§ 17-1909 — Water pollution control revolving fund agreements

§ 17-1909. Water pollution control revolving fund agreements.\n 1. As used in this section:\n a. "Allocation" means the amount of moneys allocated to reduce a\nmunicipality's or group of municipalities' total financing costs for one\nor more eligible projects.\n b. "Construction" means the erection, building, acquisition,\nalteration, reconstruction, improvement, enlargement or extension of an\neligible project; the inspection and supervision thereof; and the\nengineering, architectural, legal, fiscal, and economic investigations\nand studies, surveys, designs, plans, working drawings, specifications,\nprocedures, and other actions necessary thereto.\n c. "Corporation" means the New York state environmental facilities\ncorporation, continued pursuant to section twelve hundred eighty-two of\nthe public authorities law, or any successor thereto.\n d. "Eligible project" means a project for construction of a facility\nwhich would be eligible for financing under the Federal Water Pollution\nControl Act:\n (i) for which all required federal and state permits have been issued;\nand\n (ii) which the commissioner has determined:\n (a) is in accord with applicable comprehensive studies and reports\nmade pursuant to sections 17-0303 and 17-1901 of this article; and\n (b) is necessary for the accomplishment of the state water pollution\ncontrol program formulated pursuant to sections 17-0303 and 17-1901 of\nthis article; and\n (c) represents a reasonable effort to develop economic viability in\nplanning, design and construction; and\n (d) is a project for which financial assistance is available from the\nfund; and\n (e) conforms with applicable rules and regulations of the department,\nincluding a demonstration that design and construction consider future\nphysical climate risk due to sea level rise, and/or storm surges and/or\nflooding, based on available data predicting the likelihood of future\nextreme weather events, including hazard risk analysis data if\napplicable; and\n (f) includes consideration of county-wide or regional wastewater\nplanning.\n e. "Financial assistance to a municipality" has the same meaning as\nset forth in subdivision four of section twelve hundred eighty-five-j of\nthe public authorities law.\n f. "Fund" means the water pollution control revolving fund established\nunder section twelve hundred eighty-five-j of the public authorities\nlaw.\n g. "Intended use plan" means the plan prepared pursuant to subdivision\ntwo of this section, identifying the intended uses of the amounts\navailable in the fund, including but not limited to: (i) a list of those\nprojects for construction of publicly owned treatment works on the\npriority list developed pursuant to subdivision two of this section;\n(ii) a list of projects developed pursuant to subdivision two of this\nsection anticipated to be financed by the fund through the water\npollution control linked deposit program; (iii) a description of the\nshort and long term goals and objectives of the fund; (iv) information\non the activities to be supported, including a description of project\ncategories, discharge requirements under the Federal Water Pollution\nControl Act, terms of financial assistance, and eligible borrowers\npursuant to the water pollution control linked deposit program served;\n(v) the criteria and method established for the distribution of funds;\nand (vi) the amount of moneys from the fund, not to exceed ten million\ndollars annually, to be made available for linked loans under the water\npollution control linked deposit program during the period covered by\nsuch intended use plan.\n h. "Municipality" means any county, city, town, village, district\ncorporation, county or town improvement district, school district,\nIndian reservation wholly within New York state, any public benefit\ncorporation or public authority established pursuant to the laws of New\nYork or any agency of New York state which is empowered to construct and\noperate an eligible project, or any two or more of the foregoing which\nare acting jointly in connection with an eligible project.\n i. "Project financing agreement" means an agreement between the\ncorporation and one or more municipalities meeting the requirements of\nsubdivision four of this section.