onecle

New York Medical Care Facilities Finance Agency 392/73

Chapter 392 of the laws of 1973
                   NEW YORK STATE MEDICAL CARE FACILITIES
                             FINANCE AGENCY ACT
  Section 1.    Short title.
          2.    Declaration of policy and statement of purposes.
          3.    Definitions.
          4.    New York state medical care facilities finance agency.
          5.    Powers of the agency.
          5-a.  Federally-aided mortgage loans.
          5-b.  Equipment loans.
          5-b.  Health maintenance organization loans.
          5-c.  Terms and conditions regarding alternative indebtedness.
          5-d.  Financing non-profit housing and health facilities.
          6.    Bonds and notes of the agency.
          7.    Hospital  and  nursing  home  projects  reserve  funds and
                  appropriations.
          7-a.  Secured    hospital    projects    reserve    funds    and
                  appropriations.
          7-c.  Secured    hospital    projects    reserve    funds    and
                  appropriations.
          8.    Health facilities reserve funds and appropriations.
          9.    Special  provisions  relating  to  the  municipal   health
                  facilities improvement program.
          9-a.  Special  provisions  relating  to  mental  health services
                  facilities improvement bonds and notes.
         10.    Bonds and notes as legal investments.
         11.    Exemption from taxation of property and income.
         12.    Exemption from taxation of notes and bonds.
         13.    Agreement with the state.
         14.    State's right to require redemption of bonds.
         15.    Remedies of noteholders and bondholders.
         16-a.  Equal employment opportunity program.
         16-b.  Minority and women-owned business enterprise program.
         17.    Assistance by  state  officers,  departments,  boards  and
                  commissions.
         18.    Annual report.
         19.    Bond reserve insurance fund.
         20.    Actions against agency.
         21.    Act not affected if in part unconstitutional.
         22.    Inconsistent provisions in other laws superseded.
    Section  1.  Short title. This act may be cited as the "New York state
  medical care facilities finance agency act."
    § 2. Declaration of policy and statement of purposes.  The  protection
  and  promotion of the health of the inhabitants of the state are matters
  of public concern. In furtherance of this purpose, it is the  policy  of
  the  state to encourage the prompt and efficient provision of health and
  health-related services at a reasonable cost by the private  and  public
  sectors  in  modern,  well-equipped  health facilities accessible to the
  communities to be served.
    The leglislature has heretofore found that a serious shortage of  safe
  and  sanitary  nursing  home  accommodations  exists in many communities
  throughout the state; that many hospitals and  other  health  facilities
  throughout  the state are no longer adequate to meet the needs of modern
  medicine; that such inadequate  and  outmoded  facilities  deny  to  the
  people  of  the state the benefits of health care of the highest quality
  and that their replacement and modernization is essential to protect and
  prolong the  lives  of  the  state's  population.  The  legislature  has
  heretofore  found and declared that the accomplishment of these purposes

  cannot be readily achieved by the ordinary unaided operation of  private
  enterprise  and  to  this end has constituted and empowered the New York
  state housing finance agency,  a  multi-purpose  corporate  governmental
  agency  of  the state, to obtain funds through the issuance of its notes
  and bonds to  finance  the  construction,  acquisition,  reconstruction,
  rehabilitation  and improvement of a broad array of health facilities in
  addition to issuing its notes and  bonds  to  carry  out  other  program
  responsibilities  which  touch  on  the  quality  of  life  for the vast
  majority of the state's residents, including the  providing  of  housing
  for  persons  of low income, higher educational facilities for the state
  university of New York, mental health facilities, child care  facilities
  and facilities for the care of senior citizens.
    The  public  purposes  heretofore  enumerated  have not yet been fully
  accomplished despite the significant investment of funds through the New
  York state housing finance agency  in  the  construction  of  hospitals,
  nursing homes and health-related facilities.
    In  order  to  permit  an  acceleration in the implementation of these
  programs  in  areas  where  the  public  need  remains  urgent,  without
  jeopardizing the orderly marketing by the New York state housing finance
  agency  of  its notes and bonds for other program purposes, it is hereby
  found and declared that a separate corporate governmental agency, to  be
  known  as  the  "New York state medical care facilities finance agency,"
  should be created as a single purpose agency to act in concert with  the
  New  York  state  housing finance agency and to devote its entire energy
  and resources to the provision of additional funds for the  construction
  of  health  and  health-related  facilities  by  nursing  home companies
  created pursuant to the provisions  of  article  twenty-eight-A  of  the
  public  health  law,  by  hospitals  and non-profit medical corporations
  constituting eligible borrowers pursuant to the  provisions  of  article
  twenty-eight-B   of   the   public  health  law  and  by  municipalities
  constituting social services districts pursuant to the provisions of the
  health and mental hygiene facilities improvement act.  In  this  manner,
  the  broadest  possible base of investment by the greatest number of the
  general public may be had and the initiative and strength of our private
  enterprise economy may most readily be harnessed for the benefit of  the
  people of the state.
    Prompt provision of well-equipped, modern hospitals, schools and other
  facilities  related  to  the care, maintenance and treatment of mentally
  ill, mentally retarded and  developmentally  disabled  persons  is  also
  needed  in  the  state.  In order to encourage the investment of private
  capital in such hospitals, schools  and  other  mental  health  services
  facilities   and  to  assure  their  timely  construction,  acquisition,
  reconstruction,  rehabilitation  and  improvement,  or  the  refinancing
  thereof,  the  New  York  state  medical  care facilities finance agency
  should be empowered, through the issuance of its bonds, notes  or  other
  obligations  to the private investing public, to obtain all or a portion
  of the funds necessary to finance the same and  to  meet  the  needs  of
  patients and staff at such facilities.
    It   is   frequently   appropriate   to  combine  and  coordinate  the
  development,  rehabilitation  and  provision   of   housing   with   the
  development,  rehabilitation  and provision of health and health related
  facilities such as intermediate care, skilled nursing,  aged  treatment,
  and  hospice  facilities  for  which  there  is also a need. In order to
  encourage the investment of private capital in  non-profit  housing  and
  health  facilities,  and  to  assure  the expeditious completion of such
  facilities, the New York state medical care  facilities  finance  agency
  should  be  empowered, through the issuance of its bonds, notes or other
  obligations to the private investing public, to obtain  funds  necessary

  to  finance  loans,  for  the construction, acquisition, reconstruction,
  rehabilitation or improvement of such facilities.
    §  3. Definitions. As used in this article, unless a different meaning
  clearly appears from the context:
    1. "Agency" shall mean the corporate governmental  agency  created  by
  section four of this act.
    2.  "Amortized  value"  means,  when  used  with respect to securities
  purchased at a premium above or a discount below par, the  value  as  of
  any  given  date obtained by dividing the total amount of the premium or
  discount at which such securities were purchased by the number  of  days
  remaining  to  maturity  on such securities at the time of such purchase
  and by multiplying the amount so calculated by the number of days having
  passed since the  date  of  such  purchase;  and  (a)  in  the  case  of
  securities  purchased  at  a  premium,  by  deducting  the  product thus
  obtained from the purchase price, and (b)  in  the  case  of  securities
  purchased  at  a  discount,  by  adding the product thus obtained to the
  purchase price.
    3. "Bonds" and "notes"  shall  mean  bonds  and  notes,  respectively,
  issued by the agency pursuant to this act.
    (a)  "Hospital  and  nursing  home  project  bonds"  and "hospital and
  nursing home project notes" shall mean bonds  and  notes,  respectively,
  issued  by  the  agency  for  the  purpose  of  making loans to hospital
  corporations and non-profit medical corporations  constituting  eligible
  borrowers or nursing home companies.
    (b) "Health facilities bonds" and "health facilities notes" shall mean
  bonds  and  notes, respectively, issued by the agency for the purpose of
  financing the construction, acquisition, reconstruction,  rehabilitation
  or  improvement of health facilities for municipalities pursuant to this
  act and the health and mental hygiene facilities improvement act.
    (c) "Municipal hospital and municipal nursing home project bonds"  and
  "municipal hospital and municipal nursing home project notes" shall mean
  bonds  and  notes, respectively, issued by the agency for the purpose of
  making mortgage loans to municipal hospitals or municipal nursing homes.
    * (d)  "Special  hospital  project  bonds"  shall  mean  bonds  issued
  pursuant  to  section  seven-a  of  this  act  for the purpose of making
  mortgage loans to eligible secured hospital borrowers.
    * NB Expires December 31, 2015
    * (d-1) "Special hospital  project  bonds"  shall  mean  bonds  issued
  pursuant  to  section seven-c of this act for the purpose of refinancing
  outstanding mortgage loans of eligible secured  hospital  borrowers,  as
  defined in subdivision six-c of this section, pursuant to this act.
    * NB Repealed December 31, 2015
    4.  "Commissioner"  shall  mean  the  New  York  state commissioner of
  health.
    5. "Department" shall mean the New York state department of health.
    6. "Eligible borrower" shall mean a  non-profit  hospital  corporation
  organized  under  the  laws  of  this  state,  or  a  non-profit medical
  corporation organized under and governed by article  forty-four  of  the
  public  health  law,  which  has  entered into a regulatory agreement in
  accordance  with  the  provisions  of   section   twenty-eight   hundred
  seventy-three of the public health law.
    6-a.  "Federally-aided  mortgage  loan"  means  a  loan  secured  by a
  mortgage lien on the real property of a project or  on  a  leasehold  on
  such real property, provided that the term of such leasehold is not less
  than  twenty-five  percent longer than the term of the mortgage, and the
  personal  property  attached  to  or  used  in   connection   with   the
  construction,  acquisition, reconstruction, refinancing, rehabilitation,
  improvement, management or operation of the project, made by the  agency

  to a municipal hospital, municipal nursing home, not-for-profit hospital
  corporation,  not-for-profit  corporation providing a residential health
  care facility or not-for-profit medical corporation  organized  pursuant
  to  article  44  of  the public health law, which loan is insured by the
  federal government. This subdivision does  not  limit  the  agency  from
  consenting  to the modification of any instrument executed in connection
  with a federally-aided mortgage loan,  provided  that  the  modification
  does   not   materially  reduce  the  value  of  the  security  for  the
  federally-aided mortgage loan. A leasehold under this subdivision  shall
  conform  to  standards  adopted  by the agency, with the approval of the
  division of the budget, that adequately protect  the  interests  of  the
  agency, the state, and creditors.
    * (6-b)   "Eligible   secured   hospital   borrower"   shall   mean  a
  not-for-profit hospital corporation organized under  the  laws  of  this
  state,  which  has been designated by the commissioner of health and the
  New York state public health council as a needed  facility  eligible  to
  receive  distributions from the reimbursement pools established pursuant
  to paragraph (c) of subdivision nine  of  section  twenty-eight  hundred
  seven-a  of  the  public  health  law,  or  any  successor pool or pools
  established to serve a substantially similar purpose to such pools.
    * NB Expires December 31, 2015
    * 6-c.   "Eligible   secured   hospital   borrower"   shall   mean   a
  not-for-profit  hospital  corporation  organized  under the laws of this
  state, which has financed or refinanced a project or  projects  pursuant
  to  section  seven-a of this act, and for which special hospital project
  bonds, as defined in paragraph (d) of subdivision three of this section,
  remain outstanding.
    * NB Repealed December 31, 2015
    7. "Facilities development corporation"  shall  mean  the  corporation
  created pursuant to the facilities development corporation act.
    8.  "Health facility" shall mean a building, a unit within a building,
  a laboratory, a classroom, a housing unit, a dining hall, an  activities
  center,  a  library, or any structure on or improvement to real property
  of any kind or description, including fixtures and equipment  which  are
  an integral part of any such building, unit, structure or improvement, a
  walkway,  a  roadway or a parking lot, and improvements and connections,
  for water, sewer, gas, electrical, telephone, heating, air  conditioning
  and  other  utility  services, or a combination of any of the foregoing,
  whether for patient care and treatment of staff, staff family or service
  use, located at or related to or constituting a hospital, as defined  in
  section 2801 of the public health law.
    9.  "Health  facilities  improvement  program"  shall  mean  a program
  undertaken by the agency and, if the agency elects, with the  facilities
  development  corporation  acting  as  its  agent,  for  the  purpose  of
  constructing, acquiring,  reconstructing,  rehabilitating  or  improving
  health   facilities  or  causing  such  facilities  to  be  constructed,
  acquired, reconstructed,  rehabilitated  or  improved  pursuant  to  the
  facilities development improvement act, if applicable, and this act.
    * 10.  "Hospital project" shall mean a specific work or improvement or
  the refinancing of existing indebtedness which  constitutes  a  lien  or
  encumbrance upon the real property or assets of the eligible borrower or
  eligible  secured  hospital  borrower,  or  the  refinancing of existing
  indebtedness of an eligible secured hospital  borrower,  as  defined  in
  subdivision  six-c  of  this section, for which special hospital project
  bonds, as defined in paragraph (d) of subdivision three of this section,
  remain outstanding whether or not such refinancing  is  related  to  the
  construction,  acquisition  or  rehabilitation  of  a  specified work or
  improvement  undertaken  by  a  non-profit  hospital  corporation  or  a

  non-profit  medical  corporation,  constituting  an eligible borrower or
  eligible secured hospital borrower in accordance with the provisions  of
  article  twenty-eight-B  of  the  public  health law. The term "hospital
  project"  as used in this subdivision shall also mean a separate work or
  improvement owned and operated by an eligible borrower to  provide  such
  services, functions, capabilities and facilities as may be convenient or
  desirable for the operation of hospital or other such facility.
    * NB Effective until December 31, 2015
    * 10.  "Hospital project" shall mean a specific work or improvement or
  the refinancing of existing indebtedness which  constitutes  a  lien  or
  encumbrance upon the real property or assets of the eligible borrower or
  eligible  secured  hospital  borrower whether or not such refinancing is
  related  to  the  construction,  acquisition  or  rehabilitation  of   a
  specified  work  or  improvement  undertaken  by  a  non-profit hospital
  corporation  or  a  non-profit  medical  corporation,  constituting   an
  eligible  borrower  or  eligible secured hospital borrower in accordance
  with the provisions of article twenty-eight-B of the public health  law.
  The  term "hospital project" as used in this subdivision shall also mean
  a separate work  or  improvement  owned  and  operated  by  an  eligible
  borrower   to   provide   such  services,  functions,  capabilities  and
  facilities as may be  convenient  or  desirable  for  the  operation  of
  hospital or other such facility.
    * NB Effective and expires December 31, 2015
    * 10.  "Hospital project" shall mean a specific work or improvement or
  the refinancing of existing indebtedness which  constitutes  a  lien  or
  encumbrance  upon  the  real property or assets of the eligible borrower
  whether  or  not  such  refinancing  is  related  to  the  construction,
  acquisition  or  rehabilitation  of  a  specified  work  or  improvement
  undertaken by a non-profit hospital corporation or a non-profit  medical
  corporation,  constituting  an  eligible borrower in accordance with the
  provisions of article twenty-eight-B of the public health law.
    * NB Effective December 31, 2015
    * 11. "Hospital project cost" shall mean the sum total  of  all  costs
  incurred  by  a  non-profit hospital corporation or a non-profit medical
  corporation, constituting  an  eligible  borrower  or  eligible  secured
  hospital  borrower undertaking a project as approved by the commissioner
  in accordance with the provisions of article 28-B of the  public  health
  law,  or,  in  case  of an eligible secured hospital borrower, all costs
  incurred in connection with the  refinancing  of  existing  indebtedness
  approved  by  the  commissioner pursuant to section 2874-b of the public
  health law. In the case of eligible secured hospital borrowers, hospital
  project costs shall include all costs relating  to  the  refinancing  of
  existing indebtedness attributable to unmet bad debt and charity losses.
    * NB Effective until December 31, 2015
    * 11.  "Hospital  project  cost" shall mean the sum total of all costs
  incurred by a non-profit hospital corporation or  a  non-profit  medical
  corporation,  constituting  an  eligible  borrower  or  eligible secured
  hospital borrower undertaking a project as approved by the  commissioner
  in  accordance  with  the  provisions  of  article twenty-eight-B of the
  public health law. In the case of eligible secured  hospital  borrowers,
  hospital   project  costs  shall  include  all  costs  relating  to  the
  refinancing of existing indebtedness attributable to unmet bad debt  and
  charity losses.
    * NB Effective and expires December 31, 2015
    * 11.  "Hospital  project  cost" shall mean the sum total of all costs
  incurred by a non-profit hospital corporation or  a  non-profit  medical
  corporation,  constituting an eligible borrower undertaking a project as

  approved by the  commissioner  in  accordance  with  the  provisions  of
  article twenty-eight-B of the public health law.
    * NB Effective December 31, 2015
    * 12.  "Mortgage  loan"  shall  mean  a  loan made by the agency to an
  eligible borrower or eligible secured hospital borrower in an amount not
  to exceed the total hospital  project  costs  and  secured  by  a  first
  mortgage  lien  on  the  real  property  of  which  the hospital project
  consists or on a leasehold on such real property, provided that the term
  of such leasehold is not less than twenty-five percent longer  than  the
  term  of  the mortgage, and the personal property attached to or used in
  connection   with   the   construction,   acquisition,   reconstruction,
  rehabilitation,  improvement  or operation of the hospital project. Such
  loan may be further secured by such a  lien  upon  other  real  property
  owned  by or on a leasehold on real property of the eligible borrower or
  eligible  secured  hospital  borrower.  Notwithstanding  the   foregoing
  provisions  of  this  subdivision or any other provisions of this act to
  the contrary, any personal property may be excluded from the lien of the
  mortgage provided (a) the commissioner finds that such property  is  not
  essential  for  the rendition of required hospital services as such term
  is defined in article twenty-eight of the public health law, and (b) the
  agency consents to such exclusion.
    The term "mortgage loan" shall also mean and include a  loan  made  by
  the  agency to a limited-profit nursing home company in an amount not to
  exceed ninety-five per centum of the nursing home project cost, or to  a
  non-profit  nursing  home  company  in an amount not to exceed the total
  nursing home project cost, and secured by a first mortgage lien  on  the
  real  property  of  which  the  nursing  home  project  consists or on a
  leasehold on such real property provided that the term of such leasehold
  is not less than  twenty-five  percent  longer  than  the  term  of  the
  mortgage,  and  the  personal property attached to or used in connection
  with  the  construction,  acquisition,  reconstruction,  rehabilitation,
  improvement  or  operation  of the nursing home project. Notwithstanding
  the foregoing provisions of this subdivision or any other  provision  of
  this article to the contrary, any personal property may be excluded from
  the  lien  of the mortgage provided (a) the commissioner finds that such
  property is not essential for the nursing home project as such  term  is
  defined  in article twenty-eight-A of the public health law, and (b) the
  agency consents to such exclusion. A leasehold  under  this  subdivision
  shall  conform  to standards adopted by the agency, with the approval of
  the division of the budget, that adequately protect the interests of the
  agency, the state and creditors.
    The term "mortgage loan" shall also mean and include a loan made to an
  eligible secured hospital borrower, as defined in subdivision  six-c  of
  this  section,  to  refinance  outstanding indebtedness pursuant to this
  act.
    * NB Effective until December 31, 2015
    * 12. "Mortgage loan" shall mean a loan  made  by  the  agency  to  an
  eligible borrower or eligible secured hospital borrower in an amount not
  to  exceed  the  total  hospital  project  costs  and secured by a first
  mortgage lien on  the  real  property  of  which  the  hospital  project
  consists or on a leasehold on such real property, provided that the term
  of  such  leasehold is not less than twenty-five percent longer than the
  term of the mortgage, and the personal property attached to or  used  in
  connection   with   the   construction,   acquisition,   reconstruction,
  rehabilitation, improvement or operation of the hospital  project.  Such
  loan  may  be  further  secured  by such a lien upon other real property
  owned by or on a leasehold on real property of the eligible borrower  or
  eligible   secured  hospital  borrower.  Notwithstanding  the  foregoing

