the

agency at private sale, however, unless such sale and the terms thereof

have been approved in writing by (a) the comptroller, where such sale is

not to the comptroller, or (b) the director of the budget, where such

sale is to the comptroller.

3. Except as provided in paragraph (d) of subdivision four of this

section, any resolution or resolutions authorizing any notes or bonds or

any issue thereof may contain provisions, which shall be a part of the

contract with the holders thereof, as to:

(a) pledging all or any part of the fees and charges made or received

by the agency, and all or any part of the monies received in payment of

mortgage loans or the federally guaranteed securities acquired to

finance such mortgage loans and interest thereon, and other monies

received or to be received, to secure the payment of the notes or bonds

or of any issue thereof, subject to such agreements with bondholders or

noteholders as may then exist;

(b) pledging all or any part of the assets of the agency, including

mortgages or the federally guaranteed securities acquired to finance

such mortgage loans and obligations securing the same, to secure the

payment of the notes or bonds or of any issue of notes or bonds, subject

to such agreements with noteholders or bondholders as may then exist;

(c) the use and disposition of the gross income from mortgages owned

or financed by the agency and payment of principal of mortgages owned by

the agency;

(d) the setting aside of reserves or sinking funds and the regulation

and disposition thereof;

(e) limitations on the purpose to which the proceeds of sale of notes

or bonds may be applied and pledging such proceeds to secure the payment

of the notes or bonds or of any issue thereof;

(f) limitations on the issuance of additional notes or bonds; the

terms upon which additional notes or bonds may be issued and secured;

the refunding of outstanding or other notes or bonds;

(g) the procedure, if any, by which the terms of any contract with

noteholders or bondholders may be amended or abrogated, the amount of

notes or bonds the holders of which must consent thereto, and the manner

in which such consent may be given;

(h) limitations on the amount of monies to be expended by the agency

for operating, administrative or other expenses of the agency;

(i) vesting in a trustee or trustees such property, rights, powers and

duties in trust as the agency may determine, which may include any or

all of the rights, powers and duties of the trustee appointed by the

bondholders pursuant to this article, and limiting or abrogating the

right of the bondholders to appoint a trustee under this article or

limiting the rights, powers and duties of such trustee;

(j) any other matters, of like or different character, which in any

way affect the security or protection of the notes or bonds.

4. (a) Subject to the provisions of subdivisions three and four of

section forty-seven of this article and notwithstanding anything to the

contrary hereinabove provided in this section, the agency shall have

power and is hereby authorized from time to time to issue negotiable

bonds and notes in such principal amount, as, in the opinion of the

agency, shall be necessary to provide sufficient funds for the making of

equity loans, the payment of interest on bonds and notes issued to

provide funds for the making of such equity loans, the establishment of

reserves to secure such bonds and notes, and all other expenditures of

the agency incident to and necessary or convenient for the making of

such equity loans;

(b) The provisions of paragraphs (b), (c) and (d) of subdivision one

of this section shall apply to equity notes and bonds issued by the

agency for the making of equity loans.

(c) The provisions of subdivision two of this section shall apply to

equity notes and bonds issued by the agency for the making of equity

loans except that any such equity notes, or any renewals thereof, and

any such equity bond shall mature at such time or times as the

resolution of the members shall provide, but in no event at a time

subsequent to six months after the latest maturity date of the last

maturing equity loan made from the proceeds of such equity notes or

bonds.

(d) Any resolution or resolutions authorizing any equity notes or

equity bonds or any issue thereof for the making of equity loans may

contain any of the provisions set forth in subdivision three of this

section, which shall be a part of the contract with the holders thereof,

except that no such resolution or resolutions shall pledge any fees or

charges collected by the agency pursuant to subdivision eleven of

section forty-four, income from mortgages owned by the agency, or any

payments of principal of mortgages owned by the agency.

5. It is the intention hereof that any pledge made by the agency shall

be valid and binding from the time when the pledge is made; that the

monies or property so pledged and thereafter received by the agency

shall immediately be subject to the lien of such pledge without any

physical delivery thereof or further act; and that the lien of any such

pledge shall be valid and binding as against all parties having claims

of any kind in tort, contract or otherwise against the agency,

irrespective of whether such parties have notice thereof. Neither the

resolution nor any other instrument by which a pledge is created need be

recorded.

6. Neither the members of the agency nor any person executing the

notes or bonds shall be liable personally on the notes or bonds or be

subject to any personal liability or accountability by reason of the

issuance thereof.

7. The agency, subject to such agreements with noteholders or

bondholders as may then exist, shall have power out of any funds

available therefor to purchase notes or bonds of the agency, which shall

thereupon be cancelled, at a price not exceeding (a) if the notes or

bonds are then redeemable, the redemption price then applicable plus

accrued interest to the next interest payment date thereon, or (b) if

the notes or bonds are not then redeemable, the redemption price

applicable on the first date after such purchase upon which the notes or

bonds become subject to redemption plus accrued interest to such date.

8. The state shall not be liable on notes or bonds of the agency and

such notes and bonds shall not be a debt of the state, and such notes

and bonds shall contain on the face thereof a statement to such effect.

Reserve funds and appropriations. 1. (a) The agency shall create

and establish a special fund (herein referred to as capital reserve

fund), and shall pay into such capital reserve fund (1) any monies

appropriated and made available by the state for the purposes of such

fund, (2) any proceeds of sale of notes or bonds other than state

university construction notes or state university construction bonds,

equity notes or equity bonds, non-profit project notes or non-profit

project bonds, hospital and nursing home project notes or hospital and

nursing home project bonds, urban rental project notes or urban rental

project bonds, health facilities notes or health facilities bonds, youth

facilities project notes or youth facilities project bonds, community

mental health services and developmental disabilities services project

notes or community mental health services and developmental disabilities

services project bonds, community senior citizens services project notes

or community senior citizens services project bonds, mental hygiene

improvement notes or mental hygiene improvement bonds and revenue

housing bonds, and bonds and notes for the housing program to the extent

provided in the resolution of the agency authorizing the issuance

thereof, and (3) any other moneys which may be made available to the

agency for the purpose of such fund from any other source or sources.

All moneys held in the capital reserve fund, except as hereinafter

provided, shall be used solely for the payment of the principal of bonds

of the agency other than state university construction bonds, equity

bonds, non-profit project bonds, hospital and nursing home project

bonds, urban rental project bonds, health facilities bonds, youth

facilities project bonds, community mental health services and

developmental disabilities services project bonds, community senior

citizens services project bonds, mental hygiene improvement bonds and

revenue housing bonds, and bonds and notes for the housing program as

the same mature, required payments to any sinking fund established in a

resolution of the agency for the amortization of term bonds (hereinafter

referred to as "sinking fund payments"), the purchase or redemption of

bonds of the agency other than state university construction bonds,

equity bonds, non-profit project bonds, hospital and nursing home

project bonds, urban rental project bonds, health facilities bonds,

youth facilities project bonds, community mental health services and

developmental disabilities services project bonds, community senior

citizens services project bonds, mental hygiene improvement bonds and

revenue housing bonds, and bonds and notes for the housing program the

payment of interest on such bonds of the agency or the payment of any

redemption premium required to be paid when such bonds are redeemed

prior to maturity; provided, however, that monies in such fund shall not

be withdrawn therefrom at any time in such amount as would reduce the

amount of such fund to less than the maximum amount of principal and

interest maturing and becoming due and sinking fund payments required to

be made in any succeeding calendar year on all bonds of the agency then

outstanding other than state university construction bonds, equity

bonds, non-profit project bonds, hospital and nursing home project

bonds, urban rental project bonds, health facilities bonds, youth

facilities project bonds, community mental health services and

developmental disabilities services project bonds, community senior

citizens services project bonds, mental hygiene improvement bonds and

revenue housing bonds and bonds and notes for the housing program,

except for the purpose of paying principal of, interest and sinking fund

payments becoming due on such bonds of the agency maturing and becoming

due and for the payment of which other moneys of the agency are not

available. For the purposes of this subdivision, in computing the

maximum amount of principal maturing at a single future date (herein

called "term bonds") in any succeeding calendar year, the principal

amount of any such term bonds which are subject to mandatory redemption

prior to such future date by sinking fund payments shall not be included

in the computation determining the maximum amount of principal maturing

in said future year. Any income or interest earned by, or increment to,

the capital reserve fund due to the investment thereof may be

transferred by the agency to the general reserve fund or other fund of

the agency to the extent it does not reduce the amount of the capital

reserve fund below the maximum amount of principal and interest maturing

and becoming due and sinking fund payments required to be made in any

succeeding calendar year on all such bonds of the agency then

outstanding other than state university construction bonds, equity

bonds, non-profit project bonds, hospital and nursing home project

bonds, urban rental project bonds, health facilities bonds, youth

facilities project bonds, community mental health services and

developmental disabilities services project bonds, community senior

citizens services project bonds, mental hygiene improvement bonds and

revenue housing bonds and bonds and notes for the housing program.

(b) The agency shall not issue bonds other than state university

construction bonds, equity bonds, non-profit project bonds, hospital and

nursing home project bonds, urban rental project bonds, health

facilities bonds, youth facilities project bonds, community mental

health services and developmental disabilities services project bonds,

community senior citizens services project bonds, mental hygiene

improvement bonds and revenue housing bonds and bonds and notes for the

housing program at any time secured by the capital reserve fund if the

maximum amount of principal and interest maturing and becoming due and

sinking fund payments required to be made in a succeeding calendar year

on such bonds then to be issued and on all other bonds of the agency

then outstanding other than state university construction bonds, equity

bonds, non-profit project bonds, hospital and nursing home project

bonds, urban rental project bonds, health facilities bonds, youth

facilities project bonds, community mental health services and

developmental disabilities services project bonds, community senior

citizens services project bonds, mental hygiene improvement bonds and

revenue housing bonds and bonds and notes for the housing program will

exceed the amount of the capital reserve fund at the time of issuance

unless the agency, at the time of issuance of such bonds, shall deposit

in such fund from the proceeds of the bonds so to be issued, or

otherwise, an amount which, together with the amount then in such fund,

will be not less than the maximum amount of principal and interest

maturing and becoming due and sinking fund payments required to be made

in any succeeding calendar year on such bonds then to be issued and on

all other bonds of the agency then outstanding other than state

university construction bonds, equity bonds, non-profit project bonds,

hospital and nursing home project bonds, urban rental project bonds,

health facilities bonds, youth facilities project bonds, community

mental health services and developmental disabilities services project

bonds, community senior citizens services project bonds, mental hygiene

improvement bonds and revenue housing bonds and bonds and notes for the

housing program.

(c) The agency shall not issue bonds and notes other than state

university construction bonds and state university construction notes,

hospital and nursing home project bonds and hospital and nursing home

project notes, health facilities bonds and health facilities notes,

youth facilities project bonds and youth facilities project notes,

community mental health services and developmental disabilities services

project bonds and community mental health services and developmental

disabilities services project notes, community senior citizens services

project notes or community senior citizens services project bonds and

mental hygiene improvement bonds and mental hygiene improvement notes

and bonds and notes for the housing program for any of its corporate

purposes in an aggregate principal amount exceeding thirty-six billion

two hundred eighty million dollars, excluding bonds and notes issued to

refund outstanding bonds and notes.

(d) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article, provision is

made in paragraph (a) of this subdivision for the accumulation in the

capital reserve fund of an amount equal to the maximum amount of

principal and interest maturing and becoming due and sinking fund

payments required to be made in any succeeding calendar year on all

bonds of the agency then outstanding other than state university

construction bonds, equity bonds, non-profit project bonds, hospital and

nursing home project bonds, urban rental project bonds, health

facilities bonds, youth facilities project bonds, community mental

health services and developmental disabilities services project bonds,

community senior citizens services project bonds, mental hygiene

improvement bonds and revenue housing bonds and bonds and notes for the

housing program. In order further to assure such maintenance of the

capital reserve fund, there shall be annually apportioned and paid to

the agency for deposit in the capital reserve fund such sum, if any, as

shall be certified by the chairman of the agency to the governor and

director of the budget as necessary to restore the capital reserve fund

to an amount equal to the maximum amount of principal and interest

maturing and becoming due and sinking fund payments required to be made

in any succeeding calendar year on the bonds of the agency then

outstanding other than state university construction bonds, equity

bonds, non-profit project bonds, hospital and nursing home project

bonds, urban rental project bonds, health facilities bonds, youth

facilities project bonds, community mental health services and

developmental disabilities services project bonds, community senior

citizens services project bonds, mental hygiene improvement bonds and

revenue housing bonds and bonds and notes for the housing program. The

chairman of the agency shall annually, on or before December first, make

and deliver to the governor and director of the budget his certificate

stating the amount, if any, required to restore the capital reserve fund

to the amount aforesaid and the amount so stated, if any, shall be

apportioned and paid to the agency during the then current state fiscal

year. The principal amount of bonds secured by the capital reserve fund

to which state funds are apportionable pursuant to this paragraph shall

be limited to the total amount of bonds and notes outstanding on the

effective date of this act, plus the total amount of bonds and notes

contracted after the effective date of this act to finance projects in

progress on the effective date of this act as determined by the New York

state public authorities control board created pursuant to section fifty

of the public authorities law whose affirmative determination shall be

conclusive as to all matters of law and fact solely for the purposes of

the limitations contained in this paragraph, but in no event shall the

total amount of bonds so secured by such a capital reserve fund or funds

exceed three hundred thirty-eight million dollars, excluding bonds

issued to refund such outstanding bonds until the date of redemption of

such outstanding bonds. As outstanding bonds so secured are paid, the

amount so secured shall be reduced accordingly but the redemption of

such outstanding bonds from the proceeds of refunding bonds shall not

reduce the amount so secured.

