§ 1285-J — Water pollution control revolving fund

New York § 1285-J

• Jurisdiction: New York
• Law PBA: Public Authorities
• Title 12: New York State Environmental Facilities Corporation
• Art. 5: Public Utility Authorities

Text

§ 1285-j. Water pollution control revolving fund. 1. (a) The\ncorporation shall undertake and provide assistance in support of the\nprogram to make financial assistance available to municipalities to\nencourage and support the planning, development and construction of\nmunicipal water pollution control projects in accordance with the\nprovisions of this section, section 17-1909 of the environmental\nconservation law, and to make financial assistance available to eligible\nborrowers through linked deposits made in accordance with article\nsixteen of the state finance law.\n (b) There is hereby established in the custody of the corporation a\nspecial fund to be known as the water pollution control revolving fund.\nMoneys in the water pollution control revolving fund shall be segregated\nfrom all other funds of or in the custody of the corporation subject to\nany rights of holders of corporation bonds or notes issued for the\npurposes of this section. Moneys in the water pollution control\nrevolving fund shall only be used in accordance with the provisions of\nthis section and section 17-1909 of the environmental conservation law.\nThe moneys in such fund shall be applied to or paid out for authorized\npurposes of such fund on the direction of the chairman of the\ncorporation in accordance with subdivision four of this section and\nsection 17-1909 of the environmental conservation law, or such other\nperson as the corporation shall authorize to make such direction. In\nconsultation with the director of the division of the budget, the\ncorporation may, subject to subparagraph (ii) of paragraph a of\nsubdivision seven of section 17-1909 of the environmental conservation\nlaw, and shall, at the direction of the commissioner of environmental\nconservation pursuant to such subdivision, establish within the water\npollution control revolving fund additional accounts or subaccounts and\nspecify any conditions applicable to the transfer of moneys between such\naccounts or subaccounts. With respect to each eligible project, the\ncorporation shall establish and maintain a record of the allocation\nprovided for the benefit of such project in accordance with the terms of\nthe applicable project financing agreement or loan agreement.\n 2. As used in this section, the terms "allocation", "construction",\n"eligible project", "fund", and "project financing agreement" shall have\nthe meanings set forth in section 17-1909 of the environmental\nconservation law.\n 3. Such fund shall consist of all of the following: (a) federal\ncapitalization grants and awards or other federal assistance provided\npursuant to Title II or Title VI of the Federal Water Pollution Control\nAct, exclusive of any such grants, awards or assistance available under\nTitle II, except as may be necessary to avoid the loss to New York state\nof any unobligated Title II money which can not be made available as a\ngrant or grant increase to a municipality, for purposes of deposit in\nthe fund and appropriated by the state for deposit therein, (b) federal\ncapitalization grants and awards or other federal assistance provided\npursuant to, or for the purposes of, the Omnibus Consolidated\nRescissions and Appropriations Act of 1996 (Pub. L. 104-134) or wet\nweather quality grants as provided in the Consolidated Appropriations\nAct of 2001 (Pub. L. 106-554), (c) moneys appropriated by the state\nlegislature for the purpose of such fund or otherwise transferred by the\nstate for deposit therein by the comptroller as required by law, (d)\npayments of principal and interest made by municipalities pursuant to\nloan or other agreements entered into pursuant to subdivisions eight and\nnine of this section: provided, however, if such loans were financed by\nthe issuance of bonds or notes of the corporation, deposit of such\npayments into the fund shall be subject to the rights of the holders of\nsuch bonds or notes to receive such moneys, (e) investment earnings on\namounts in such fund, (f) any other payments received from\nmunicipalities pursuant to a loan or other agreement made pursuant to\nsubdivisions eight and nine of this section for costs of managing and\nadministering the program, (g) the proceeds of bonds or notes issued by\nthe corporation for purposes of providing financial assistance to\nmunicipalities, (h) the balance of any fees or penalties paid pursuant\nto the terms and conditions of a compliance or enforcement agreement for\nviolations of the federal Marine Protection, Research and Sanctuaries\nAct, as amended (33 U.S.C. §§ 1401 et seq.), occurring prior to December\nthirty-first, nineteen hundred ninety-four, after payment has been made\nto the administrator of the United States environmental protection\nagency, a trust account, the ocean dumping alternatives account, and (i)\nthe balance of any amount in a trust account or, if applicable,\nmunicipal trust accounts of the clean oceans fund upon a finding by the\nadministrator of the United States environmental protection agency that\nfees or penalties were not paid into such trust account or municipal\ntrust account as required by the Marine Protection, Research, and\nSanctuaries Act, or an applicable compliance or enforcement agreement.