§ 58 — Sale or lease of municipal projects by authorities

§ 58. Sale or lease of municipal projects by authorities. 1. An\nauthority, subject to the approval of the local legislative body of the\nmunicipality in which such authority has territorial jurisdiction, may\nsell or lease any municipal project of such authority to any corporation\ncreated pursuant to article two of the private housing finance law on a\nco-operative basis, and an authority may enter into a contract for the\nsale of or sell or lease a municipal project to such a corporation\neither prior to, at the date of, or subsequent to the physical\ncompletion of such project and, in the event of a sale or lease of any\nsuch project prior to the physical completion thereof, the authority may\nagree to complete and may complete construction and development of such\nproject. No such corporation to which such a municipal project is sold\nor leased as provided in this section shall pay a dividend on any of its\nstock or pay interest on any of its income debentures.\n 2. Any sale or lease of a municipal project by an authority pursuant\nto subdivision one of this section may be made without public bidding,\npublic sale or public offering pursuant to such negotiated contract,\nagreement or lease, containing such provisions, limitations,\nrequirements, terms and conditions, as the authority selling or leasing\nsuch project, in its discretion, may determine to be necessary or\ndesirable; provided, that, in the event of a sale of a municipal\nproject, the purchase price to be paid to the authority on or prior to\ndate of transfer of title to such project by the authority, or upon the\nphysical completion of such project, shall not be less than the amount\nrequired by the authority to pay and retire, or to make provision for\nthe payment and retirement of, all bonds, notes and other obligations\nissued by the authority to finance the project cost, and to pay or make\nprovision for the payment of all obligations incurred or to be incurred\nby the authority as part of the project cost.\n 3. Notwithstanding the provisions of section thirty-three of article\ntwo of the private housing finance law, the real property in a municipal\nproject sold or leased as provided in subdivision one of this section,\nwhen the transfer thereunder becomes effective, shall be exempt from\nlocal and municipal taxes, other than assessments for local\nimprovements, to such extent as may be granted by the local legislative\nbody of any municipality in which such project is located; provided,\nhowever, that any corporation to which such project is so sold or leased\nshall pay to each municipality in which a project is located, with\nrespect to each such project, local and municipal taxes in amounts not\nless than the sum or sums contracted to be paid by the authority as a\npayment in lieu of taxes with respect to such project and which the\nauthority would be obligated to pay to the municipality had it not sold\nor leased the project to such a corporation. The tax exemption shall\noperate and continue so long as capital loans of the corporation to\nwhich such project shall have been sold or leased are outstanding, but\nin no event shall such exemption for a municipal project located outside\na city of one million or more persons continue for a period of more than\nthirty years, commencing in each instance from the date on which the\nbenefits of such exemption became available to and effective for such\ncorporation.\n Notes, bonds, mortgages and other obligations of such a corporation\nare declared to be issued for a public purpose and to be public\ninstrumentalities and, together with interest thereon, shall be exempt\nfrom tax.\n 4. The provisions of section thirteen of article two of the private\nhousing finance law requiring the approval by the commissioner of\nhousing of the persons incorporating a limited-profit housing company\nand the provisions of section fourteen of article two of the private\nhousing finance law requiring the consent of the commissioner of housing\nto the filing of the certificate of incorporation of such a company in\nthe office of the secretary of state and the amendment thereof shall not\napply to a corporation created pursuant to article two of the private\nhousing finance law on a cooperative basis for the purchase or lease of\na municipal project pursuant to this section; nor shall any of the\nprovisions of article two of the private housing finance law conferring\nupon the commissioner of housing any powers in respect of limited-profit\nhousing companies apply to such a corporation. The application of this\nsubdivision shall be limited to corporations undertaking a project with\nthe aid of a municipal loan under article two of the private housing\nfinance law.\n 5. Any project that received a tax exemption under this section may,\nupon the expiration of the tax exemption period, be granted an\nadditional tax exemption period of up to fifty years, or until such time\nas the project is no longer operated under the restrictions and for the\npurposes set forth in this article, whichever is sooner.\n