(e) In computing the amount of the capital reserve fund for the

purposes of this section, securities in which all or a portion of such

fund shall be invested shall be valued at par or if purchased at less

than par, at their cost to the agency.

2. The agency shall create and establish a special fund (herein

referred to as general reserve fund) and shall pay into such fund all

fees and charges collected by the agency pursuant to paragraph (a) of

subdivision eleven of section forty-four of this article, or otherwise,

other than fees and charges collected in connection with the making of

mortgage loans (or commitments therefor) to mutual companies, non-profit

companies, urban rental companies or community development corporations,

and any monies which the agency shall transfer from the capital reserve

fund pursuant to the provisions of paragraph (a) of subdivision one of

this section. Such monies and any other monies paid into the general

reserve fund may, in the discretion of the agency but subject to

agreements with bondholders and noteholders, be used by the agency (a)

for the repayment of advances from the state in accordance with the

provisions of repayment agreements between the agency and the director

of the budget, (b) to reimburse the division of housing and community

renewal the reasonable costs of the services performed by the

commissioner of housing and community renewal and division of housing

and community renewal pursuant to section fifty-five of this article,

(c) to pay all costs, expenses and charges of financing, including fees

and expenses of trustees and paying agents, (d) for transfers to the

capital reserve fund, (e) for the payment of the principal of and

interest on bonds or notes other than state university construction

bonds or state university construction notes, equity bonds or equity

notes, non-profit project bonds or non-profit project notes, hospital

and nursing home project bonds or hospital and nursing home project

notes, urban rental project bonds or urban rental project notes, health

facilities bonds or health facilities notes, youth facilities project

bonds or youth facilities project notes, community mental health

services and developmental disabilities services project bonds or

community mental health services and developmental disabilities services

project notes, community senior citizens services project notes or

community senior citizens services project bonds, mental hygiene

improvement bonds or mental hygiene improvement notes and revenue

housing bonds and bonds and notes for the housing program issued by the

agency when the same shall become due whether at maturity or on call for

redemption and for the payment of any redemption premium required to be

paid where such bonds or notes are redeemed prior to their stated

maturities, and to purchase bonds or notes other than state university

construction bonds or state university construction notes, equity bonds

or equity notes, non-profit project bonds or non-profit project notes,

hospital and nursing home project bonds or hospital and nursing home

project notes, urban rental project bonds or urban rental project notes,

health facilities bonds or health facilities notes, youth facilities

project bonds or youth facilities project notes, community mental health

services and developmental disabilities services project bonds or

community mental health services and developmental disabilities services

project notes, community senior citizens services project notes or

community senior citizens services project bonds, mental hygiene

improvement bonds or mental hygiene improvement notes and revenue

housing bonds and bonds and notes for the housing program issued by the

agency, or (f) for such other corporate purposes of the agency as the

agency in its discretion shall determine and provide.

3. (a) The agency shall create and establish a special fund (herein

referred to as equity reserve fund), and shall pay into such equity

reserve fund (1) any monies appropriated and made available by the state

for the purposes of such fund, (2) any proceeds of sale of equity notes

or equity bonds, to the extent provided in the resolution of the agency

authorizing the issuance thereof, and (3) any other monies which may be

made available to the agency for the purpose of such fund from any other

source or sources. All moneys held in the equity reserve fund, except as

hereinafter provided, shall be used solely for the payment of the

principal of equity bonds of the agency, as the same mature, the

purchase of equity bonds of the agency, the payment of interest on

equity bonds of the agency or the payment of any redemption premium

required to be paid when such bonds are redeemed prior to maturity;

provided, however, that moneys in such fund shall not be withdrawn

therefrom at any time in such amount as would reduce the amount of such

fund to less than the maximum amount of principal and interest maturing

and becoming due in any succeeding calendar year on all equity bonds of

the agency then outstanding, except for the purpose of paying principal

and interest on equity bonds of the agency maturing and becoming due and

for the payment of which other monies of the agency are not available.

Any income or interest earned by, or increment to, the equity reserve

fund due to the investment thereof may be transferred to the equity loan

fund or other fund of the agency to the extent it does not reduce the

amount of the equity reserve fund below the maximum amount of principal

and interest maturing and becoming due in any succeeding calendar year

on all equity bonds of the agency then outstanding.

(b) The agency shall not issue equity bonds at any time secured by the

equity reserve fund if the maximum amount of principal and interest

maturing and becoming due in a succeeding calendar year on the equity

bonds then to be issued and on all other equity bonds of the agency then

outstanding will exceed the amount of the equity reserve fund at the

time of issuance, unless the agency, at the time of issuance of such

bonds, shall deposit in such fund from the proceeds of the bonds so to

be issued, or otherwise, an amount which together with the amount then

in such fund, will be not less than the maximum amount of principal and

interest maturing and becoming due in any succeeding calendar year on

the equity bonds then to be issued and on all other equity bonds of the

agency then outstanding.

(c) The agency shall not issue equity bonds and equity notes in an

aggregate principal amount exceeding fifty million dollars, excluding

equity bonds and notes issued to refund outstanding equity bonds and

notes.

(d) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article, provision is

made in paragraph (a) of this subdivision for the accumulation in the

equity reserve fund of an amount equal to the maximum amount of

principal and interest maturing and becoming due in any succeeding

calendar year on all equity bonds of the agency then outstanding. In

order further to assure such maintenance of the equity reserve fund,

there shall be annually apportioned and paid to the agency for deposit

in the equity reserve fund such sum, if any, as shall be certified by

the chairman of the agency to the governor and director of the budget as

necessary to restore the equity reserve fund to an amount equal to the

maximum amount of principal and interest maturing and becoming due in

any succeeding calendar year on the equity bonds of the agency then

outstanding. The chairman of the agency shall annually, on or before

December first, make and deliver to the governor and director of the

budget his certificate stating the amount, if any, required to restore

the equity reserve fund to the amount aforesaid and the amount so

stated, if any, shall be apportioned and paid to the agency during the

then current state fiscal year. The principal amount of bonds secured by

the equity reserve fund to which state funds are apportionable pursuant

to this paragraph shall be limited to the total amount of bonds and

notes outstanding on the effective date of this act, plus the total

amount of bonds and notes contracted after the effective date of this

act to finance projects in progress on the effective date of this act,

as determined by the New York state public authorities control board

created pursuant to section fifty of the public authorities law whose

affirmative determination shall be conclusive as to all matters of law

and fact solely for the purposes of the limitations contained in this

paragraph, but in no event shall the total amount of bonds so secured by

such a equity reserve fund or funds exceed three hundred fifteen

thousand dollars, excluding bonds issued to refund such outstanding

bonds until the date of redemption of such outstanding bonds. As

outstanding bonds so secured are paid, the amount so secured shall be

reduced accordingly but the redemption of such outstanding bonds from

the proceeds of refunding bonds shall not reduce the amount so secured.

(e) In computing the amount of the equity reserve fund for the

purposes of this section, securities in which all or a portion of such

fund shall be invested shall be valued at par if purchased at par, or if

purchased at other than par, at amortized value.

4. The agency shall create and establish a special fund (herein

referred to as equity loan fund) and shall pay into such fund any monies

which the agency shall transfer from the equity reserve fund pursuant to

the provisions of paragraph (a) of subdivision three of this section and

any monies received in payment of principal of or interest on equity

loans. Such monies and any other monies paid into the equity loan fund

may, in the discretion of the agency, but subject to agreements with the

holders of equity bonds and equity notes be used by the agency (a) for

the repayment of advances from the state in accordance with the

provisions of repayment agreements between the agency and the director

of the budget, (b) to reimburse the division of housing the reasonable

costs of the services performed by the commissioner of housing and

division of housing pursuant to section fifty-five of this article, (c)

to pay all costs, expenses and charges of financing equity loans,

including fees and expenses of trustees and paying agents, (d) for

transfers to the equity reserve fund, (e) for the payment of the

principal of and interest on equity bonds or equity notes issued by the

agency when the same shall become due whether at maturity or on call for

redemption and for the payment of any redemption premium required to be

paid where such bonds or notes are redeemed prior to their stated

maturities, and to purchase equity bonds or equity notes issued by the

agency, or (f) for such other corporate purposes of the agency as the

agency in its discretion shall determine and provide.

5. (a) The agency may create and establish one or more additional

reserve funds to be known as debt service reserve funds and may pay into

such reserve funds (1) any moneys appropriated and made available by the

state for the purposes of such funds, (2) any proceeds of sale of

non-profit project notes or non-profit project bonds, to the extent

provided in the resolution of the agency authorizing the issuance

thereof, and (3) any other moneys which may be made available to the

agency for the purposes of such funds from any other source or sources.

The moneys held in or credited to any debt service reserve fund

established under this subdivision except as hereinafter provided, shall

be used solely for the payment of the principal of non-profit project

bonds of the agency secured by such reserve fund, as the same mature,

required payments to any sinking fund established in a resolution of the

agency for the amortization of term bonds (hereinafter referred to as

"sinking fund payments"), the purchase or redemption of such non-profit

project bonds of the agency, the payment of interest on such non-profit

project bonds of the agency or the payment of any redemption premium

required to be paid when such bonds are redeemed prior to maturity;

provided, however, that moneys in any such fund shall not be withdrawn

therefrom at any time in such amount as would reduce the amount of such

fund to less than the maximum amount of principal, interest maturing and

becoming due and sinking fund payments required to be made in any

succeeding calendar year on the non-profit project bonds of the agency

then outstanding and secured by such reserve fund, except for the

purpose of paying principal and interest and sinking fund payments

becoming due on the non-profit project bonds of the agency secured by

such reserve fund maturing and becoming due and for the payment of which

other moneys of the agency are not available. For the purposes of this

subdivision five, in computing the maximum amount of principal maturing

at a single future date (herein called "term bonds") in any succeeding

calendar year, the principal amount of any such term bonds which are

subject to mandatory redemption prior to such future date by sinking

fund payments shall not be included in the computation determining the

maximum amount of principal maturing in said future year. Any income or

interest earned by, or increment to, any such debt service reserve fund

due to the investment thereof may be transferred to any other fund or

account of the agency to the extent it does not reduce the amount of

such debt service reserve fund below the maximum amount of principal and

interest maturing and becoming due and sinking fund payments required to

be made in any succeeding calendar year on all non-profit project bonds

of the agency then outstanding and secured by such reserve fund.

(b) The agency shall not issue non-profit project bonds at any time if

the maximum amount of principal and interest maturing and becoming due

and sinking fund payments required to be made in a succeeding calendar

year on the non-profit project bonds outstanding and then to be issued

and secured by a debt service reserve fund will exceed the amount of

such reserve account at the time of issuance, unless the agency, at the

time of issuance of such bonds, shall deposit in such reserve fund from

the proceeds of the bonds so to be issued, or otherwise, an amount which

together with the amount then in such reserve fund, will be not less

than the maximum amount of principal and interest maturing and becoming

due and sinking fund payments required to be made in any succeeding

calendar year on the non-profit project bonds then to be issued and on

all other non-profit project bonds of the agency then outstanding and

secured by such reserve fund.

(c) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article provision is

made in paragraph (a) of this subdivision for the accumulation in each

debt service reserve fund of an amount equal to the maximum amount of

principal and interest maturing and becoming due and sinking fund

payments required to be made in any succeeding calendar year on all

non-profit project bonds of the agency then outstanding and secured by

such reserve fund. In order further to assure the maintenance of such

debt service reserve funds, there shall be annually apportioned and paid

to the agency for deposit in each debt service reserve fund such sum, if

any, as shall be certified by the chairman of the agency to the governor

and director of the budget as necessary to restore such reserve fund to

an amount equal to the maximum amount of principal and interest maturing

and becoming due and sinking fund payments required to be made in any

succeeding calendar year on the non-profit project bonds of the agency

then outstanding and secured by such reserve fund. The chairman of the

agency shall annually, on or before December first, make and deliver to

the governor and director of the budget his certificate stating the sum,

if any, required to restore each such debt service reserve fund to the

amount aforesaid, and the sum or sums so certified, if any, shall be

apportioned and paid to the agency during the then current state fiscal

year. The principal amount of bonds secured by a debt service reserve

fund or funds to which state funds are apportionable pursuant to this

paragraph shall be limited to the total amount of bonds and notes

outstanding on the effective date of this act, plus the total amount of

bonds and notes contracted after the effective date of this act to

finance projects in progress on the effective date of this act as

determined by the New York state public authorities control board

created pursuant to section fifty of the public authorities law whose

affirmative determination shall be conclusive as to all matters of law

and fact solely for the purpose of the limitations contained in this

paragraph, but in no event shall the total amount of bonds so secured by

such a debt service reserve fund or funds exceed seven hundred

ninety-three million dollars, excluding bonds issued to refund such

outstanding bonds until the date of redemption of such outstanding

bonds. As outstanding bonds so secured are paid, the amount so secured

shall be reduced accordingly but the redemption of such outstanding

bonds from the proceeds of refunding bonds shall not reduce the amount

so secured.