  provisions of this subdivision or any other provisions of  this  act  to
  the contrary, any personal property may be excluded from the lien of the
  mortgage  provided  (a)  the  commissioner  of  health  finds  that such
  property  is  not  essential  for  the  rendition  of  required hospital
  services as such term is defined in article twenty-eight of  the  public
  health law, and (b) the agency consents to such exclusion.
    The  term  "mortgage  loan" shall also mean and include a loan made by
  the agency to a limited-profit nursing home company in an amount not  to
  exceed  ninety-five  percentum of the nursing home project cost, or to a
  non-profit nursing home company in an amount not  to  exceed  the  total
  nursing  home  project cost, and secured by a first mortgage lien on the
  real property of which  the  nursing  home  project  consists  or  on  a
  leasehold on such real property provided that the term of such leasehold
  is  not  less  than  twenty-five  percent  longer  than  the term of the
  mortgage, and the personal property attached to or  used  in  connection
  with  the  construction,  acquisition,  reconstruction,  rehabilitation,
  improvement or operation of the nursing  home  project.  Notwithstanding
  the  foregoing  provisions of this subdivision or any other provision of
  this article to the contrary, any personal property may be excluded from
  the lien of the mortgage provided (a) the commissioner finds  that  such
  property  is  not essential for the nursing home project as such term is
  defined in article twenty-eight-A of the public health law, and (b)  the
  agency  consents  to  such exclusion. A leasehold under this subdivision
  shall conform to standards adopted by the agency, with the  approval  of
  the division of the budget, that adequately protect the interests of the
  agency, the state and creditors.
    * NB Effective and expires December 31, 2015
    * 12.  "Mortgage  loan"  shall  mean  a  loan made by the agency to an
  eligible borrower in an amount not to exceed the total hospital  project
  cost  and secured by a first mortgage lien on the real property of which
  the hospital project consists and the personal property attached  to  or
  used  in  connection with the construction, acquisition, reconstruction,
  rehabilitation, improvement or operation of the hospital  project.  Such
  loan  may  be  further  secured  by such a lien upon other real property
  owned by the eligible borrower. Notwithstanding the foregoing provisions
  of this subdivision or any other provisions of this act to the contrary,
  any personal property may be excluded from  the  lien  of  the  mortgage
  provided  (a) the commissioner of health finds that such property is not
  essential for the rendition of required hospital services as  such  term
  is defined in article twenty-eight of the public health law, and (b) the
  agency consents to such exclusion.
    The  term  "mortgage  loan" shall also mean and include a loan made by
  the agency to a limited-profit nursing home company in an amount not  to
  exceed  ninety-five  percentum of the nursing home project cost, or to a
  non-profit nursing home company in an amount not  to  exceed  the  total
  nursing  home  project cost, and secured by a first mortgage lien on the
  real property of  which  the  nursing  home  project  consists  and  the
  personal   property   attached   to  or  used  in  connection  with  the
  construction, acquisition, reconstruction,  rehabilitation,  improvement
  or  operation of the nursing home project. Notwithstanding the foregoing
  provisions of this subdivision or any other provision of this article to
  the contrary, any personal property may be excluded from the lien of the
  mortgage provided (a) the commissioner finds that such property  is  not
  essential  for  the  nursing  home  project  as  such term is defined in
  article twenty-eight-A of the public health  law,  and  (b)  the  agency
  consents to such exclusion.
    * NB Effective December 31, 2015

    13.  "Nursing  home  company"  shall  mean  a  nursing home company as
  defined in article twenty-eight-A of the public health law.
    (a)  A  "limited-profit  nursing  home  company"  shall mean a company
  incorporated pursuant to the provisions of article twenty-eight-A of the
  public health law and business corporation law.
    (b)  A  "non-profit  nursing  home  company"  shall  mean  a   company
  incorporated pursuant to the provisions of article twenty-eight-A of the
  public health law and the not-for-profit corporation law.
    14.  "Nursing  home project" shall mean a specific work or improvement
  undertaken by a nursing home company in accordance with  the  provisions
  of article twenty-eight-A of the public health law.
    15.  "Nursing home project cost" shall mean the sum total of all costs
  incurred by a nursing home company undertaking a project as approved  by
  the   commissioner   in   accordance  with  the  provisions  of  article
  twenty-eight-A of the public health law.
    16.  "Municipality"  for  the  purposes  of  the   health   facilities
  improvement  program  and  federally-aided  mortgage  loans to municipal
  hospitals and municipal nursing homes  means  a  county,  city  or  town
  constituting  a  social  services  district  as defined in sections two,
  sixty-one, seventy-five and seventy-five-a of the social  services  law,
  or  any two or more of the foregoing which are acting jointly to provide
  a health facility or health facilities, municipal hospitals or municipal
  nursing homes.
    17. "Bond reserve insurance fund"  shall  mean  the  fund  created  by
  section nineteen of this act.
    * 18.  "Equipment  loan"  shall  mean  a  loan made by the agency to a
  non-profit  hospital  corporation,  a  county  hospital,   a   municipal
  hospital,  a  New  York  state  department  of  health facility, a state
  university of New York health care facility or a non-profit  corporation
  providing  a  residential  health  care  facility,  for  the  purpose of
  financing or refinancing the acquisition through purchase  or  lease  of
  equipment,  including  construction  and  rehabilitation  related to the
  installation of such equipment,  and  shall  also  include  intellectual
  property  or other intangible property, including information technology
  and software, that is eligible for tax-exempt financing under the United
  States internal revenue code.
    The term "equipment loan" shall also mean the financing  of  equipment
  acquisitions  by  the  purchase,  lease  or sublease of equipment by the
  agency and the lease or sublease  of  such  equipment  to  a  non-profit
  hospital  corporation,  a  county  hospital,  a  municipal  hospital,  a
  hospital under the jurisdiction of the state university of New York,  or
  a  non-profit  corporation  providing a residential health care facility
  for the purpose of providing for the acquisition of such  equipment  and
  for  the  construction  and  rehabilitation  related to the installation
  thereof and shall also include intellectual property or other intangible
  property,  including  information  technology  and  software,  that   is
  eligible  for  tax-exempt  financing  under  the  United States internal
  revenue code.
    * NB There are 3 sub 18's
    * 18. "Municipal hospital" or "municipal nursing home"  shall  mean  a
  hospital or nursing home of, and located in, a municipality.
    * There are 3 sub 18's
    * 18.  "Hmo investment loan" shall mean a loan made by the agency to a
  lending institution for the purpose of financing a loan by  the  lending
  institution  to  the owner of an Hmo project. Such investment loan shall
  be evidenced by a note or other evidence of indebtedness constituting  a
  general  obligation  of  the lending institution and shall be secured to
  the satisfaction of the agency. Such investment loan  shall  not  exceed

  one  hundred  percent  of  the  cost  of  development of the Hmo project
  approved by the agency.
    * There are 3 sub 18's
    19. "Lending institution" shall mean any bank, trust company, national
  bank, state or federal mutual savings bank, state or federal savings and
  loan  association,  or state or federal credit union, insurance company,
  pension fund or retirement system of any corporation or association,  or
  any  other entity which is owned or controlled by any one or more of the
  above, provided the same is supervised by or responsible to  any  agency
  of the federal government, the state or any department thereof.
    20.  "Hmo  project" shall mean a specific work or improvement, whether
  or not to effectuate all or any part of  a  plan,  and  includes  lands,
  buildings,  improvements,  fixtures  and  personal property constructed,
  acquired or reconstructed, refinanced, rehabilitated, improved, managed,
  owned or operated  by  a  non-profit  corporation  for  the  purpose  of
  conducting  the  activities  of  a health maintenance organization. "Hmo
  project" shall also mean the refinancing of existing indebtedness  which
  constitutes a lien or other encumbrance upon the real property or assets
  of  the  non-profit  corporation  conducting  the activities of a health
  maintenance organization, whether or not such refinancing is related  to
  the  construction,  acquisition or rehabilitation of a specified work or
  improvement. "Hmo project" shall also mean the financing or  refinancing
  through  purchase  or  lease  of  equipment,  including construction and
  rehabilitation related to the installation of such equipment, whether or
  not the financing or refinancing of said equipment  is  related  to  the
  construction,  acquisition  or rehabilitation of a specified work or im-
  provement. An Hmo project may be undertaken by:
    (a) A health maintenance organization holding a valid  certificate  of
  authority  issued  pursuant  to  article forty-four of the public health
  law;
    (b) A health maintenance organization operating under  the  provisions
  of article IX-C of the insurance law; and
    (c)  By  a  non-profit  corporation  which  operates  a facility which
  possesses a valid operating certificate under  article  twenty-eight  of
  the  public  health  law  and  which  has entered into a contract with a
  health  maintenance  organization  operating  under  the  provisions  of
  article  forty-four  of  the  public  health  law or article IX-C of the
  insurance law to provide health care services to persons enrolled in the
  health  maintenance  organization,   provided   the   commissioner   has
  determined  that  the  facility  will be used principally as the medical
  group  facility  component  of  a   group   model   health   maintenance
  organization  and  the commissioner has approved the construction of the
  facility pursuant to section twenty-eight  hundred  two  of  the  public
  health law.
    21.  "Non-profit  housing  and  health facility" shall mean a specific
  work or improvement, whether or not to effectuate all or any part  of  a
  plan  acquired,  owned, constructed, rehabilitated, improved, managed or
  operated by  a  non-profit  company  and  consisting  of  five  or  more
  residential  units,  and  at  the election of the agency such additional
  health or health related facilities  as  the  agency  may  approve;  and
  including   the  lands,  buildings  and  improvements  acquired,  owned,
  constructed, managed or operated to provide such units,  and  health  or
  health   related   facilities   and   such  incidental  and  appurtenant
  commercial, recreation, cultural, communal, dining, parking, day care or
  residential child care, senior citizen and community facilities  as  may
  be  approved  by  the  agency.  As  used  in  connection  with  the term
  non-profit housing and health facility, the term residential unit  shall
  refer  to  units suitable for residential use or accommodations included

  within the term housing as defined in subdivision nine of section twelve
  of the private housing finance law,  and  the  term  non-profit  company
  shall  mean  a  company  incorporated  pursuant to the provisions of the
  not-for-profit  corporation law for the purpose of providing housing for
  staff members, employees, students or users of a  hospital,  health,  or
  health  related facility and their immediate families or for the purpose
  of providing a hospital, health, or health related facility.
    23. "Loan" when made to either an eligible borrower  or  nursing  home
  company,  shall  mean  either a mortgage loan or a project loan, each as
  defined in this act.
    24. "Project loan" shall mean a loan made by the agency to an eligible
  borrower or nursing home company in an amount not to  exceed  the  total
  hospital  project cost or total nursing home project cost, respectively.
  Such loans shall be secured in a manner acceptable  to  the  agency  and
  such   security   may  consist  of  a  mortgage  on  real  property  and
  improvements or  other  security  acceptable  to  the  agency;  provided
  however,  that  a  project  loan  shall not include any loan made by the
  agency to an eligible borrower or nursing home company that  constitutes
  a mortgage loan as defined in this act. Project loans shall only be made
  in  accordance  with  guidelines  adopted  by the board of the dormitory
  authority, as successor to the agency.
    § 4. New York state medical care facilities finance agency.  There  is
  hereby  created  the  New  York  state  medical  care facilities finance
  agency. The agency shall be a corporate governmental agency constituting
  a public benefit corporation. From and after the effective date  of  the
  health care financing consolidation act, as provided in subdivision 1 of
  section  1699-f of the public authorities law, the agency shall continue
  its corporate existence in and through the dormitory authority, and  the
  dormitory authority shall succeed to the powers, duties and functions of
  the agency.
    §  5.  Powers  of the agency. Except as otherwise limited by this act,
  the agency shall have power:
    1. To sue and be sued;
    2. To have a seal and alter the same at pleasure;
    3. To make and execute contracts and all other  instruments  necessary
  or  convenient  for  the exercise of its powers and functions under this
  act;
    4. To make  and  alter  by-laws  for  its  organization  and  internal
  management;
    5. To acquire, hold and dispose of personal property for its corporate
  purposes;
    6.  To  appoint officers, agents and employees, prescribe their duties
  and qualifications and fix their compensation;
    7. To  borrow  money  and  issue  negotiable  notes,  bonds  or  other
  obligations and to provide for the rights of the holders thereof;
    8. To invest any funds held in reserve or sinking funds, or any monies
  not required for immediate use or disbursement, at the discretion of the
  agency,  in  obligations of the state or the United States government or
  obligations the principal and interest of which are  guaranteed  by  the
  state  or  the  United States government, or in any other obligations in
  which the comptroller of the state of New York is authorized  to  invest
  pursuant to section ninety-eight of the state finance law;
    9.  Subject  to the approval of the commissioner of health pursuant to
  the provisions of article twenty-eight-A of the public  health  law,  to
  make  mortgage  and  project  loans  to  nursing  home  companies and to
  undertake commitments to make any such mortgage and project loans;
    10. Subject to the approval of the commissioner of health pursuant  to
  the  provisions  of  article  28-B  of  the  public  health law, to make

  mortgage loans and project loans to non-profit hospital corporations and
  non-profit medical corporations constituting eligible borrowers  and  to
  undertake commitments to make any such mortgage loans and project loans;
    * 10.  Subject  to the approval of the commissioner of health pursuant
  to the provisions of article twenty-eight-B of the public health law, to
  make mortgage and project loans to non-profit hospital corporations  and
  non-profit  medical  corporations  constituting  eligible  borrowers and
  eligible secured hospital borrowers and to undertake commitments to make
  any such mortgage and project loans;
    * NB Expires December 31, 2015
    10-a. To make  federally-aided  mortgage  loans  pursuant  to  section
  five-a of this act and, in connection with such federally-aided mortgage
  loans,  to  exercise  the  powers  and undertake the responsibilities as
  required by any law, regulation or  other  requirement  of  the  federal
  government.
    10-b.  To  make equipment loans pursuant to section five-b of this act
  and, in connection with such equipment loans, to enter  into  agreements
  with respect to the repayment of such loans.
    10-c. Subject to any agreement with bondholders and noteholders as may
  then  exist,  to permit eligible borrowers and nursing home companies to
  incur, assume or guarantee indebtedness from a  lender  other  than  the
  agency  or from the agency under a separate bond resolution, as provided
  for in agreements with bondholders and noteholders and section five-c of
  this act.
    * 10-d. To  make  mortgage  loans  and  project  loans  to  non-profit
  hospital  corporations  and non-profit medical corporations constituting
  eligible secured hospital borrowers, as defined in subdivision six-c  of
  section three of this act, and to undertake commitments to make any such
  mortgage loans and project loans;
    * NB Repealed December 31, 2015
    11. Subject to the approval of the commissioner of health, to sell, at
  public  or  private  sale,  any  mortgage or other obligation securing a
  mortgage loan made by the agency;
    12. In connection with the making of mortgage  or  project  loans  and
  commitments  therefor to non-profit hospital corporations and non-profit
  medical corporations constituting eligible  borrowers  or  nursing  home
  companies, to make and collect from such corporations and companies such
  fees  and  charges,  including  but  not limited to reimbursement of all
  costs  of  financing  by  the  agency,  service  charges  and  insurance
  premiums, as the agency shall determine to be reasonable;
    12-a.  In  connection  with  the  financing or refinancing of a mental
  health services facility pursuant to  lease,  sublease,  loan  or  other
  financing   agreements   for  the  purpose  of  providing  financing  or
  refinancing for or for the purpose of  constructing,  rehabilitating  or
  improving  mental  health  services facilities, to make and collect such
  fees and charges, including but not  limited  to  reimbursement  of  all
  costs  of  financing by the agency, service charges, insurance premiums,
  letter of credit fees or the costs of  any  other  financial  mechanisms
  which  may  be  used to reduce the debt service that would be payable by
  the agency on its mental health services  facilities  improvement  bonds
  and notes, as the agency shall determine to be reasonable.
    13.  In  connection  with any property on which it has made a mortgage
  loan or a project loan, to foreclose on any such property secured  by  a
  mortgage  or  commence  any  action  to  protect  or  enforce  any right
  conferred upon it by any law, mortgage, contract or other agreement, and
  to bid for and purchase such property at any foreclosure or at any other
  sale, or acquire or take possession of any such property;  and  in  such
  event  the  agency  may  complete,  administer, pay the principal of and

