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New York NYS Financial Emergency Act for the city of NY 868/75

NEW YORK STATE FINANCIAL EMERGENCY ACT FOR THE CITY OF NEW YORK *
  Section  1.   Short title.
           2.   Definitions.
           2-a. Legislative declaration of financial emergency.
           3.   General rights and prohibitions.
           4.   Power  of  city  or  covered organization to determine the
                  expenditure of available funds.
           5.   New York state financial control board; created.
           6.   Administration of the board.
           7.   Functions of the board.
           7-a. Reports of the city.
           8.   Development of the financial plan.
           9.   Establishment and application of the board fund.
           9-a. Establishment and application of a  general  debt  service
                  fund.
           9-b. Limitations on short-term borrowing.
          10.   Wage freeze.
          10-a. Covenants, authorizations to agree and remedies.
          11.   Prohibitions; penalties.
          12.   Indemnification.
          13.   Termination.
          14.   Separability.
          15.   Court preference.
            * Terminates July 1, 2008 or ... see § 13
            * Section  1.   Short  title.  This act shall be known and may
          be cited as the "New York State Financial Emergency Act for  The
          City of New York".
            * Terminates July 1, 2008 or ... see § 13
            * §  2.  Definitions. As used in this act, the following words
          and terms shall have the following meanings unless  the  context
          shall indicate another or different meaning or intent.
            1.  "Comptroller"  means  the  comptroller of the state of New
          York.
            2. "City" means the city of New York.
            3. "Mayor" means the mayor of the city of New York.
            4. "City comptroller" means the comptroller of the city.
            5.  "Covered  organization"  means  any  governmental  agency,
          public authority or public benefit corporation which receives or
          may  receive monies directly, indirectly or contingently, (other
          than monies received for the sale of goods or the  rendering  of
          services  or  the loan of monies to the city) from the city, and
          in  any  event  includes,  without  limitation,  the  board   of
          education of the city of New York, the board of higher education
          of  the city of New York, the New York city transitional finance
          authority, the health and hospitals corporation,  the  New  York
          city transit authority, the New York city housing authority, the
          New  York  city housing development corporation, city university
          construction fund, Battery park city authority,  New  York  city
          convention  and  exhibition  center  corporation,  Manhattan and
          Bronx surface transit operating authority, Staten  Island  rapid
          transit  operating authority, the New York city sports authority
          and the Brooklyn sports center authority but shall  not  include
          (i)  any governmental agency, public authority or public benefit
          corporation specifically exempted from the  provisions  of  this
          act  by  order  of  the  board  upon application of such agency,
          authority, or corporation to the board or  at  the  board's  own
          motion  upon a finding by the board that such exemption does not
          materially affect the ability of the city to adopt and  maintain

          a  budget  pursuant  to  the provisions of this act and provided
          that at the time of such exemption there  shall  have  been  and
          during  the  period  of  such exemption there shall be an annual
          audit  by  a  nationally recognized independent certified public
          accounting firm or consortium of firms, one of which shall be  a
          nationally   recognized  firm,  of  the  covered  organization's
          financial statements  performed  in  accordance  with  generally
          accepted  auditing  standards and report by such auditor thereon
          which includes an  opinion  that  the  financial  statements  so
          audited have been prepared in accordance with generally accepted
          accounting  principles (subject to the provisions of subdivision
          two-a of section eight of this act) and such  other  information
          as  such  auditors  deem  appropriate,  (ii)  any  state  public
          authority as defined in section two hundred  one  of  the  civil
          service  law,  unless  specifically  named  above,  or (iii) any
          governmental agency, authority,  commission  or  instrumentality
          created  by  compact  or agreement between the state of New York
          and another state or states; provided, however, that  the  board
          may  terminate  any  exemption  granted  by  order  of the board
          pursuant to this  subdivision  upon  a  determination  that  the
          circumstances  upon  which  such  exemption  was  granted are no
          longer applicable.
            6. "Board" means the governmental agency  created  by  section
          five of this act.
            7.  "Deputy  comptroller" means the deputy comptroller for the
          city of New York created by section forty-one-a of the executive
          law.
            8. "Municipal assistance corporation for the city of New York"
          means the corporate governmental agency created by section three
          thousand thirty-three of the public authorities law.
            9. "Short-term obligations" means tax anticipation notes, bond
          anticipation notes, revenue anticipation notes, budget notes and
          urban renewal notes of the city.