(d) In computing any debt service reserve fund for the purposes of

this section, securities in which all or a portion of such reserve fund

shall be invested shall be valued at par, or if purchased at less than

par, at their cost to the agency.

6. (a) The agency may create and establish a special fund to be known

as hospital and nursing home capital reserve fund and may pay into such

reserve funds (1) any monies appropriated and made available by the

state for the purposes of such funds, (2) any proceeds of sale of

hospital and nursing home project notes or hospital and nursing home

project bonds, to the extent provided in the resolution of the agency

authorizing the issuance thereof, and (3) any other monies which may be

made available to the agency for the purposes of such accounts from any

other source or sources. The monies held in or credited to the capital

reserve fund established under this subdivision except as hereinafter

provided, shall be used solely for the payment of the principal of

hospital and nursing home project bonds of the agency secured by such

reserve fund, as the same mature, required payments to any sinking fund

established in a resolution of the agency for the amortization of term

bonds (hereinafter referred to as "sinking fund payments") the purchase

or redemption of such hospital and nursing home project bonds of the

agency, the payment of interest on such hospital and nursing home

project bonds of the agency, or the payment of any redemption premium

required to be paid when such bonds are redeemed prior to maturity;

provided, however, that monies in any such fund shall not be withdrawn

therefrom at any time in such amount as would reduce the amount of such

fund to less than the maximum amount of principal and interest maturing

and becoming due and sinking fund payments required to be made in any

succeeding calendar year on the hospital and nursing home project bonds

of the agency then outstanding and secured by such reserve fund, except

for the purpose of paying principal, interest on hospital and nursing

home project bonds of the agency secured by such reserve fund maturing

and becoming due and sinking fund payments becoming due and for the

payment of which other monies of the agency are not available. For the

purposes of this subdivision six, in computing the maximum amount of

principal maturing at a single future date (herein called "term bonds")

in any succeeding calendar year, the principal amount of any such term

bonds which are subject to mandatory redemption prior to such future

date by sinking fund payments shall not be included in the computation

determining the maximum amount of principal maturing in said future

year. Any income or interest earned by, or increment to, any such

hospital and nursing home capital reserve fund due to the investment

thereof may be transferred to the hospital and nursing home general

reserve fund or other fund of the agency, to the extent it does not

reduce the amount of such hospital and nursing home capital reserve fund

below the maximum amount of principal and interest maturing and becoming

due and sinking fund payments required to be made in any succeeding

calendar year on all hospital and nursing home project bonds of the

agency then outstanding and secured by such reserve fund.

(b) The agency shall not issue hospital and nursing home project bonds

and notes in an aggregate principal amount exceeding one billion nine

hundred fifty million dollars excluding hospital and nursing home

project bonds and hospital and nursing home project notes issued to

refund outstanding hospital and nursing home project bonds and hospital

and nursing home project notes, nor shall it issue hospital and nursing

home project bonds at any time secured by the hospital and nursing home

capital reserve fund if the maximum amount of principal and interest

maturing and becoming due and sinking fund payments required to be made

in a succeeding calendar year on the hospital and nursing home project

bonds outstanding and then to be issued and secured by the hospital and

nursing home capital reserve fund will exceed the amount of such reserve

fund at the time of issuance, unless the agency, at the time of issuance

of such bonds, shall deposit in such reserve fund from the proceeds of

the bonds so to be issued, or otherwise, an amount which together with

the amount then in such reserve fund, will be not less than the maximum

amount of principal and interest maturing and becoming due and sinking

fund payments required to be made in any succeeding calendar year on the

hospital and nursing home project bonds then to be issued and on all

other hospital and nursing home project bonds of the agency then

outstanding and secured by such reserve fund.

(c) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article provision is

made in paragraph (a) of this subdivision for the accumulation in the

hospital and nursing home capital reserve fund of an amount equal to the

maximum amount of principal and interest maturing and becoming due and

sinking fund payments to be made in any succeeding calendar year on all

hospital and nursing home project bonds of the agency then outstanding

and secured by such reserve fund. In order further to assure the

maintenance of such hospital and nursing home capital reserve fund,

there shall be annually apportioned and paid to the agency for deposit

in such hospital and nursing home capital reserve fund such sum, if any,

as shall be certified by the chairman of the agency to the governor and

director of the budget as necessary to restore such reserve fund to an

amount equal to the maximum amount of principal and interest maturing

and becoming due and sinking fund payments required to be made in any

succeeding calendar year on the hospital and nursing home project bonds

of the agency then outstanding and secured by such reserve fund. The

chairman of the agency shall annually, on or before December first, make

and deliver to the governor and director of the budget his certificate

stating the sums, if any, required to restore such hospital and nursing

home capital reserve fund to the amount aforesaid, and the sums so

certified, if any, shall be apportioned and paid to the agency during

the then current state fiscal year. The principal amount of bonds

secured by the hospital and nursing home capital reserve fund to which

state funds are apportionable pursuant to this paragraph shall be

limited to the total amount of bonds and notes outstanding on the

effective date of this act, plus the total amount of bonds and notes

contracted after the effective date of this act to finance projects on

progress on the effective date of this act as determined by the New York

state public authorities control board created pursuant to section fifty

of the public authorities law whose affirmative determination shall be

conclusive as to all matters of law and fact solely for the purposes of

the limitations contained in this paragraph, but in no event shall the

total amount of bonds so secured by such a capital reserve fund or funds

exceed nine hundred sixteen million dollars, excluding bonds issued to

refund such outstanding bonds until the date of redemption of such

outstanding bonds. As outstanding bonds so secured are paid, the amount

so secured shall be reduced accordingly but the redemption of such

outstanding bonds from the proceeds of refunding bonds shall not reduce

the amount so secured.

(d) In computing any hospital and nursing home capital reserve fund

for the purposes of this section, securities in which all or a portion

of such reserve fund shall be invested shall be valued at par, or if

purchased at less than par, at their cost to the agency.

7. The agency shall create and establish one or more additional

special funds (herein referred to as hospital and nursing home general

reserve funds) and shall, to the extent provided in the applicable bond

resolution of the agency authorizing the issuance of hospital and

nursing home project bonds, pay into any such fund the fees and charges

collected by the agency pursuant to paragraph (b) of subdivision eleven

of section forty-four of this article and any monies which the agency

shall transfer from the hospital and nursing home capital reserve fund

pursuant to the provisions of paragraph (a) of subdivision six of this

section. Such monies and any other monies paid into a hospital and

nursing home general reserve fund may, in the discretion of the agency,

but subject to agreements with bondholders and noteholders, be used by

the agency (a) for the repayment of advances from the state in

accordance with the provisions of repayment agreements between the

agency and the director of the budget, (b) to reimburse the department

of health the reasonable costs of the services performed by the

commissioner of health and the department of health pursuant to

subdivision three of section fifty-five of this article, (c) to pay all

costs, expenses and charges of financing, including fees and expenses of

trustees and paying agents, (d) for transfers to the hospital and

nursing home capital reserve fund, (e) for the payment of principal and

interest on hospital and nursing home project bonds and notes issued by

the agency when the same shall become due whether at maturity or on call

for redemption and for the payment of any redemption premium required to

be paid where such hospital and nursing home project bonds and notes are

redeemed prior to their stated maturities and to purchase hospital and

nursing home project bonds or notes issued by the agency, or (f) for

such other corporate purposes of the agency as the agency in its

discretion shall determine and provide.

8. (a) The agency may create and establish one or more additional

reserve funds to be known as health facilities reserve funds and may pay

into such reserve funds (1) any monies appropriated and made available

by the state for the purposes of such funds, (2) any proceeds of sale of

health facilities notes or health facilities bonds, to the extent

provided in the resolution of the agency authorizing the issuance

thereof, and (3) any other monies which may be made available to the

agency for the purposes of such funds from any other source or sources.

The monies held in or credited to any health facilities reserve fund

established under this subdivision, except as hereinafter provided,

shall be used solely for the payment of the principal of health

facilities bonds of the agency secured by such reserve fund, as the same

mature, required payments to any sinking fund established in a

resolution of the agency for the amortization of term bonds (hereinafter

referred to as "sinking fund payments") the purchase or redemption of

such health facilities bonds of the agency, the payment of interest on

such health facilities bonds of the agency, or the payment of any

redemption premium required to be paid when such bonds are redeemed

prior to maturity; provided, however, that monies in any such fund shall

not be withdrawn therefrom at any time in such amount as would reduce

the amount of such fund to less than the maximum amount of principal and

interest maturing and becoming due and sinking fund payments required to

be made in any succeeding calendar year on the health facilities bonds

of the agency then outstanding and secured by such reserve fund, except

for the purpose of paying principal, interest and sinking fund payments

becoming due on the health facilities bonds of the agency secured by

such reserve fund maturing and becoming due and for the payment of which

other monies of the agency are not available. For the purposes of this

subdivision eight, in computing the maximum amount of principal maturing

at a single future date (herein called "term bonds") in any succeeding

calendar year, the principal amount of any such term bonds which are

subject to mandatory redemption prior to such future date by sinking

fund payments shall not be included in the computation determining the

maximum amount of principal maturing in said future year. Any income or

interest earned by, or increment to, any such health facilities reserve

fund due to the investment thereof may be transferred to any other fund

or account of the agency to the extent it does not reduce the amount of

such health facilities reserve fund below the maximum amount of

principal and interest maturing and becoming due and sinking fund

payments required to be made in any succeeding calendar year on all

health facilities bonds of the agency then outstanding and secured by

such reserve fund.

(b) The agency shall not issue health facilities bonds at any time if

the maximum amount of principal and interest maturing and becoming due

and sinking fund payments required to be made in a succeeding calendar

year on the health facilities bonds outstanding and then to be issued

and secured by any health facilities reserve fund will exceed the amount

of such reserve account at the time of issuance, unless the agency, at

the time of issuance of such bonds, shall deposit in such reserve fund

from the proceeds of the bonds so to be issued, or otherwise, an amount

which together with the amount then in such reserve fund will be not

less than the maximum amount of principal and interest maturing and

becoming due and sinking fund payments required to be made in any

succeeding calendar year on the health facilities bonds then to be

issued and on all other health facilities bonds of the agency then

outstanding and secured by such reserve fund.

(c) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article, provision is

made in paragraph (a) of this subdivision for the accumulation in each

health facilities reserve fund of an amount equal to the maximum amount

of principal and interest maturing and becoming due and sinking fund

payments required to be made in any succeeding calendar year on all

health facilities bonds of the agency then outstanding and secured by

such reserve fund. In order further to assure the maintenance of such

health facilities reserve funds, there shall be annually apportioned and

paid to the agency for deposit in each health facilities reserve fund

such sum, if any, as shall be certified by the chairman of the agency to

the governor and director of the budget as necessary to restore such

reserve fund to an amount equal to the maximum amount of principal and

interest maturing and becoming due and sinking fund payments required to

be made in any succeeding calendar year on the health facilities bonds

of the agency then outstanding and secured by such reserve fund. The

chairman of the agency shall annually, on or before December first, make

and deliver to the governor and director of the budget his certificate

stating the sums, if any, required to restore each such health

facilities reserve fund to the amount aforesaid, and the sums so

certified, if any, shall be apportioned and paid to the agency during

the then current state fiscal year. The principal amount of bonds

secured by a health facilities reserve fund or funds to which state

funds are apportionable pursuant to this paragraph shall be limited to

the total amount of bonds and notes outstanding on the effective date of

this act, plus the total amount of bonds and notes contracted after the

effective date of this act to finance projects in progress on the

effective date of this act as determined by the New York state public

authorities control board created pursuant to section fifty of the

public authorities law whose affirmative determination shall be

conclusive as to all matters of law and fact solely for the purposes of

the limitations contained in this paragraph, but in no event shall the

total amount of bonds so secured by such a reserve fund or funds exceed

six hundred seventy-five million dollars, excluding bonds issued to

refund such outstanding bonds until the date of redemption of such

outstanding bonds. As outstanding bonds so secured are paid, the amount

so secured shall be reduced accordingly but the redemption of such

outstanding bonds from the proceeds of refunding bonds shall not reduce

the amounts so secured.

(d) In computing any health facilities reserve fund for the purposes

of this section, securities in which all or a portion of such reserve

fund shall be invested shall be valued at par, or if purchased at less

than par, at their cost to the agency.

