§ 1823 — Further restrictions on loans and loan guarantees

§ 1823. Further restrictions on loans and loan guarantees. In addition\nto other provisions of this title limiting the power of the authority to\nmake loans to local development corporations in respect of a particular\nproject, and to guarantee loans made by banking organizations, the\nfollowing restrictions shall also apply:\n 1. No funds of the authority shall be used in respect of any project\nif the completion thereof would result in the removal of an industrial\nor manufacturing plant or research and development facility or other\neligible business facility of the project occupant from one area of the\nstate to another area of the state or in the abandonment of one or more\nplants or facilities of the project occupant located within the state,\nprovided, however, that neither restriction shall apply if the authority\nshall determine on the basis of the application before it that the\nproject is reasonably necessary to discourage the project occupant from\nremoving such other plant or facility to a location outside the state or\nis reasonably necessary to preserve the competitive position of the\nproject occupant in its respective industry.\n 2. No funds of the authority shall be used in respect of any project\nif the authority would be required to operate, service or maintain the\nproject pursuant to any lease or other agreement except upon foreclosure\nor except upon the occurrence of a default in the payment or terms of\nany loan guaranteed by the authority, provided, however, notwithstanding\nany other provision of this subtitle, the authority may take title to a\nproject under a financing lease which does not require the authority to\noperate, service or maintain the project itself, and which provides for\npayments in lieu of property taxes as approved by the local taxing\njurisdiction which are equal to or less than any property taxes which\nwould have been due had the authority not taken title to the property.\nNothing shall prevent the authority from transferring such property to\nthe project occupant or its designee at the end of the term of such\nfinancing.\n 3. No funds of the authority shall be used for a project unless the\napplicant shows to the satisfaction of the authority that funds equal to\nthe amount of the proposed loan from the authority are not reasonably\navailable from other sources at a comparable cost of borrowing.\n 4. No funds of the authority shall be used in violation of any further\nrestrictions imposed by general rule or regulation of the authority in\nrelation to assisted projects and the authority is hereby authorized to\nadopt rules and regulations containing such restrictions as it may deem\nnecessary or appropriate to effectuate its corporate purposes.\n 5. No provision of this title shall prevent the inclusion in a\nmortgage, lease or other agreement relating to an assisted project of a\nprovision granting the project occupant the right to purchase such\nproject upon such terms and conditions as the authority may approve.\n 6. No funds of the authority shall be loaned or used for any project\nunless the applicant demonstrates to the authority that such project has\na valid permit or permits for the following, when such permits are\nrequired pursuant to applicable federal, state or local law: the\ngeneration, treatment, storage and disposal of hazardous wastes; the\ndischarge of pollutants into the waters of the state, or, if such a\nplant or facility is in violation thereof, that the project contemplated\nincludes the elimination of any such violation or violations.\n 7. Loans in economically distressed areas and to companies in need of\nspecial assistance. (a) Loans by the authority pursuant to paragraphs\n(a) and (b) of subdivision two of section eighteen hundred three of this\nchapter may exceed forty percent but shall not exceed sixty percent of\nthe cost of the project for:\n (i) projects which are or will be located in empire zones designated\npursuant to article eighteen-b of the general municipal law or in areas\nthat meet, in accordance with the most recent census data available, the\nfollowing criteria:\n (A) the area must have a poverty rate of at least twenty percent for\nthe year to which the data relate; and\n (B) the area must have an unemployment rate of at least one hundred\ntwenty-five percent of the statewide unemployment rate for the year to\nwhich the data relate;\n (ii) projects involving companies in need of special assistance as\ndetermined by the findings of the members of the authority that such\ncompanies are unable to obtain a sufficient amount of financing at\nprevailing market rates of interest for businesses of similar size in\nthe same industry in New York state.\n (b) In determining eligibility for loans involving companies in need\nof special assistance pursuant to subparagraph (ii) of paragraph (a) of\nthis subdivision, the members of the authority shall consider:\n (i) the applicant's potential for creating jobs in New York state;\n (ii) the benefits derived from the project in the community in which\nthe project is or will be located;\n (iii) the interaction of a project with economic development programs\nadministered by the department of economic development, the New York\nstate urban development corporation and the New York state science and\ntechnology foundation;\n (iv) the meaningful participation of minority and women-owned business\nenterprises and minority group members and women in a project;\n (v) the degree to which the project will support apprenticeship\ntraining;\n (vi) compliance with the provisions of section eighteen hundred\ntwenty-six of this chapter with regard to the project occupant; and\n (vii) in consultation with the department of economic development, the\neligibility of the applicant for assistance under the industrial\neffectiveness program pursuant to article seven of the economic\ndevelopment law.\n (c) In addition to the rules and regulations promulgated with regard\nto loans made by the authority under other provisions of this title, the\nmembers of the authority shall also promulgate rules and regulations\npertaining to the loans made under subparagraphs (i) and (ii) of\nparagraph (a) of this subdivision by December first, nineteen hundred\nninety-two.\n (d) On an annual basis, the authority shall compile and publish:\n (i) in consultation with the department of economic development, a\nlisting of economically distressed areas as defined in subparagraph (i)\nof paragraph (a) of this subdivision.\n (ii) the criteria for determining the eligibility of a project that is\nin need of special assistance under subparagraph (ii) of paragraph (a)\nof this subdivision.\n (e) All otherwise applicable requirements and restrictions of this\ntitle shall apply to projects that are described in paragraph (a) of\nthis subdivision, provided, however, that in the case of projects which\ninvolve the relocation of economic activity from another municipality\nwithin New York state, the authority shall also find that the project\noccupant has made reasonable efforts to carry out the project within the\nmunicipality from which the project occupant intends to move an\nindustrial, or manufacturing plant, or research and development\nfacility, or other eligible business facility.\n