  interest on any obligations incurred in connection with  such  property,
  dispose  of,  and  otherwise deal with, such property, in such manner as
  may be necessary or desirable to protect the  interests  of  the  agency
  therein;
    14. To lease or purchase one or more existing health facilities from a
  municipality  and  cause  such  health  facilities  to be reconstructed,
  rehabilitated or improved, or to lease or purchase real property from  a
  municipality  and cause one or more health facilities to be constructed,
  reconstructed,  rehabilitated  or  improved  thereon,  or  to  lease  or
  purchase  one  or  more  existing  health facilities from a municipality
  which has already  been  constructed,  reconstructed,  rehabilitated  or
  improved  provided,  however,  that  no  such  health  facility shall be
  eligible for such lease or purchase  unless  it  has  been  constructed,
  reconstructed,  rehabilitated  or improved within eighteen months of the
  date of the bond issue and the amount of the bond issue used to  finance
  such  lease  or  purchase shall not exceed the total project cost to the
  municipality of such  construction,  reconstruction,  rehabilitation  or
  improvement.   At   the   election  of  the  agency,  any  construction,
  reconstruction,  rehabilitation  or   improvement   pursuant   to   this
  subdivision  may be performed by the facilities development corporation,
  acting as the agent of the agency;
    15. To lease or purchase from any person, firm or corporation  one  or
  more  existing  health facilities and cause such health facilities to be
  reconstructed, rehabilitated or improved or to lease  or  purchase  real
  property  from  any  person,  firm  or corporation and cause one or more
  health facilities to be  constructed,  reconstructed,  rehabilitated  or
  improved  thereon,  or  to lease or purchase one or more existing health
  facilities from a person, firm or corporation  which  has  already  been
  constructed, reconstructed, rehabilitated or improved provided, however,
  that  no  such  health  facility  shall  be  eligible  for such lease or
  purchase unless it has been constructed, reconstructed, rehabilitated or
  improved within eighteen months of the date of the bond  issue  and  the
  amount  of  the  bond issue used to finance such lease or purchase shall
  not  exceed  the  total  project  cost  to  the  municipality  of   such
  construction,  reconstruction,  rehabilitation  or  improvement.  At the
  election of the agency, any construction, reconstruction, rehabilitation
  or improvement pursuant to this subdivision  may  be  performed  by  the
  facilities development corporation, acting as the agent of the agency;
    * 15-a.  Notwithstanding the provisions of subdivision fifteen of this
  section, to lease or purchase from any person, firm or  corporation  one
  or    more   health   facilities   the   construction,   reconstruction,
  rehabilitation or improvement of which has been financed, in whole or in
  part,  through  loans  furnished,  secured  or  arranged  by   a   local
  development  corporation  incorporated  and existing pursuant to section
  1411 of the not-for-profit corporation law, provided, however, that such
  local development corporation was in existence and engaged in  promoting
  the  development  of health facilities on January 1, 1999, and provided,
  further, that the proceeds of the bond  issue  allocable  to  each  such
  health  facility  shall  not  exceed seven million five hundred thousand
  dollars.
    * NB Repealed June 30, 2019
    16. To lease or sublease to a  municipality  health  facilities  which
  have   been   constructed,  acquired,  reconstructed,  rehabilitated  or
  improved  by  the  agency  pursuant  to  this  act  and  the  facilities
  development improvement act, if applicable;
    17.  To  exercise  all  or  any combination of the powers set forth in
  subdivisions fourteen, fifteen and sixteen of this section;

    18. To procure insurance against  any  loss  in  connection  with  its
  property  and  other  assets (including mortgages and mortgage loans) in
  such amounts, and from such insurers, as it deems desirable;
    19.  To  accept  any  gifts or grants or loans of funds or property or
  financial or other aid in any form from the federal  government  or  any
  agency  or  instrumentality  thereof or from the state or from any other
  source and to comply, subject to the provisions of this  act,  with  the
  terms and conditions thereof;
    20.  To engage the services of private consultants on a contract basis
  for rendering professional and technical assistance and advice;
    21. To enter into a contract with the New York state  housing  finance
  agency  to market and service any agency bonds and notes approved by the
  agency and to contract with the New York state housing finance agency to
  render such other services as the agency may request, including but  not
  limited  to  the use of the premises, personnel and personal property of
  the  New  York  state  housing  finance  agency,  and  to  provide   for
  reimbursement  to  the  New  York  state housing finance agency from the
  agency for any expenses necessarily  incurred  by  the  New  York  state
  housing  finance  agency in carrying out the terms of any such contract.
  Any such contract shall be subject  to  the  separate  approval  of  the
  director of the budget;
    22.  Subject to the approval of the commissioner of health, to acquire
  by purchase from the New York state housing finance agency any  mortgage
  or  other  obligation securing a loan made by the New York state housing
  finance agency to a hospital corporation or to a nursing  home  company,
  and to sell same at public or private sale;
    23.  To  acquire  by  purchase from the New York state housing finance
  agency its right, title and interest in real  property,  leaseholds  and
  subleaseholds  relating  to  the municipal health facilities improvement
  program;
    24. To do any and all things necessary or convenient to carry out  its
  purposes  and  exercise  the  powers expressly given and granted in this
  act.
    § 5-a. Federally-aided mortgage loans. In addition to  the  powers  of
  the  agency  to make mortgage loans pursuant to other provisions of this
  act, the agency has the following powers:
    1. The agency may make federally-aided mortgage loans to  a  municipal
  hospital,  municipal  nursing  home,  non-profit  hospital  corporation,
  non-profit corporation providing a residential health care  facility  or
  non-profit  medical corporation organized pursuant to article forty-four
  of the public health law upon terms and conditions not inconsistent with
  article twenty-eight of the public health  law  or  article  sixteen  or
  thirty-one  of  the  mental  hygiene  law  as  the  case may be and this
  section. The proceeds of such loan  are  to  be  used  substantially  to
  finance  the  construction,  acquisition,  reconstruction,  refinancing,
  rehabilitation, improvement, management or operation of the project.
    2. A federally-aided mortgage loan made by the agency shall not exceed
  an amount  equal  to  the  lesser  of  (i)  the  maximum  mortgage  loan
  authorized  or  approved  by  the federal government or (ii) one hundred
  percent of the cost of  development  of  the  project  approved  by  the
  agency.
    3.  With  respect  to  a  non-profit  hospital corporation, non-profit
  corporation providing a residential health care facility  or  non-profit
  medical  corporation,  the  agency  shall  not  make  a  federally-aided
  mortgage loan unless (a) the  commissioner  has  approved  the  project,
  recommended the project based on public need and the financial resources
  available  to  it,  and  finds that the non-profit hospital corporation,
  non-profit corporation providing a residential health care facility,  or

  non-profit  medical  corporation  has  complied  with  the provisions of
  article twenty-eight of the public health  law  or  article  sixteen  or
  thirty-one  of  the  mental hygiene law as the case may be, and that the
  non-profit  medical corporation also has complied with the provisions of
  article forty-four of the public health law, and (b)  the  agency  finds
  that  (i)  the  estimated  revenues of the project will be sufficient to
  cover all probable costs of operations and maintenance, all installments
  of principal and interest on the indebtedness relating to  the  project,
  taxes,  and  such other expenses, including the maintenance of reserves,
  as may be projected or required by the agency or the federal government,
  and (ii) with respect to a nursing home project, the project  is  to  be
  available  for  persons  of  low  income  as defined by paragraph two of
  section twenty-eight hundred sixty of the public health law.
    4. As used in this section or in  connection  with  a  federally-aided
  mortgage  loan, the term "project" means a specific work or improvement,
  whether or not to effectuate all or any part of  a  plan,  and  includes
  lands,   buildings,   improvements,   fixtures   and  personal  property
  constructed,   acquired,   reconstructed,   refinanced,   rehabilitated,
  improved,  managed,  owned  or  operated  by  a  non-profit  corporation
  pursuant to this section, to provide hospital, residential health  care,
  residential  facilities  for  the  mentally retarded and developmentally
  disabled or the mentally disabled or for the care,  treatment,  training
  and  education  of the mentally retarded and developmentally disabled or
  the mentally disabled or comprehensive health  services  facilities  and
  such  related  incidental  and  appurtenant facilities as the agency may
  approve.  The  term  "project"  shall  also  mean  a  separate  work  or
  improvement,  including lands, buildings, fixtures and personal property
  related thereto, managed, owned or operated by a non-profit  corporation
  pursuant   to   this   section  to  provide  such  services,  functions,
  capabilities and facilities as may be convenient or  desirable  for  the
  operation  of  a  hospital,  a  residential health care or comprehensive
  health services facility.
    5. Notwithstanding any other provisions of law,  general,  special  or
  local,  or  any  provision  of any charter or ordinance, including local
  finance law section twenty,  a  municipality  is  hereby  authorized  to
  borrow  for  or  give  a  mortgage on its municipal hospitals or nursing
  homes for the purpose of constructing, reconstructing, rehabilitating or
  improving one or more such hospitals or nursing homes pursuant  to  this
  act  in accordance with the terms of any agreement entered into pursuant
  to this act.
    6. As used in this  section  or  in  connection  with  federally-aided
  mortgage loan regarding residential facilities for the mentally retarded
  and  developmentally  disabled or the mentally disabled or for the care,
  treatment,  training  and  education  of  the  mentally   retarded   and
  developmentally   disabled   or   the   mentally   disabled   the   term
  "commissioner" shall also mean the commissioner of mental health or  the
  commissioner of mental retardation and developmental disabilities.
    7.  (a)  In  connection  with  the  making of federally-aided mortgage
  loans, the commissioner  of  health  shall  charge  to  such  non-profit
  hospital  corporation,  non-profit  corporation  providing a residential
  health care facility or non-profit  medical  corporation,  for  mortgage
  closings on or after April first, nineteen hundred eighty-nine, a fee of
  nine-tenths  of one percent of the mortgage loan, payable on requisition
  on or after the mortgage closing to the state department  of  health  by
  the mortgagor for deposit into the state general fund.
    (b) In connection with the refinancing or refunding of federally-aided
  mortgage  loans  or  loans  made pursuant to articles twenty-eight-A and
  twenty-eight-B of the public health  law,  the  commissioner  of  health

  shall   charge  to  such  non-profit  hospital  corporation,  non-profit
  corporation providing a residential health care facility  or  non-profit
  medical  corporation,  for  mortgage  closings  on or after April first,
  nineteen hundred eighty-nine, a fee of five-tenths of one percent of the
  new  mortgage  loan,  payable  on  requisition  on or after the mortgage
  closing to the state department of health by the mortgagor  for  deposit
  into the state general fund.
    (c)  The  fees  and charges paid by a non-profit hospital corporation,
  non-profit corporation providing a residential health care  facility  or
  non-profit  medical  corporation  pursuant  to this subdivision shall be
  deemed allowable capital costs in  the  determination  of  reimbursement
  rates  established pursuant to article twenty-eight of the public health
  law. The cost  of  such  fees  and  charges  shall  not  be  subject  to
  reimbursement  ceiling  or  other penalties used by the commissioner for
  the purpose of establishing  reimbursement  rates  pursuant  to  article
  twenty-eight of the public health law.
    * § 5-b. Equipment loans.  1. The agency may make an equipment loan to
  a  non-profit  hospital  corporation,  a  county  hospital,  a municipal
  hospital, a New York  state  department  of  health  facility,  a  state
  university  of New York health care facility or a non-profit corporation
  providing a residential health care facility, upon terms and  conditions
  not  inconsistent with article twenty-eight of the public health law and
  this section. The proceeds of such loan are to be used substantially  to
  finance the acquisition through purchase or lease of equipment including
  construction  and  rehabilitation  related  to  the installation of such
  equipment  or  the  acquisition  of  intellectual  property   or   other
  intangible property, including information technology and software, that
  is  eligible  for  tax-exempt financing under the United States internal
  revenue code.
    2. The agency shall not make an equipment loan unless the agency finds
  that the non-profit hospital  corporation,  municipal  hospital,  county
  hospital,  New  York  state  department  of  health  facility,  a  state
  university of New York health care facility  or  non-profit  corporation
  providing  a  residential  health  care  facility, has complied with the
  provisions  of  article  twenty-eight  of  the  public  health  law   in
  connection  with  the  proposed equipment loan and that the commissioner
  has approved the equipment acquisition  or  lease  pursuant  to  section
  twenty-eight  hundred two of the public health law in any case where the
  acquisition or lease is subject to the provisions of  such  section,  or
  has   approved   such  acquisition  or  lease  according  to  guidelines
  prescribed by the commissioner in any other case.
    3. The agency may make an equipment loan by  the  purchase,  lease  or
  sublease  of  equipment  by the agency and the lease or sublease of such
  equipment to a non-profit hospital corporation,  a  county  hospital,  a
  municipal  hospital,  a  hospital  under  the  jurisdiction of the state
  university of New York health care facility, or a non-profit corporation
  providing  a  residential  health  care  facility  for  the  purpose  of
  providing for the acquisition of such equipment and for the construction
  and  rehabilitation related to the installation thereof. Notwithstanding
  the above, the agency shall not make an equipment loan pursuant to  this
  section  unless  or  until  the  borrower or lessee, vendee, licensee or
  other ultimate beneficiary of  such  equipment  loan  has  obtained  the
  approval  of  the  commissioner pursuant to section twenty-eight hundred
  two of the public health law or such other guidelines prescribed by  the
  commissioner  in  any  case  where  the acquisition or lease is or would
  otherwise have been  subject  to  such  provisions,  had  the  borrower,
  lessee,  vendee, licensee or ultimate beneficiary of such equipment loan
  obtained financing from a source other than the agency.

    * NB There are 2 § 5-b's
    * § 5-b. Health maintenance organization loans. 1. The agency may make
  Hmo  investment  loans  to  lending  institutions  for  the  purpose  of
  financing an Hmo project. In connection with the  making  of  investment
  loans  and  commitments therefor to lending institutions, the agency may
  make and collect from such lending institutions such  fees  and  charges
  including,  but  not limited to, reimbursement of all costs of financing
  by the agency and service charges, as the agency shall determine  to  be
  reasonable.
    2.  In  addition  to  the  powers of the agency to make Hmo investment
  loans pursuant to other provisions of this  act,  the  agency  may  make
  loans and undertake commitments to make loans to owners of Hmo projects,
  which loans may be but are not limited to mortgage loans, mortgage loans
  insured  by  the  federal  government  or leasehold mortgage loans. Such
  loans shall be of such terms and conditions, and  shall  be  secured  in
  such manner as is satisfactory to the agency.
    3. The agency shall not make a loan or Hmo investment loan pursuant to
  this  section  unless  (a) the commissioner has approved the Hmo project
  pursuant to section twenty-eight hundred two of the public health law in
  any case where the project is subject to the provisions of such  section
  or  has  approved  the project according to guidelines prescribed by the
  commissioner in any other case,  and  (b)  the  agency  finds  that  the
  estimated revenues of the Hmo project or the Hmo investment loan, as the
  case  may  be, will be sufficient to cover all installments of principal
  and interest on the indebtedness issued relating to the Hmo project, and
  (c) the indebtedness issued relating to the Hmo project has received  an
  investment  grade rating from a recognized rating agency, or the loan or
  the Hmo investment loan made by  the  agency  is  fully  secured  as  to
  principal  and  interest by the general credit of a bank, national bank,
  trust company, savings bank, savings  and  loan  association,  insurance
  company,  governmental  agency  of  the  United  States of America, or a
  combination thereof.
    * NB There are two § 5-b's
    § 5-c. Terms and conditions regarding  alternative  indebtedness.  The
  agency  may  require  such  terms  and conditions regarding indebtedness
  incurred or assumed from a lender other than the agency or guaranteed by
  an eligible borrower or nursing home company  as  it  deems  appropriate
  including  qualifications  and  approval  of the lender, approval of the
  purpose of the indebtedness, time or rate of amortization of  principal,
  and  time  or  rate  of payment of interest; provided, however, that the
  interest of the lender created as a result of such  indebtedness  as  to
  priority of lien with respect to a mortgage loan may only be on a parity
  with or subordinate to that of the agency in proportion to the amount of
  the  loan  secured.  Such  a  borrower may so incur, assume or guarantee
  indebtedness from a lender other than the agency, or  incur,  assume  or
  guarantee  indebtedness from the agency under a separate bond resolution
  upon such terms and conditions provided for in the applicable  agreement
  with  bondholders  and  noteholders  and  with the consent of the agency
  where such lender is other than the agency. This  section  applies  only
  where  the  agency  has  issued  its  bonds to make a mortgage loan or a
  project loan to a hospital to which the agency is authorized to  make  a
  loan  pursuant  to  this  act  and  the  bonds and notes are not secured
  pursuant to paragraph (a) of subdivision one of section  seven  of  this
  act.
    § 5-d. Financing non-profit housing and health facilities. 1.  Subject
  to  the  provisions of any contract with noteholders and bondholders (a)
  to make and contract for  the  making  of  loans  for  the  acquisition,
  refinancing,  construction  or  rehabilitation of non-profit housing and