9. (a) The agency may create and establish one or more additional

reserve funds to be known as urban rental debt service reserve funds and

may pay into such reserve funds (1) any monies appropriated and made

available by the state for the purposes of such funds, (2) any proceeds

of sale of urban rental project notes or urban rental project bonds, to

the extent provided in the resolution of the agency authorizing the

issuance thereof, and (3) any other monies which may be made available

to the agency for the purposes of such funds from any other source or

sources. The monies held in or credited to any urban rental debt service

reserve fund established under this subdivision except as hereinafter

provided, shall be used solely for the payment of the principal of urban

rental project bonds of the agency secured by such reserve fund, as the

same mature, required payments to any sinking fund established in a

resolution of the agency for the amortization of term bonds (hereinafter

referred to as "sinking fund payments"), the purchase or redemption of

such urban rental project bonds of the agency, the payment of interest

on such urban rental project bonds of the agency, or the payment of any

redemption premium required to be paid when such bonds are redeemed

prior to maturity; provided, however, that monies in any such fund shall

not be withdrawn therefrom at any time in such amount as would reduce

the amount of such fund to less than the maximum amount of principal and

interest maturing and becoming due and sinking fund payments required to

be made in any succeeding calendar year on the urban rental project

bonds of the agency then outstanding and secured by such reserve fund,

except for the purpose of paying principal, interest and sinking fund

payments becoming due on the urban rental project bonds of the agency

secured by such reserve fund maturing and becoming due and for the

payment of which other monies of the agency are not available. For the

purposes of this subdivision nine, in computing the maximum amount of

principal maturing at a single future date (herein called "term bonds")

in any succeeding calendar year, the principal amount of any such term

bonds which are subject to mandatory redemption prior to such future

date by sinking fund payments shall not be included in the computation

determining the maximum amount of principal maturing in said future

year. Any income or interest earned by, or increment to, any such urban

rental debt service reserve fund due to the investment thereof may be

transferred to any other fund or account of the agency to the extent it

does not reduce the amount of such urban rental debt service reserve

fund below the maximum amount of principal and interest maturing and

becoming due and sinking fund payments required to be made in any

succeeding calendar year on all urban rental project bonds of the agency

then outstanding and secured by such reserve fund.

(b) The agency shall not issue urban rental project bonds at any time

if the maximum amount of principal and interest maturing and becoming

due and sinking fund payments required to be made in any succeeding

calendar year on the urban rental project bonds outstanding and then to

be issued and secured by an urban rental debt service reserve fund will

exceed the amount of such reserve account at the time of issuance,

unless the agency, at the time of issuance of such bonds, shall deposit

in such reserve fund from the proceeds of the bonds so to be issued, or

otherwise, an amount which together with the amount then in such reserve

fund, will be not less than the maximum amount of principal and interest

maturing and becoming due and sinking fund payments required to be made

in any succeeding calendar year on the urban rental project bonds then

to be issued and on all other urban rental project bonds of the agency

then outstanding and secured by such reserve fund.

(c) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article provision is

made in paragraph (a) of this subdivision for the accumulation in each

urban rental debt service reserve fund of an amount equal to the maximum

amount of principal and interest maturing and becoming due and sinking

fund payments required to be made in any succeeding calendar year on all

urban rental project bonds of the agency then outstanding and secured by

such reserve fund. In order further to assure the maintenance of such

urban rental debt service reserve funds, there shall be annually

apportioned and paid to the agency for deposit in each urban rental debt

service reserve fund such sum, if any, as shall be certified by the

chairman of the agency to the governor and director of the budget as

necessary to restore such reserve fund to an amount equal to the maximum

amount of principal and interest maturing and becoming due and sinking

fund payments required to be made in any succeeding calendar year on the

urban rental project bonds of the agency then outstanding and secured by

such reserve fund. The chairman of the agency shall annually, on or

before December first, make and deliver to the governor and director of

the budget his certificate stating the sums, if any, required to restore

each such urban rental debt service reserve fund to the amount

aforesaid, and the sums so certified, if any, shall be apportioned and

paid to the agency during the then current state fiscal year. The

principal amount of bonds secured by an urban rental debt service

reserve fund or funds to which state funds are apportionable pursuant to

this paragraph shall be limited to the total amount of bonds and notes

outstanding on the effective date of this act, plus the total amount of

bonds and notes contracted after the effective date of this act to

finance projects in progress on the effective date of this act as

determined by the New York state public authorities control board

created pursuant to section fifty of the public authorities law whose

affirmative determination shall be conclusive as to all matters of law

and fact solely for the purposes of the limitations contained in this

paragraph, but in no event shall the total amount of bonds so secured by

such a debt service reserve fund or funds exceed six hundred forty-five

million dollars, excluding bonds issued to refund such outstanding bonds

until the date of redemption of such outstanding bonds. As outstanding

bonds so secured are paid, the amount so secured shall be reduced

accordingly but the redemption of such outstanding bonds from the

proceeds of refunding bonds shall not reduce the amount so secured.

(d) In computing any urban rental debt service reserve fund for the

purposes of this section, securities in which all or a portion of such

reserve fund shall be invested shall be valued at par if purchased at

par, or if purchased at other than par, at amortized value.

10. (a) The agency may create and establish a special fund to be known

as youth facilities capital reserve fund and may pay into such reserve

funds (1) any monies appropriated and made available by the state for

the purposes of such funds, (2) any proceeds of sale of youth facilities

project notes or youth facilities project bonds, to the extent provided

in the resolution of the agency authorizing the issuance thereof, and

(3) any other monies which may be made available to the agency for the

purposes of such accounts from any other source or sources. The monies

held in or credited to the capital reserve fund established under this

subdivision except as hereinafter provided, shall be used solely for the

payment of principal of youth facilities project bonds of the agency

secured by such reserve fund, as the same mature, the purchase of such

youth facilities project bonds of the agency, the payment of interest on

youth facilities project bonds of the agency, or the payment of any

redemption premium required to be paid when such bonds are redeemed

prior to maturity; provided, however, that monies in any such fund shall

not be withdrawn therefrom at any time in such amount as would reduce

the amount of such fund to less than the maximum amount of principal and

interest maturing and becoming due in any succeeding calendar year on

the youth facilities project bonds of the agency then outstanding and

secured by such reserve fund, except for the purpose of paying principal

and interest on youth facilities project bonds of the agency secured by

such reserve fund maturing and becoming due and for the payment of which

other monies of the agency are not available. Any income or interest

earned by, or increment to, any such youth facilities capital reserve

fund due to the investment thereof may be transferred to the youth

facilities general reserve fund or other fund of the agency, to the

extent it does not reduce the amount of such youth facilities capital

reserve fund below the maximum amount of principal and interest maturing

and becoming due in any succeeding calendar year on all youth facilities

project bonds of the agency then outstanding and secured by such reserve

fund.

(b) The agency shall not issue youth facilities project bonds and

notes in an aggregate principal amount exceeding one hundred million

dollars excluding youth facilities project bonds and youth facilities

project notes issued to refund outstanding youth facilities project

bonds and youth facilities project notes, nor shall it issue youth

facilities project bonds at any time secured by the youth facilities

capital reserve fund if the maximum amount of principal and interest

maturing and becoming due in a succeeding calendar year on the youth

facilities project bonds outstanding and then to be issued and secured

by the youth facilities capital reserve fund will exceed the amount of

such reserve fund at the time of issuance, unless the agency, at the

time of issuance of such bonds, shall deposit in such reserve fund from

the proceeds of the bonds so to be issued, or otherwise, an amount which

together with the amount then in such reserve fund, will be not less

than the maximum amount of principal and interest maturing and becoming

due in any succeeding calendar year on the youth facilities project

bonds then to be issued and on all other youth facilities project bonds

of the agency then outstanding and secured by such reserve fund.

(c) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article provision is

made in paragraph (a) of this subdivision for the accumulation in the

youth facilities capital reserve fund of an amount equal to the maximum

amount of principal and interest maturing and becoming due in any

succeeding calendar year on all youth facilities project bonds of the

agency then outstanding and secured by such reserve fund. In order

further to assure the maintenance of such youth facilities capital

reserve fund, there shall be annually apportioned and paid to the agency

for deposit in such youth facilities capital reserve fund such sum, if

any, as shall be certified by the chairman of the agency to the governor

and director of the budget as necessary to restore such reserve fund to

an amount equal to the maximum amount of principal and interest maturing

and becoming due in any succeeding calendar year on the youth facilities

project bonds of the agency then outstanding and secured by such reserve

fund. The chairman of the agency shall annually, on or before December

first, make and deliver to the governor and director of the budget his

certificate stating the sums, if any, required to restore such youth

facilities capital reserve fund to the amount aforesaid, and the sums so

certified, if any, shall be apportioned and paid to the agency during

the then current state fiscal year. The principal amount of bonds

secured by the youth facilities capital reserve fund to which state

funds are apportionable pursuant to this paragraph shall be limited to

the total amount of bonds and notes outstanding on the effective date of

this act, plus the total amount of bonds and notes contracted after the

effective date of this act to finance projects in progress on the

effective date of this act as determined by the New York state public

authorities control board created pursuant to section fifty of the

public authorities law whose affirmative determination shall be

conclusive as to all matters of law and fact solely for the purposes of

the limitations contained in this paragraph, but in no event shall the

total amount of bonds so secured by such a capital reserve fund exceed

twenty-four million dollars, excluding bonds issued to refund such

outstanding bonds until the date of redemption of such outstanding

bonds. As outstanding bonds so secured are paid, the amount so secured

shall be reduced accordingly but the redemption of such outstanding

bonds from the proceeds of refunding bonds shall not reduce the amount

so secured.

(d) In computing any youth facilities capital reserve fund for the

purpose of this section, securities in which all or a portion of such

reserve fund shall be invested shall be valued at par if purchased at

par, or if purchased at other than par, at amortized value.

11. The agency shall create and establish a special fund (herein

referred to as the youth facilities general reserve fund) and shall pay

into such fund all fees and charges collected by the agency pursuant to

paragraph (c) of subdivision eleven of section forty-four of this

article and any monies which the agency shall transfer from the youth

facilities capital reserve fund pursuant to the provisions of paragraph

(a) of subdivision ten of this section. Such monies and any other monies

paid into the youth facilities general reserve fund may, in the

discretion of the agency, but subject to agreements with bondholders and

noteholders, be used by the agency (a) for the repayment of advances

from the state in accordance with the provisions of repayment agreements

between the agency and the director of the budget, (b) to reimburse the

department of social services the reasonable costs of the services

performed by the commissioner of social services and the department of

social services pursuant to subdivision four of section fifty-five of

this article, (c) to pay all costs, expenses and charges of financing,

including fees and expenses of trustees and paying agents, (d) for

transfers to the youth facilities capital reserve fund, (e) for the

payment of principal of and interest on youth facilities project bonds

and notes issued by the agency when the same shall become due whether at

maturity or on call for redemption and for the payment of any redemption

premium required to be paid where such youth facilities project bonds

and notes are redeemed prior to their stated maturities and to purchase

youth facilities project bonds or notes issued by the agency, or (f) for

such other corporate purposes of the agency as the agency in its

discretion shall determine and provide.

12. (a) The agency may create and establish a special fund to be known

as community mental health services and developmental disabilities

services capital reserve fund and may pay into such reserve funds (1)

any monies appropriated and made available by the state for the purposes

of such funds, (2) any proceeds of sale of community mental health

services and developmental disabilities services project notes or

community mental health services and developmental disabilities services

project bonds, to the extent provided in the resolution of the agency

authorizing the issuance thereof, and (3) any other monies which may be

made available to the agency for the purposes of such accounts from any

other source or sources. The monies held in or credited to the capital

reserve fund established under this subdivision except as hereinafter

provided, shall be used solely for the payment of principal of community

mental health services and developmental disabilities services project

bonds of the agency secured by such reserve fund, as the same mature,

the purchase of such community mental health services and developmental

disabilities services project bonds of the agency, the payment of

interest on such community mental health services and developmental

disabilities services project bonds of the agency, or the payment of any

redemption premium required to be paid when such bonds are redeemed

prior to maturity; provided, however, that monies in any such fund shall

not be withdrawn therefrom at any time in such amount as would reduce

the amount of such fund to less than the maximum amount of principal and

interest maturing and becoming due in any succeeding calendar year on

the community mental health services and developmental disabilities

services project bonds of the agency then outstanding and secured by

such reserve fund, except for the purpose of paying principal and

interest on community mental health services and developmental

disabilities services project bonds of the agency secured by such

reserve fund maturing and becoming due and for the payment of which

other monies of the agency are not available. Any income or interest

earned by, or increment to, any such community mental health services

and developmental disabilities services capital reserve fund due to the

investment thereof may be transferred to the community mental health

services and developmental disabilities services general reserve fund or

other fund of the agency, to the extent it does not reduce the amount of

such community mental health services and developmental disabilities

services capital reserve fund below the maximum amount of principal and

interest maturing and becoming due in any succeeding calendar year on

all community mental health services and developmental disabilities

services project bonds of the agency then outstanding and secured by

such reserve fund.