\n 2. The commissioner is required to establish and maintain a list of\npotentially eligible projects and shall establish, pursuant to rules and\nregulations, a process for listing potentially eligible projects\nidentified by municipalities and eligible borrowers pursuant to article\nsixteen of the state finance law and a priority ranking system for the\npurpose of providing financial assistance to municipalities and eligible\nborrowers for such projects under this section. In establishing such\nsystem, the commissioner shall take into account:\n a. The environmental significance of such potentially eligible\nprojects which shall include, but need not be limited to, an assessment\nof (i) public health and safety; (ii) protection of environmental\nresources; (iii) population affected; (iv) attainment of state water\nquality goals and standards; (v) compliance with state and federal law,\nrules and regulations; and (vi) the extent to which such projects\nreflect county-wide or regional wastewater planning;\n b. A municipality's inability as determined by the corporation to pay\nfor such potentially eligible project prior to receipt of such financial\nassistance;\n c. The regional distribution of environmentally significant projects;\n d. For agricultural projects funded through the water pollution\ncontrol linked deposit program, in consultation with the commissioner of\nagriculture and markets, the extent to which the project will reduce,\nabate, control, or prevent non-point source pollution originating from\nagricultural sources and/or propose to implement best management\npractices, as identified in section three of the soil and water\nconservation districts law; and\n e. For residential and small business on-site wastewater treatment\nsystem projects funded through the water pollution control linked\ndeposit program, in consultation with the department of state, the\nextent to which the project will prevent an increase in nutrients in\nwater bodies or the extent to which the project will enhance source\nwater or watershed protection.\n 3. a. The corporation is authorized to promulgate regulations,\ndeveloped in consultation with the commissioner and the director of the\ndivision of the budget, for the purpose of carrying out its\nresponsibilities under this section, including establishing criteria and\nstandards for determining the amount of financial assistance to a\nmunicipality for an eligible project. To the extent financial assistance\nto a municipality for an eligible project is provided as a loan from the\nproceeds of bonds or notes of the corporation, the amount of an\nallocation applicable to the portion of such eligible project financed\nwith such loan shall be, subject to such maximum financial limitations\nas may otherwise be necessary and prescribed by the commissioner and the\ndirector of the division of the budget, thirty-three and one-third\npercent of the principal amount of such loan outstanding at any time for\nsuch eligible project, to the extent reasonably practicable, and subject\nto such deviation as may be necessary, in connection with the\nadministration and investment of moneys in the fund, unless allocations\nin differing amounts are necessary to preclude a determination by the\ncommissioner or the corporation pursuant to paragraph e of subdivision\neight of this section or unless an allocation in a differing amount is\nrequired for an innovative technology demonstration project; provided,\nhowever, that in the case of any municipality which has, during the\nperiod commencing on June first, nineteen hundred ninety-two and ending\non September thirtieth, two thousand twenty-seven, (i) submitted an\napplication for financial assistance in the form of such a loan for an\neligible project, which application has been accepted by the\ncorporation, (ii) closed on such loan, and (iii) commenced construction\nof such eligible project, the allocation applicable to the portion of\nsuch project financed with such loan shall be, subject to maximum\nfinancial limitations as may otherwise be necessary and prescribed by\nthe commissioner and the director of the division of the budget, fifty\npercent of the principal balance outstanding on such loan at any time\nfor such eligible project, to the extent reasonably practicable, and\nsubject to such deviation as may be necessary, in connection with the\nadministration and investment of moneys in the fund, unless allocations\nin differing amounts are necessary to preclude a determination by the\ncommissioner or the corporation pursuant to paragraph e of subdivision\neight of this section or unless an allocation in a differing amount is\nrequired for an innovative technology demonstration project.\n b. The corporation may enter into a project financing agreement with\nup to three municipalities which provides for up to one hundred percent\nsubsidy of the interest on the amount of principal not to exceed three\nmillion dollars for the construction of innovative technology\ndemonstration projects which shall be waste water treatment facilities\nwhich utilize innovative technology approved by the commissioner as\ndefined in regulations promulgated by the United States environmental\nprotection agency in accordance with the Federal Water Pollution Control\nAct. The commissioner shall prepare criteria for selection of eligible\nprojects pursuant to this paragraph including, but not limited to, the\nuse of innovative technology which has been proven reasonably effective\non at least a demonstration model basis.\n c. The department is authorized to promulgate regulations, developed\nin consultation with the director of the division of the budget, for the\npurpose of carrying out its responsibilities under this section.