  health facilities and (b) to make and to  contract  for  the  making  of
  loans to or to purchase loans from lending institutions for the purposes
  of financing loans for such acquisition, construction or rehabilitation.
    2.  The  powers  granted by this section may be exercised only if: (a)
  the commissioner has approved any health, or health  related  facilities
  which are in addition to the residential unit and housing portion of the
  facility,  pursuant  to  section  twenty-eight hundred two of the public
  health law in any case where the facility is subject to  the  provisions
  of such section or has approved the facility according to the guidelines
  prescribed in any other case; and (b) (i) obligations of the agency have
  been  issued  to  fund the loan made or purchased by the agency and such
  obligations have received an investment grade rating from  a  recognized
  rating agency, or (ii) the loan made or purchased by the agency is fully
  secured  as  to  principal  and interest by insurance or a commitment to
  insure issued by the state of New York mortgage agency or by the general
  credit of the bank, national bank, trust company, savings bank,  savings
  and  loan  association, insurance company, the college construction loan
  insurance association, the student  loan  marketing  association,  or  a
  governmental agency of the United States.
    § 6. Bonds and notes of the agency. 1. (a) The agency shall have power
  and is hereby authorized from time to time to issue its negotiable bonds
  and  notes  in  conformity  with  applicable  provisions  of the uniform
  commercial code in such principal amount  as,  in  the  opinion  of  the
  agency, shall be necessary to provide sufficient funds for achieving its
  corporate  purposes,  including  the  making  of mortgage loans, project
  loans, or equipment loans, or loans to owners of  Hmo  projects  or  Hmo
  investment  loans  and  the  construction,  acquisition, reconstruction,
  rehabilitation or improvement  of  health  facilities,  the  payment  of
  interest  on bonds and notes of the agency, establishment of reserves to
  secure such bonds and notes, and all other expenditures  of  the  agency
  incident  to  and  necessary  or  convenient  to carry out its corporate
  purposes and powers;
    (b) The agency shall have power, from time to time, to  issue  renewal
  notes,  to  issue  bonds  to  pay  notes  and whenever it deem refunding
  expedient, to refund any bonds by the issuance of new bonds, whether the
  bonds to be refunded have or have not matured, and to issue bonds partly
  to refund bonds then outstanding and partly for any other  purpose.  The
  refunding  bonds shall be sold and the proceeds applied to the purchase,
  redemption or payment of the bonds to be refunded;
    (c) Except as may otherwise be expressly provided by the agency, every
  issue if its notes or bonds shall be general obligations of  the  agency
  payable out of any revenues or monies of the agency, subject only to any
  agreements  with  the  holders of particular notes or bonds pledging any
  particular receipts or revenues.
    2. The notes and bonds  shall  be  authorized  by  resolution  of  the
  members, shall bear such date or dates, and shall mature at such time or
  times, in the case of any such note, or any renewals thereof, issued for
  achieving  its  corporate  purposes  other  than  the making of mortgage
  loans, not exceeding five years, from the date of issue of such original
  note, and in the case of any such note, or any renewals thereof,  issued
  for  the  purpose  of  making mortgage loans, not exceeding seven years,
  from the date of issue of such original note, and in  the  case  of  any
  such  bond  not  exceeding  fifty  years from the date of issue, as such
  resolution or resolutions may provide. The notes and  bonds  shall  bear
  interest  at  such  rate  or rates, be in such denominations, be in such
  form, either coupon or registered, carry such  registration  privileges,
  be  executed  in  such  manner, be payable in such medium of payment, at
  such place or places and be subject to such terms of redemption as  such

  resolution or resolutions may provide. The notes and bonds of the agency
  may  be  sold by the agency, at public or private sale, at such price or
  prices as the agency shall determine. No notes or bonds  of  the  agency
  may be sold by the agency at private sale, however, unless such sale and
  the  terms thereof have been approved in writing by (a) the comptroller,
  where such sale is not to the comptroller or, (b) the  director  of  the
  budget, where such sale is to the comptroller.
    3. Any resolution or resolutions authorizing any notes or bonds or any
  issue  thereof  may  contain  provisions,  which  shall be a part of the
  contract with the holders thereof, as to:
    (a) pledging all or any part of the fees and charges made or  received
  by  the agency, and all or any part of the monies received in payment of
  mortgage or  project  loans  and  interest  thereon,  and  other  monies
  received  or  to  be received, to secure the payment of the hospital and
  nursing home project bonds or hospital nursing home project notes or  of
  any  issue  thereof,  subject  to  such  agreement  with  bondholders or
  noteholders as may then exist;
    (b) pledging all or any part of the assets of  the  agency,  including
  mortgages  and  obligations  securing the same, to secure the payment of
  the hospital and nursing home project bonds or hospital and nursing home
  project  notes,  subject  to  such  agreements   with   bondholders   or
  noteholders   as   may  then  exist,  provided  that  no  resolution  or
  resolutions of the agency authorizing hospital and nursing home  project
  bonds  and  hospital and nursing home project notes shall (i) pledge all
  or any portion of the rentals paid to the agency with respect to  health
  facilities  financed  with  the  proceeds  of health facilities bonds or
  health facilities notes, or (ii) pledge  any  other  assets,  monies  or
  accounts  pledged  to  the agency as security for the payment of rentals
  with respect to health facilities financed with the proceeds  of  health
  facilities bonds or health facilities notes;
    (c)  the  use and disposition of the gross income from mortgages owned
  by the agency and payment of principal of mortgages owned by the agency;
    (d) pledging all or any part of the rentals paid to  the  agency  with
  respect  to  health  facilities  financed  with  the  proceeds of health
  facilities bonds or health facilities notes or any other assets,  monies
  or  accounts  pledged  or  assigned  to  the  agency as security for the
  payment of such rentals, all subject to any agreement  with  noteholders
  or  bondholders  as  may  then  exist and provided that no resolution or
  resolutions authorizing health facilities bonds  and  health  facilities
  notes  shall  (i) pledge all or any part of the fees and charges made or
  received by the agency pursuant to subdivision twelve of section five in
  connection with the making of mortgage loans or commitments therefor, or
  all or any part of the monies received in payment of such mortgage loans
  and interest thereon, or (ii) pledge all or any part of the mortgages of
  the agency or obligations securing the same, or (iii) provide as to  the
  use  and  disposition  of  the  gross income from mortgages owned by the
  agency or as to the payment of  principal  of  mortgages  owned  by  the
  agency;
    (e)  the setting aside of reserves or sinking funds and the regulation
  and disposition thereof;
    (f) limitations on the purpose to which the proceeds of sale of  notes
  or bonds may be applied and pledging such proceeds to secure the payment
  of the notes or bonds or of any issue thereof;
    (g)  limitations  on  the  issuance  of additional notes or bonds; the
  terms upon which additional notes or bonds may be  issued  and  secured;
  the refunding of outstanding or other notes or bonds;
    (h)  the  procedure,  if  any, by which the terms of any contract with
  noteholders or bondholders may be amended or abrogated,  the  amount  of

  notes or bonds the holders of which must consent thereto, and the manner
  in which such consent may be given;
    (i)  limitations  on the amount of monies to be expended by the agency
  for operating, administrative or other expenses of the agency;
    (j) vesting in a trustee or trustees such property, rights, powers and
  duties in trust as the agency may determine, which may  include  any  or
  all  of  the  rights,  powers and duties of the trustee appointed by the
  bondholders pursuant to this act, and limiting or abrogating  the  right
  of  the  bondholders to appoint a trustee under this act or limiting the
  right, powers and duties of such trustee;
    (k) any other matters, of like or different character,  which  in  any
  way affect the security or protection of the notes or bonds.
    (l)  pledging all or any part of the fees and charges made or received
  by the agency, and all or any part of the monies received pursuant to  a
  lease,  sublease,  loan  or  other  financing  agreements  entered  into
  pursuant to section nine-a of this act and interest thereon,  and  other
  monies  received  or  to  be  received,  to secure the payment of mental
  health services facilities improvement notes or bonds or  of  any  issue
  thereof,  subject  to such agreements with bondholders or noteholders as
  may then exist;
    (m) pledging all or any part of the assets of  the  agency,  including
  lease,  sublease,  loan  or  other  financing  agreements  entered  into
  pursuant to section nine-a of this act,  and  obligations  securing  the
  same,  to  secure  the  payment  of  mental  health services improvement
  facilities notes or bonds or of any issue of notes or bonds, subject  to
  such agreements with noteholders or bondholders as may then exist;
    (n)  the use and disposition of the gross income from lease, sublease,
  loan or other financing agreements  entered  into  pursuant  to  section
  nine-a  of this act and payment of principal of lease, sublease, loan or
  other financing agreements entered into pursuant to  section  nine-a  of
  this act;
    (o)  pledging  or  depositing  all  or  any  part of the assets of the
  agency, including moneys paid to the agency by the comptroller  and  the
  commissioner  of  taxation and finance of the state of New York pursuant
  to the provisions of section ninety-seven-f of the state finance law, to
  pay or provide for the refunding of  mental  hygiene  improvement  bonds
  issued  pursuant to section forty-seven-b of the private housing finance
  law.
    4. It is the intention hereof that any pledge made by the agency shall
  be valid and binding from the time when the pledge  is  made;  that  the
  monies  or  property  so  pledged  and thereafter received by the agency
  shall immediately be subject to the lien  of  such  pledge  without  any
  physical  delivery thereof or further act; and that the lien of any such
  pledge shall be valid and binding as against all parties  having  claims
  of  any  kind  in  tort,  contract  or  otherwise  against  the  agency,
  irrespective of whether such parties have notice  thereof.  Neither  the
  resolution nor any other instrument by which a pledge is created need be
  recorded.
    5.  Neither  the  members  of  the agency nor any person executing the
  notes or bonds shall be liable personally on the notes or  bonds  or  be
  subject  to  any  personal  liability or accountability by reason of the
  issuance thereof.
    6.  The  agency,  subject  to  such  agreements  with  noteholders  or
  bondholders  as  may  then  exist,  shall  have  power  out of any funds
  available therefor to purchase notes or bonds of the agency, which shall
  thereupon be cancelled, at a price not exceeding (a)  if  the  notes  or
  bonds  are  then  redeemable,  the redemption price then applicable plus
  accrued interest to the next interest payment date thereon,  or  (b)  if

  the  notes  or  bonds  are  not  then  redeemable,  the redemption price
  applicable on the first date after such purchase upon which the notes or
  bonds become subject to redemption plus accrued interest to such date.
    7.  The  state shall not be liable on notes or bonds of the agency and
  such notes and bonds shall not be a debt of the state,  and  such  notes
  and bonds shall contain on the face thereof a statement to such effect.
    §   7.   Hospital   and   nursing  home  projects  reserve  funds  and
  appropriations. 1. (a) For the purposes of the issuance by the agency of
  hospital and nursing home project bonds, the term "hospital and  nursing
  home  capital reserve fund requirement" shall mean, as of any particular
  date of computation, an amount of money equal to  the  greatest  of  the
  respective  amounts,  for  the  then  current or any succeeding calendar
  year, of annual debt service payments of the agency,  such  annual  debt
  service payments for any calendar year being an amount of money equal to
  the  aggregate  of (i) all interest payable during such calendar year on
  all  hospital  and  nursing  home  project  bonds  of  the  agency  then
  outstanding  on said date of computation, plus (ii) the principal amount
  of all hospital and nursing  home  project  bonds  of  the  agency  then
  outstanding  on  said  date  of  computation  which  mature  during such
  calendar year, plus (iii)  the  amount  of  all  sinking  fund  payments
  payable  during  such  calendar  year  with  respect to all hospital and
  nursing home project bonds of the agency outstanding  on  said  date  of
  computation;  and  the term "sinking fund payment" shall mean the amount
  of money specified in the resolution authorizing term bonds  as  payable
  into  a sinking fund for the amortization of such term bonds. The agency
  shall create and establish a special fund to be known  as  the  hospital
  and nursing home capital reserve fund and may pay into such reserve fund
  (1)  any  monies  appropriated  and  made available by the state for the
  purposes of such fund, (2) any proceeds of sale of hospital and  nursing
  home  project  notes  or hospital and nursing home project bonds, to the
  extent provided in the resolution of the agency authorizing the issuance
  thereof, and (3) any other monies which may be  made  available  to  the
  agency  for  the purposes of such fund from any other source or sources.
  The monies held in or credited to the hospital and nursing home  capital
  reserve  fund  established under this subdivision, except as hereinafter
  provided, shall be used solely for  the  payment  of  the  principal  of
  hospital  and  nursing  home project bonds of the agency secured by such
  reserve fund, as the same mature, sinking fund payments, the purchase of
  such hospital and nursing home project bonds of the agency, the  payment
  of  interest  on  such  hospital  and nursing home projects bonds of the
  agency, or the payment of any redemption premium  required  to  be  paid
  when  such bonds are redeemed prior to maturity; provided, however, that
  monies in such fund shall not be withdrawn therefrom at any time in such
  amount as would reduce the amount of such fund to less than the hospital
  and nursing home  capital  reserve  fund  requirement,  except  for  the
  purpose  of  paying  principal  and interest on the hospital and nursing
  home project bonds of the agency secured by such reserve  fund  maturing
  and  becoming  due  and any sinking fund payments and for the payment of
  which other monies of the  agency  are  not  available.  Any  income  or
  interest  earned  by,  or  increment  to,  the hospital and nursing home
  capital reserve fund due to the investment thereof may be transferred to
  any other fund or account of the agency to the extent it does not reduce
  the amount of the hospital and nursing home capital reserve  fund  below
  the hospital and nursing home capital reserve fund requirement.
    (b) The agency shall not issue hospital and nursing home project bonds
  and  hospital  and  nursing home project notes in an aggregate principal
  amount  exceeding  fifteen  billion  eight  hundred   million   dollars,
  excluding  hospital  and  nursing  home  project  bonds and hospital and

  nursing home project notes issued to  refund  outstanding  hospital  and
  nursing home projects bonds and hospital and nursing home project notes;
  provided,  however,  that upon any such refunding or repayment the total
  aggregate   principal  amount  of  outstanding  bonds,  notes  or  other
  obligations may be greater than fifteen billion  eight  hundred  million
  dollars  only  if the present value of the aggregate debt service of the
  refunding or repayment bonds, notes or other obligations  to  be  issued
  shall  not exceed the present value of the aggregate debt service of the
  bonds, notes or other obligations so  to  be  refunded  or  repaid.  For
  purposes hereof, the present values of the aggregate debt service of the
  refunding  or  repayment  bonds,  notes  or other obligations and of the
  aggregate debt service of the  bonds,  notes  or  other  obligations  so
  refunded  or  repaid,  shall  be  calculated  by utilizing the effective
  interest rate of the  refunding  or  repayment  bonds,  notes  or  other
  obligations,  which  shall  be  that  rate  arrived  at  by doubling the
  semi-annual  interest  rate  (compounded  semi-annually)  necessary   to
  discount  the debt service payments on the refunding or repayment bonds,
  notes or other obligations from the payment dates thereof to the date of
  issue of the refunding or repayment bonds, notes  or  other  obligations
  and  to  the  price bid including estimated accrued interest or proceeds
  received by the agency including estimated  accrued  interest  from  the
  sale  thereof.  The  agency  shall  not  issue hospital and nursing home
  project bonds at any time secured  by  the  hospital  and  nursing  home
  capital  reserve  fund  if upon issuance, the amount in the hospital and
  nursing home capital reserve fund will be less  than  the  hospital  and
  nursing home capital reserve fund requirement, unless the agency, at the
  time  of issuance of such bonds, shall deposit in such reserve fund from
  the proceeds of the bonds so to be issued, or otherwise, an amount which
  together with the amount then in such reserve fund,  will  be  not  less
  than the hospital and nursing home capital reserve fund requirement.
    (c)  To  assure the continued operation and solvency of the agency for
  the carrying out of the public purposes of this act, provision  is  made
  in  paragraph  (a)  of  this  subdivision  for  the  accumulation in the
  hospital and nursing home capital reserve fund of an amount equal to the
  hospital and nursing home capital reserve  fund  requirement.  In  order
  further  to  assure  the  maintenance  of  the hospital and nursing home
  capital reserve fund, there shall be annually apportioned  and  paid  to
  the  agency for deposit in the hospital and nursing home capital reserve
  fund such sum, if any, as shall be certified  by  the  chairman  of  the
  agency  to  the  governor  and  director  of  the budget as necessary to
  restore such reserve fund to an amount equal to the hospital and nursing
  home capital reserve fund requirement. The chairman of the agency  shall
  annually,  on or before December first, make and deliver to the governor
  and director of the budget his certificate stating  the  sums,  if  any,
  required  to  restore the hospital and nursing home capital reserve fund
  to the amount aforesaid and the sums so  certified,  if  any,  shall  be
  apportioned  and paid to the agency during the then current state fiscal
  year. The principal amount of bonds secured by the hospital and  nursing
  home  capital  reserve  fund  to  which  state  funds  are apportionable
  pursuant to this paragraph shall be limited to the total amount of bonds
  and notes outstanding on the effective date of this act, plus the  total
  amount  of  bonds  and notes contracted after the effective date of this
  act to finance projects in progress on the effective date of this act as
  determined by the  New  York  state  public  authorities  control  board
  created  pursuant  to  section fifty of the public authorities law whose
  affirmative determination shall be conclusive as to all matters  of  law
  and  fact  solely  for the purposes of the limitations contained in this
  paragraph, but in no event shall the total amount of bonds so secured by

  such a capital reserve fund or funds exceed two  hundred  forty  million
  dollars,  excluding  bonds issued to refund such outstanding bonds until
  the date of redemption of such outstanding bonds. As  outstanding  bonds
  so  secured are paid, the amount so secured shall be reduced accordingly
  but the redemption of  such  outstanding  bonds  from  the  proceeds  of
  refunding bonds shall not reduce the amount so secured.
    (d)  In  computing  the hospital and nursing home capital reserve fund
  for the purposes of this section, securities in which all or  a  portion
  of  such  reserve  fund  shall  be  invested  shall  be valued at par if
  purchased at par, or if purchased at other than par, at amortized value.
    2. The agency shall create and establish one  or  more  special  funds
  (herein  referred to as hospital and nursing home general reserve funds)
  and shall, to the extent provided in the applicable bond  resolution  of
  the agency authorizing the issuance of hospital and nursing home project
  bonds,  pay  into  any  such  fund the fees and charges collected by the
  agency pursuant to subdivision twelve of section five of  this  act  and
  any monies which the agency shall transfer from the hospital and nursing
  home capital reserve fund pursuant to the provisions of paragraph (a) of
  subdivision  one  of this section. Such monies and any other monies paid
  into a hospital and nursing  home  general  reserve  fund  may,  in  the
  discretion of the agency, but subject to agreements with bondholders and
  noteholders,  be  used  by  the agency (a) for the repayment of advances
  from the state in accordance with the provisions of repayment agreements
  between the agency and the director of the budget, (b) to reimburse  the
  department  of  health the reasonable costs of the services performed by
  the commissioner of health and the  department  of  health  pursuant  to
  subdivision  two of section seventeen of this act, (c) to pay all costs,
  expenses and charges  of  financing,  including  fees  and  expenses  of
  trustees  and  paying  agents,  (d)  for  transfers  to the hospital and
  nursing home capital reserve fund, (e) for the payment of principal  and
  interest  on  hospital  and  nursing home project bonds and hospital and
  nursing home project notes issued by the  agency  when  the  same  shall
  become  due  whether  at  maturity or on call for redemption and for the
  payment of any  redemption  premium  required  to  be  paid  where  such
  hospital  and  nursing  home project bonds and hospital and nursing home
  project notes are redeemed prior to  their  stated  maturities  and  any
  sinking fund payments, and to purchase hospital and nursing home project
  bonds  or  hospital and nursing home project notes issued by the agency,
  or (f) for such other corporate purposes of the agency as the agency  in
  its discretion shall determine and provide.
    * §  7-a.  Secured hospital projects reserve funds and appropriations.
  1.  Special hospital project bonds issued to  finance  the  projects  of
  eligible  secured  hospital  borrowers  shall  be secured by (i) a first
  mortgage  lien  on  such  property  as  specified  in  accordance   with
  subdivision twelve of section three of this act, (ii) funds and accounts
  established  under  the  bond  resolution,  (iii)  the  secured hospital
  special debt service reserve fund or funds, (iv)  the  secured  hospital
  capital  reserve  fund  or  funds,  and  (v)  such  service  contract or
  contracts entered into in accordance with the provisions of  subdivision
  four of this section.
    2.  (a)  The  agency  shall  establish a secured hospital special debt
  service reserve fund or funds and pay into such  fund  or  funds  moneys
  from  the  secured hospital fund up to an amount not to exceed an amount
  necessary to ensure the repayment of principal and interest due  on  any
  outstanding  indebtedness  on  special  hospital  projects  bonds. Funds
  deposited in such special debt service reserve fund or  funds  shall  be
  used  in  the  event that an eligible secured hospital borrower fails to
  make the required debt service payments  on  special  hospital  projects