(b) The agency shall not issue community mental health services and

developmental disabilities services project bonds and notes in an

aggregate principal amount exceeding one hundred million dollars

excluding community mental health services and developmental

disabilities services project bonds and community mental health services

and developmental disabilities services project notes issued to refund

outstanding community mental health services and developmental

disabilities services project bonds and community mental health services

and developmental disabilities services project notes, nor shall it

issue community mental health services and developmental disabilities

services project bonds at any time secured by the community mental

health services and developmental disabilities services capital reserve

fund if the maximum amount of principal and interest maturing and

becoming due in a succeeding calendar year on the community mental

health services and developmental disabilities services project bonds

outstanding and then to be issued and secured by the community mental

health services and developmental disabilities services capital reserve

fund will exceed the amount of such reserve fund at the time of

issuance, unless the agency, at the time of issuance of such bonds,

shall deposit in such reserve fund from the proceeds of the bonds so to

be issued, or otherwise, an amount which together with the amount then

in such reserve fund, will be not less than the maximum amount of

principal and interest maturing and becoming due in any succeeding

calendar year on the community mental health services and developmental

disabilities services project bonds then to be issued and on all other

community mental health services and developmental disabilities services

project bonds of the agency then outstanding and secured by such reserve

fund.

(c) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article provision is

made in paragraph (a) of this subdivision for the accumulation in the

community mental health services and developmental disabilities services

capital reserve fund of an amount equal to the maximum amount of

principal and interest maturing and becoming due in any succeeding

calendar year on all community mental health services and developmental

disabilities services project bonds of the agency then outstanding and

secured by such reserve fund. In order further to assure the maintenance

of such community mental health services and developmental disabilities

services capital reserve fund, there shall be annually apportioned and

paid to the agency for deposit in such community mental health services

and developmental disabilities services capital reserve fund such sum,

if any, as shall be certified by the chairman of the agency to the

governor and director of the budget as necessary to restore such reserve

fund to an amount equal to the maximum amount of principal and interest

maturing and becoming due in any succeeding calendar year on the

community mental health services and developmental disabilities services

project bonds of the agency then outstanding and secured by such reserve

fund. The chairman of the agency shall annually, on or before December

first, make and deliver to the governor and director of the budget his

or her certificate stating the sums, if any, required to restore such

community mental health services and developmental disabilities services

capital reserve fund to the amount aforesaid, and the sums so certified,

if any, shall be apportioned and paid to the agency during the then

current state fiscal year. The principal amount of bonds secured by the

community mental health services and developmental disabilities services

capital reserve fund to which state funds are apportionable pursuant to

this paragraph shall be limited to the total amount of bonds and notes

outstanding on the effective date of this act, plus the total amount of

bonds and notes contracted after the effective date of this act to

finance projects in progress on the effective date of this act as

determined by the New York state public authorities control board

created pursuant to section fifty of the public authorities law whose

affirmative determination shall be conclusive as to all matters of law

and fact solely for the purposes of the limitations contained in this

paragraph, but in no event shall the total amount of bonds so secured by

such a capital reserve fund or funds exceed thirteen million dollars,

excluding bonds issued to refund such outstanding bonds until the date

of redemption of such outstanding bonds. As outstanding bonds so secured

are paid, the amount so secured shall be reduced accordingly but the

redemption of such outstanding bonds from the proceeds of refunding

bonds shall not reduce the amount so secured.

(d) In computing any community mental health services and

developmental disabilities services capital reserve fund for the

purposes of this section, securities in which all or a portion of such

reserve fund shall be invested shall be valued at par if purchased at

par, or if purchased at other than par, at amortized value.

13. The agency shall create and establish a special fund (herein

referred to as community mental health services and developmental

disabilities services general reserve fund) and shall pay into such fund

all fees and charges collected by the agency pursuant to paragraph (c)

of subdivision eleven of section forty-four of this article and any

monies which the agency shall transfer from the community mental health

services and developmental disabilities services capital reserve fund

pursuant to the provisions of paragraph (a) of subdivision ten of this

section. Such monies and any other monies paid into the community mental

health services and developmental disabilities services general reserve

fund may, in the discretion of the agency, but subject to agreements

with bondholders and noteholders, be used by the agency (a) for the

repayment of advances from the state in accordance with the provisions

of repayment agreements between the agency and the director of the

budget, (b) to reimburse the department of mental hygiene the reasonable

costs of the services performed by the commissioner of mental hygiene

and the department of mental hygiene pursuant to subdivision four of

section fifty-five of this article, including the reasonable costs of

such services performed by the health and mental hygiene facilities

improvement corporation upon request by the commissioner of mental

hygiene pursuant to the provisions of section 75.25 of the mental

hygiene law, (c) to pay all costs, expenses and charges of financing,

including fees and expenses of trustees and paying agents, (d) for

transfers to the community mental health services and developmental

disabilities services capital reserve fund, (e) for the payment of

principal of and interest on community mental health services and

developmental disabilities services project bonds and notes issued by

the agency when the same shall become due whether at maturity or on call

for redemption and for the payment of any redemption premium required to

be paid where such community mental health services and developmental

disabilities services project bonds and notes are redeemed prior to

their stated maturities and to purchase community mental health services

and developmental disabilities services project bonds or notes issued by

the agency, or (f) for such other corporate purposes of the agency as

the agency in its discretion shall determine and provide.

14. (a) The agency may create and establish a special fund to be known

as community senior citizens services capital reserve fund and may pay

into such reserve fund (1) any moneys appropriated and made available by

the state for the purposes of such fund, (2) any proceeds of sale of

community senior citizens services project notes or community senior

citizens services project bonds, to the extent provided in the

resolution of the agency authorizing the issuance thereof, and (3) any

other moneys which may be made available to the agency for the purposes

of such accounts from any other source or sources. The moneys held in or

credited to the capital reserve fund established under this subdivision

except as hereinafter provided, shall be used solely for the payment of

principal of community senior citizens services project bonds of the

agency secured by such reserve fund, as the same mature, the purchase of

such community senior citizens services project bonds of the agency, the

payment of interest on such community senior citizens services project

bonds of the agency, or the payment of any redemption premium required

to be paid when such bonds are redeemed prior to maturity; provided,

however, that moneys in any such fund shall not be withdrawn thereform

at any time in such amount as would reduce the amount of such fund to

less than the maximum amount of principal and interest maturing and

becoming due in any succeeding calendar year on the community senior

citizens services project bonds of the agency then outstanding and

secured by such reserve fund, except for the purpose of paying principal

and interest on community senior citizens services project bonds of the

agency secured by such reserve fund maturing and becoming due and for

the payment of which other moneys of the agency are not available. Any

income or interest earned by, or increment to, any such community senior

citizens services capital reserve fund due to the investment thereof may

be transferred to the community senior citizens services general reserve

fund or other fund of the agency, to the extent it does not reduce the

amount of such community senior citizens services capital reserve fund

below the maximum amount of principal and interest maturing and becoming

due in any succeeding calendar year on all community senior citizens

services project bonds of the agency then outstanding and secured by

such reserve fund.

(b) The agency shall not issue community senior citizens services

project bonds and notes in an aggregate principal amount exceeding fifty

million dollars excluding community senior citizens services project

bonds and community senior citizens services project notes issued to

refund outstanding community senior citizens services project bonds and

community senior citizens services project notes, nor shall it issue

community senior citizens services project bonds at any time secured by

the community senior citizens capital reserve fund if the maximum amount

of principal and interest maturing and becoming due in a succeeding

calendar year on the community senior citizens services project bonds

outstanding and then to be issued and secured by the community senior

citizens services capital reserve fund will exceed the amount of such

reserve fund at the time of issuance, unless the agency, at the time of

issuance of such bonds, shall deposit in such reserve fund from the

proceeds of the bonds so to be issued, or otherwise, an amount which

together with the amount then in such reserve fund, will be not less

than the maximum amount of principal and interest maturing and becoming

due in any succeeding calendar year on the community senior citizens

services project bonds then to be issued and on all other community

senior citizens services project bonds of the agency then outstanding

and secured by such reserve fund.

(c) To assure the continued operation and solvency of the agency for

the carrying out of the public purposes of this article provision is

made in paragraph (a) of this subdivision for the accumulation in the

community senior citizens services capital reserve fund of an amount

equal to the maximum amount of principal and interest maturing and

becoming due in any succeeding calendar year on all community senior

citizens services project bonds of the agency then outstanding and

secured by such reserve fund. In order further to assure the maintenance

of such community senior citizens services capital reserve fund, there

shall be annually apportioned and paid to the agency for deposit in such

community senior citizens services capital reserve fund such sum, if

any, as shall be certified by the chairman of the agency to the governor

and director of the budget as necessary to restore such reserve fund to

an amount equal to the maximum amount of principal and interest maturing

and becoming due in any succeeding calendar year on the community senior

citizens services project bonds of the agency then outstanding and

secured by such reserve fund. The chairman of the agency shall annually,

on or before December first, make and deliver to the governor and

director of the budget his certificate stating the sums, if any,

required to restore such community senior citizens services capital

reserve fund to the amount aforesaid, and the sums so certified, if any,

shall be apportioned and paid to the agency during the then current

state fiscal year. The principal amount of bonds secured by the

community senior citizens services capital reserve fund to which state

funds are apportionable pursuant to this paragraph shall be limited to

the total amount of bonds and notes outstanding on the effective date of

this act, plus the total amount of bonds and notes contracted after the

effective date of this act to finance projects in progress on the

effective date of this act as determined by the New York state public

authorities control board created pursuant to section fifty of the

public authorities law whose affirmative determination shall be

conclusive as to all matters of law and fact solely for the purposes of

the limitations contained in this paragraph, but in no event shall the

total amount of bonds so secured by such a capital reserve fund or funds

exceed two million eight hundred thousand dollars, excluding bonds

issued to refund such outstanding bonds until the date of redemption of

such outstanding bonds. As outstanding bonds so secured are paid, the

amount so secured shall be reduced accordingly but the redemption of

such outstanding bonds from the proceeds of refunding bonds shall not

reduce the amount so secured.

(d) In computing any community senior citizens services capital

reserve fund for the purposes of this section, securities in which all

or a portion of such reserve fund shall be invested shall be valued at

par if purchased at par, or if purchased at other than par, at amortized

value.

15. The agency shall create and establish a special fund (herein

referred to as community senior citizens services general reserve fund)

and shall pay into such fund all fees and charges collected by the

agency pursuant to subdivision eleven-a of section forty-four of this

article and any moneys which the agency shall transfer from the

community senior citizens services capital reserve fund pursuant to the

provisions of paragraph (a) of subdivision fourteen of this section.

Such moneys and any other moneys paid into the community senior citizens

services general reserve fund may, in the discretion of the agency, but

subject to agreements with bondholders and noteholders, be used by the

agency (a) for the repayment of advances from the state in accordance

with the provisions of repayment agreements between the agency and the

director of the budget, (b) to reimburse the department of social

services of the state of New York for the reasonable costs of the

services performed by such department pursuant to subdivision six of

section fifty-five of this article, (c) to pay all costs, expenses and

charges of financing, including fees and expenses of trustees and paying

agents, (d) for transfers to the community senior citizens services

capital reserve fund, (e) for the payment of principal of and interest

on community senior citizens services project bonds and notes issued by

the agency when the same shall become due whether at maturity or on call

for redemption and for the payment of any redemption premium required to

be paid where such community senior citizens services project bonds and

notes are redeemed prior to their stated maturities and to purchase

community senior citizens services project bonds or notes issued by the

agency, or (f) for such other corporate purposes of the agency as it, in

its discretion, shall determine and provide.

16. (a) The agency may create and establish one or more special funds

to be known as community mental health services and developmental

disabilities services capital reserve funds and may pay into such

reserve funds (1) any monies appropriated and made available by the

state for the purposes of such funds, (2) any proceeds of the sale of

community mental health services and developmental disabilities services

project revenue bonds or notes, to the extent provided in the resolution

of the agency authorizing the issuance thereof, and (3) any other monies

which may be made available to the agency for the purposes of such fund

or funds from any other source or sources. The monies held in or

credited to a capital reserve fund established under this subdivision,

except as hereinafter provided and as provided in agreements with

bondholders and noteholders, shall be used solely for the payment of

principal of community mental health services and developmental

disabilities services project revenue bonds of the agency secured by

such reserve fund, as the same mature, required payments to any sinking

fund established in a resolution of the agency for the amortization of

term bonds (hereinafter referred to as "sinking fund payments"), the

purchase of such revenue bonds of the agency, the payment of interest on

such revenue bonds of the agency, or the payment of any redemption

premium required to be paid when such bonds are redeemed prior to

maturity. Any income or interest earned by, or increment to, any such

community mental health services and developmental disabilities services

capital reserve fund due to the investment thereof may be transferred to

the agency, subject to agreements with bondholders and noteholders.

(b) In computing any community mental health services and

developmental disabilities services capital reserve fund for the

purposes of this section, securities in which all or a portion of such

reserve fund shall be invested shall be valued at par if purchased at

par, or if purchased at other than par, at the amortized value.

