§ 2408 — Reserve funds and appropriations

§ 2408. Reserve funds and appropriations. (1) The agency may create\nand establish one or more reserve funds to be known as debt service\nreserve funds and pay into any such reserve fund (a) any moneys\nappropriated by the state for the purposes of such fund, (b) any\nproceeds of sale of bonds and notes to the extent provided in the\nresolution of the agency authorizing the issuance thereof, (c) any\nmoneys directed to be transferred by the agency to such debt service\nreserve fund, and (d) any other moneys made available to the agency for\nthe purposes of such fund from any other source or sources. The moneys\nheld in or credited to any debt service reserve fund established under\nthis subdivision, except as hereinafter provided, shall be used solely\nfor the payment of the principal of bonds of the agency secured by such\ndebt service reserve fund, as the same mature, required payments to any\nsinking fund established for the amortization of such bonds (hereinafter\nreferred to as "sinking fund payments"), the purchase or redemption of\nsuch bonds of the agency, the payment of interest on such bonds of the\nagency or the payment of any redemption premium required to be paid when\nsuch bonds are redeemed prior to maturity, provided, however, that\nmoneys in such fund shall not be withdrawn therefrom at any time in such\namount as would reduce the amount of such fund to less than the maximum\namount of the principal and interest maturing and becoming due in any\nsucceeding state fiscal year on the bonds of the agency then outstanding\nand secured by such reserve fund, except for the purpose of paying the\nprincipal of and interest on such bonds of the agency secured by such\nreserve fund maturing and becoming due and sinking fund payments for the\npayment of which other moneys of the agency are not available. Any\nincome or interest earned by, or increment to, any such debt service\nreserve fund due to the investment thereof may be transferred to any\nother fund or account of the agency to the extent it does not reduce the\namount of such debt service reserve fund below the maximum amount of\nprincipal and interest maturing and becoming due in any succeeding state\nfiscal year on all bonds of the agency then outstanding and secured by\nsuch reserve fund. Moneys in any debt service reserve fund not required\nfor immediate use or disbursement may be invested in obligations of the\nstate or the United States of America or obligations the principal and\ninterest of which are guaranteed by the state or the United States of\nAmerica or in obligations of any agency of the state or the United\nStates of America which may from time to time be legally purchased by\nsavings banks within the state as an investment of funds belonging to\nthem or in their control. In computing the amount of any debt service\nreserve fund for the purposes of this section, securities in which all\nor a portion of such reserve fund are invested shall be valued at par\nor, if purchased at less than par, at their cost to the agency. If the\nagency shall create and establish one or more debt service reserve funds\nas herein provided, the agency shall not issue bonds at any time if the\nmaximum amount of principal and interest maturing and becoming due in a\nsucceeding state fiscal year on the bonds outstanding and then to be\nissued and secured by a debt service reserve fund will exceed the amount\nof such reserve fund at the time of issuance, unless the agency, at the\ntime of issuance of such bonds, shall deposit in such reserve fund from\nthe proceeds of the bonds to be issued, or otherwise an amount which\ntogether with the amount then in such reserve fund, will be not less\nthan the amount of principal and interest maturing and becoming due in\nany succeeding state fiscal year on the bonds then to be issued and on\nall other bonds of the agency then outstanding and secured by such\nreserve fund.\n (2) To assure the continued operation and solvency of the agency for\nthe carrying out of the public purposes of this act, provision is made\nin subdivision one of this section for the accumulation in each debt\nservice reserve fund of an amount equal to the maximum amount of\nprincipal and interest maturing and becoming due in any succeeding state\nfiscal year on all bonds of the agency then outstanding and secured by\nsuch reserve fund. In order to further assure the continued operation\nand solvency of the agency for the fulfillment of its corporate\npurposes, there shall be annually apportioned and paid to the agency for\ndeposit in each debt service reserve fund such sum, if any, as shall be\ncertified by the chairman of the agency to the governor and director of\nthe budget, as necessary to restore any such debt service reserve fund\nto an amount equal to the maximum amount of principal and interest\nmaturing and becoming due in any succeeding state fiscal year on the\nbonds of the agency then outstanding and secured by such reserve fund;\nin which case such sum so apportioned and paid shall be deposited by the\nagency in such debt service reserve fund. The principal amount of bonds\nsecured by a debt service reserve fund or funds to which state funds are\napportionable pursuant to this subdivision shall be limited to the total\namount of bonds and notes outstanding on the effective date of this act,\nplus the total amount of bonds and notes contracted after the effective\ndate of this act to finance projects in progress on the effective date\nof this act as determined by the New York state public authorities\ncontrol board created pursuant to section fifty of this chapter whose\naffirmative determination shall be conclusive as to all matters of law\nand fact solely for the purposes of the limitations contained in this\nsubdivision, but in no event shall the total amount of bonds so secured\nby such a debt service reserve fund or funds exceed three hundred\neighty-seven million dollars, excluding bonds issued to refund such\noutstanding bonds until the date of redemption of such outstanding\nbonds. As outstanding bonds so secured are paid, the amount so secured\nshall be reduced accordingly but the redemption of such outstanding\nbonds from the proceeds of refunding bonds shall not reduce the amount\nso secured.\n (3) The agency may create and establish such other reserve funds as it\nshall deem advisable and necessary.\n (4) All amounts paid over to the agency by the state pursuant to the\nprovisions of this section shall constitute and be accounted for as\nadvances by the state to the agency and, subject only to the rights of\nthe holders of any bonds or notes of the agency theretofore or\nthereafter issued, shall be repaid to the state from all available\noperating revenues of the agency in excess of amounts required for the\ndebt service reserve funds and operating expenses.\n (5) The chairman of the agency shall make and deliver to the governor\nand director of the budget on or before December first, nineteen hundred\nseventy and on or before December first in each year thereafter, a\ncertificate stating the amount estimated to be required for payment of\nor provision for expenses of the agency for the next ensuing state\nfiscal year. The amount so stated for any such ensuing state fiscal year\nshall be the sum of the amounts, if any, estimated for such fiscal year,\nby which anticipated operating expenses will exceed available operating\nrevenues that the agency anticipates with reasonable certainty it will\nreceive during such fiscal year. To assure the continued operation and\nsolvency of the agency for the fulfillment of its corporate purposes,\nthere shall be apportioned and paid to the agency after audit by and\nupon the warrant of the comptroller on vouchers certified or approved by\nthe officer or officers authorized by the agency, not more than the\namount so stated for expenses of the agency for such fiscal year.\n (6) As used in this section, (a) the term "operating expenses" for the\nfiscal year shall mean ordinary expenditures for operation and\nadministration of the agency; and (b) the term "available operating\nrevenues" for the fiscal year shall mean all amounts received on account\nof mortgages acquired by the agency, fees charged by the agency, if any,\nand income or interest earned or added to funds of the agency due to the\ninvestment thereof, and not required under the terms or provisions of\nany covenant or agreement with holders of any bonds or notes of the\nagency to be applied to any purposes other than payment of expenses of\nthe agency.\n