            10. "Revenues" mean all taxes, federal and state  aid,  rents,
          fees,  charges, payments, all proceeds from borrowings and other
          income and receipts paid or payable to or for the account of the
          city or any of the covered organizations.
            11. "Financial plan" means the financial plan of the city  and
          the  covered  organizations  to be developed pursuant to section
          eight of this act, as from time to time modified.
            12. "Control  period"  means  the  period  of  time  from  the
          effective  date  of this act until the date when (a) there shall
          no longer be effective  or  outstanding  any  guarantee  by  the
          United  States  of  America  as  to  payment  of principal of or
          interest on any note or bond issued  by  the  city  or  a  state
          financing agency, (b) the board shall determine, based on annual
          audit reports furnished in accordance with section seven-a, that
          for  each  of  the three immediately preceding fiscal years, the
          city  has  adopted  and  adhered   to   budgets   covering   all
          expenditures  other than capital items, the results of which did
          not show a deficit when reported in  accordance  with  generally
          accepted  accounting  principles  subject  to  the provisions of
          subdivision two-a of section eight  of  this  act  and  (c)  the
          comptroller of the state and the comptroller of the city jointly
          shall  certify that securities sold by or for the benefit of the
          city during the fiscal year immediately preceding such date  and
          the  then  current  fiscal  year  in  the  general public market
          satisfied the capital and seasonal financing requirements of the

          city  during  such  period  and  that  there  is  a  substantial
          likelihood  that  such  securities  can  be  sold in the general
          public market from  such  date  through  the  end  of  the  next
          succeeding   fiscal   year   in   amounts   which  will  satisfy
          substantially  all  of  the  capital  and   seasonal   financing
          requirements  of  the city during such period in accordance with
          the financial plan then  in  effect,  provided  that  for  these
          purposes  sales  to  any  fund whose governing body includes any
          designated representative  of  the  state  or  city  or  to  any
          financial  institution which participates in a private placement
          for the purchase of securities  for  the  benefit  of  the  city
          during  its  nineteen hundred seventy-nine fiscal year shall not
          be deemed sales in the general public market, unless in the case
          of sales to  such  a  financial  institution  such  comptrollers
          jointly  certify at the time of each such sale that a sale could
          have been made in such amount and on reasonably comparable terms
          in the general public market. After termination of  the  control
          period  in  accordance  with  the foregoing provisions and until
          there shall no longer be outstanding any notes or  bonds  issued
          by  the  city  or a state financing agency which are entitled to
          the benefits of the pledge and agreement authorized  by  section
          ten-a  hereof,  the board shall reimpose a control period upon a
          determination at any time that any of the following  events  has
          occurred or that there is a substantial likelihood and imminence
          of  such  occurrence:  (i) the city shall have failed to pay the
          principal of or interest on any of its bonds or notes  when  due
          or  payable  (other  than notes held by the municipal assistance
          corporation for the city of New York to  the  extent  that  such
          corporation  has  evidenced  its  intention  not to present such
          notes  for  payment  during  the  fiscal  year  in   which   the
          determination is made provided that such notes were held by such
          corporation on June thirtieth, nineteen hundred seventy-eight or
          were  issued in exchange for or in refunding or renewal of notes
          held by such corporation on such date), (ii) the city shall have
          incurred a deficit of more  than  one  hundred  million  dollars
          during its fiscal year in the results of operations covered by a
          budget  covering  all  expenditures  other than capital items as
          reported  in  accordance  with  generally  accepted   accounting
          principles,  subject  to  the provisions of subdivision two-a of
          section eight of this act, (iii)  the  city  shall  have  issued
          notes in violation of section nine-b of this act as amended from
          time  to  time,  (iv) the city shall have otherwise violated any
          provision of this act and such violation  substantially  impairs
          the  ability  of the city to pay principal of or interest on its
          bonds or notes when due and payable or its ability to  adopt  or
          adhere  to a budget covering all expenditures other than capital
          items  balanced  in  accordance  with  this  act  or   (v)   the
          comptrollers' joint certification at any time, at the request of
          the  board or on the comptrollers' joint initiative, which joint
          certification shall be made from time to  time  as  promptly  as
          circumstances  warrant  and  reported  to the board, that on the
          basis of facts existing at such time they  could  not  make  the
          joint  certification  described  by  clause (c) of the preceding
          sentence. The board shall terminate any such  reimposed  control
          period  when  it  determines  that  none of the conditions which
          would permit the board to reimpose a control period exist. After
          termination  of  a  control  period  the  board  shall  annually
          consider  items  (i) through (v) above and determine whether, in

          its judgment, any of the events described  in  such  items  have
          occurred  and  the  board shall publish each such determination.