(c) The agency shall create and establish one or more special funds

(herein referred to as community mental health services and

developmental disabilities services general reserve funds) and shall to

the extent provided in the applicable bond resolution of the agency

authorizing the issuance of community mental health services and

developmental disabilities services project revenue bonds, pay into any

such fund the fees and charges collected by the agency pursuant to

paragraph (d) of subdivision eleven of section forty-four of this

article and any monies which the agency shall transfer from a community

mental health services and developmental disabilities services capital

reserve fund pursuant to the provisions of paragraph (a) of this

subdivision. Such monies and any other monies paid into a community

mental health services and developmental disabilities service general

reserve fund may, in the discretion of the agency, but subject to

agreements with bondholders and noteholders, be used by the agency (i)

for the repayment of advances from the state in accordance with the

provisions of repayment agreements between the agency and the director

of the budget, (ii) to reimburse the department of mental hygiene the

reasonable costs of the services performed by the commissioner of mental

hygiene and the department of mental hygiene pursuant to subdivision

five of section fifty-five of this article, including the reasonable

costs of such services performed by the facilities development

corporation upon request by the commissioner of mental hygiene pursuant

to the provisions of section 75.25 of the mental hygiene law, (iii) to

pay all costs, expenses and charges of financing, including fees and

expenses of trustees and paying agents, (iv) for transfers to a

community mental health services and developmental disabilities services

capital reserve fund, (v) for the payment of principal of and interest

on community mental health services and developmental disabilities

services project revenue bonds and notes issued by the agency when the

same shall become due whether at maturity or on call for redemption and

for the payment of any redemption premium required to be paid where such

community mental health services and developmental disabilities services

project revenue bonds and notes are redeemed prior to their stated

maturities and to purchase community mental health services and

developmental disabilities services revenue bonds or notes issued by the

agency, or (vi) for such other corporate purposes of the agency as the

agency in its discretion shall determine and provide.

State university construction bonds and notes. 1.

Definitions. For the purposes of section forty-seven and of this

section:

a. "State university facility" shall mean a classroom, lecture hall,

library, laboratory or other academic building, or any structure on or

improvement to real property of any kind or description, including

fixtures and equipment which are an integral part of any such building,

structure or improvement, a walkway or roadway, and improvements and

connections for water, sewer, gas, electrical, telephone, heating, air

conditioning and other utility services at a state-operated institution

or statutory or contract college under the jurisdiction of the state

university of New York, and shall include a housing unit or any

emergency temporary housing, with necessary and usual attendant and

related facilities and equipment, for the use of students, faculty and

staff, and their families, at such an institution or statutory or

contract college.

b. "State university construction bonds" and "state university

construction notes" shall mean bonds and notes respectively, issued by

the agency pursuant to subdivision two of this section.

2. Additional powers of the agency.

a. The agency shall have power to cause state university facilities to

be constructed, acquired, reconstructed, rehabilitated or improved on

any real property leased or made available by the state university of

New York, or any state-operated institution or statutory or contract

college under the jurisdiction of the state university of New York,

under an agreement with the state university construction fund created

by section three hundred seventy-one of the education law and in

connection therewith may authorize the state university construction

fund to act as its agent for the purpose of constructing, acquiring,

reconstructing, rehabilitating or improving such state university

facilities.

b. The agency shall have power and is hereby authorized from time to

time to issue negotiable bonds and notes in conformity with applicable

provisions of the uniform commercial code in such principal amount as,

in the opinion of the agency, shall be necessary, after taking into

account other monies which may be available for the purpose, to provide

sufficient funds for the construction, acquisition, reconstruction,

rehabilitation or improvement of state university facilities pursuant to

the preceding paragraph of this subdivision, the payment of interest on

state university construction bonds and state university construction

notes issued for such purposes, the establishment of reserves to secure

such bonds and notes, and all other expenditures of the agency incident

to and necessary or convenient for any such construction, acquisition,

reconstruction, rehabilitation or improvement; provided, however, that

the agency shall not issue state university construction bonds and state

university construction notes in an aggregate principal amount exceeding

three billion dollars, excluding state university construction bonds and

state university construction notes issued to refund outstanding state

university construction bonds or state university construction notes. In

no event, however, shall the agency issue state university construction

bonds or state university construction notes after August first,

nineteen hundred eighty-eight, except state university construction

bonds or state university construction notes issued to refund

outstanding state university construction bonds or state university

construction notes; provided, however, that only state university

construction bonds to be issued to refund state university construction

bonds may be issued after August first, nineteen hundred eighty-eight.

Such bonds shall be excluded from such limitation as to the aggregate

principal amount of state university construction bonds and state

university construction notes if the present value of the aggregate debt

service on the refunding bonds does not exceed the present value of the

aggregate debt service on the bonds refunded thereby. For purposes

hereof, the present value of the aggregate debt service of the refunding

bonds and the aggregate debt service of the bonds refunded, shall be

calculated by utilizing the true interest cost of the refunding bonds,

which shall be that rate arrived at by doubling the semi-annual interest

rate (compounded semi-annually) necessary to discount the debt service

payments on the refunding bonds from the payment dates thereof to the

date of issue of the refunding bonds to the purchase price of the

refunding bonds, including interest accrued thereon prior the issuance

thereof.

3. Application of other provisions of article. Except as stated in

section forty-seven, the other provisions of this article shall apply to

state university construction bonds and state university construction

notes issued by the agency pursuant to this section, provided, however,

that such bonds and notes, subject to any agreements with the holders of

particular bonds or notes pledging any specified portions thereof, shall

be secured by a pledge to the payment thereof of (i) rentals paid to the

agency with respect to state university facilities financed with the

proceeds of such bonds and notes, and (ii) any other assets, monies or

accounts pledged or assigned to the agency as security for the payment

of such rentals, and provided further that no resolution or resolutions

authorizing state university construction bonds and state university

construction notes shall (i) pledge all or any part of the fees and

charges made or received by the agency pursuant to subdivision eleven of

section forty-four in connection with the making of mortgage loans or

commitments therefor, or all or any part of the monies received in

payment of such mortgage loans and interest thereon, or (ii) pledge all

or any part of the mortgages of the agency or obligations securing the

same, or (iii) provide as to the use and disposition of the gross income

from mortgages owned by the agency or as to the payment of principal of

mortgages owned by the agency, or (iv) pledge all or any part of the

rentals paid to the agency under leases, subleases or other agreements

for health facilities or mental hygiene facilities entered into by the

agency in accordance with this article, or (v) pledge or assign all or

any part of any other assets, monies or accounts pledged or assigned to

the agency as security for the payment of rentals for such health

facilities or mental hygiene facilities.

4. Repayment fund. The agency shall create and establish a special

fund (herein referred to as state university repayment fund) and shall

pay into such fund any monies which the agency shall receive in payment

of rentals due under one or more lease agreements referred to in

subdivision three of this section. Such monies and any other monies paid

into the state university repayment fund may, in the discretion of the

agency but subject to agreements with the holders of state university

construction bonds and state university construction notes, be used by

the agency (a) for the repayment of advances, if any, from the state to

the agency in connection with state university facilities in accordance

with the provisions of repayment agreements between the agency and the

director of the budget, (b) to pay all costs, expenses and charges of

financing the construction, acquisition, reconstruction, rehabilitation

or improvement of state university facilities on any real property

leased or made available to the agency by the state university of New

York, including fees and expenses of trustees and paying agents and the

reasonable costs of services performed by the commissioner of housing

and division of housing in respect thereof, and (c) for the payment of

the principal of and interest on state university construction bonds or

state university construction notes issued by the agency when the same

shall become due whether at maturity or on call for redemption and for

the payment of any redemption premium required to be paid where such

bonds or notes are redeemed prior to their stated maturities, and to

purchase state university construction bonds or state university

construction notes issued by the agency.

Mental hygiene improvement bonds and notes. 1. Definitions.

For the purposes of section forty-seven and of this section:

a. "Community mental health and developmental disabilities facility"

shall mean a building, a unit within a building, a laboratory, a

classroom, a housing unit, a dining hall, an activities center, a

library, or any structure on or improvement to real property of any kind

or description, including fixtures and equipment which are an integral

part of such building, unit or structure or improvement, a walkway, a

roadway or a parking lot and improvements and connections for water,

sewer, gas, electrical, telephone, heating, air conditioning and other

utility services, or a combination of any of the foregoing, whether for

patient care and treatment or staff, staff family or service use,

located in a city, or in a county not wholly included within a city,

authorized to provide community mental health services in accordance

with the provisions of article forty-one of title E of the mental

hygiene law, which is utilized or to be utilized for the administration

and conduct of programs for people living with either mental illness or

developmental disabilities, or both, and for the provision of services

therefor. A community mental health and developmental disabilities

facility shall also mean and include a residential facility to be

operated as a community residence for the mentally disabled, and a

treatment facility for use in the conduct of an alcoholism treatment

program or of a substance abuse treatment program as defined in the

mental hygiene law.

b. "Mental hygiene facility" shall mean a building, a unit within a

building, a laboratory, a classroom, a housing unit, a dining hall, an

activities center, a library, or any structure on or improvement to real

property of any kind or description, including fixtures and equipment

which are an integral part of any such building, unit, structure or

improvement, a walkway, a roadway or a parking lot, and improvements and

connections for water, sewer, gas, electrical, telephone, heating, air

conditioning and other utility services, or a combination of any of the

foregoing, whether for patient care and treatment or staff, staff family

or service use, located at or related to any state hospital, any state

school, or any state psychiatric or research institute now or hereafter

established under the professional jurisdiction, supervision and control

of the state department of mental hygiene. A mental hygiene facility

shall mean and include a "community mental health and developmental

disabilities facility", unless such facility is expressly excepted or

the context clearly requires otherwise, and shall also mean and include

a treatment facility for use in the conduct of an alcoholism or

substance abuse treatment program as defined in the mental hygiene law,

unless such facility is expressly excepted or the context clearly

requires otherwise. The definition contained in this subdivision shall

not be construed to exclude therefrom a facility to be made available

under license or permit from the health and mental hygiene facilities

improvement corporation to a voluntary agency at the request of the

commissioners of the offices of the department of mental hygiene having

jurisdiction thereof for use in providing community mental health and

developmental disabilities services, or for use in the conduct of an

alcoholism or substance abuse treatment program.

c. "Mental hygiene improvement bonds" and "mental hygiene improvement

notes" shall mean bonds and notes, respectively, issued by the agency

pursuant to subdivision two of this section.

d. "Mental hygiene facilities improvement program" shall mean a

program undertaken by the agency and the health and mental hygiene

facilities improvement corporation for the purpose of constructing,

acquiring, reconstructing, rehabilitating or improving mental hygiene

facilities or causing such facilities to be constructed, acquired,

reconstructed, rehabilitated or improved pursuant to the health and

mental hygiene facilities improvement act and this article.

2. Additional powers of the agency.

a. The agency shall have power to lease one or more existing mental

hygiene facilities from the trustees of the health and mental hygiene

facilities improvement corporation and to construct, acquire,

reconstruct, rehabilitate and improve new mental hygiene facilities at

such facilities, or on any real property leased from the said

corporation, and to cause such new facilities to be constructed,

acquired, reconstructed, rehabilitated or improved by the trustees of

the said corporation as its agent, all in accordance with a lease,

sublease or other agreement entered into between the agency and the

trustees of the said corporation pursuant to subdivision four of section

nine of the health and mental hygiene facilities improvement act.

b. The agency shall have power and is hereby authorized from time to

time to issue negotiable bonds and notes in conformity with applicable

provisions of the uniform commercial code in such principal amount as,

in the opinion of the agency, shall be necessary, after taking into

account other monies which may be available for the purpose, to provide

sufficient funds for the construction, acquisition, reconstruction,

rehabilitation or improvement of mental hygiene facilities pursuant to

the preceding paragraph of this subdivision, the payment of interest on

mental hygiene improvement bonds and mental hygiene improvement notes

issued for such purposes, the establishment of reserves to secure such

bonds and notes, and all other expenditures of the agency incident to

and necessary or convenient for any such construction, acquisition,

reconstruction, rehabilitation or improvement; provided, however, that

the agency shall not issue mental hygiene improvement bonds and mental

hygiene improvement notes in an aggregate principal amount exceeding

seven hundred five million dollars, excluding mental hygiene improvement

bonds and mental hygiene improvement notes issued to refund outstanding

mental hygiene improvement bonds or mental hygiene improvement notes.

3. Application of other provisions of article. Except as stated in

section forty-seven, the other provisions of this article shall apply to

mental hygiene improvement bonds and mental hygiene improvement notes

issued by the agency pursuant to this section, provided, however, that

such bonds and notes, subject to any agreements with the holders of

particular bonds or notes pledging any specified portions thereof, shall

be secured by a pledge to the payment thereof of (i) rentals paid to the

agency with respect to mental hygiene facilities financed with the

proceeds of such bonds and notes, and (ii) any other assets, monies or

accounts pledged or assigned to the agency as security for the payment

of such rentals, and provided further that no resolution or resolutions

authorizing mental hygiene improvement bonds and mental hygiene

improvement notes shall (i) pledge all or any part of the fees and

charges made or received by the agency pursuant to subdivision eleven of

section forty-four in connection with the making of mortgage loans or

commitments therefor, or all or any part of the monies received in

payment of such mortgage loans and interest thereon, or (ii) pledge all

or any part of the mortgages of the agency or obligations securing the

same, or (iii) provide as to the use and disposition of the gross income

from mortgages owned by the agency or as to the payment of principal of

mortgages owned by the agency, or (iv) pledge all or any part of the

rentals paid to the agency under leases, subleases or other agreements

for state university facilities or health facilities entered into by the

agency in accordance with this article, or (v) pledge or assign all or

any part of any other assets, monies or accounts pledged or assigned to

the agency as security for the payment of rentals for such state

university facilities or health facilities.