  bonds,  including, if necessary, payments due as a result of the failure
  to make principal and interest payments associated with the  refinancing
  of indebtedness attributable to unmet bad debt and charity care losses.
    (b)  The  agency  shall  establish  a  secured  hospital  fund for the
  purposes of paragraph (a) of this subdivision and  for  the  support  of
  eligible borrowers, and shall pay into such fund: (i) all funds required
  to  be paid in accordance with the provisions of article twenty-eight of
  the public health law and regulations promulgated thereunder;  (ii)  any
  mortgage insurance premium assessed in an amount fixed at the discretion
  of  the  agency,  upon  the  issuance of special hospital project bonds;
  (iii) any income or interest earned on other  reserve  funds  which  the
  agency  elects  to  transfer  to the secured hospital fund; and (iv) any
  other moneys which may be made available to the agency for the  purposes
  of  such  fund  from  any  other source or sources. Moneys paid into the
  secured hospital fund shall,  in  the  discretion  of  the  agency,  but
  subject to agreements with bondholders, be used to fund the special debt
  service  reserve  fund  or funds at a level or levels which minimize the
  need for use of the capital reserve fund or funds in the  event  of  the
  failure  of  an  eligible secured hospital borrower to make the required
  debt service payments on special hospital project bonds.
    (c) Notwithstanding the provisions of paragraphs (a) and (b)  of  this
  subdivision,  the state hereby expressly reserves the right to modify or
  repeal the provisions of article twenty-eight of the public health law.
    3. The agency shall establish a secured hospital capital reserve  fund
  or  funds  which  shall  be  funded at an amount or amounts equal to the
  lesser of either: (i) the maximum  amount  of  principal,  sinking  fund
  payments  and interest due in any succeeding year on outstanding special
  hospital project bonds or (ii) the maximum amount to  insure  that  such
  bonds  will not be considered arbitrage bonds under the Internal Revenue
  Code of 1986, as amended. The capital reserve fund shall  be  funded  by
  the  sale  of special hospital project bonds or from such other funds as
  may be legally available for such purpose, as provided for in  the  bond
  resolution or resolutions authorizing the issuance of such bonds.
    4. (a) Notwithstanding the provisions of any general or special law to
  the  contrary,  and  subject  to  the  making  of  annual appropriations
  therefor by the legislature, in order to provide adequate health care to
  persons of low income who otherwise would be unable to secure  the  same
  and  to  assist  the agency in the undertaking and financing of mortgage
  loans to eligible secured hospital borrowers as defined  in  subdivision
  six-b  of  section  three  of  this  act  and  in  consideration  of the
  undertaking thereof and the benefits to  be  derived  therefrom  by  the
  people  of  the  state,  the director of the budget is authorized in any
  state fiscal year to enter into one or more service contracts,  none  of
  which  shall exceed thirty years in duration, with the agency, upon such
  terms as the director of the budget and  the  agency  agree,  so  as  to
  provide  annually  to  the  agency in the aggregate such sum, if any, as
  necessary to meet the debt service payments due on  outstanding  special
  hospital  project  bonds  in  any year if the funds provided for in this
  section are inadequate.
    (b) Any service contract entered into pursuant  to  paragraph  (a)  of
  this  subdivision  shall provide (i) that the obligation of the director
  of the budget or of the state to fund or  to  pay  the  amounts  therein
  provided for shall not constitute a debt of the state within the meaning
  of  any  constitutional  or  statutory  provision  and  shall  be deemed
  executory only to the extent of moneys available and that  no  liability
  shall  be  incurred  by  the  state  beyond the moneys available for the
  purpose, and that such obligation is subject to annual appropriation  by
  the  legislature;  and (ii) that the amounts paid to the agency pursuant

  to any such contract may be used by it solely to pay  or  to  assist  in
  financing costs of mortgage loans to eligible secured hospital borrowers
  as defined in subdivision six-b of section three of this act.
    5.  The  agency  shall  not issue special hospital project bonds in an
  aggregate  principal  amount  exceeding   one   billion   nine   hundred
  seventy-four  million  two  hundred  fifty  thousand  dollars, excluding
  special hospital project bonds  issued  to  refund  outstanding  special
  hospital project bonds issued for such purposes; provided, however, that
  upon  any  such  refunding  or  repayment  the total aggregate principal
  amount of outstanding bonds, notes or other obligations may  be  greater
  than  one  billion  nine  hundred seventy-four million two hundred fifty
  thousand dollars only if the present value of the aggregate debt service
  of the refunding or repayment bonds, notes or other  obligations  to  be
  issued  shall not exceed the present value of the aggregate debt service
  of the bonds, notes or other obligations so to be  refunded  or  repaid.
  For purposes hereof, the present values of the aggregate debt service of
  the  refunding or repayment bonds, notes or other obligations and of the
  aggregate debt service of the  bonds,  notes  or  other  obligations  so
  refunded  or  repaid,  shall  be  calculated  by utilizing the effective
  interest rate of the  refunding  or  repayment  bonds,  notes  or  other
  obligations,  which  shall  be  that  rate  arrived  at  by doubling the
  semi-annual  interest  rate  (compounded  semi-annually)  necessary   to
  discount  the debt service payments on the refunding or repayment bonds,
  notes or other obligations from the payment dates thereof to the date of
  issue of the refunding or repayment bonds, notes  or  other  obligations
  and  to  the  price bid including estimated accrued interest or proceeds
  received by the agency including estimated  accrued  interest  from  the
  sale thereof.
    * NB Expires December 31, 2015
    * §  7-c.  Secured hospital projects reserve funds and appropriations.
  1.  Special hospital project bonds, as defined  in  paragraph  (d-1)  of
  subdivision  three of section three of this act, issued to refinance the
  projects  of  eligible  secured  hospital  borrowers,  as   defined   in
  subdivision  six-c of section three of this act, shall be secured by (a)
  a mortgage lien, (b) funds  and  accounts  established  under  the  bond
  resolution,  (c)  the secured hospital special debt service reserve fund
  or funds, (d) the secured hospital capital reserve fund  or  funds,  and
  (e)  such  service contract or contracts entered into in accordance with
  the provisions of subdivision four of this section.
    2. (a) The agency shall establish  a  secured  hospital  special  debt
  service  reserve  fund  or  funds and pay into such fund or funds moneys
  from the secured hospital fund up to an amount not to exceed  an  amount
  necessary  to  ensure the repayment of principal and interest due on any
  outstanding indebtedness on special hospital projects bonds, as  defined
  in paragraph (d-1) of subdivision three of section three of this act.
    Funds  deposited in such secured hospital special debt service reserve
  fund or funds shall be used  in  the  event  that  an  eligible  secured
  hospital  borrower,  as defined in subdivision six-c of section three of
  this act, fails to make payments in an  amount  sufficient  to  pay  the
  required  debt  service  payments  on special hospital project bonds, as
  defined in paragraph (d-1) of subdivision three of section three of this
  act.
    (b) The agency shall, for  the  purposes  of  paragraph  (a)  of  this
  subdivision  and for the support of eligible secured hospital borrowers,
  pay into the secured hospital fund currently established and  maintained
  by  the agency: (i) all funds required to be paid in accordance with the
  provisions  of  article  twenty-eight  of  the  public  health  law  and
  regulations  promulgated  in  such  article; (ii) any mortgage insurance

  premium assessed in an amount fixed at the  discretion  of  the  agency,
  upon  the  issuance  of  special  hospital  project bonds, as defined in
  paragraph (d-1) of subdivision three of section three of this act; (iii)
  any  income  or  interest earned on other reserve funds which the agency
  elects to transfer to the secured hospital  fund;  and  (iv)  any  other
  moneys  which  may be made available to the agency from any other source
  or sources. Moneys paid into the secured hospital  fund  shall,  in  the
  discretion of the agency, but subject to agreements with bondholders, be
  used  to  fund the special debt service reserve fund or funds at a level
  or levels which minimize the need for use of the capital reserve fund or
  funds in the event of  the  failure  of  an  eligible  secured  hospital
  borrower,  as defined in subdivision six-c of section three of this act,
  to make the required debt service payments on special  hospital  project
  bonds,  as  defined  in  paragraph (d-1) of subdivision three of section
  three of this act.
    (c) Notwithstanding the provisions of paragraphs (a) and (b)  of  this
  subdivision,  the state hereby expressly reserves the right to modify or
  repeal the provisions of article twenty-eight of the public health law.
    3. The agency shall establish a secured hospital capital reserve  fund
  or  funds  which  shall  be  funded at an amount or amounts equal to the
  lesser of either: (a) the maximum  amount  of  principal,  sinking  fund
  payments  and interest due in any succeeding year on outstanding special
  hospital project bonds, as defined in  paragraph  (d-1)  of  subdivision
  three  of section three of this act, or (b) the maximum amount to ensure
  that such bonds  will  not  be  considered  arbitrage  bonds  under  the
  Internal  Revenue  Code  of  1986,  as amended. The capital reserve fund
  shall be funded by the  sale  of  special  hospital  project  bonds,  as
  defined in paragraph (d-1) of subdivision three of section three of this
  act,  or  from  such  other  funds  as may be legally available for such
  purpose,  as  provided  for  in  the  bond  resolution  or   resolutions
  authorizing the issuance of such bonds.
    4. (a) Notwithstanding the provisions of any general or special law to
  the  contrary,  and  subject  to  the  making  of  annual appropriations
  therefor by the legislature in order  to  refinance  mortgage  loans  to
  eligible  secured hospital borrowers, as defined in subdivision six-c of
  section three of this act, the director of the budget is  authorized  in
  any state fiscal year to enter into one or more service contracts, which
  service  contracts  shall  not  exceed  the term of the special hospital
  project bonds, issued for the benefit of the eligible  secured  hospital
  borrower,  upon  such terms as the director of the budget and the agency
  agree, so as to provide annually to the agency  in  the  aggregate  such
  sum,  if  any,  as  necessary  to  meet the debt service payments due on
  outstanding special hospital project  bonds,  as  defined  in  paragraph
  (d-1)  of subdivision three of section three of this act, in any year if
  the funds provided for in this section are inadequate.
    (b) Any service contract entered into pursuant  to  paragraph  (a)  of
  this  subdivision  shall provide (i) that the obligation of the director
  of the budget or of the state to fund or  to  pay  the  amounts  therein
  provided for shall not constitute a debt of the state within the meaning
  of  any  constitutional  or  statutory  provision  and  shall  be deemed
  executory only to the extent of moneys available and that  no  liability
  shall  be  incurred  by  the  state beyond the moneys available for such
  purpose, and that such obligation is subject to annual appropriation  by
  the  legislature;  and (ii) that the amounts paid to the agency pursuant
  to any such contract may be used by it solely to pay  or  to  assist  in
  financing   costs   of  mortgage  loans  to  eligible  secured  hospital
  borrowers, as defined in subdivision six-c of section three of this act.

    5. The agency shall not  issue  special  hospital  project  bonds,  as
  defined in paragraph (d-1) of subdivision three of section three of this
  act,  except  to  refinance mortgage loans for eligible secured hospital
  borrowers as provided in section three of this act.
    * NB Repealed December 31, 2015
    §  8.  Health  facilities reserve funds and appropriations. 1. (a) For
  the purposes of the issuance by the agency of health  facilities  bonds,
  the  term "health facilities reserve fund requirement" shall mean, as of
  any particular date of computation, an amount  of  money  equal  to  the
  greatest  of  the  respective  amounts,  for  the  then  current  or any
  succeeding calendar year, of annual debt service payments of the agency,
  such annual debt service payments for any calendar year being an  amount
  of  money equal to the aggregate of (i) all interest payable during such
  calendar year  on  all  health  facilities  bonds  of  the  agency  then
  outstanding on said date of computation, plus (ii) the prinicipal amount
  of  all  health  facilities bonds of the agency then outstanding on said
  date of computation which mature during such calendar year,  plus  (iii)
  the  amount  of  all  sinking fund payments payable during such calendar
  year  with  respect  to  all  health  facilities  bonds  of  the  agency
  outstanding  on  said  date  of  computation; and the term "sinking fund
  payment" shall mean the amount of  money  specified  in  the  resolution
  authorizing   term  bonds  as  payable  into  a  sinking  fund  for  the
  amortization of such term bonds. The agency may create and establish one
  or more additional reserve  funds  to  be  known  as  health  facilities
  reserve  funds  and  may  pay  into  such  reserve  funds (1) any monies
  appropriated and made available by the state for the  purposes  of  such
  funds,  (2)  any  proceeds  of sale of health facilities notes or health
  facilities bonds, to the extent provided in the resolution of the agency
  authorizing the issuance thereof, and (3) any other monies which may  be
  made  available  to  the  agency for the purposes of such funds from any
  other source or sources. The monies held in or credited  to  any  health
  facilitiss  reserve  fund  established under this subdivision, except as
  hereinafter provided, shall be  used  solely  for  the  payment  of  the
  prinicipal  of  health  facilities  bonds  of the agency secured by such
  reserve fund, as the same mature, sinking fund payments, the purchase of
  such health facilities bonds of the  agency,  and  the  payment  of  any
  redemption  premium  required  to  be  paid when such bonds are redeemed
  prior to maturity; provided, however, that monies in any such fund shall
  not be withdrawn therefrom at any time in such amount  as  would  reduce
  the  amount of such fund to less than the health facilities reserve fund
  requirement, except for the purpose of paying principal and interest  on
  the  health  facilities bonds of the agency secured by such reserve fund
  maturing and becoming due and any sinking  fund  payments  and  for  the
  payment  of  which  other  monies  of  the agency are not available. Any
  income  or  interest  earned  by,  or  increment  to,  any  such  health
  facilities reserve fund due to the investment thereof may be transferred
  to  any  other  fund  or account of the agency to the extent it does not
  reduce the amount of such  health  facilities  reserve  fund  below  the
  health facilities reserve fund requirement.
    (b)  The  agency  shall  not  issue health facilities bonds and health
  facilities notes, municipal hospital bonds,  municipal  hospital  notes,
  municipal  nursing  home  bonds  and  municipal nursing home notes in an
  aggregate principal amount  exceeding  two  billion  dollars,  excluding
  health  facilities  bonds  and  health facilities notes issued to refund
  outstanding health facilities bonds  or  health  facilities  notes.  The
  agency  shall not issue health facilities bonds at any time secured by a
  health facilities reserve fund if  upon  issuance,  the  amount  in  the
  health  facilities  reserve fund will be less than the health facilities

  reserve fund requirement, unless the agency, at the time of issuance  of
  such  bonds, shall deposit in such reserve fund from the proceeds of the
  bonds so to be issued, or otherwise, an amount which together  with  the
  amount  then  in  such  reserve  fund,  will be not less than the health
  facilities reserve fund requirement.
    (c) In computing any health facilities reserve fund for  the  purposes
  of  this  section,  securities in which all or a portion of such reserve
  fund shall be invested shall be valued at par if purchased at par, or if
  purchased at other than par, at amortized value.
    2. (a) The agency shall create  and  establish  one  or  more  special
  accounts  (herein  referred  to as health facilities income account) and
  shall pay into such accounts any monies which the agency  shall  receive
  in  payment of rentals due under one or more leases or subleases entered
  into with a municipality pursuant to section five and any  other  monies
  which the agency shall receive from a municipality as security for or in
  payment of such rentals. Such monies and any other monies paid into such
  health facilities income accounts, may, in the discretion of the agency,
  but  subject  to  agreements with the holders of health facilities bonds
  and health facilities notes, be used by the agency (1) for the repayment
  of advances, if any, from the state to the  agency  in  connection  with
  health   facilities,   and  any  real  property  required  therefor,  in
  accordance with the provisions of repayment agreements  related  thereto
  which have been entered into with the director of the budget, (2) to pay
  all   costs,  expenses  and  charges  of  financing  the  health  facil-
  applicable to such account or accounts including fees  and  expenses  of
  trustees  and  paying  agents,  (3)  to pay the administrative and other
  expenses of the agency allocable to the services performed by the agency
  in the  financing  of  the  construction,  acquisition,  reconstruction,
  rehabilitation  or improvement of health facilities and matters relating
  thereto, (4) for the payment of the principal of and interest on  health
  facilities bonds or health facilities notes isued by the agency when the
  same  shall become due whether at maturity or by call for redemption and
  for the payment of any redemption premium required to be paid where such
  bonds or notes are redeemed prior to their stated  maturities,  and  any
  sinking fund payments, and to purchase health facilities bonds or health
  facilities  notes  isued  by the agency, or (5) for such other corporate
  purposes of the agency relating to the carrying out  of  its  functions,
  powers  and  duties  with  respect to the financing of the construction,
  acquisition, reconstruction, rehabilitation  or  improvement  of  health
  facilities as the agency in its discretion shall determine and provide.
    (b)  To  assure the continued payment of rentals due under one or more
  leases or subleases entered into with a municipality pursuant to section
  five, the agency shall make and deliver to the appropriate chief  fiscal
  officer  of  the municipality a certificate setting forth the amount, if
  any, due and not paid to the agency under such lease  or  sublease  with
  such  municipality within five days of the due date. In the event of the
  failure or inability of the municipality to pay over the  stated  amount
  to the agency within ten days of receipt of such certificate, the agency
  shall  forthwith make and deliver to the comptroller of the state of New
  York, the director of the budget of  the  state  of  New  York  and  the
  commissioner  of  health  of the state of New York a further certificate
  restating the amount due and not paid, and such  amount  shall  be  paid
  over  to  the  agency,  upon  the warrant of the comptroller on vouchers
  certified as correct by the commissioner of  health,  out  of  the  next
  payment  of  state aid to such municipality pursuant to section 368-a of
  the social services law or funds appropriated for the purpose of  making
  payment on behalf of such municipality pursuant to section 367-b of such
  law.  To  the extent any such payments to the agency are made from state