          Each such joint certification made by the comptrollers hereunder
          shall  be  based  on their separate written determinations which
          shall take into account a report and  opinion  of  a  nationally
          recognized  independent  expert  in  the  marketing of municipal
          securities  selected  by  the  board  as  well  as   any   other
          information  which may be available to each comptroller and each
          such separate written determination by  the  comptrollers  shall
          have  annexed  thereto the report and opinion of such expert and
          any other information taken  into  account  and  shall  be  made
          public  when delivered to the board. Notwithstanding any part of
          the foregoing to the contrary, in no  event  shall  any  control
          period  continue  beyond  the  earlier  of  (a)  July first, two
          thousand eight or (b) the date (i)  when  all  bonds  and  notes
          containing  the pledge and agreement authorized by section ten-a
          of this act are  refunded,  redeemed,  discharged  or  otherwise
          defeased  or  (ii) when there shall no longer be outstanding any
          guarantee by the United States  of  America  or  any  agency  or
          instrumentality  thereof  as  to  payment  of  principal  of  or
          interest on any note or bond issued  by  the  city  or  a  state
          financing agency, whichever of (i) or (ii) shall occur later.
            13. "Debt service repayment account" means the special account
          established pursuant to subdivision four of section nine of this
          act.
            14.  "Fund"  means  the  general debt service fund established
          pursuant to section nine-a of this act.
            15. "Board fund" means the board fund established pursuant  to
          section nine of this act.
            16. "TAN debt service account" means the tax anticipation note
          debt  service  account  established  within the fund pursuant to
          section nine-a of this act.
            17. "RAN debt service account" means the revenue  anticipation
          note  debt  service account established within the fund pursuant
          to section nine-a of this act.
            18. "Available funds" means at any  date  of  computation  the
          monies  held by the city or a covered organization which (i) are
          not required (a) to be applied to the fund, the TAN debt service
          account, the RAN debt service account or otherwise to  meet  the
          debt   service   requirements   of  the  city  and  the  covered
          organizations on their bonds and notes  (other  than  bonds  and
          notes   of  covered  organizations  payable  from  revenues  not
          included in the fund) as they become due, or (b)  to  pay  other
          liabilities  of  the  city  and the covered organizations having
          statutory or contractual priority over remaining liabilities  of
          the  city and the covered organizations, and (ii) therefore, may
          be applied to the payment of other obligations on  an  allocated
          basis  as  specified  by the city for expenditures in accordance
          with a financial plan.
            19. "Available tax levy" with  respect  to  an  issue  of  tax
          anticipation  notes  means  at any date of computation the total
          amount of city  real  estate  taxes  or  assessments  projected,
          consistent  with  the  financial  plan  then  in  effect,  to be
          received in cash on  or  before  the  fifth  day  preceding  the
          maturity  date of such tax anticipation note issue, less amounts
          required during the period between the date of  computation  and
          the  fifth  day preceding such maturity date to be paid into the
          general debt service fund or otherwise required to pay  interest

          payable  on  other  outstanding  city bonds and notes, principal
          (including  payments  into  sinking   funds)   coming   due   on
          outstanding  city  bonds  and  principal to be paid from sources
          other  than  the  proceeds  of  bonds  or renewal notes on other
          outstanding city notes (exclusive of revenue anticipation  notes
          or renewals thereof issued less than two years prior to the date
          of  computation)  but  not including payments from sinking funds
          required by the terms of certain city bonds. For the purposes of
          this  subdivision  such  amounts  required  shall  not   include
          principal  of  or  interest on any notes of the city held by the
          municipal assistance corporation for the city of New York to the
          extent that such corporation has evidenced its intention not  to
          present  such  notes for payment of principal or interest during
          the fiscal year in which the computation is made  provided  that
          such  notes  were  held  by  such corporation on June thirtieth,
          nineteen hundred seventy-eight or were issued in exchange for or
          in refunding or renewal of notes held  by  such  corporation  on
          such date.