4. Mental hygiene facilities fund. The agency shall create and

establish a special fund (herein referred to as mental hygiene

facilities fund) and shall pay into such fund any monies which the

agency shall receive in payment of rentals due under one or more leases,

subleases or other agreements entered into pursuant to subdivision four

of section nine of the health and mental hygiene facilities improvement

act and any other monies which the agency shall receive from the health

and mental hygiene facilities improvement corporation as security for or

in payment of such rentals. Such monies and any other monies paid into

the mental hygiene facilities fund may, in the discretion of the agency,

but subject to agreements with the holders of mental hygiene improvement

bonds and mental hygiene improvement notes, be used by the agency (a)

for the repayment of advances, if any, from the state to the agency in

connection with mental hygiene facilities, and any real property

required therefor, in accordance with the provisions of repayment

agreements related thereto which have been entered into with the

director of the budget, (b) to pay all costs, expenses and charges of

financing mental hygiene facilities including fees and expenses of

trustees and paying agents, (c) to pay the administrative and other

expenses of the agency allocable to the services performed by the agency

in the financing of the construction, acquisition, reconstruction,

rehabilitation or improvement of mental hygiene facilities and matters

relating thereto, (d) for the payment of the principal of and interest

on mental hygiene improvement bonds or mental hygiene improvement notes

issued by the agency when the same shall become due whether at maturity

or by call for redemption and for the payment of any redemption premium

required to be paid where such bonds or notes are redeemed prior to

their stated maturities, and to purchase mental hygiene improvement

bonds or mental hygiene improvement notes issued by the agency, or (e)

for such other corporate purposes of the agency relating to the carrying

out of its functions, powers and duties with respect to the financing of

the construction, acquisition, reconstruction, rehabilitation or

improvement of mental hygiene facilities as the agency in its discretion

shall determine and provide.

Special provisions related to certain bonds and notes.

Notwithstanding any other provision of law, general or special:

1. Any public corporation or officer responsible for the acquisition

of real property or the planning, supervision or administration of

facilities thereon which may be constructed, acquired, reconstructed,

rehabilitated or improved by the agency pursuant to this article is

hereby authorized for and on behalf and in the name of the people of the

state of New York, to execute and deliver to the agency, for such

consideration, if any, as may be determined by such public corporation

or officer and the agency, but not to exceed the cost of acquisition

thereof and the cost of improvements thereon, a lease for a term not

exceeding fifty years or a quitclaim deed conveying to the agency all

the right, title and interest of the people of the state of New York in

and to any of the lands acquired by such public corporation or officer

for such facilities, and in and to any of the improvements thereon, for

the purpose of constructing, reconstructing, rehabilitating or improving

thereon one or more facilities pursuant to this article for lease or

sublease to any such public corporation or officer, in accordance with

the terms of an agreement entered into among them in accordance with

law. The agency is hereby authorized to accept any such lease or

conveyance, to lease or sublease such lands, improvements and facilities

to such public corporation or officer, and to hold the same subject to

the terms of any such lease, conveyance, sublease or other agreement,

and such public corporation or officer is hereby authorized, with the

approval of the governor, or where so designated by the governor for

such purpose, the director of the budget, to lease or sublease any such

lands or improvements or the facilities constructed, reconstructed,

rehabilitated or improved thereon pursuant to this article or other

provisions of law, and to hold such lands, improvements and facilities

subject to the terms of any such lease, sublease or other agreement.

2. a. In the event that the agency shall fail, within five years from

the date of a lease or conveyance authorized pursuant to subdivision one

of this section, to construct, reconstruct, rehabilitate or improve the

facility or facilities thereon for which the conveyance was made, as

provided for in a lease, sublease or other agreement entered into with

such public corporation or officer, or in the event that such facility

or facilities shall cease to be used for the purposes intended, then and

in either event but subject to the terms of any lease, sublease or other

agreement undertaken by the agency, such lands, and the improvements and

facilities thereon, shall revert to the people of the state of New York

with right of re-entry thereupon, and such lease or deed shall be made

subject to such conditions; provided, however, that as a condition

precedent to the exercise of such right of re-entry the state of New

York, or such public corporation or officer, shall pay to the agency an

amount equal to the purchase price of such lands and improvements, the

depreciated cost of any facility or facilities constructed,

reconstructed, rehabilitated or improved thereon, and all other costs of

the agency incident to the acquisition of such lands and the financing

of construction, reconstruction, rehabilitation or improvement relating

to such facility or facilities, all as provided in the aforesaid lease,

sublease or other agreement entered into with such public corporation or

officer.

b. In the event that the agency shall determine that any portions of

the lands leased or conveyed pursuant to subdivision one hereof are in

excess of the lands needed to construct, reconstruct, rehabilitate or

improve the facility or facilities thereon for which the conveyance was

made, as provided in a lease, sublease or other agreement entered into

with such public corporation or officer, the agency may terminate its

lease with respect to such excess portions of such lands or reconvey

such excess portions to the people of the state of New York; provided,

however, that the state of New York or such public corporation or

officer shall pay to the agency an amount equal to the consideration, if

any, paid by the agency to such public corporation or officer allocable

to such excess lands and such other costs of the agency as are incident

to the acquisition of such excess lands, all as may be approved by such

public corporation or officer and the agency. Any monies so paid to the

agency shall be used and applied, subject to the provisions of any

contract with noteholders and bondholders, for the sole purpose of

paying costs and expenses of the agency incident to the financing of the

facility or facilities to be constructed, reconstructed, rehabilitated

or improved on such other portions of the land as shall have been leased

or conveyed to the agency pursuant to subdivision one hereof.

3. The attorney general shall pass upon the form and sufficiency and

manner of execution of any deed of conveyance and of any lease or

sublease of lands authorized to be given under subdivision one of this

section and the same shall not be effective unless so approved by him.

4. The cost of construction, acquisition, reconstruction,

rehabilitation or improvement of facilities undertaken by the agency

pursuant to this article may include the cost of acquisition of any land

and improvements leased or conveyed to the agency in accordance with

subdivision one of this section and the cost of the original

furnishings, equipment, machinery and apparatus determined by the

responsible public corporation or officer to be needed to furnish and

equip such facilities upon the completion of work. The agency shall have

power to acquire or lease and to hold land and improvements required for

the construction, acquisition, reconstruction, rehabilitation or

improvement of facilities undertaken by the agency pursuant to this

article and to provide the original furnishings, equipment, machinery

and apparatus determined by the responsible public corporation or

officer to be needed to furnish and equip such facilities upon the

completion of work and to issue its bonds and notes to provide

sufficient funds to pay the cost thereof.

5. Any public corporation or officer referred to in subdivision one of

this section is hereby authorized and empowered, in connection with any

lease, sublease or other agreement with the agency to which such public

corporation or officer is a party, and subject to such agreements with

third parties as may then exist, to:

(a) pledge or assign to the agency all or any portion of the revenues

and monies received or to be received by such public corporation or

officer, which may be available for the purpose of paying rentals for

the use of the facilities constructed, acquired, reconstructed,

rehabilitated or improved or to be constructed, acquired, reconstructed,

rehabilitated or improved under such agreement, so that the payment of

such rentals may be fully secured and protected; provided, however, that

such pledge or assignment shall not extend to appropriations or advances

from the state except appropriations or advances made specifically for

the purpose of paying all or any part of such rentals;

(b) use and dispose of such revenues and monies, or any portions

thereof, for the purpose of defraying, in whole or in part, (1) the cost

of acquiring any real property for the purpose of constructing,

acquiring, reconstructing, rehabilitating or improving facilities

thereon which may be constructed, acquired, reconstructed, rehabilitated

or improved by the agency pursuant to this article, (2) the cost of

financing the construction, acquisition, reconstruction, rehabilitation

or improvement of such facilities, and (3) the cost of acquiring the

original furnishings, equipment, machinery and apparatus needed to

furnish and equip such facilities upon the completion of work;

(c) set aside rental reserves and to agree to the maintenance,

regulation and disposition thereof;

(d) agree to limitations on the purposes to which the proceeds of sale

of agency notes or bonds may be applied and to the pledging of such

proceeds to secure the payment of agency notes or bonds or of any issue

thereof;

(e) agree to limitations on the making of additional leases, subleases

or agreements with the agency or with others, and the terms upon which

such additional leases, subleases or agreements may be made;

(f) recognize and give effect to such assignment, upon receipt of any

notice of assignment by the agency of any such lease, sublease or other

agreement with the agency, or of any of its rights under such lease,

sublease or other agreement, and to pay the assignee thereof rentals or

other payments then due or which may become due under any such lease,

sublease or other agreement which has been so assigned by the agency;

and

(g) agree to any other matters, of like or different character, which

in any way affect the security or protection of the rental payments

required to be made under the terms of such lease, sublease or other

agreement with the agency.

6. (a) Any state university facility, as defined in section

forty-seven-a of this article, which has been constructed, acquired,

reconstructed, rehabilitated or improved, in whole or in part, out of

monies advanced to the state university of New York, the state

university construction fund, the state office of general services or

the dormitory authority since August first, nineteen hundred sixty-two

pursuant to appropriations or reappropriations as advances from the

capital construction fund, and the lands upon which such a facility is

located, may be leased or conveyed to the agency by the state university

of New York, the state university construction fund or the dormitory

authority in accordance with the provisions of subdivisions one through

five of this section, notwithstanding that the construction,

acquisition, reconstruction, rehabilitation or improvement of such

facility may have been completed by the state university of New York,

the state university construction fund, the dormitory authority or the

state office of general services, or may have been undertaken or may

hereafter be undertaken by the dormitory authority under agreement with

the state university of New York or the state university construction

fund.

(b) Subject to such agreements with third parties as may then exist,

the state university of New York and the state university construction

fund are hereby authorized and empowered to enter into leases, subleases

and other agreements with the agency with respect to any state

university facility described in paragraph (a), and the lands upon which

such a facility is or may be located, in accordance with the provisions

of section three hundred seventy-eight of the education law and the

provisions of subdivisions one through five of this section; and the

agency is hereby authorized and empowered to accept any lease or

conveyance of any such state university facility, and the lands upon

which such a facility is or may be located, to acquire, construct,

reconstruct, rehabilitate or improve any such facility and to issue

bonds and notes to provide sufficient funds therefor in accordance with

the provisions of section forty-seven-a of this article and the

provisions of subdivisions one through five of this section.

(c) Any mental hygiene facility, as defined in section forty-seven-b

of this article, which has been constructed, acquired, reconstructed,

rehabilitated or improved, in whole or in part, out of monies advanced

or deemed to have been advanced to the health and mental hygiene

facilities improvement corporation, the state department of mental

hygiene or the office of general services, since April first, nineteen

hundred sixty-three pursuant to appropriations or reappropriations as

advances from the capital construction fund, and the lands upon which

such a facility is located, may be leased or conveyed to the agency by

the health and mental hygiene facilities improvement corporation or the

commissioner of mental hygiene in accordance with the provisions of

subdivisions one through five of this section, notwithstanding that the

construction, acquisition, reconstruction, rehabilitation or improvement

of such facility may have been completed by the health and mental

hygiene facilities improvement corporation, the state department of

mental hygiene or the office of general services.

(d) Subject to such agreements with third parties as may then exist,

the health and mental hygiene facilities improvement corporation is

hereby authorized and empowered to enter into leases, subleases and

other agreements with the agency with respect to any mental hygiene

facility described in paragraph (c), and the lands upon which such a

facility is or may be located, in accordance with the provisions of

subdivision four of section nine of the health and mental hygiene

facilities improvement act and the provisions of subdivisions one

through five of this section; and the agency is hereby authorized and

empowered to accept any lease or conveyance of any such mental hygiene

facility, and the lands upon which such a facility is or may be located,

to acquire, construct, reconstruct, rehabilitate or improve any such

facility, and to issue bonds and notes to provide sufficient funds

therefor in accordance with the provisions of section forty-seven-b of

this article and the provisions of subdivisions one through five of this

section.