\n 4. Moneys in the water pollution control revolving fund shall be\napplied by the corporation to provide financial assistance to\nmunicipalities for construction of eligible projects and, upon\nconsultation with the director of the division of the budget and the\ncommissioner, for such other purposes permitted by the Federal Water\nPollution Control Act, as amended, and to provide for the administrative\nand management costs of the program. All moneys from federal\ncapitalization grants and awards or other federal assistance made\navailable pursuant to, or for the purposes of, the Omnibus Consolidated\nRescissions and Appropriations Act of 1996 (Pub. L. 104-134) or wet\nweather quality grants as provided in the Consolidated Appropriations\nAct of 2001 (Pub. L. 106-554), which are deposited into the water\npollution control fund pursuant to subdivision three of this section,\nand any corresponding state match moneys, may be used by the corporation\nfor the purposes permitted by the Omnibus Consolidated Rescissions and\nAppropriations Act of 1996 (Pub. L. 104-134) or wet weather quality\ngrants as provided in the Consolidated Appropriations Act of 2001 (Pub.\nL. 106-554), and for no other purposes. As used in this section\n"financial assistance to municipalities" means any one or more of the\nfollowing:\n (a) making loans to municipalities for construction of eligible\nprojects, provided such loans (i) are made at market or below market\nrates, (ii) do not have a final maturity of more than twenty years\nfollowing scheduled completion of the eligible project, (iii) have\nprincipal and interest payments which commence not later than one year\nafter scheduled completion of the eligible project, and (iv) require the\nmunicipality to establish a dedicated source of revenue (which may be a\ngeneral obligation of the municipality); unless otherwise determined by\nthe corporation or directed by the commissioner of environmental\nconservation pursuant to subdivision eight of section 17-1909 of the\nenvironmental conservation law, the corporation shall make such loans\nonly from the proceeds of the corporation's bonds or notes issued for\npurposes of this section;\n (b) buying or refinancing debt obligations of municipalities at market\nor below market rates, if work was commenced and debt was incurred for\nthe eligible project after March seventh, nineteen hundred eighty-five;\n (c) guarantying, or purchasing insurance or other credit enhancement\nfor municipal obligations where such action would improve credit market\naccess for or reduce interest rates on such municipal obligations;\n (d) providing a source of revenue or security for payment of principal\nand interest on bonds or notes issued by the corporation if the proceeds\nof the sale of such bonds or notes will be deposited in the fund;\n (e) providing interest rate subsidy allocations to subsidize loans to\nmunicipalities made from the proceeds of the corporation's bonds or\nnotes;\n (f) using investment earnings on moneys in the fund to pay, pursuant\nto subdivision seven of this section, the costs of the corporation and\nthe department of environmental conservation of administering and\nmanaging the program described in this section and section 17-1909 of\nthe environmental conservation law.\n Subject to any applicable provisions of federal or state law, any\nfinancial assistance at an interest rate of zero percent provided to\nmunicipalities that meet the financial hardship criteria regulations\nestablished pursuant to section 17-1909 of the environmental\nconservation law, may have a final maturity up to forty years following\nscheduled completion of the eligible project.\n 5. The corporation may make payments to the sewage treatment program\nmanagement and administration fund in accordance with subdivision seven\nof this section to reimburse such fund for expenditures made pursuant to\nappropriation to pay the cost of the corporation and the department of\nenvironmental conservation for administering and managing the water\npollution control revolving fund program established in section\nninety-seven-l of the state finance law, for such costs. Such\nreimbursement shall be made from (a) available investment earnings on\nall amounts in the water pollution control revolving fund excluding all\namounts in the fund which are the subject of allocations or other\nfinancial assistance to a municipality; and (b) payments received from a\nmunicipality for such purpose pursuant to a project financing agreement\nor loan agreement; and (c) if the sources of revenue described in this\nparagraph and paragraphs (a) and (b) of this subdivision are or are\nanticipated to be insufficient, then from the proceeds of federal\ncapitalization grants, awards or assistance appropriated to the fund for\nadministration and management of such program.