            20.  "State  financing  agency" means the municipal assistance
          corporation for the city of New York or its successor.
            * Terminates July 1, 2008 or ... see § 13
            * § 2-a. Legislative declaration of financial  emergency.  The
          legislature  hereby finds and declares that a state of financial
          emergency continues to exist within the  city.  The  legislature
          further finds and declares that the maintenance by the city of a
          balanced budget in accordance with generally accepted accounting
          principles  and  the  city's  borrowing  practices  are and will
          continue to be a matter of overriding state concern, and that it
          is  also  appropriate  and  desirable  for  the  legislature  to
          exercise  its  duty under section twelve of article eight of the
          state constitution to restrict the powers of the city to prevent
          abuses  in  taxation  and  assessments  and  in  contracting  of
          indebtedness by the city.
            * Terminates July 1, 2008 or ... see § 13
            * §  3.  General  rights and prohibitions. 1. Neither the city
          nor any covered organization shall borrow or expend any  monies,
          or  in any way, directly or indirectly, expressly or implicitly,
          engage its credit during any control period except in compliance
          with the provisions of this act.
            2. Nothing contained in this act shall limit the right of  the
          city  or  any covered organization to comply with the provisions
          of any existing contract with or for the benefit of the  holders
          of  any  bonds or notes of the city or such covered organization
          or any public authority or public benefit corporation.
            3. Nothing contained in this act shall be construed to  impair
          the right of employees to organize or to bargain collectively.
            * Terminates July 1, 2008 or ... see § 13
            * §  4. Power of city or covered organization to determine the
          expenditure of available funds. Nothing contained  in  this  act
          shall  be  construed to limit the power of the city or a covered
          organization to determine, from time to time,  within  available
          funds  for  the  city  or  for  such  covered  organization, the
          purposes for which expenditures are to be made by  the  city  or
          such  covered organization and the amounts of such expenditures,
          consistent with the aggregate expenditures then permitted  under
          the financial plan for the city or such covered organization.
            * Terminates July 1, 2008 or ... see § 13

            * §  5. New York state financial control board; created. There
          is hereby created the New York state  financial  control  board.
          The  board shall be a governmental agency and instrumentality of
          the state and it shall have such powers and functions as are set
          forth in this act.
            * Terminates July 1, 2008 or ... see § 13
            * §  6.  Administration of the board. 1. The membership of the
          board shall be the governor, the state comptroller (pursuant  to
          his  authority  to  supervise  the  accounts  of  any  political
          subdivision of the state), the mayor, the city  comptroller  and
          three  members  appointed  by  the  governor with the advice and
          consent of the senate. At least two  of  the  appointed  members
          shall  be residents of the city or have their principal place of
          business in the city. Such appointed members shall serve at  the
          pleasure  of the governor. The governor shall be the chairman of
          the board and the governor or his representative  shall  preside
          over  all meetings of the board. The board shall act by majority
          vote of the entire board. The board shall maintain a  record  of
          its  proceedings  in  such  form  as  it may determine, but such
          record shall indicate attendance and  all  votes  cast  by  each
          member.  Every  member of the board, who is otherwise an elected
          official of the state or city, shall be entitled to designate  a
          representative  to  attend,  in his place, meetings of the board
          and to vote or otherwise act in his behalf.  Written  notice  of
          such  designation  shall  be  furnished  to  the  board  by  the
          designating  member  prior  to  any  meeting  attended  by   his
          representative.  Any  such  representative  shall  serve  at the
          pleasure of the designating member. No such representative shall
          be authorized to delegate any of his duties or functions to  any
          other  person.  The  lieutenant governor, temporary president of
          the senate, the minority  leader  of  the  senate,  speaker  and
          minority leader of the assembly, the president of the council of
          the  city  of  New  York,  the  city board of estimate acting by
          majority vote, and the vice-chairman and the minority leader  of
          the  council  of the city of New York, shall each be entitled to
          appoint a representative to the board.  Each such representative
          shall be entitled  to  receive  notice  of  and  to  attend  all
          meetings  of  the  board  but  shall not be entitled to vote. No
          representative shall be an employee or officer of  the  federal,
          state  or  city  governments. Each representative shall serve at
          the pleasure of  the  appointing  official  or  body,  shall  be
          eligible  for  reappointment,  and  shall  hold office until his
          successor has been appointed.