\n 4. The corporation may enter into project financing agreements with\nmunicipalities providing for the construction and financing of eligible\nprojects. The corporation shall prepare each project financing\nagreement, which shall include but is not limited to the following\nprovisions:\n a. A description of the eligible project;\n b. An estimate of the reasonable cost of the eligible project and a\nprojected cash flow schedule for meeting that cost;\n c. A schedule for construction of the eligible project;\n d. A right of the corporation to approve all contracts for services\nand construction funded pursuant to a project financing agreement, and\nto inspect and review the construction of eligible projects;\n e. Notwithstanding the provisions of any other law, general, special\nor local, inconsistent with this section, a right of the corporation to\ninvest proceeds of the corporation's bonds or notes, including proceeds\nof bonds or notes of the municipality, as provided in subdivision four\nof section twelve hundred eighty-four and subdivision six of section\ntwelve hundred eighty-five-j of the public authorities law.\n Such right shall include the right to invest such monies together with\nany other monies held by the corporation pursuant to the provisions of\nsection twelve hundred eighty-five-j of the public authorities law;\n f. Remedies in the event of a municipality's failure to comply with\nthe terms of a project financing agreement;\n g. An agreement by the corporation to:\n (i) lend to the municipality for the construction of an eligible\nproject a specified amount from the proceeds of the corporation's bonds\nor notes, not to exceed the estimated reasonable cost of construction of\nthe eligible project established in the project financing agreement or\nany loan agreement, subject to the ability of the corporation to provide\nsuch financing, including but not limited to the approval of the\ncorporation's board and any other approvals required by state or federal\nlaw;\n (ii) use all reasonable efforts to issue its bonds or notes in an\namount sufficient to finance the estimated reasonable cost of the\neligible project, including but not limited to costs of issuance, credit\nsupport fees, if any, trustees fees, interest during construction, and\nsuch reserve funds, if any, as may be necessary to secure such bonds or\nnotes;\n (iii) in the alternative, provide financial assistance to the\nmunicipality for the construction of an eligible project in a specified\namount from the proceeds of any federal capitalization grant, award,\nassistance, or any state moneys appropriated to or otherwise transferred\ninto the fund, not to exceed the estimated reasonable cost of\nconstruction of the eligible project established in the project\nfinancing agreement or any loan agreement, as determined by the\ncorporation or as directed by the commissioner pursuant to subdivision\neight of this section or subdivision four of section twelve hundred\neighty-five-j of the public authorities law;\n (iv) make reimbursements for the administrative and management costs\nof the department and the corporation in accordance with subdivisions\nfive and seven of section twelve hundred eighty-five-j of the public\nauthorities law;\n (v) provide to the municipality, for any loan made from the proceeds\nof the corporation's bonds or notes, an interest rate subsidy allocation\nfor the eligible project in accordance with section twelve hundred\neighty-five-j of the public authorities law and this section;\n (vi) administer any federal rebate requirement in connection with\nobligations of the corporation and of any municipality issued in\naccordance with a project financing or loan agreement;\n h. An agreement by the municipality to:\n (i) proceed expeditiously with and complete the eligible project in\naccordance with plans approved pursuant to titles seven and eight of\nthis article;\n (ii) commence operation of the eligible project on completion of the\nproject, and not discontinue operation of or dispose of the eligible\nproject as long as a loan to the municipality for such project remains\noutstanding, without approval of the commissioner; provided, however,\nthat the commissioner shall not approve disposition of the eligible\nproject without the concurrent approvals, as appropriate, of the\ncorporation and the state comptroller. None of the foregoing shall limit\nthe commissioner's authority to terminate or impose conditions upon the\noperation of an eligible project pursuant to the provisions of this\nchapter and any implementing regulations thereto;\n (iii) operate and maintain the eligible project in accordance with\napplicable requirements of federal and state law;\n (iv) establish and maintain project accounts in accordance with the\nproject financing agreement and generally accepted government accounting\nstandards;\n (v) establish a dedicated source of revenue (which may include a\ngeneral obligation of the municipality) providing for:\n (a) operation and maintenance costs of the eligible project and\nequipment renewal and replacement; and\n (b) loan repayment regardless of whether the eligible project is in\noperation;\n (vi) permit any reviews or audits and provide assistance determined to\nbe reasonable and necessary by the department or the corporation;\n (vii) retain public ownership of the eligible project; and\n (viii) notwithstanding the provisions of any other law, general,\nspecial or local, inconsistent with this section, delegate to the\ncorporation the authority to invest proceeds of bonds or notes issued by\nthe corporation or the municipality on behalf of the municipality.