  aid payments pursuant to section 368-a of such law, the amount  of  such
  payments shall be deducted from the corresponding apportionment of state
  aid  otherwise credited to such municipality, and the state shall not be
  obligated to pay, nor shall such municipality be entitled to receive, by
  virtue  of  such deduction, any additional or increased apportionment or
  payment of state aid pursuant to section 368-a of  the  social  services
  law.  To  the extent any such payments to the agency are made from funds
  appropriated for the purpose  of  making  payments  on  behalf  of  such
  municipality  pursuant  to section 367-b of such law, the amount of such
  payments may be deducted from any other payments of state assistance  to
  such  municipality under the social services law and the state shall not
  be obligated to pay, nor shall the municipality be entitled to  receive,
  by  virtue  of such deduction, any additional or increased apportionment
  or payment of such state assistance,  provided,  however,  that  nothing
  contained  in this sentence shall be construed to limit, impair, impede,
  or otherwise adversely affect in any manner the rights  or  remedies  of
  the purchasers and holders and owners of any bonds or notes of the state
  or   any  agency  or  instrumentality,  public  benefit  corporation  or
  political subdivision thereof under which such  purchasers  and  holders
  and  owners have any right of payment of such bonds or notes by recourse
  to such state assistance monies.
    § 9. Special provisions relating to the  municipal  health  facilities
  improvement  program.  Notwithstanding  any  other  provisions  of  law,
  general, special or local, or any provision of any charter or ordinance:
    1. A municipality is hereby authorized to execute and deliver  to  the
  agency  for such consideration as may be determined by the municipality,
  the agency and the health  and  mental  hygiene  facilities  improvement
  corporation,  but  not  to exceed the cost of acquisition thereof to the
  municipality and the cost of improvements thereon, a lease  for  a  term
  not  exceeding  fifty years or a quit claim deed conveying to the agency
  all right, title and interest  of  such  municipality  in  and  to  real
  property,    for    the   purpose   of   constructing,   reconstructing,
  rehabilitating, or improving one or more health facilities  pursuant  to
  this  act  and  the health and mental hygiene facilities improvement act
  for subsequent lease or sublease to  such  municipality,  in  accordance
  with  the  terms  of any agreement entered into pursuant to this act and
  the health and mental hygiene facilities improvement act.
    2. A municipality is hereby authorized to lease or sublease  from  the
  agency  the  health  facilities  acquired,  constructed,  reconstructed,
  rehabilitated or improved  pursuant  to  this  act  and  the  facilities
  development  corporation  act  in  accordance  with  the  terms  of  any
  agreement  entered  into  pursuant  to  this  act  and  the   facilities
  development  corporation  act.  At  such  time  as all rentals due or to
  become due to the agency pursuant to the terms  of  any  such  lease  or
  sublease have been paid or such lease or sublease is terminated pursuant
  to  the provisions thereof, the jurisdiction of the agency over the real
  property leased or conveyed pursuant to this section, together with  the
  improvements  thereon  shall cease and all interest real and personal in
  such real property and improvements vested in the agency shall  vest  in
  the municipality with right of re-entry thereon.
    3.  No  real property interest therein shall be acquired by the agency
  pursuant to this section unless title thereto shall have  been  approved
  by the attorney general.
    4.  The  attorney general shall pass upon the form and sufficiency and
  manner of execution of any deed  of  conveyance  and  of  any  lease  or
  sublease  to  which  the  agency and a municipality are parties, and the
  same shall not be effecteive unless approved by him.

    5. In the event that the agency shall fail within five years from  the
  date  of  a  lease  or conveyance authorized pursuant to this section to
  construct, reconstruct, rehabilitate or improve  the  health  facilities
  thereon  for  which the lease or conveyance was made, as provided for in
  any  agreement  entered  into  pursuant  to  this act and the health and
  mental hygiene facilities improvement act, or in  the  event  that  such
  health facilities shall cease to be used for the purposes intended, then
  and  in  either event but subject to the terms of any lease, sublease or
  other agreement between the  agency  and  the  municipality,  such  real
  property   and  any  health  facilities  thereon  shall  revert  to  the
  municipality with right of re-entry thereupon and  such  lease  or  deed
  shall  be  made subject to such conditions; provided, however, that as a
  condition precedent to the  exercise  of  such  right  of  re-entry  the
  municipality  shall  pay  to  the agency an amount equal to the purchase
  price of  such  real  property,  the  depreciated  cost  of  any  health
  facilities  constructed,  reconstructed,  rehabilitated or improved, and
  all other costs of the agency incident to the acquisition of  such  real
  property    and   the   financing   of   construction,   reconstruction,
  rehabilitation or  improvement  relating  to  such  facilities,  all  as
  provided  in  the  aforesaid  lease, sublease or other agreement entered
  into with such municipality.
    6. In the event that the agency shall determine that any  portions  of
  the  real  property  leased  or conveyed pursuant to this section are in
  excess  of  the  real  property  needed   to   construct,   reconstruct,
  rehabilitate or improve the facility or facilities thereon for which the
  conveyance  was made, as provided in any agreement entered into pursuant
  to this act and the health and  mental  hygiene  facilities  improvement
  act,  the  agency  may  terminate  its lease with respect to such excess
  portions of such real property or reconvey such excess portions  to  the
  municipality,  provided, however, that the municipality shall pay to the
  agency an amount equal to the consideration, if any, paid by the  agency
  to  such  municipality  allocable  to such excess real property and such
  other costs of the the agency as are incident to the acquisition of such
  excess real property, all as may be approved by  such  municipality  and
  the  agency. Any monies so paid to the agency shall be used and applied,
  subject  to  the  provisions  of  any  contract  with  noteholders   and
  bondholders,  for  the  sole purpose of paying costs and expenses of the
  agency incident to  the  financing  of  the  health  facilities,  to  be
  constructed,  reconstructed,  rehabilitated  or  improved  on such other
  portions of the real property as shall have been leased or  conveyed  to
  the agency pursuant to this section.
    7.    The   cost   of   construction,   acquisition,   reconstruction,
  rehabilitation or improvement of health  facilities  undertaken  by  the
  agency pursuant to this act and the health and mental hygiene facilities
  improvement act may include the cost of acquisition of any real property
  leased or conveyed to the agency in accordance with this section and the
  cost  of  the  original  furnishings, equipment, machinery and apparatus
  needed to furnish and equip such facilities upon the completion  of  the
  work.  The  agency shall have power to acquire or lease and to hold real
  property required for  the  construction,  acquisition,  reconstruction,
  rehabilitation or improvement of the health facilities undertaken by the
  agency pursuant to this act and the health and mental hygiene facilities
  improvement  act  and  to  provide  the original furnishings, equipment,
  machinery and apparatus needed to furnish and equip such facilities upon
  the completion of work and to issue  its  bonds  and  notes  to  provide
  sufficient funds to pay the cost thereof.
    8.  A  municipality  is hereby authorized and empowered, in connection
  with any lease, sublease or other agreement with  the  agency  to  which

  such  municipality is a party, and subject to such agreements with third
  parties as may then exist, to:
    (a)  pledge or assign to the agency all or any portion of the revenues
  and monies received or to be received by the municipality, which may  be
  available  for  the  purpose of paying rentals for the use of the health
  facilities  constructed,  acquired,  reconstructed,   rehabilitated   or
  improved  under  such agreement, so that the payment of such rentals may
  be fully secured and protected;
    (b) use and dispose of such  revenues  and  monies,  or  any  portions
  thereof,  for the purpose of defraying, in whole or in part (1) the cost
  of  acquiring  any  real  property  for  the  purpose  of  constructing,
  acquiring,   reconstructing,   rehabilitating  or  improving  facilities
  thereon which may be constructed, acquired, reconstructed, rehabilitated
  or improved by the agency pursuant to this act and the health and mental
  hygiene facilities improvement  act,  (2)  the  cost  of  financing  the
  construction, acquisition, reconstruction, rehabilitation or improvement
  of  such  facilities,  and  (3)  the  cost  of  acquiring  the  original
  furnishings, equipment, machinery and apparatus needed  to  furnish  and
  equip such facilities upon the completion of the work;
    (c)  set  aside  rental  reserves  and  to  agree  to the maintenance,
  regulation and disposition thereof;
    (d) agree to limitations on the purposes to which the proceeds of sale
  of health facilities notes or health facilities bonds may be applied and
  to the pledging of  such  proceeds  to  secure  the  payment  of  health
  facilities notes or health facilities bonds or of any issue thereof;
    (e) agree to limitations on the making of additional leases, subleases
  or  agreements  with the agency or with others, and the terms upon which
  such additional leases, subleases or agreements may be made;
    (f) upon receipt of any notice of assignment by the agency of any such
  lease, sublease or other agreement with the agency, or  of  any  of  its
  rights under such lease, sublease or other agreement, recognize and give
  effect  to  such  assignment  and to pay the assignee thereof rentals or
  other payments then due or which may become due under  any  such  lease,
  sublease  or  other  agreement which has been so assigned by the agency;
  and
    (g) agree to any other matters, of like or different character,  which
  in  any  way  affect  the  security or protection of the rental payments
  required to be made under the terms of such  lease,  sublease  or  other
  agreement with the agency.
    9.  A municipality is hereby authorized and empowered, to enter into a
  lease, sublease, license or other operating  agreement  with  any  other
  person,  firm  or  corporation  to  operate  or  to sublease, license or
  otherwise arrange for the operation of, the health facilities  acquired,
  constructed,  reconstructed,  rehabilitated or improved pursuant to this
  act.
    §  9-a.  Special  provisions  relating  to  mental   health   services
  facilities improvement bonds and notes. 1. Definitions. For the purposes
  of this act:
    a.  "Mental  health  services  facility" shall mean a building, a unit
  within a building, a laboratory, a classroom, a housing unit,  a  dining
  hall,  an  activities  center,  a  library, real property of any kind or
  description, or any structure on or improvement to real property of  any
  kind  or  description, including fixtures and equipment which may or may
  not be an integral  part  of  any  such  building,  unit,  structure  or
  improvement, a walkway, a roadway or a parking lot, and improvements and
  connections  for  water, sewer, gas, electrical, telephone, heating, air
  conditioning and other utility services, or a combination of any of  the
  foregoing, whether for patient care and treatment or staff, staff family

  or  service  use,  located  at or related to any psychiatric center, any
  developmental center, or any state psychiatric or research institute  or
  other  facility  now or hereafter established under the state department
  of mental hygiene. A mental health services facility shall also mean and
  include a residential care center for adults, a "community mental health
  and  retardation  facility", and a state or voluntary operated treatment
  facility for use in the conduct of  an  alcoholism  or  substance  abuse
  treatment  program  as  defined  in  the mental hygiene law, unless such
  residential  care  center  for  adults,  community  mental  health   and
  retardation  facility  or  alcoholism  or  substance  abuse  facility is
  expressly excepted  or  the  context  clearly  requires  otherwise.  The
  definition  contained  in  this  subdivision  shall  not be construed to
  exclude therefrom a facility, whether  or  not  owned  or  leased  by  a
  voluntary  agency,  to  be made available under lease, or sublease, from
  the facilities development corporation to  a  voluntary  agency  at  the
  request  of  the  commissioners  of  the  offices  and  directors of the
  divisions of  the  department  of  mental  hygiene  having  jurisdiction
  thereof  for  use in providing services in a residential care center for
  adults, community mental health and retardation services, or for use  in
  the  conduct  of an alcoholism or substance abuse treatment program. For
  purposes of this section mental health services facility shall also mean
  mental hygiene facility as defined in subdivision ten of  section  three
  of the facilities development corporation act.
    b.  "Mental  health services facilities improvement bonds" and "mental
  health services facilities  improvement  notes"  shall  mean  bonds  and
  notes, respectively, issued by the agency pursuant to subdivision two of
  this section.
    c.  "Mental health services facilities improvement program" shall mean
  a program undertaken  by  the  agency  and  the  facilities  development
  corporation  for  the  purpose  of  financing,  refinancing,  designing,
  constructing, acquiring,  reconstructing,  rehabilitating  or  improving
  mental  hygiene  facilities  and  mental  health  services facilities or
  causing  such  facilities  to   be   financed,   refinanced,   designed,
  constructed, acquired, reconstructed, rehabilitated or improved.
    2.  Additional powers of the agency. a. The agency shall have power to
  enter into  one  or  more  lease,  sublease,  loan  or  other  financing
  agreements with the directors of the facilities development corporation,
  or  any  successor agency, for the purpose of providing the financing or
  refinancing   for   or   for   designing,    constructing,    acquiring,
  reconstructing,  rehabilitating  and  improving  mental  health services
  facilities at new or existing mental health services facilities,  or  on
  any real property or interest in real property owned by or conveyed from
  said  corporation,  or any successor agency, or any voluntary agency, or
  for the  refinancing  of  any  such  facilities  for  which  bonds  have
  previously  been  issued  by  the agency or by the state housing finance
  agency and are outstanding  and  to  cause  by  the  providing  of  such
  financing   such  facilities  to  be  designed,  constructed,  acquired,
  reconstructed, rehabilitated or improved or financed  or  refinanced  by
  the  directors  of the said corporation, or any successor agency, all in
  accordance with one or more lease, sublease,  loan  or  other  financing
  agreements entered into between the agency and the directors of the said
  corporation  pursuant  to  subdivision  4 of section 9 of the facilities
  development corporation act.
    b. The agency shall have power and is hereby authorized from  time  to
  time  to  issue negotiable bonds and notes in conformity with applicable
  provisions of the uniform commercial code in such principal  amount  as,
  in  the  opinion  of  the  agency, shall be necessary, after taking into
  account other moneys which may be available for the purpose, to  provide

  sufficient  funds  to  the  facilities  development  corporation, or any
  successor agency, for the financing or refinancing of or for the design,
  construction, acquisition, reconstruction, rehabilitation or improvement
  of  mental  health  services  facilities pursuant to paragraph a of this
  subdivision,  the  payment  of  interest  on  mental   health   services
  improvement  bonds  and  mental health services improvement notes issued
  for such purposes, the establishment of reserves to  secure  such  bonds
  and  notes,  the  cost  or premium of bond insurance or the costs of any
  financial mechanisms which may be used to reduce the debt  service  that
  would  be payable by the agency on its mental health services facilities
  improvement bonds and notes and all other  expenditures  of  the  agency
  incident  to  and  necessary  or  convenient to providing the facilities
  development corporation, or any successor agency,  with  funds  for  the
  financing  or  refinancing  of  or  for  any  such design, construction,
  acquisition, reconstruction, rehabilitation or improvement and  for  the
  refunding of mental hygiene improvement bonds issued pursuant to section
  47-b  of  the  private  housing finance law; provided, however, that the
  agency shall not issue mental  health  services  facilities  improvement
  bonds  and  mental  health  services  facilities improvement notes in an
  aggregate  principal  amount  exceeding  seven  billion  seven   hundred
  twenty-two  million  eight  hundred  fifteen thousand dollars, excluding
  mental health services facilities improvement bonds  and  mental  health
  services  facilities  improvement  notes  issued  to  refund outstanding
  mental health services facilities improvement bonds  and  mental  health
  services  facilities improvement notes; provided, however, that upon any
  such  refunding  or  repayment  of  mental  health  services  facilities
  improvement  bonds  and/or mental health services facilities improvement
  notes the total aggregate principal amount of outstanding mental  health
  services  facilities  improvement  bonds  and  mental  health facilities
  improvement notes may  be  greater  than  seven  billion  seven  hundred
  twenty-two  million  eight  hundred  fifteen  thousand  dollars only if,
  except as hereinafter provided with respect to  mental  health  services
  facilities  bonds  and mental health services facilities notes issued to
  refund mental hygiene improvement bonds authorized to be issued pursuant
  to the provisions of section 47-b of the private  housing  finance  law,
  the  present  value  of  the  aggregate debt service of the refunding or
  repayment bonds to be issued shall not exceed the present value  of  the
  aggregate  debt  service  of  the  bonds  to  be refunded or repaid. For
  purposes hereof, the present values of the aggregate debt service of the
  refunding or repayment bonds, notes or  other  obligations  and  of  the
  aggregate  debt  service  of  the  bonds,  notes or other obligations so
  refunded or repaid, shall  be  calculated  by  utilizing  the  effective
  interest  rate  of  the  refunding  or  repayment  bonds, notes or other
  obligations, which shall  be  that  rate  arrived  at  by  doubling  the
  semi-annual   interest  rate  (compounded  semi-annually)  necessary  to
  discount the debt service payments on the refunding or repayment  bonds,
  notes or other obligations from the payment dates thereof to the date of
  issue  of  the  refunding or repayment bonds, notes or other obligations
  and to the price bid including estimated accrued  interest  or  proceeds
  received  by the authority including estimated accrued interest from the
  sale thereof. Such bonds, other than bonds issued to refund  outstanding
  bonds,  shall  be  scheduled  to  mature  over  a term not to exceed the
  average  useful  life,  as  certified  by  the  facilities   development
  corporation,  of the projects for which the bonds are issued, and in any
  case shall not exceed thirty years and the maximum maturity of notes  or
  any  renewals  thereof  shall not exceed five years from the date of the
  original issue of such notes. Notwithstanding  the  provisions  of  this
  section,  the  agency  shall  have the power and is hereby authorized to