            2.  Notwithstanding  any  inconsistent  provisions   of   law,
          general,  special or local, no officer or employee of the state,
          or political subdivision of the state, any  governmental  entity
          operating any public school or college or other public agency or
          instrumentality   or   unit   of   government   which  exercises
          governmental powers under the laws of the state,  shall  forfeit
          his  office  or  employment  by  reason  of  his  acceptance  or
          appointment as a member, representative,  officer,  employee  or
          agent   of   the   board  nor  shall  service  as  such  member,
          representative, officer, employee  or  agent  of  the  board  be
          deemed   incompatible   or  in  conflict  with  such  office  or
          employment.
            3. The members of the board appointed by the governor and  all
          representatives  designated  by members of the board shall serve
          without salary or per diem allowance but shall  be  entitled  to

          reimbursement  for actual and necessary expenses incurred in the
          performance of official duties under this act, provided  however
          that  such members and representatives are not, at the time such
          expenses  are  incurred,  public employees otherwise entitled to
          such reimbursement.
            4. The governor and  the  mayor,  jointly,  shall  appoint  an
          executive  director of the board who shall serve at the pleasure
          of the board and may be removed by  the  board.  The  board  may
          delegate  to  the  executive  director  or to one or more of its
          other officers, employees or agents, such powers and  duties  as
          the  board  may deem proper, except any duties inconsistent with
          the duties and functions  prescribed  by  any  other  office  or
          position any such person may hold.
            * Terminates July 1, 2008 or ... see § 13
            * § 7. Functions of the board. 1. In carrying out the purposes
          of this act, the board shall perform the following functions:
            a.  In accordance with the provisions of section eight of this
          act, the board shall (i) consult with the city and  the  covered
          organizations  in  the  preparation  of  the financial plan, and
          certify to the city the revenue estimates approved therein, (ii)
          prescribe the form of the  financial  plan  and  the  supporting
          information required in connection therewith, and (iii) exercise
          the  rights  of  approval,  disapproval  and  modification  with
          respect to the financial plan, including but not limited to  the
          revenue estimates contained therein.
            b.  The  board,  to  the  extent  it  deems  it  necessary  or
          appropriate in order to accomplish the  purposes  of  this  act,
          shall  establish  and  adopt  procedures with respect to the (i)
          proper maintenance of the  board  fund,  (ii)  the  deposit  and
          investment  of  revenues  in such fund and (iii) disbursement of
          monies from such fund.
            c. The board shall, from time to time and  to  the  extent  it
          deems  necessary  or  appropriate  in  order  to  accomplish the
          purposes of this act, (i)  review  the  operations,  management,
          efficiency  and productivity of such city operations and of such
          covered organizations or  portions  thereof  as  the  board  may
          determine,  and make reports thereon; (ii) audit compliance with
          the financial plan in such areas as  the  board  may  determine;
          (iii)  recommend  to the city and the covered organizations such
          measures relating to their  operations,  management,  efficiency
          and  productivity  as  it  deems appropriate to reduce costs and
          improve services so as to advance the purposes of this act;  and
          (iv)  obtain information of the financial condition and needs of
          the city and the covered  organizations.  Nothing  herein  shall
          diminish the powers of the comptroller otherwise provided by law
          and  the  board may request the assistance of the comptroller in
          performing the above functions.
            d. The board (i) shall receive from the city  and  review  the
          reports  to  be prepared by or on behalf of the city pursuant to
          section seven-a; (ii)  shall  receive  from  the  city  and  the
          covered organizations and from the deputy comptroller, and shall
          review such financial statements and projections, budgetary data
          and  information,  and  management  reports and materials as the
          board deems necessary or desirable to accomplish the purposes of
          this act; and (iii) shall inspect, copy and audit such books and
          records of the city and the covered organizations as  the  board
          deems  necessary or desirable to accomplish the purposes of this
          act.