\n i. An agreement by the corporation to certify, subject to the\navailability of funds, payment upon submission of a satisfactory request\nfor disbursement of loan proceeds by a municipality, of an amount\nequivalent to actual construction costs incurred on or before the date\nof submission of the request for disbursement of loan proceeds, plus any\nprojected construction costs which will be incurred within ninety days\nfrom the date of submission of the request for disbursement of loan\nproceeds, less any funds already advanced;\n j. An agreement in regard to financial assistance provided pursuant to\nparagraph (b) of subdivision four of section twelve hundred\neighty-five-j of the public authorities law, to waive programmatic\nrequirements other than those mandated by federal law and subparagraph\n(i) of paragraph d of subdivision one of this section, provided that the\nproject was in compliance with the goals and requirements of the Federal\nWater Pollution Control Act, prior to July first, nineteen hundred\neighty-eight, or was subject to an administrative or judicial order\nrequiring compliance with the goals and requirements of the Federal\nWater Pollution Control Act prior to September thirtieth, nineteen\nhundred eighty-nine; and\n k. Such other agreements or covenants as may be required in connection\nwith the issuance by the corporation of its bonds or notes.\n 5. For the purpose of implementing the program set forth in this\nsection and section twelve hundred eighty-five-j of the public\nauthorities law, and ensuring compliance with the requirements of Title\nVI of the Federal Water Pollution Control Act, the corporation shall\nensure compliance with each project financing agreement by:\n a. retaining the right to inspect and review work on each eligible\nproject in progress and upon completion, and determining whether such\nwork was undertaken and completed in compliance with all relevant plans\nand the terms of such project financing agreement;\n b. retaining the right to certify or refuse to certify advances and\npayments to a municipality pursuant to a project financing agreement or\nany loan agreement executed subsequent thereto to finance an eligible\nproject;\n c. retaining the right to certify or refuse to certify advances and\npayments to a municipality pursuant to a project financing agreement and\nany loan agreement executed subsequent thereto to finance an eligible\nproject based upon the determinations of any review or audit;\n d. establishing remedies if work on an eligible project has not been\ncompleted in accordance with all relevant plans and the terms of such\nproject financing agreement due to factors within the municipality's\ncontrol; and\n e. requiring a municipality to maintain project accounts with respect\nto any eligible project.\n Nothing herein shall be construed to affect or diminish the general\nauthority of the department to inspect and review the work on any\nproject financed pursuant to this section, or to inspect the records\nrelating to such project, for the purpose of determining compliance with\nany other provisions of this chapter.\n 6. In the event the work completed pursuant to a project financing\nagreement or loan agreement is deemed not in compliance with such\nagreements, the corporation shall expeditiously notify the municipality\nof such non-compliance and indicate the reasons for such determination.\n 7. For the purpose of implementing the program set forth in this\nsection and section twelve hundred eighty-five-j of the public\nauthorities law, and ensuring compliance with the requirements of Title\nVI of the Federal Water Pollution Control Act, the department shall:\n a. Enter into any agreement between the state of New York and the\nadministrator of the United States environmental protection agency and\ntake all other actions necessary to comply with the requirements of\nTitle VI of the Federal Water Pollution Control Act and state law,\nincluding but not limited to:\n (i) determining a reasonable schedule for financing and construction\nof eligible projects;\n (ii) directing the establishment of systems of records or accounts and\nsubaccounts within the water pollution control revolving fund as the\ndepartment deems necessary or desirable, and approving or disapproving\nthe establishment of such record systems or accounts and subaccounts as\nthe corporation requests for the operation of the water pollution\ncontrol revolving loan fund;\n (iii) determining the accounts or subaccounts within the water\npollution control revolving fund which will be used as a source of\nfunding for each eligible project subject to the limitations of\nsubdivision six of this section; and\n (iv) approving each project for qualification as an eligible project.