  issue mental health services facilities improvement bonds and/or  mental
  health  services  facilities  improvement  notes  to  refund outstanding
  mental hygiene improvement bonds authorized to be issued pursuant to the
  provisions  of  section  47-b of the private housing finance law and the
  amount of bonds issued or outstanding for such  purposes  shall  not  be
  included for purposes of determining the amount of bonds issued pursuant
  to this section. The director of the budget shall allocate the aggregate
  principal  authorized  to  be  issued  by the agency among the office of
  mental health, office for people with  developmental  disabilities,  and
  the  office  of alcoholism and substance abuse services, in consultation
  with their respective commissioners to finance  bondable  appropriations
  previously approved by the legislature.
    3.  Application  of other provisions of article. Except as provided in
  this section, the other provisions of this act  shall  apply  to  mental
  health  services facilities improvement bonds and mental health services
  facilities improvement notes issued  by  the  agency  pursuant  to  this
  section,  provided,  however,  that such bonds and notes, subject to any
  agreements with the holders of particular bonds or  notes  pledging  any
  specified  portions thereof, shall be secured by a pledge thereof of (a)
  payments made to the agency  with  respect  to  mental  health  services
  facilities  financed  or  refinanced with the proceeds of such bonds and
  notes, and (b) any other assets, moneys or accounts pledged or  assigned
  to  the  agency as security for such payments. However, no resolution or
  resolutions authorizing mental health  services  facilities  improvement
  bonds  or  mental health services facilities improvement notes shall (A)
  pledge all or any part of the fees and charges made or received  by  the
  agency  pursuant  to  paragraphs (a) through (d) of subdivision three of
  section six of this act in connection with the making of mortgage  loans
  or  commitments  therefor,  or all or any part of the moneys received in
  payment of such mortgage loans and interest thereon, (B) pledge  all  or
  any  part  of  the  mortgages  of the agency or obligations securing the
  same, (C) provide as to the use and disposition of the gross income from
  mortgages owned by the agency or as to the payment of the  principal  of
  mortgages owned by the agency, (D) pledge all or any part of the rentals
  paid  to  the  agency  under  leases,  subleases or other agreements for
  health facilities entered into by the agency  in  accordance  with  this
  article,  or  (E)  pledge or assign all or any part of any other assets,
  moneys or accounts pledged or assigned to the agency as security for the
  payment of rentals for such health facilities.
    4. Mental health services facilities fund. The agency shall create and
  establish one or more special funds (herein referred to as mental health
  services facilities funds) and shall pay into any such fund  any  moneys
  which the agency shall receive in payment in accordance with one or more
  agreements  entered  into  pursuant to subdivision 4 of section 9 of the
  facilities development corporation act and any other  moneys  which  the
  agency   shall  receive  from  the  facilities  development  corporation
  pursuant to such agreements. Such moneys and any other moneys paid  into
  the mental health services facilities fund may, in the discretion of the
  agency,  but  subject  to  agreements  with the holders of mental health
  services  facilities  improvement  bonds  and  mental  health   services
  facilities  improvement  notes,  be  used  by  the  agency  (a)  for the
  repayment of  advances,  if  any,  from  the  state  to  the  agency  in
  connection with mental health services facilities, and any real property
  or  interest  in real property required therefor, in accordance with the
  provisions of repayment  agreements  related  thereto  which  have  been
  entered  into  with  the  director  of the budget, (b) to pay all costs,
  expenses and charges of financing and refinancing mental health services
  facilities including fees and expenses of trustees and paying agents and

  credit enhancement  fees,  (c)  to  pay  the  administrative  and  other
  expenses of the agency allocable to the services performed by the agency
  in  the  financing  or  refinancing  of  or  the  design,  construction,
  acquisition,  reconstruction,  rehabilitation  or  improvement of mental
  health services facilities and matters relating  thereto,  (d)  for  the
  payment  of  the  principal  of  and  interest on mental health services
  facilities  improvement  bonds  or  mental  health  services  facilities
  improvement  notes  issued  by the agency when the same shall become due
  whether at maturity or by call for redemption and for the payment of any
  redemption premium required to be paid where such  bonds  or  notes  are
  redeemed prior to their stated maturities, and to purchase mental health
  services   facilities   improvement  bonds  or  mental  health  services
  facilities improvement notes issued by the agency, or (e) for such other
  corporate purposes of the agency relating to the  carrying  out  of  its
  functions,   powers   and  duties  with  respect  to  the  financing  or
  refinancing of the design,  construction,  acquisition,  reconstruction,
  rehabilitation  or  improvement  of mental health services facilities as
  the agency in its discretion shall determine and provide.
    5. The agency may create and establish one or more special funds to be
  known as mental health services facilities improvement  capital  reserve
  funds  and  may  pay into such reserve funds (a) any moneys appropriated
  and made available by the state for the purposes of such funds, (b)  any
  proceeds  of  the  sale of mental health services facilities improvement
  notes or bonds, to the extent provided in the resolution of  the  agency
  authorizing  the issuance thereof, and (c) any other moneys which may be
  made available to the agency for the purposes of  such  funds  from  any
  other  source  or  sources. The amount in each such capital reserve fund
  shall be determined by resolution of the agency provided, however,  that
  such  capital  reserve  fund  shall  not  exceed  the  maximum amount of
  payments becoming due in any succeeding calendar year.
    The  moneys  held  in  or  credited  to  the  capital  reserve   funds
  established under this subdivision except as hereinafter provided, shall
  be used solely to the extent any payments as they become due pursuant to
  one  or  more  agreements referred to in subdivision two of this section
  are not made or provided for by the facilities development  corporation,
  provided,  however,  that  the  moneys  in  such funds shall, subject to
  agreement with the bondholders, not be withdrawn therefrom at  any  time
  in  such  amount  as  would  reduce  the amount thereof to less than the
  amount determined by resolution of the agency except for the purpose  of
  making  such  payments  becoming  due  under  the  agreements  with  the
  facilities development corporation and for which other  moneys  are  not
  available.
    Any  income  or  interest  earned by, or increment to, any such mental
  health services improvement facilities capital reserve fund due  to  the
  investment  thereof  may  be  transferred  to the mental health services
  facilities fund to the extent it does not  reduce  the  amount  of  such
  mental   health   services   capital  reserve  fund  below  the  reserve
  requirement determined by resolution of the agency.
    6. Notwithstanding any other provision of law, general or special:
    a. Any public corporation or officer responsible for  the  acquisition
  of  real  property  or  any  interest  in real property or the planning,
  supervision  or  administration  of  facilities  thereon  which  may  be
  designed,   constructed,   acquired,   reconstructed,  rehabilitated  or
  improved by the agency pursuant to this act is hereby authorized for and
  on behalf and in the name of the people of the state  of  New  York,  to
  execute  and  deliver  to the agency, for such consideration, if any, as
  may be determined by such public corporation or officer and the  agency,
  but  not  to  exceed  the  cost  of  acquisition thereof and the cost of

  improvement thereon, a lease for a term not exceeding thirty years or  a
  quitclaim  deed  conveying to the agency the title to or any interest in
  real property and to any real property or interest in real  property  of
  the  people of the state of New York acquired by such public corporation
  or officer for such facilities, and in and to any  of  the  improvements
  thereon,  for  the  purpose  of designing, constructing, reconstructing,
  rehabilitating or improving thereon one or more facilities  pursuant  to
  this  act  for  lease  or  sublease  to  any  such public corporation or
  officer, in accordance with the terms of an agreement entered into among
  them in accordance with law. The agency is hereby authorized  to  accept
  any  such lease or conveyance from such public corporation or officer or
  from any voluntary agency, to lease or sublease such real property,  any
  interest  in  real  property, improvements and facilities to such public
  corporation or officer, and to hold the same subject to the terms of any
  such lease, conveyance, sublease or other  agreement,  and  such  public
  corporation  or  officer  is hereby authorized, with the approval of the
  director of the budget, to lease or sublease  any  such  real  property,
  interests  in real property, or improvements of the facilities designed,
  constructed, reconstructed, rehabilitated or improved  thereon  pursuant
  to  this act or other provisions of law, and to hold such real property,
  any interests in real property, improvements and facilities  subject  to
  the terms of any such lease, sublease or other agreement.
    b. (i) In the event that the agency shall fail, within five years from
  the  date  of a lease or conveyance authorized pursuant to subdivision 1
  of this section, to construct, reconstruct, rehabilitate or improve  the
  facility  or  facilities  thereon  for which the conveyance was made, as
  provided for in a lease, sublease, loan  or  other  financing  agreement
  entered  into  with  such public corporation or officer, or in the event
  that such facility or facilities shall cease to be used for the purposes
  intended, then and in either event but  subject  to  the  terms  of  any
  lease,  sublease,  loan  or  other financing agreement undertaken by the
  agency,  such  real  property,  interests  in  real  property,  and  the
  improvements  and  facilities thereon, shall revert to the people of the
  state of New York with right of re-entry thereupon, and  such  lease  or
  deed  shall  be made subject to such conditions. Provided, however, that
  as a condition precedent to the exercise of such right of  re-entry  the
  agency  shall be paid an amount equal to the purchase price of such real
  property,  any  interest  in  real  property,  and   improvements,   the
  depreciated   cost   of   any   facility   or   facilities  constructed,
  reconstructed, rehabilitated or improved thereon, and all other costs of
  the agency incident to the acquisition of such real  property,  interest
  in  real  property,  and  the financing of construction, reconstruction,
  rehabilitation or improvement relating to such facility  or  facilities,
  all  as  provided  in  the  aforesaid  lease,  sublease,  loan  or other
  financing  agreement  entered  into  with  such  public  corporation  or
  officer.  It is further provided that for the Corona Unit of the Bernard
  M. Fineson developmental disabilities services office, the agency may be
  paid an amount less than or equal to the  purchase  price  of  the  real
  property,   any   interest  in  real  property,  and  improvements,  the
  depreciated   cost   of   the   facility   constructed,   reconstructed,
  rehabilitated,  demolished  or  improved thereon, and all other costs of
  the agency incident to the acquisition of the real property, interest in
  real  property  and  the  financing  of  construction,   reconstruction,
  rehabilitation,  demolition or improvement relating to the facility, all
  as provided in the aforesaid lease, sublease, loan  or  other  financing
  agreement entered into with such public corporation or officer.
    (ii) In the event that the agency shall determine that any portions of
  the  real  property  or  interest  in  real  property leased or conveyed

  pursuant to subdivision 1 of this section are  in  excess  of  the  real
  property  or interest in real property needed to construct, reconstruct,
  rehabilitate or improve the facility or facilities thereon for which the
  conveyance  was  made,  as  provided in a lease, sublease, loan or other
  financing agreement entered into with such public corporation or officer
  or any voluntary agency, the agency may terminate its lease with respect
  to such excess portions of  such  real  property  or  interest  in  real
  property  or reconvey such excess portions to the people of the state of
  New York or to such voluntary agency. Provided, however, that the  state
  of  New  York  or  such  public corporation or officer or such voluntary
  agency shall pay to the agency an amount equal to the consideration,  if
  any,  paid  by  the agency to such public corporation or officer or such
  voluntary agency allocable to such excess real property or  interest  in
  real  property and such other costs of the agency as are incident to the
  acquisition of such excess real property or interest in  real  property,
  all  as  may  be  approved by such public corporation or officer or such
  voluntary agency and the agency. Any monies so paid to the agency  shall
  be  used  and  applied,  subject  to  the provision of any contract with
  noteholders and bondholders, for the sole purpose of  paying  costs  and
  expenses  of  the  agency  incident  to the financing of the facility or
  facilities to be designed, constructed, reconstructed, rehabilitated  or
  improved on such other portions of the real property or interest in real
  property as shall have been leased or conveyed to the agency pursuant to
  subdivision  1  of  this  section.  It  is further provided that for the
  Corona  unit  of  the  Bernard  M.  Fineson  developmental  disabilities
  services  office,  the  state  of New York or such public corporation or
  officer or such voluntary agency may but is not required to pay  to  the
  agency  an  amount less than or equal to the consideration, if any, paid
  by the agency to such public corporation or officer  or  such  voluntary
  agency  allocable  to  such  excess  real  property  or interest in real
  property and such other costs of the  agency  as  are  incident  to  the
  acquisition  of  such excess real property or interest in real property,
  all as may be approved by such public corporation  or  officer  or  such
  voluntary  agency and the agency. Any monies so paid to the agency shall
  be used and applied, subject to  the  provision  of  any  contract  with
  noteholders  and  bondholders,  for the sole purpose of paying costs and
  expenses of the agency incident to the financing of the Corona  unit  of
  the  Bernard M. Fineson developmental disabilities services office to be
  designed,  constructed,  reconstructed,  rehabilitated,  demolished   or
  improved on such other portions of the real property or interest in real
  property as shall have been leased or conveyed to the agency pursuant to
  subdivision 1 of this section.
    c.  The  attorney  general  shall  pass upon the form, sufficiency and
  manner of execution of any deed  of  conveyance  and  of  any  lease  or
  sublease  of  lands  and  of  any  loan  or  other  financing  agreement
  authorized to be given under subdivision one of this section,  excluding
  any lease or sublease given by a voluntary agency to the agency, and the
  same shall not be effective unless so approved by him.
    d.  The  cost  of  design,  construction, acquisition, reconstruction,
  rehabilitation or improvement of facilities  undertaken  by  the  agency
  pursuant  to  this  act  may include the cost of acquisition of any real
  property, interest in real property and improvements leased or  conveyed
  to  the  agency in accordance with subdivision 1 of this section and the
  cost of the original furnishings,  equipment,  machinery  and  apparatus
  determined by the responsible public corporation or officer to be needed
  to  furnish  and  equip such facilities upon the completion of work. The
  agency shall have power to acquire or lease and to hold  real  property,
  any  interest in real property and improvements required for the design,

  construction, acquisition, reconstruction, rehabilitation or improvement
  of facilities undertaken by the agency  pursuant  to  this  act  and  to
  provide  the  original  furnishings,  equipment, machinery and apparatus
  determined by the responsible public corporation or officer to be needed
  to  furnish and equip such facilities upon the completion of work and to
  issue its bonds  and  notes  to  provide  sufficient  funds  to  pay  or
  refinance the cost thereof.
    e.  Any  public  corporation  or officer referred to in paragraph a of
  this subdivision is hereby authorized and empowered, in connection  with
  any  lease,  sublease, loan or other financing agreement with the agency
  to which such public corporation or officer is a party, and  subject  to
  such agreements with third parties as may then exist, to:
    (i)  pledge or assign to the agency all or any portion of the revenues
  and monies received or to be received  by  such  public  corporation  or
  officer,  which  may be available for the purpose of making payments for
  the  use  of  the  facilities  constructed,   acquired,   reconstructed,
  rehabilitated or improved or to be constructed, acquired, reconstructed,
  rehabilitated  or  improved  under such agreement, so that such payments
  may be fully secured and protected; provided, however, that such  pledge
  or  assignment  shall  not extend to appropriations or advances from the
  state except  appropriations  or  advances  made  specifically  for  the
  purpose of paying all or any part of such payments;
    (ii)  use  and  dispose  of  such revenues and monies, or any portions
  thereof, for the purpose of defraying, in whole or in part, (1) the cost
  of acquiring any real property or interest  in  real  property  for  the
  purpose  of  constructing,  acquiring, reconstructing, rehabilitating or
  improving  facilities  thereon  which  may  be  constructed,   acquired,
  reconstructed,  rehabilitated or improved by the agency pursuant to this
  act,  (2)  the  cost  of  financing   the   construction,   acquisition,
  reconstruction,  rehabilitation  or  improvement of such facilities, and
  (3) the cost of acquiring the original furnishings, equipment, machinery
  and apparatus needed to furnish  and  equip  such  facilities  upon  the
  completion of work;
    (iii)  set  aside reserves and to agree to the maintenance, regulation
  and disposition thereof;
    (iv) agree to limitations on the purposes to  which  the  proceeds  of
  sale of agency notes or bonds may be applied and to the pledging of such
  proceeds  to secure the payment of agency notes or bonds or of any issue
  thereof;
    (v)  agree  to  limitations  on  the  making  of  additional   leases,
  subleases,  loans  or other financing agreements with the agency or with
  others, and the terms upon  which  such  additional  leases,  subleases,
  loans or other financing agreements may be made;
    (vi) recognize and give effect to such assignment, upon receipt of any
  notice  of assignment by the agency of any such lease, sublease, loan or
  other financing agreement with the agency, or of any of its rights under
  such lease, sublease, loan or other financing agreement, and to pay  the
  assignee  thereof  payments  then  due or which may become due under any
  such lease, sublease, loan or other financing agreement which  has  been
  so assigned by the agency; and
    (vii)  agree  to  any  other  matters, of like or different character,
  which in any way affect the  security  or  protection  of  the  payments
  required  to  be  made  under the terms of such lease, sublease, loan or
  other financing agreement with the agency.
    f. (i) Any mental hygiene facility, as defined in this section,  which
  has   been   constructed,   acquired,  reconstructed,  rehabilitated  or
  improved, in whole or in part, out of monies advanced or deemed to  have
  been  advanced  to  the  facilities  development  corporation, the state