            e. All contracts entered into  by  the  city  or  any  covered
          organization  must be consistent with the provisions of this act
          and must comply with the requirements of the financial  plan  as
          approved  by  the  board. With respect to all contracts or other
          obligations  to  be  entered  into  by  the  city or any covered
          organization   after   October   fifteenth,   nineteen   hundred
          seventy-five, requiring the payment of funds or the incurring of
          costs by the city or any covered organization:
            (i) Within twenty days from the effective date of this act the
          mayor shall present to the board proposed regulations respecting
          the  categories  and  types  of  contracts and other obligations
          required  to  be  reviewed  by  the  board  pursuant   to   this
          subdivision  e.  Within  thirty  days from the effective date of
          this act, the board shall approve or  modify  and  approve  such
          proposed  regulations  or  promulgate  its own in the event that
          such proposed regulations are not submitted  to  it  within  the
          twenty  days  as  provided  for  herein.  Such  regulations  may
          thereafter be modified by the board from time  to  time  on  not
          less than thirty days notice to the mayor and the mayor may from
          time   to  time  propose  modifications  to  the  board.  Unless
          expressly disapproved or modified by  the  board  within  thirty
          days from the date of submission by the mayor, any such proposed
          regulations  or  modifications  shall  be deemed approved by the
          board;
            (ii) Prior to entering into any contract or other  obligations
          subject  to  review of the board under its regulations, the city
          or any covered organization shall submit a copy of such contract
          or other obligation to the board accompanied by an  analysis  of
          the  projected  costs of such contract or other obligation and a
          certification that performance thereof  will  be  in  accordance
          with  the  financial  plan,  all  in  such  form  and  with such
          additional information as the board  may  prescribe.  The  board
          shall  promptly  review  the  terms  of  such  contract or other
          obligation and the supporting information in order to  determine
          compliance with the financial plan;
            (iii)  During  a  control  period  the  board shall, by order,
          disapprove any contract or other obligation reviewed by it  only
          upon  a  determination that, in its judgment, the performance of
          such contract or other obligation would be inconsistent with the
          financial plan and the city or covered  organization  shall  not
          enter into such contract or other obligation;
            (iv)  During  a control period if the board approves the terms
          of a reviewed contract or other obligation, the city or  covered
          organization  may  enter  into such contract or other obligation
          upon the terms submitted to the board. Failure of the  board  to
          notify  the  city or covered organization within thirty days (or
          such additional time not exceeding  thirty  days  as  the  board
          shall  have  notified  the city or covered organization, that it
          requires to complete its review and analysis)  after  submission
          to  it  of  a contract or other obligation that such contract or
          other  obligation  has  been  disapproved  shall  be  deemed  to
          constitute board approval thereof.
            f. Upon submission thereof by the city, the board shall review
          the terms of each proposed long-term and short-term borrowing by
          the  city  and  any covered organization to be affected during a
          control period but after  October  fifteenth,  nineteen  hundred
          seventy-five,  and  no  such  borrowing  shall  be  made  unless
          approved by the board. Each such proposed borrowing by a covered

          organization shall be submitted  to  the  city  by  the  covered
          organization  before it may be considered by the board. Not more
          than  thirty  days  after  any  such  submission  by  a  covered
          organization  the city shall transmit any such proposed terms of
          borrowing to the board together with the  certification  of  the
          city  as  to  whether  such  proposed  terms of borrowing are in
          accordance with the financial plan and are consistent  with  the
          objectives  and purposes of this act. Any such submission to the
          city shall be accompanied by  a  certification  of  the  covered
          organization  that  the terms thereof are in accordance with the
          financial  plan  and  are  consistent  with  the  objectives  or
          purposes  of  this act. The transmittal by the city to the board
          shall include a recommendation by the city for the  approval  or
          disapproval  of such proposed terms of borrowing pursuant to the
          terms of this paragraph. In the event the  city  does  not  make
          such  transmittal  within  such  thirty day period, such covered
          organization may submit such proposed borrowing directly to  the
          board. The board shall disapprove any borrowing if it determines
          that  such  borrowing is inconsistent with the financial plan or
          the objectives or purposes of this act. The board shall  consult
          and coordinate with the municipal assistance corporation for the
          city  of New York with respect to borrowings of the city and any
          covered organization and shall receive reports from the muncipal
          assistance corporation for the city of New York on its review of
          borrowings by  the  city.  No  covered  organizations  shall  be
          prohibited  from issuing bonds or notes to pay outstanding bonds
          or notes.