\n b. Arrange in consultation with the corporation for independently\nconducted reviews and audits on at least an annual basis necessary to\ncarry out the objectives of the fund.\n c. Submit a copy of the draft intended use plan to the governor, the\ndirector of the division of the budget, the chairman of the senate\nfinance committee and the chairman of the assembly ways and means\ncommittee on or before October thirty-first, nineteen hundred\neighty-nine and annually on or before such date thereafter and submit a\ncopy of the final intended use plan to such persons upon its approval by\nthe administrator of the United States environmental protection agency.\n 8. The corporation may or, if so directed by the commissioner, the\ncorporation shall provide financial assistance to municipalities as a\nloan pursuant to paragraph (a) of subdivision four of section twelve\nhundred eighty-five-j of the public authorities law from any available\nmoneys in the fund other than the proceeds of the corporation's bonds or\nnotes or moneys needed to comply with subdivision five of section twelve\nhundred eighty-five-j of the public authorities law if and to the extent\nany of the following conditions are met:\n a. The corporation determines that it is unable to, or that it is\nimpracticable to, finance all or a portion of the costs of an eligible\nproject from the proceeds of bonds or notes that are special obligations\nof the corporation; or\n b. The total cost of the eligible project and related segments does\nnot exceed four million dollars where such project and related segments\nservice a municipality with a population of three thousand five hundred\nor less; or\n c. The commissioner or the corporation determines that failure to do\nso would jeopardize the receipt or maintenance of federal capitalization\ngrant moneys, awards or assistance; or\n d. A determination is made by the corporation that the issuance of and\nuse of the proceeds of the corporation's bonds to provide financial\nassistance to municipalities would cause the loss of the tax-exempt\nstatus of any bonds or other obligations of New York state, all or a\nportion of the proceeds of which are appropriated or otherwise\ntransferred into the fund; or\n e. Federal capitalization grants are provided in the form of a letter\nof credit or draws under capitalization grant agreements and the\ncommissioner or the corporation determines, consistent with the purposes\nof the fund, that providing financial assistance from the proceeds of\ncorporation bonds or notes would delay receipt of moneys from the\nfederal government under the Federal Water Pollution Control Act.\n The interest rate charged on any loan made by the corporation pursuant\nto this subdivision shall be no more than two-thirds of the market rate\nof interest otherwise applicable thereto, provided, however, that in the\ncase of any municipality which has, during the period commencing on June\nfirst, nineteen hundred ninety-two and ending on September thirtieth,\ntwo thousand twenty-seven, (i) submitted an application for financial\nassistance in the form of a loan from the corporation pursuant to this\nsubdivision, for an eligible project, which application has been\naccepted by the corporation, (ii) closed on such loan, and (iii)\ncommenced construction of such eligible project, the interest rate\ncharged on such loan shall be no more than one-half of the market rate\notherwise applicable thereto.\n 9. The contracts for the construction of eligible projects constructed\nand financed pursuant to a project financing agreement shall be subject\nto the requirements and provisions of article 15-A of the executive law\nand, for such purposes, any such contract shall be considered a "state\ncontract" and the department shall be the "contracting agency" for each\nsuch contract.\n 10. Notwithstanding the provisions of any other law, general, special\nor local, the following determinations shall be made by the corporation\nin its sole and absolute discretion:\n (a) In connection with any application for financial assistance from\nthe fund in the form of a loan from the proceeds of bonds or notes of\nthe corporation, the determination as to whether the municipality\nreceiving such loan has qualified for an allocation of fifty percent of\nthe principal amount of such loan outstanding at any time, pursuant to\nsubdivision three of this section; and\n (b) In connection with any application for financial assistance from\nthe fund in the form of a loan from the corporation pursuant to\nsubdivision eight of this section, where the municipality receiving such\nloan is not qualified for an interest rate of zero percent, the\ndetermination as to whether such municipality has qualified for an\ninterest rate of one-half of the market rate otherwise applicable\nthereto, pursuant to subdivision eight of this section.\n