7. a. The agency shall have the power to acquire by lease or deed from

the health and mental hygiene facilities improvement corporation any

real property acquired by the corporation pursuant to the provisions of

subdivision six of section nine of the facilities development

corporation act (i) for the purpose of constructing, reconstructing,

rehabilitating or improving thereon one or more community mental health

and developmental disabilities facilities or (ii) for the purpose of

financing the acquisition, construction, reconstruction, rehabilitation

or improvement thereon of one or more community mental health and

developmental disabilities facilities, pursuant to the provisions of

this article and the facilities development corporation act. The agency

is hereby authorized to lease or sublease such real property and

facilities thereon to the corporation for the purpose of making the same

available to a city or a county not wholly within a city, for use and

occupancy in accordance with the provisions of a lease, sublease or

other agreement between the corporation and such city or county.

b. In the event that the agency shall fail, within five years after

the date of a lease or conveyance of such real property from such city

or county to the corporation, to construct, reconstruct, rehabilitate or

improve the community mental health and developmental disabilities

facility or facility thereon for which such lease or conveyance was

made, as provided for in a lease, sublease or other agreement entered

into by such city or county and the corporation, then, subject to the

terms of any lease, sublease or other agreement undertaken by the

agency, such real property and any facilities thereon shall revert to

the corporation with right of re-entry thereupon, and such lease or deed

shall be made subject to such condition of reverter and re-entry;

provided, however, that as a condition precedent to the exercise of such

right of re-entry the corporation shall pay to the agency an amount

equal to the sum of the purchase price of such real property, the

depreciated cost of any community mental health and developmental

disabilities facility or facilities constructed, reconstructed,

rehabilitated or improved thereon and all other costs of the agency

incident to the acquisition of such lands and the financing of

construction, reconstruction, rehabilitation or improvement relating to

such community mental health and developmental disabilities facility or

facilities, all as provided in the aforesaid lease, sublease or other

agreement entered into with the corporation.

c. No real property or interest therein shall be acquired by the

agency pursuant to this subdivision unless the title thereto shall be

approved by the attorney general.

d. The attorney general shall pass upon the form and sufficiency and

manner of execution of any deed of conveyance and of any lease or

sublease of real property authorized to be acquired by the agency

pursuant to this subdivision and the same shall not be effective unless

such deed, lease or sublease shall be so approved by him.

Health facilities bonds and notes. 1. Definitions. For the

purposes of section forty-seven and this section:

a. "Municipality" means a county, city or town constituting a social

services district as defined in sections two, sixty-one, seventy-five

and seventy-five-a of the social services law, or any two or more of the

foregoing which are acting jointly to provide a health facility or

health facilities.

b. "Health facility" means a building, a unit within a building, a

laboratory, a classroom, a housing unit, a dining hall, an activities

center, a library, or any structure on or improvement to real property

of any kind or description, including fixtures and equipment which are

an integral part of any such building, unit, structure or improvement, a

walkway, a roadway or a parking lot, and improvements and connections

for water, sewer, gas, electrical, telephone, heating, air conditioning

and other utility services, or a combination of any of the foregoing,

whether for patient care and treatment of staff, staff family or service

use, located at or related to or constituting a hospital of, and located

in, a municipality.

c. "Health facilities bonds" and "health facilities notes" shall mean

bonds and notes, respectively, issued by the agency pursuant to

subdivision two of this section.

d. "Health facilities improvement program" shall mean a program

undertaken by the agency and the health and mental hygiene facilities

improvement corporation for the purpose of constructing, acquiring,

reconstructing, rehabilitating or improving health facilities or causing

such facilities to be constructed, acquired, reconstructed,

rehabilitated or improved pursuant to the health and mental hygiene

facilities improvement act and this article.

2. Additional powers of the agency. In accordance with any agreement

entered into pursuant to this article and the health and mental hygiene

facilities improvement act: a. The agency shall have powers: (i) to

lease or purchase one or more existing health facilities from a

municipality and cause such facility or facilities to be reconstructed,

rehabilitated or improved by the health and mental hygiene facilities

improvement corporation, created by the health and mental hygiene

facilities improvement act, as its agent or, on any real property leased

or purchased from a municipality to cause one or more health facilities

to be constructed by the health and mental hygiene facilities

improvement corporation as its agent; (ii) to lease or purchase from any

person, firm or corporation real property for the purpose of causing

health facilities to be constructed, reconstructed, rehabilitated or

improved by the health and mental hygiene facilities improvement

corporation as its agent; (iii) to lease or sublease to a municipality

health facilities which have been constructed, acquired, reconstructed,

rehabilitated or improved by the agency pursuant to this article and the

health and mental hygiene facilities improvement act; and (iv) to do all

or any combination of the foregoing.

b. The agency shall have power and is hereby authorized from time to

time to issue negotiable bonds and notes in such principal amount as, in

the opinion of the agency, shall be necessary, after taking into account

other monies which may be available for the purpose, to provide

sufficient funds for the construction, acquisition, reconstruction,

rehabilitation or improvement of health facilities pursuant to this

subdivision two, the payment of interest on health facilities bonds and

health facilities notes issued for such purposes, the establishment of

reserves to secure such bonds and notes, and all other expenditures of

the agency incident to and necessary or convenient for any such

construction, acquisition, reconstruction, rehabilitation or

improvement, provided, however, that the agency shall not issue health

facilities bonds and health facilities notes in an aggregate principal

amount exceeding eight hundred million dollars, excluding health

facilities bonds and health facilities notes issued to refund

outstanding health facilities bonds or health facilities notes.

3. Application of other provisions of article. Except as stated in

section forty-seven, the other provisions of this article shall apply to

health facilities bonds and health facilities notes issued by the agency

pursuant to this section, provided, however, that such bonds and notes,

subject to any agreements with the holders of particular bonds or notes

pledging any specified portions thereof, shall be secured by a pledge to

the payment thereof of (i) rentals paid to the agency with respect to

health facilities financed with the proceeds of such bonds and notes,

and (ii) any other assets, monies or accounts pledged or assigned to the

agency as security for the payment of such rentals, and provided further

that no resolution or resolutions authorizing health facilities bonds

and health facilities notes shall (i) pledge all or any part of the fees

and charges made or received by the agency pursuant to subdivision

eleven of section forty-four in connection with the making of mortgage

loans or commitments therefor, or all or any part of the monies received

in payment of such mortgage loans and interest thereon, or (ii) pledge

all or any part of the mortgages of the agency or obligations securing

the same, or (iii) provide as to the use and disposition of the gross

income from mortgages owned by the agency or as to the payment of

principal of mortgages owned by the agency, or (iv) pledge all or any

part of the rentals paid to the agency under leases, subleases or other

agreements for state university facilities and mental hygiene facilities

entered into by the agency in accordance with this article, or (v)

pledge or assign all or any part of any other assets, monies or accounts

pledged or assigned to the agency as security for the payment of rentals

for such state university facilities and mental hygiene facilities.

4. Health facilities income accounts. a. The agency shall create and

establish one or more special accounts (herein referred to as health

facilities income accounts) and shall pay into such accounts any monies

which the agency shall receive in payment of rentals due under one or

more leases or subleases entered into pursuant to subdivision two of

this section and any other monies which the agency shall receive from a

municipality as security for or in payment of such rentals. Such monies

and any other monies paid into such health facilities income accounts,

may, in the discretion of the agency, but subject to agreements with the

holders of health facilities bonds and health facilities notes, be used

by the agency (1) for the repayment of advances, if any, from the state

to the agency in connection with health facilities, and any real

property required therefor, in accordance with the provisions of

repayment agreements related thereto which have been entered into with

the director of the budget, (2) to pay all costs, expenses and charges

of financing the health facilities applicable to such account or

accounts including fees and expenses of trustees and paying agents, (3)

to pay the administrative and other expenses of the agency allocable to

the services performed by the agency in the financing of the

construction, acquisition, reconstruction, rehabilitation or improvement

of health facilities and matters relating thereto, (4) for the payment

of the principal of and interest on health facilities bonds or health

facilities notes issued by the agency when the same shall become due

whether at maturity or by call for redemption and for the payment of any

redemption premium required to be paid where such bonds or notes are

redeemed prior to their stated maturities, and to purchase health

facilities bonds or health facilities notes issued by the agency, or (5)

for such other corporate purposes of the agency relating to the carrying

out of its functions, powers and duties with respect to the financing of

the construction, acquisition, reconstruction, rehabilitation or

improvement of health facilities as the agency in its discretion shall

determine and provide.

b. To assure the continued payment of rentals due under one or more

leases or subleases entered into pursuant to subdivision two of this

section, the agency shall annually, not later than November first in

each year, make and deliver to the appropriate chief fiscal officer of

the municipality a certificate setting forth the amount, if any, due and

not paid for the preceding fiscal year of the agency under such lease or

sublease with such municipality. In the event of the failure or

inability of the municipality to pay over the stated amount to the

agency on or before December first of the same year, the agency shall

forthwith make and deliver to the comptroller of the state of New York,

the director of the budget of the state of New York and the

commissioners of health and social services of the state of New York a

further certificate restating the amount due and not paid, and such

amount shall be paid over to the agency, upon the warrant of the

comptroller on vouchers certified as correct by the commissioner of

health and approved by the commissioner of social services, out of the

next payment of state aid to such municipality pursuant to section three

hundred sixty-eight-a of the social services law or funds appropriated

for the purpose of making payments on behalf of such municipality

pursuant to section three hundred sixty-seven-b of such law. To the

extent any such payments to the agency are made from state aid payments

pursuant to section three hundred sixty-eight-a of such law, the amount

of such payments shall be deducted from the corresponding apportionment

of state aid otherwise credited to such municipality, and the state

shall not be obligated to pay, nor shall such municipality be entitled

to receive, by virtue of such deduction, any additional or increased

apportionment or payment of state aid pursuant to section three hundred

sixty-eight-a of the social services law. To the extent any such

payments to the agency are made from funds appropriated for the purpose

of making payments on behalf of such municipality pursuant to section

three hundred sixty-seven-b of such law, the amount of such payments may

be deducted from any other payments of state assistance to such

municipality under the social services law and the state shall not be

obligated to pay, nor shall the municipality be entitled to receive, by

virtue of such deduction, any additional or increased apportionment or

payment of such state assistance, provided, however, that nothing

contained in this sentence shall be construed to limit, impair, impede,

or otherwise adversely affect in any manner the rights or remedies of

the purchasers and holders and owners of any bonds or notes of the state

or any agency or instrumentality, public benefit corporation or

political subdivision thereof under which such purchasers and holders

and owners have any right of payment of such bonds or notes by recourse

to such state assistance monies.

5. Special provisions. Notwithstanding any other provision of law,

general, special or local, or any provision of any charter or ordinance:

a. A municipality is hereby authorized to execute and deliver to the

agency for such consideration as may be determined by the municipality,

the agency and the health and mental hygiene facilities improvement

corporation, but not to exceed the cost of acquisition thereof to the

municipality and the cost of improvements thereon, a lease for a term

not exceeding fifty years or a quit claim deed conveying to the agency

all right, title and interest of such municipality in and to real

property, for the purpose of constructing, reconstructing,

rehabilitating, or improving one or more health facilities pursuant to

this article and the health and mental hygiene facilities improvement

act for subsequent lease or sublease to such municipality, in accordance

with the terms of any agreement entered into pursuant to this article

and the health and mental hygiene facilities improvement act.

b. A municipality is hereby authorized to lease or sublease from the

agency the health facilities constructed, reconstructed, rehabilitated

or improved pursuant to this article and the health and mental hygiene

facilities improvement act, in accordance with the terms of any

agreement entered into pursuant to this article and such act. At such

time as all rentals due or to become due to the agency pursuant to the

terms of any such lease or sublease have been paid or such lease or

sublease is terminated pursuant to the provisions thereof, the

jurisdiction of the agency over the real property leased or conveyed

pursuant to paragraph a of this subdivision, together with the

improvements thereon shall cease and all interest real and personal in

such real property and improvements vested in the agency shall vest in

the municipality with right of re-entry thereon, provided, however if

such real property were leased or conveyed to the agency by a

municipality which constituted a city social services district which

district was dissolved pursuant to the provisions of chapter

twenty-eight of the laws of nineteen hundred seventy-two, all interest

real and personal in such real property and improvements vested in the

agency shall vest in the municipality which formerly constituted the

city social services district with right of re-entry thereon.

c. No real property or interest therein shall be acquired by the

agency pursuant to this subdivision unless title thereto shall have been

approved by the attorney general.

d. The attorney general shall pass upon the form and sufficiency and

manner of execution of any deed of conveyance and of any lease or

sublease to which the agency and a municipality are parties, and the

same shall not be effective unless approved by him.

e. In the event that the agency shall fail within five years from the

date of a lease or conveyance authorized pursuant to paragraph a of this

subdivision five to construct, reconstruct, rehabilitate or improve the

health facilities thereon for which the lease or conveyance was made, as

provided for in any agreement entered into pursuant to this article and

the health and mental hygiene facilities improvement act, or in the

event that such health facilities shall cease to be used for the

purposes intended, then and in either event but subject to the terms of

any lease, sublease or other agreement between the agency and the

municipality, such real property and any health facilities thereon,

shall revert to the municipality with right of re-entry thereupon and

such lease or deed shall be made subject to such conditions; provided,

however, that as a condition precedent to the exercise of such right of

re-entry the municipality shall pay to the agency an amount equal to the

purchase price of such real property, the depreciated cost of any health

facilities constructed, reconstructed, rehabilitated or improved, and

all other costs of the agency incident to the acquisition of such real

property and the financing of construction, reconstruction,

rehabilitation or improvement relating to such facilities, all as

provided in the aforesaid lease, sublease or other agreement entered

into with such municipality.

f. In the event that the agency shall determine that any portions of

the real property leased or conveyed pursuant to paragraph a of this

subdivision five are in excess of the real property needed to construct,

reconstruct, rehabilitate or improve the facility or facilities thereon