§ 123.00 — Exclusion of self-liquidating indebtedness in ascertaining the power of a municipality to contract indebtedness

New York § 123.00

• Jurisdiction: New York
• Law LFN: Local Finance
• Title 9: Procedures Relating to the Ascertainment of Amounts to Be Included or Excluded In Ascertaining Debt-contracting Power
• Art. 2: Local Indebtedness

Text

§ 123.00 Exclusion of self-liquidating indebtedness in ascertaining\nthe power of a municipality to contract indebtedness. a. As used in this\nsection: 1. The term "outstanding indebtedness", shall mean indebtedness\nevidenced by bonds and bond anticipation notes.\n 2. The term "public improvement" shall mean either a single\nimprovement or a group of improvements, which are maintained for the\nsame purpose, including improvements used primarily in connection\ntherewith, and which are producing or are intended to produce revenue.\n b. 1. In ascertaining the power of a municipality to contract\nindebtedness, there may be excluded, to the extent permitted in\nparagraph e of this section, the outstanding indebtedness contracted by\nany such municipality for a public improvement or part thereof, or\nservice, owned or rendered by such municipality if such public\nimprovement or part thereof, or service, shall have yielded net revenue\nto such municipality during the preceding fiscal year in a sum equal to\ntwenty-five per centum or more of the amount required in such year for\nthe payment of the interest on and amortization of, or payment of, such\noutstanding indebtedness.\n 2. The outstanding indebtedness of a district corporation, as the term\n"district corporation" is defined in paragraph a of section 102.00 of\nthis chapter, contracted on or after January first, nineteen hundred\nthirty-nine, may be excluded, to the extent permitted in paragraph e of\nthis section, in ascertaining the indebtedness of a city or village\nwithin which, or of a town within the unincorporated area of which, such\ndistrict corporation is situated in whole or in part, if such\noutstanding indebtedness was contracted for a public improvement or part\nthereof, or service, owned or rendered by such district corporation and\nif such public improvement or part thereof, or service, shall have\nyielded net revenue to such district corporation during the preceding\nfiscal year of the district corporation in a sum equal to twenty-five\nper centum or more of the amount required in such year for the payment\nof the interest on and amortization of, or payment of, such outstanding\nindebtedness.\n 3. In ascertaining the power of a county or town to contract\nindebtedness, there may be excluded, to the extent permitted in\nparagraph e of this section, the outstanding indebtedness contracted by\nany such county or town on behalf of an improvement district for a\npublic improvement or part thereof, or service, owned or rendered by\nsuch district if such public improvement or part thereof, or service,\nshall have yielded net revenue to such district during the preceding\nfiscal year in a sum equal to twenty-five per centum or more of the\namount required in such year for the payment of the interest on and\namortization of, or payment of, such outstanding indebtedness.\n c. 1. A proportionate exclusion of indebtedness contracted or proposed\nto be contracted also may be granted for the period from the date when\nsuch indebtedness is first contracted or to be contracted for a public\nimprovement or part thereof, or service, owned or rendered or to be\nowned or rendered by a municipality, district corporation, or county or\ntown improvement district through the first year of operation of such\npublic improvement or part thereof, or service. The amount of such\nexclusion shall be computed in the manner provided in this section on\nthe basis of estimated net revenue for the first year of operation. Such\nestimated net revenue shall be determined by deducting from the gross\nrevenues estimated to be received during the first year of operation of\nsuch public improvement or part thereof, or service, all estimated costs\nof operation, maintenance and repairs for such year. The amount of any\nsuch proportionate exclusion shall not exceed seventy-five per centum of\nthe amount which would be excluded if the computation were made on the\nbasis of net revenue instead of estimated net revenue. The term\n"indebtedness," as used in this subdivision means indebtedness which\nwould be included in ascertaining the power of a municipality to\ncontract indebtedness, including indebtedness evidenced or to be\nevidenced by bonds or bond anticipation notes.\n 2. A proportionate exclusion of outstanding indebtedness may be\ngranted, to the extent permitted in paragraph e of this section, in the\nfiscal year in which the first year of operation of a public improvement\nor part thereof, or service, is completed if the improvement or part\nthereof, or service, shall have yielded net revenue during the first\nyear of operation in a sum equal to twenty-five per centum or more of\nthe amount required in such year for the payment of the interest on and\namortization of, or payment of, such indebtedness.\n d. The net revenue of a public improvement or part thereof, or\nservice, shall be determined by deducting from its gross revenues of a\nyear all costs of operation, maintenance and repairs for such year.\nTaxes, assessments, and subsidies by the municipality or district\ncorporation, shall not be included in computing gross revenues.\n e. The maximum amount of any such outstanding indebtedness which may\nbe so excluded shall be in the same proportion to the total amount of\nany such indebtedness as the amount of any such net revenue shall bear\nto the amount required in any such year for the payment of the interest\non and amortization of, or payment of, any such indebtedness.