\n Notwithstanding the foregoing, if the sources of revenues described in\nparagraphs (a), (b) and (c) of this subdivision are at any time\ninsufficient to make a reimbursement to the state pursuant to this\nsubdivision when due, the corporation shall make such reimbursement from\nany other available amounts in the water pollution control revolving\nfund, excluding all amounts that are the subject of allocations,\nprovided, that the amounts paid from fund sources other than those\ndescribed in paragraphs (a), (b) and (c) of this subdivision shall be\nreimbursed upon a determination by the director of the budget that\nfuture revenues obtained from sources described in paragraphs (a), (b)\nand (c) of this subdivision are in excess of the amounts reasonably\nneeded to make future reimbursements pursuant to this subdivision.\n * 6. Moneys in the water pollution control revolving fund may be\ninvested as provided in subdivision four of section twelve hundred\neighty-four of this title and may be further invested (a) in investment\nagreements continuously secured by obligations with any insurance or\nreinsurance company or corporate affiliate thereof rated by a nationally\nrecognized rating agency in one of its two highest categories, any bank,\ntrust company or broker or dealer, as defined by the securities exchange\nact of 1934, which is a dealer in government bonds, which reports to,\ntrades with and is recognized as a primary dealer by a federal reserve\nbank and is a member of the securities investors protection corporation,\nif, (i) such obligations securing such investment agreements are\nobligations as set forth in section ten of the general municipal law,\n(ii) such obligations are delivered to a trustee for the benefit of the\ncorporation or, with respect to moneys pledged under an indenture of\ntrust relating to bonds or notes of the corporation, to the trustee\nunder such indenture, or are supported by a safe keeping receipt issued\nby a depository satisfactory to the corporation as applicable, provided\nthat such investment agreements must provide that the value of the\nunderlying obligations shall be maintained at a current market value,\ncalculated no less frequently than monthly, of not less than the amount\ndeposited thereunder, (iii) a prior perfected security interest in the\nobligations which are securing such agreement has been granted to the\ncorporation, as applicable, and (iv) such obligations are free and clear\nof adverse third party claims, or (b) in obligations as set forth in\nsection ten of the general municipal law that are rated by a nationally\nrecognized rating agency in one of its two highest rating categories.\n * NB Effective until September 30, 2026\n * 6. Moneys in the water pollution control revolving fund may be\ninvested as provided in subdivision four of section twelve hundred\neighty-four of this title and may be further invested (a) in investment\nagreements continuously secured by obligations with any insurance or\nreinsurance company or corporate affiliate thereof rated by a nationally\nrecognized rating agency in one of its two highest categories, any bank,\ntrust company or broker or dealer, as defined by the securities exchange\nact of 1934, which is a dealer in government bonds, which reports to,\ntrades with and is recognized as a primary dealer by a federal reserve\nbank and is a member of the securities investors protection corporation,\nif, (i) such obligations securing such investment agreements are\nobligations as set forth in section ten of the general municipal law,\n(ii) such obligations are delivered to a trustee for the benefit of the\ncorporation or, with respect to moneys pledged under an indenture of\ntrust relating to bonds or notes of the corporation, to the trustee\nunder such indenture, or are supported by a safe keeping receipt issued\nby a depository satisfactory to the corporation as applicable, provided\nthat such investment agreements must provide that the value of the\nunderlying obligations shall be maintained at a current market value,\ncalculated no less frequently than monthly, of not less than the amount\ndeposited thereunder, (iii) a prior perfected security interest in the\nobligations which are securing such agreement has been granted to the\ncorporation, as applicable, and (iv) such obligations are free and clear\nof adverse third party claims, or (b) in obligations the interest on\nwhich is excludable from gross income under section one hundred three of\nthe internal revenue code, provided that such obligations are rated by a\nnationally recognized rating agency in one of its two highest rating\ncategories.\n * NB Effective September 30, 2026\n 7. The corporation may transfer to the sewage treatment program\nmanagement and administration fund established pursuant to section\nninety-seven-l of the state finance law no less frequently than\nsemi-monthly amounts from the fund sufficient to reimburse the sewage\ntreatment program management and administration fund in accordance with\nthe provisions of subdivision five of this section.\n 8. In addition to the powers of the corporation granted elsewhere in\nthis chapter, the corporation shall have the power to enter into project\nfinancing agreements authorized by section 17-1909 of the environmental\nconservation law. Notwithstanding the powers granted to the corporation\nelsewhere in this title, the corporation's power to finance eligible\nprojects from the fund is limited to eligible projects for which project\nfinancing agreements have been executed pursuant to section 17-1909 of\nthe environmental conservation law.