            g. The board  and  the  comptroller  shall  receive  quarterly
          reports from the city comptroller setting forth the debt service
          requirements  on all bonds and notes of the city and the covered
          organizations for the following quarter, which reports shall  be
          in  such  form  and  contain such information as the board shall
          determine. Such reports shall be issued no later than sixty days
          prior to the start of the quarter  to  which  they  pertain  and
          shall  be  updated  immediately  upon  each issuance of bonds or
          notes after the date of such report to  reflect  any  change  in
          debt  service  requirements  as  a  result of such issuance. The
          board also shall receive from the  city  monthly  and  quarterly
          financial  reports,  which  reports  shall  be  in such form and
          contain such information as the board shall determine and  shall
          be  made available by the city to the public.  In order to avoid
          duplicative reports and reporting requirements,  to  the  extent
          that  the  city  is  required  to  submit  monthly  or quarterly
          financial reports to the department of the treasury pursuant  to
          any  agreement  or  arrangement  made in connection with federal
          guarantees of notes or bonds issued  by  the  city  or  a  state
          financing  agency,  copies of such reports shall be submitted to
          the board in satisfaction of the monthly and quarterly reporting
          requirements set forth  above,  together  with  such  additional
          information as the board may require. Each monthly and quarterly
          report  herein  required  to  be  submitted  to  the  board must
          indicate any variance  between  actual  and  budgeted  revenues,
          expenses or cash for the period covered by such report.
            h.  The board shall issue, to the appropriate officials of the
          city and the covered organizations,  such  orders  as  it  deems
          necessary  to accomplish the purposes of this act, including but
          not limited to timely  and  satisfactory  implementation  of  an
          approved  financial  plan.  Any order so issued shall be binding

          upon the official to whom it was issued and  failure  to  comply
          with  such  order  shall  subject  the official to the penalties
          described in section eleven of this act.
            i.  The  board  shall coordinate with the municipal assistance
          corporation for the city of New York and the deputy  comptroller
          with  respect to the performance of its review and monitoring of
          the revenues and  expenditures  of  the  city  and  the  covered
          organizations.
            2.  In the event of any default by the city on its outstanding
          bonds or notes, and so long as such default has not been  cured,
          the  board may, any provisions of this act notwithstanding, take
          any action that it is authorized to take pursuant to title six-A
          of article two of the local finance law, and may direct the city
          to take any action that the city is  authorized  to  take  under
          such law.
            * 3.  (a)  Notwithstanding  any provision of the New York City
          Collective Bargaining Law, codified as chapter fifty-four of the
          New York city administrative code, or any general or special law
          to the contrary, any report  or  recommendation  of  an  impasse
          panel constituted pursuant to such chapter which provides for an
          increase in wages or fringe benefits of any employee of the city
          or covered organization, in addition to considering any standard
          or factor required to be considered by applicable law, including
          the  standards  enumerated  in section 1173-7.0(c)(3)(b) of such
          chapter,  shall  also  take  into   consideration   and   accord
          substantial  weight  to the financial ability of the city and or
          covered organization to pay the cost of such increase  in  wages
          or fringe benefits.
            (b) The board of collective bargaining constituted pursuant to
          such  chapter,  when  reviewing  such  report  or recommendation
          before proceeding  to  other  issues,  shall  make  a  threshold
          determination as to whether such report or recommendation for an
          increase in wages or fringe benefits is within the city's and or
          covered   organization's   financial  ability  to  pay.  If  the
          threshold determination is in the negative, the matter shall  be
          remitted  to the impasse panel for further consideration. If the
          threshold determination  is  in  the  affirmative,  the  further
          review  of  the  report  or recommendation with respect to other
          issues, if any, shall proceed as provided  by  law.  Unless  the
          parties  stipulate  otherwise, the threshold determination shall
          be made within thirty days after submission  of  the  report  or
          recommendation to the board of collective bargaining.
            (c)  Any  determination pursuant to article eight of the labor
          law or any agreement or stipulation entered into in lieu thereof
          which provides for an increase in wages or  fringe  benefits  of
          any  employee  of  the  city  or  covered organization shall, in
          addition to considering any standard or factor  required  to  be
          considered  by  applicable law, also take into consideration and
          accord substantial weight to the financial ability of  the  city
          and or covered organization to pay the cost of such increase.
            (d)  Any report or recommendation of a fact finding or similar
          type panel or any interest arbitration award which provides  for
          an  increase  in wages or fringe benefits of any employee of the
          city or covered organization not subject to  the  provisions  of
          the New York City Collective Bargaining Law, codified as chapter
          fifty-four  of  the New York city administrative code, shall, in
          addition to considering any standard or factor  required  to  be
          considered  by  applicable law, also take into consideration and

          accord substantial weight to the financial ability of  the  city
          and or covered organization to pay the cost of such increase.