  department of mental hygiene or the office of  general  services,  since
  April 1, 1963 pursuant to appropriations or reappropriations as advances
  from the capital projects fund, and the real property or any interest in
  real  property  upon  which such a facility is located, may be leased or
  conveyed to the agency by the facilities development corporation or  the
  commissioner  of  mental  hygiene  in  accordance with the provisions of
  subdivisions 1 through 5  of  this  section,  notwithstanding  that  the
  construction, acquisition, reconstruction, rehabilitation or improvement
  of  such  facility may have been completed by the facilities development
  corporation, the state department of mental hygiene  or  the  office  of
  general services.
    (ii)  Subject to such agreements with third parties as may then exist,
  the  facilities  development  corporation  is  hereby   authorized   and
  empowered  to  enter  into  leases, subleases, loans and other financing
  agreements with the agency with respect to any mental  hygiene  facility
  described  in  subparagraph (i) of this paragraph, and the real property
  or any interest in real property upon which such a facility is or may be
  located, in accordance with the provisions of subdivision 4 of section 9
  of the facilities development corporation  act  and  the  provisions  of
  subdivisions  1  through  5  of  this  section; and the agency is hereby
  authorized and empowered to accept any lease or conveyance of  any  such
  mental  hygiene  facility, and the real property or any interest in real
  property upon which such a facility is or may be  located,  to  acquire,
  construct,  reconstruct,  rehabilitate or improve any such facility, and
  to issue bonds  and  notes  to  provide  sufficient  funds  therefor  in
  accordance with the provisions of this section.
    7. a. The agency shall have the power to acquire by lease or deed from
  the facilities development corporation any real property acquired by the
  corporation  pursuant  to  the  provisions of subdivision six of section
  nine of the facilities development corporation act (i) for  the  purpose
  of constructing, reconstructing, rehabilitating or improving thereon one
  or  more  community mental health and retardation facilities or (ii) for
  the purpose of financing or refinancing the  acquisition,  construction,
  reconstruction,  rehabilitation  or  improvement  thereon of one or more
  community mental health and  retardation  facilities,  pursuant  to  the
  provisions  of  this act and the facilities development corporation act.
  The agency is hereby authorized to lease or sublease such real  property
  and  facilities thereon to the corporation for the purpose of making the
  same available to a city or a county not wholly within a city,  for  use
  and  occupancy in accordance with the provisions of a lease, sublease or
  other agreement between the corporation and such city or county.
    b. In the event that the agency shall fail, within  five  years  after
  the  date  of  a lease or conveyance of such real property from property
  from such city or county to the corporation, to construct,  reconstruct,
  rehabilitate  or  improve  the  community  mental health and retardation
  facility or facility thereon for which  such  lease  or  conveyance  was
  made,  as provided for in a lease, sublease or other financing agreement
  entered into by such city or county and the corporation,  then,  subject
  to  the  terms  of  any  lease,  sublease  or  other financing agreement
  undertaken by the agency, such real property and any facilities  thereon
  shall  revert  to  the corporation with right of re-entry thereupon, and
  such lease or deed shall be made subject to such condition  of  reverter
  and  re-entry.  Provided,  however, that as a condition precedent to the
  exercise of such right of re-entry the  corporation  shall  pay  to  the
  agency  an  amount  equal  to the sum of the purchase price of such real
  property, the depreciated  cost  of  any  community  mental  health  and
  retardation   facility   or   facilities   constructed,   reconstructed,
  rehabilitated or improved thereon and all  other  costs  of  the  agency

  incident  to  the  acquisition  of  such  lands  and  the  financing  of
  construction, reconstruction, rehabilitation or improvement relating  to
  such community mental health and retardation facility or facilities, all
  as  provided  in  the  aforesaid  lease,  sublease  or  other  financing
  agreement entered into with the corporation. It is further provided that
  for the Corona unit of the Bernard M. Fineson developmental disabilities
  services office, the corporation may but is not required to pay  to  the
  agency  an  amount  less than or equal to the purchase price of the real
  property, the depreciated cost of sum of the community mental health and
  retardation   facility   constructed,   reconstructed,    rehabilitated,
  demolished  or  improved  thereon  and  all  other  costs  of the agency
  incident  to  the  acquisition  of  such  lands  and  the  financing  of
  construction,  reconstruction, rehabilitation, demolition or improvement
  relating to such community mental health and retardation  facility,  all
  as  provided  in  the  aforesaid  lease,  sublease  or  other  financing
  agreement entered into with the corporation.
    c. No real property or interest  therein  shall  be  acquired  by  the
  agency  pursuant  to  this subdivision unless the title thereto shall be
  approved by the attorney general.
    d. The attorney general shall pass upon the form and  sufficiency  and
  manner  of  execution  of  any  deed  of  conveyance and of any lease or
  sublease of real property  authorized  to  be  acquired  by  the  agency
  pursuant  to this subdivision and the same shall not be effective unless
  such deed, lease or sublease shall be so approved by him.
    § 10. Bonds and notes as legal investments. The bonds and notes of the
  agency are hereby made securities  in  which  all  public  officers  and
  bodies  of this state and all municipalities and municipal subdivisions,
  all insurance companies and associations, and other persons carrying  on
  an  insurance  business,  all  banks,  bankers, trust companies, savings
  banks and saving associations, including savings and loan  associations,
  building  and  loan associations, investment companies and other persons
  carrying  on  a  banking  business,   all   administrators,   guardians,
  executors,  trustees  and  other  fiduciaries,  and  all  other  persons
  whatsoever who are now or may hereafter be authorized to invest in bonds
  or other obligations of the  state,  may  properly  and  legally  invest
  funds, including capital, in their control and belonging to them.
    §  11. Exemption from taxation of property and income. The property of
  the agency and its income and operations shall be exempt from taxation.
    § 12. Exemption from  taxation  of  notes  and  bonds.  It  is  hereby
  determined  that  the  creation of the agency is in all respects for the
  benefit of the people of the state and  for  the  improvement  of  their
  health,  safety,  welfare,  comfort and security, and that said purposes
  are public purposes and that the agency will be performing an  essential
  governmental function in the exercise of the powers conferred upon it by
  this  act.  The  state  covenants with the purchasers and all subsequent
  holders and transferees of notes and bonds  issued  by  the  agency,  in
  consideration  of the acceptance of and payment for the notes and bonds,
  that the notes and bonds of the agency, issued pursuant to this act  and
  the income therefrom and all its fees, charges, gifts, grants, revenues,
  receipts, and other monies received or to be received, pledged to pay or
  secure  the  payment  of  such notes or bonds shall at all times be free
  from taxation, except for estate and gift taxes and taxes on transfers.
    § 13. Agreement with the state. The state does hereby  pledge  to  and
  agree with the holders of any notes or bonds issued under this act, that
  the state will not limit or alter the rights hereby vested in the agency
  to fulfill the terms of any agreements made with the holders thereof, or
  in  any  way  impair  the rights and remedies of such holders until such
  notes or bonds, together with the interest thereon, with interest on any

  unpaid  installments  of  interest,  and  all  costs  and  expenses   in
  connection  with  any  action  or  proceeding  by  or  on behalf of such
  holders, are fully met and  discharged.  The  agency  is  authorized  to
  include this pledge and agreement of the state in any agreement with the
  holders of such notes or bonds.
    §  14.  State's  right to require redemption of bonds. Notwithstanding
  and in addition to any provisions for the redemption of bonds which  may
  be  contained  in  any contract with the holders of the bonds, the state
  may, upon furnishing sufficient funds therefor, require  the  agency  to
  redeem,  prior  to  maturity,  as  a  whole,  any  issue of bonds on any
  interest payment date not less than twenty years after the date  of  the
  bonds  of  such issue at one hundred five per centum of their face value
  and accrued interest or  at  such  lower  redemption  price  as  may  be
  provided  in  the  bonds in case of the redemption thereof as a whole on
  the redemption date. Notice of such redemption shall be published in  at
  least  two  newspapers  publishing  and  circulating respectively in the
  cities of Albany and New York at least twice, the first  publication  to
  be at least thirty days before the date of redemption.
    §  15.  Remedies  of noteholders and bondholders. 1. In the event that
  the agency shall default in the payment of principal of or  interest  on
  any  issue of notes or bonds after the same shall become due, whether at
  maturity or upon call for redemption, and such  default  shall  continue
  for  a period of thirty days, or in the event that the agency shall fail
  or refuse to comply with the provisions of this act, or shall default in
  any agreement made with the holders of any issue of notes or bonds,  the
  holders  of  twenty-five per centum in aggregate principal amount of the
  notes or  bonds  of  such  issue  then  outstanding,  by  instrument  or
  instruments filed in the office of the clerk of the county of Albany and
  approved  or  acknowledged  in the same manner as a deed to be recorded,
  may appoint a trustee to represent the holders of such  notes  or  bonds
  for the purposes herein provided.
    2.  Such  trustee  may,  and  upon  written  request of the holders of
  twenty-five per centum in principal amount of such notes or  bonds  then
  outstanding shall, in his or its own name:
    (a)  by  suit,  action  or  proceeding  in  accordance  with the civil
  practice law and  rules,  enforce  all  rights  of  the  noteholders  or
  bondholders,  including  the right to require the agency to collect fees
  and charges and interest  and  amortization  payments  on  mortgage  and
  project  loans  made by it adequate to carry out any agreement as to, or
  pledge of, such fees and charges and interest and amortization  payments
  on such mortgages, project loans and other properties and to require the
  agency  to carry out any other agreements with the holders of such notes
  or bonds and to perform its duties under this act;
    (b) bring suit upon such notes or bonds;
    (c) by action or suit, require the agency to account as if it were the
  trustee of an express trust for the holders of such notes or bonds;
    (d) by action or suit, enjoin any acts or things which may be unlawful
  or in violation of the rights of the holders of such notes or bonds;
    (e) declare all such notes or  bonds  due  and  payable,  and  if  all
  defaults  shall  be  made good, then, with the consent of the holders of
  twenty-five per centum of the principal amount of such  notes  or  bonds
  then outstanding, to annul such declaration and its consequences.
    3.  Such  trustee  shall in addition to the foregoing have and possess
  all of the powers necessary or  appropriate  for  the  exercise  of  any
  functions  specifically  set  forth  herein  or  incident to the general
  representation of bondholders or  noteholders  in  the  enforcement  and
  protection of their rights.

    4.  The  supreme  court shall have jurisdiction of any suit, action or
  proceeding by the trustee on behalf of such noteholders or  bondholders.
  The  venue  of  any such suit, action or proceeding shall be laid in the
  county of Albany.
    5.  Before  declaring  due and payable the principal of notes or bonds
  issued in connection with any mortgage or other obligations  securing  a
  mortgage  loan  made  by the agency, the trustee shall first give thirty
  days' notice in writing to the governor, to the  agency,  to  the  state
  commissioner of health and to the attorney general of the state.
    §  16-a.  Equal  employment  opportunity program. 1. All contracts for
  design, construction, services and materials pursuant  to  this  act  of
  whatever  nature and all documents soliciting bids or proposals therefor
  shall contain or make reference to the following provisions:
    a.  The  contractor  will  not  discriminate  against   employees   or
  applicants  for  employment  because  of  race,  creed,  color, national
  origin, sex, age, disability, or marital status, and will  undertake  or
  continue existing programs of affirmative action to ensure that minority
  group   persons   and  women  are  afforded  equal  opportunity  without
  discrimination. Such programs shall include,  but  not  be  limited  to,
  recruitment, employment, job assignment, promotion, upgrading, demotion,
  transfer,   layoff,   termination,  rates  of  pay  or  other  forms  of
  compensation, and  selections  for  training  or  retraining,  including
  apprenticeship and on-the-job training.
    b.  At  the  request  of the agency, the contractor shall request each
  employment agency, labor union, or authorized representative of  workers
  with  which  it  has  a  collective  bargaining  or  other  agreement or
  understanding and which is involved in the performance of  the  contract
  with  the  agency  to  furnish  a written statement that such employment
  agency, labor union or representative shall not discriminate because  of
  race,  creed,  color,  national  origin, sex, age, disability or marital
  status and that such union  or  representative  will  cooperate  in  the
  implementation of the contractor's obligations hereunder.
    c.  The  contractor will state, in all solicitations or advertisements
  for  employees  placed  by  or  on  behalf  of  the  contractor  in  the
  performance  of  the  contract  with  the  agency,  that  all  qualified
  applicants  will  be  afforded  equal  employment  opportunity   without
  discrimination because of race, creed, color, national origin, sex, age,
  disability or marital status.
    d.  The contractor will include the provisions of paragraphs a through
  c of this subdivision in every subcontract or purchase order in  such  a
  manner  that  such provisions will be binding upon each subcontractor or
  vendor as to its work in connection with the contract with the agency.
    2. The agency shall establish procedures and guidelines to ensure that
  contractors and subcontractors undertake programs of affirmative  action
  and  equal  employment  opportunity  as  required  by this section. Such
  procedures  may  require  after  notice  in  a  bid  solicitation,   the
  submission  of  an  affirmative action program prior to the award of any
  contract, or at any time thereafter, and may require the  submission  of
  compliance  reports  relating to the operation and implementation of any
  affirmative action  program  adopted  hereunder.  The  agency  may  take
  appropriate action including contractual sanctions for non-compliance to
  effectuate  the  provisions of this section and shall be responsible for
  monitoring compliance with this act.
    § 16-b. Minority and women-owned business enterprise program. 1. a. In
  the  performance  of  projects  pursuant  to  this  act   minority   and
  women-owned  business  enterprises  shall  be  given the opportunity for
  meaningful  participation.  The  agency  shall  establish  measures  and
  procedures   to  secure  meaningful  participation  and  identify  those

  contracts and items of work for which minority and women-owned  business
  enterprises  may  best  bid  to  actively  and affirmatively promote and
  assist their participation in the projects,  so  as  to  facilitate  the
  award  of  a  fair  share  of  contracts  to such enterprises; provided,
  however, that nothing in this  act  shall  be  construed  to  limit  the
  ability  of the agency to assure that qualified minority and women-owned
  business enterprises  may  participate  in  the  program.  For  purposes
  hereof,  minority business enterprise shall mean any business enterprise
  which is at least fifty-one per centum owned by, or in  the  case  of  a
  publicly  owned  business, at least fifty-one per centum of the stock of
  which is owned by citizens or permanent resident aliens who  are  Black,
  Hispanic,  Asian or American Indian, Pacific Islander or Alaskan natives
  and such ownership interest is real, substantial and continuing and have
  the authority to independently control the day to day business decisions
  of the entity for at least one year; and women-owned business enterprise
  shall mean any business enterprise  which  is  at  least  fifty-one  per
  centum  owned  by, or in the case of a publicly owned business, at least
  fifty-one per centum of the stock of  which  is  owned  by  citizens  or
  permanent  resident aliens who are women, and such ownership interest is
  real, substantial and continuing and have the authority to independently
  control the day to day business decisions of the entity for at least one
  year.
    The provisions of this paragraph shall not be construed to  limit  the
  ability of any minority or women-owned business enterprise to bid on any
  contract.
    b.  In  the  implementation of this section, the agency shall consider
  compliance by any contractor  with  the  requirements  of  any  federal,
  state,  or  local  law  concerning  minority  and  women-owned  business
  enterprises, which may effectuate the requirements of this  section.  If
  the department or the office determines that by virtue of the imposition
  of  the  requirements  of  any  such  law,  in respect to contracts, the
  provisions thereof duplicate or conflict with this act, the  agency  may
  waive   the  applicability  of  this  section  to  the  extent  of  such
  duplication or conflict.
    c. Nothing in this section shall be deemed  to  require  that  overall
  state  and  federal  requirements  for  participation  of  minority  and
  women-owned business enterprises in programs authorized under  this  act
  be  applied  without regard to local circumstances to all projects or in
  all communities.
    2. In order to implement  the  requirements  and  objectives  of  this
  section,   the   agency   shall  establish  procedures  to  monitor  the
  contractors' compliance with provisions hereof,  provide  assistance  in
  obtaining   competing   qualified   minority  and  women-owned  business
  enterprises to perform contracts proposed to be awarded, and take  other
  appropriate  measures  to improve the access of minority and women-owned
  business enterprises to these contracts.
    §  17.  Assistance  by  state  officers,   departments,   boards   and
  commissions.  1. The department of audit and control, department of law,
  department of health, and all other state officers, departments, boards,
  divisions and commissions may render such services to the agency  within
  their respective functions as may be requested by the agency.
    2. The state commissioner of health and the state department of health
  are  hereby  designated  to  act  for  and  in  behalf  of the agency in
  servicing the mortgage loans of  the  agency,  and  shall  perform  such
  functions  and  services  in  connection  with the making, servicing and
  collection of such loans as shall be requested by the agency. The agency
  shall pay to the department of health from  any  monies  of  the  agency
  available  for  such purpose, such amounts as are necessary to reimburse

  the department of  health  for  the  reasonable  cost  of  the  services
  performed  by  the  commissioner  of  health  and  department  of health
  pursuant to this section.
    §  18.  Annual  report.  The  agency shall submit to the governor, the
  chairman of the senate finance committee, the chairman of  the  assembly
  ways and means committee, the comptroller and the director of the budget
  within  one  hundred  eighty  days  after  the end of its fiscal year, a
  complete and detailed report  setting  forth:  (1)  its  operations  and
  accomplishments;  (2)  its  receipts and expenditures during such fiscal
  year in accordance with the categories or classifications established by
  the agency for its operating and capital outlay  purposes,  including  a
  listing  of  all private consultants engaged by the agency on a contract
  basis and a statement of the total amount  paid  to  each  such  private
  consultant;  (3)  its  assets  and  liabilities at the end of its fiscal
  year, including a schedule of its mortgage loans and commitments and the
  status of reserve, special or other funds; and (4)  a  schedule  of  its
  bonds and notes outstanding at the end of its fiscal year, together with
  a  statement  of  the  amounts  redeemed and incurred during such fiscal
  year.
    § 19. Bond  reserve  insurance  fund.  The  agency  shall  create  and
  establish a special fund, to be known as the bond reserve insurance fund
  and  shall pay into such fund all monies appropriated and made available
  by the state for the purposes of such fund and any  other  monies  which
  may  be  made available to the agency for the purposes of such fund from
  any other source or  sources.  All  monies  held  in  the  bond  reserve
  insurance  fund  shall  be  used  by  the  agency  to  meet the agency's
  obligation to repay principal and  interest  on  its  outstanding  bonds
  solely to the extent that all other revenues of the agency available for
  such  purpose are not sufficient to meet such obligations of the agency.
  Any income or interest earned by,  or  increment  to  the  bond  reserve
  insurance  fund  may  be used for authorized purposes including, but not
  limited to, the addition of such income or interest earned, or increment
  to the monies held in such fund for the purposes herein provided, or the
  repayment of appropriation expenditures made to the credit of such fund.
    § 20. Actions against agency. Except in an action for wrongful  death,
  an action against the agency founded on tort shall not be commenced more
  than  one  year and ninety days after the cause of action therefor shall
  have accrued, nor unless a notice of claim shall have been served on the
  agency within the time limited  by,  and  in  compliance  with  all  the
  requirements  of section fifty-e of the general municipal law. An action
  against the agency for wrongful death shall be commenced  in  accordance
  with  the notice of claim and time limitation provisions of title eleven
  of article nine of the public authorities law.
    § 21. Act not affected if in part unconstitutional.  If  any  section,
  subdivision,  paragraph, sentence, clause or provision of this act shall
  be unconstitutional or be ineffective in whole or in part, to the extent
  that it is not unconstitutional or ineffective, it shall  be  valid  and
  effective and no other section, subdivision, paragraph, sentence, clause
  or provision shall on account thereof be deemed invalid or ineffective.
    § 22. Inconsistent provisions in other laws superseded. Insofar as the
  provisions of this act are inconsistent with the provisions of any other
  law,  general,  special  or  local,  the provisions of this act shall be
  controlling.

  
Section:

Last modified: September 11, 2016