§ 59-C — Insured housing initiatives fund

§ 59-c. Insured housing initiatives fund. 1. The agency shall create\nand establish a special fund to be known as the insured housing\ninitiatives fund and shall pay into such fund any moneys which may be\nmade available to the agency for the purposes of such fund from any\nsource, including, but not limited to, moneys appropriated by and made\navailable pursuant to appropriation by the state and any income or\ninterest earned by, or increment to, the fund due to the investment\nthereof or moneys payable to the agency under any contract entered into\npursuant to subdivision two of this section. Subject to the provisions\nof any contract with bondholders and noteholders and any contract\nauthorized pursuant to this section for the provision of insurance,\nletters of credit or other financial mechanisms, the moneys held in or\ncredited to the insured housing initiatives fund established under this\nsubdivision, in the discretion of the agency, shall be used by the\nagency in accordance with subdivision two of this section to enable it\nto reduce the debt service that would otherwise be payable by the agency\non its bonds, notes and other obligations issued to make loans pursuant\nto subdivision twenty-nine-a of section forty-four of this article, and\nthereby to reduce the obligations of the borrower to the agency. The\nreduction in debt service as a result of any contract entered into\npursuant to subdivision two of this section shall result solely in the\nreduction of rents payable by low income individuals or families\nresiding in those units in the housing development assisted by the fund\nthat are required to be occupied by such individuals or families for\ninterest on obligations issued to finance such housing development to be\nexempt from taxation pursuant to section 103(b)(4) of the internal\nrevenue code of 1954, as amended. Provided, however, to the extent that\nsuch rents for such units are affordable to persons or families whose\nincome is not in excess of sixty-five percent of median income for the\narea, as defined by the agency, then any remaining savings or benefits\nshall be applied to the further reduction of such rents for such units,\nand/or the reduction of rents payable by other low income individuals or\nfamilies residing in the housing development assisted by such fund\nand/or the increase in the occupancy of low income individuals or\nfamilies residing in such housing development in excess of that required\npursuant to section 103(b)(4) of the internal revenue code of 1954, as\namended.\n 2. The agency may enter into contracts for the provision of insurance,\nletters of credit or other financial mechanisms designed to reduce such\ndebt service on bonds, notes and other obligations of the agency in\naccordance with this section, so long as such obligations receive an\ninvestment grade rating from a recognized rating agency. The moneys held\nin or credited to the fund shall not be used to pay the principal of or\ninterest on such obligations of the agency, the principal of or interest\non the obligations of the borrower to the agency or any fees of the\nagency.\n 3. For the purposes of this section, "low income individuals or\nfamilies" shall mean persons or families with incomes of no more than\neighty percent of the median income for the area, as defined by the\nagency.\n 4. The agency shall account separately for all moneys received by the\nfund.\n