\n f. Where an exclusion has been granted pursuant to this section, the\nrevenues of such public improvement or part thereof, or service, for the\nperiod for which the exclusion is granted, shall be applied to and\nactually used for payment of all costs of operation, maintenance and\nrepairs for such period, and payment of the amounts required in such\nperiod for interest on and amortization of or redemption of the\nindebtedness excluded, or such revenues shall be deposited in a special\nfund to be used solely for such payments. The application and use of\nsuch payments or the deposits required therefor shall not prohibit a\nmunicipality, district corporation or improvement district from using\nany such revenues, in excess of such payments or deposits, for any\nlawful purpose of the municipality, district corporation or improvement\ndistrict.\n g. An application may be filed with the state comptroller for the\npurpose of obtaining an exclusion of such indebtedness. Such application\nshall be made on behalf of any municipality by its chief fiscal officer\nin his discretion, or by its chief fiscal officer on the direction of\nits finance board, and on behalf of any district corporation by its\nfinance board. If the finance board of a district corporation shall\nrefuse or fail to make such application, the application may be made by\nthe municipality seeking an exclusion of indebtedness. The application\nshall be verified by the chief fiscal officer or finance board making\nthe application. The application shall be in such form and shall contain\nsuch information as shall be prescribed by the state comptroller.\n h. Within fifteen days after the filing of such application with the\nstate comptroller, such chief fiscal officer or such finance board\nmaking the application shall cause a notice to be published that such\napplication has been filed with the state comptroller. Such notice shall\nbe published in the official newspaper or newspapers of the municipality\nor district corporation, or if there be no such newspaper or newspapers,\nthen the finance board of the municipality or district corporation shall\ndesignate one or more newspapers having a general circulation in such\nmunicipality or district corporation for the publication of such notice.\nThe notice also shall contain a statement of the amount of indebtedness\nfor which a proportionate exclusion is sought and a brief description of\nthe public improvement or part thereof, or service. Proof of publication\nof such notice shall be filed in the office of the state comptroller. A\ncopy of the application and of all financial statements, documents,\ncomputations and other data and information which will be submitted by\nthe chief fiscal officer of such municipality or the finance board of\nsuch district corporation to the state comptroller in support of such\napplication shall be filed in the office of such chief fiscal officer or\nfinance board and shall be public records.\n i. After the filing of such application, the state comptroller shall\nreview the facts set forth therein. The state comptroller shall have the\npower to examine the accounts and records of the municipality, district\ncorporation or improvement district with respect to such public\nimprovement or part thereof, or service. He may also require the chief\nfiscal officer and other public officers, boards and agencies of such\nmunicipality, district corporation or improvement district to furnish\nsuch additional data and information in their possession as he deems\nnecessary to enable him to make his determination.\n j. In the case of a municipality, the state comptroller shall issue a\nwritten certificate setting forth his determination as to the extent to\nwhich any such indebtedness may be excluded. If an exclusion is allowed\nby the state comptroller, such certificate shall constitute the\nauthorization for the exclusion of such amount of such indebtedness in\nascertaining the power of such municipality to contract indebtedness. In\nthe case of a district corporation, the state comptroller shall issue a\nwritten certificate setting forth his determination as to the extent to\nwhich any such indebtedness shall be excluded in ascertaining the\nindebtedness of a city or village within which, or of a town within the\nunincorporated area of which, such district corporation is situated in\nwhole or in part. If an exclusion is allowed by the state comptroller,\nsuch certificate shall constitute the authorization for the exclusion of\nsuch amount of such indebtedness in ascertaining the power of such city,\nvillage or town to contract indebtedness. If the state comptroller\ndisallows the application, the certificate shall set forth the reasons\nfor such disallowance. The determination of the state comptroller shall\nbe conclusive. The certificate of the state comptroller shall not be\nissued until ten days after the filing of such proof of publication in\nthe office of the state comptroller and shall be issued within\nforty-five days after such filing. The certificate of the state\ncomptroller granting an exclusion shall be effective until the first day\nof the fourth month following the close of the fiscal year in which the\napplication is made, except that where the application is made in\nconnection with a public improvement or part thereof, or service, which\nhas not been in operation for one year the certificate shall be\neffective until the first day of the fourth month following the close of\nthe first year of operation. The certificate of the state comptroller\nshall be executed under his hand and seal in duplicate. One of such\ncertificates shall be filed in the department of audit and control and\nthe other in the office of the chief fiscal officer of such municipality\nor in the office of the finance board of the district corporation. Both\nof such certificates shall be public records.\n k. The provisions of this section shall not affect or impair any\nexisting exclusions of indebtedness, or the power to exclude\nindebtedness granted by any other provision of this chapter or the\nconstitution.\n