\n 9. In addition to the powers granted to the corporation elsewhere in\nthis chapter, the corporation may make loans to municipalities for\npurposes of financing eligible projects for which the fund may be used,\nsubject to the limitations of subdivision eight of this section, may\naccept the obligations of any municipality as security for the repayment\nof a loan to such municipality, and may assign and pledge such municipal\nobligations and loan agreements for the benefit of the holder of\nobligations of the corporation from the proceeds of which such loans are\nmade. Loan proceeds may be disbursed to a municipality in accordance\nwith such restrictions as may be imposed by the corporation in\nconnection with such loan or obligations of the corporation from the\nproceeds of which such loan is made.\n 10. The corporation is authorized to arrange for any audits required\nby law for the purpose of issuing its bonds or notes to provide\nfinancial assistance to municipalities, and provide for the\nimplementation of any independently conducted reviews or audits arranged\npursuant to subdivision seven of section 17-1909 of the environmental\nconservation law.\n 11. In the event a municipality shall fail to make any payment due the\ncorporation pursuant to any loan agreement, financing agreement, or\nother obligation of the municipality sold to the corporation or issued\nas security for the undertaking of the municipality thereunder, the\ncorporation shall certify to the comptroller, and notify the chairman of\nthe senate finance committee, the chairman of the assembly ways and\nmeans committee, the director of the division of the budget and the\ngoverning body of the municipality that such municipality has failed to\nmake such payment. Such certificate shall be in such form as may be\ndetermined by the corporation provided such certificate shall specify\nthe exact amount of debt service and surcharge, if applicable, required\nto satisfy such municipality's unpaid obligation. The comptroller, upon\nreceipt of such certificate from the corporation, is authorized to and\nshall, to the extent not otherwise prohibited by law and subject to any\nother provision of law providing for withholding of payments to the\nmunicipality which take precedence over this subdivision, withhold from\nsuch municipality the next succeeding payments of state aid or local\nassistance otherwise payable to it to the extent necessary to meet the\ncertified amount of debt service and surcharge, if applicable, due the\ncorporation and shall immediately pay over to the corporation as a debt\nservice payment on behalf of such municipality the amount so withheld.\n 12. (a) Notwithstanding the provisions of any general or special law\nto the contrary, the commissioner of environmental conservation on\nbehalf of the state and the corporation, subject to the approval of the\ndirector of the budget, are each hereby authorized to enter into a state\nrevolving fund service contract or contracts providing for the\nadministration of the water pollution control revolving fund and the\nfinancing by the corporation of the contributions made by the state to\nthe water pollution control revolving fund. Any such contract or\ncontracts shall be upon such terms and conditions as the corporation and\nthe commissioner of environmental conservation shall determine to be\nreasonable, including, but not limited to, provisions relating to the\nrespective obligations of the state and the corporation with respect to\nthe administration of the water pollution control revolving fund and\nprovisions providing for the payment of (i) all fees and other charges\nof, and expenses incurred by, the corporation in connection with the\nissuance and administration of special obligation bonds to provide funds\nto the state or reimburse the state for contributions to the water\npollution control revolving fund and (ii) all debt service payments on\nsuch bonds.\n (b) Any such contract entered into pursuant to paragraph (a) of this\nsubdivision shall provide that the obligation of the state to fund or to\npay the amounts therein provided for shall not constitute a debt of the\nstate within the meaning of any constitutional or statutory provision\nand shall be deemed executory only to the extent of moneys available\ntherefore and that no liability shall be incurred by the state beyond\nthe moneys available for such purpose, and that such obligation is\nsubject to annual appropriation by the legislature.\n (c) Any such contract or any payments made or to be made thereunder\nmay be assigned and pledged by the corporation as security for its bonds\nand notes issued for the purpose of financing the state contribution to\nthe water pollution control revolving fund.\n (d) The comptroller is hereby authorized to receive from the\ncorporation any portion of special obligation bond proceeds paid to\nprovide funds to or reimburse the state for its contribution to the\nwater pollution control revolving fund and to credit such amounts to the\ncapital projects fund or any other appropriate fund.\n 13. In addition to the powers granted to the corporation in this\nsection, the corporation is authorized to exercise the powers, perform\nthe responsibilities and take the actions assigned to it under section\n17-1909 of the environmental conservation law.\n