            (e)  Any  party to a proceeding before the board of collective
          bargaining as described  in  paragraph  (b)  or  other  body  as
          described in paragraphs (c) or (d) hereof may commence a special
          proceeding  in the appellate division, first department, supreme
          court, state of New York, to review the threshold  determination
          as  to  the city and or covered organization's financial ability
          to pay. Such proceeding shall be commenced not later than thirty
          days after the final determination has been made by the board of
          collective bargaining in the case of paragraph (b) or other body
          in the case of paragraphs (c) or (d). Such proceeding shall have
          preference over all other causes  in  such  appellate  division,
          other than causes relating to the election law.
            (f) The court shall make a de novo review of the record solely
          for  the  purpose of determining whether an award of an increase
          in wages or fringe benefits was within the city's and or covered
          organization's financial ability to pay. The court's findings as
          to such issue shall be based upon a  preponderance  of  all  the
          evidence  set forth in the record.  Unless the parties stipulate
          otherwise, arguments or submission shall be had  within  fifteen
          days  after commencement of the special proceeding and the court
          shall render its decision within fifteen  days  thereafter.  All
          questions,  other  than  the  question relating to the threshold
          determination, shall be reviewed by the  appellate  division  in
          the   same   proceeding  in  the  manner  provided  by  articles
          seventy-five or seventy-eight of  the  civil  practice  law  and
          rules  as  may  be  appropriate,  notwithstanding that the issue
          would otherwise have  been  cognizable  in  the  first  instance
          before  a  special  or  trial  term of the supreme court.  If an
          appeal shall  otherwise  lie  from  such  determination  of  the
          appellate  division  to  the  court  of  appeals, notice of such
          appeal shall be filed within thirty days after the entry of  the
          final order or judgment of the appellate division if such appeal
          is  of right or within ten days after entry of an order granting
          leave to appeal and such appeal shall have preference  over  all
          other appeals other than appeals relating to the election law.
            (g)  At any stage of any proceeding under paragraphs (a), (b),
          (c), (d) and (e) hereof or any appeal from an order or  judgment
          therefrom,  the  board  may intervene as a party on the issue of
          the financial ability of the city and or covered organization to
          pay the cost of an increase in wages or fringe benefits.
            (h) For the purposes of this subdivision, financial ability to
          pay shall mean the financial ability of the city and or  covered
          organization  to pay the cost of any increase in wages or fringe
          benefits without requiring an increase  in  the  level  of  city
          taxes  existing  at the time of the commencement of a proceeding
          under paragraph (a), (c) or (d) hereof.
            (i) The provisions of this subdivision shall terminate on June
          thirtieth, nineteen hundred eighty-six.
            * NB Expires June 30, 1986
            4. During a control period, except upon approval by the  board
          in  accordance  with  the  provisions  of  paragraph  e  or f of
          subdivision one of this section, as the board  shall  determine,
          neither  the  city  nor  a  covered organization shall enter any
          agreement or other arrangement, whether or not it creates a debt
          of the city or a covered organization,  pursuant  to  which  the
          revenues  or  credit  of  the city may be directly or indirectly

          pledged, encumbered,  committed  or  promised,  contingently  or
          otherwise,  for  the  payment of obligations of a public benefit
          corporation. Nothing in this subdivision shall limit  the  right
          of  the  city  to  comply  with  the  provisions of any existing
          agreement or other arrangement in respect of the obligations  of
          a public benefit corporation.
            5.  The  board  may  employ  such  consultants  as it may deem
          necessary to assist it  in  performing  its  functions  required
          under this act.
            6.  The  board  shall  have  the authority to make and execute
          agreements and all  other  instruments  which  the  board  deems
          necessary   for   the  exercise  of  its  powers  and  functions
          including, in connection  with  any  agreement  by  the  federal
          government or any agency or instrumentality thereof to guarantee
          the  payment  of  the principal of or interest on bonds or notes
          issued by the city or by a state financing agency, to enter into
          one or more agreements containing terms and conditions  required
          by  the  secretary of the treasury pursuant to the New York City
          Loan Guarantee Act of l978, Public Law 95-339 with  the  federal
          government or any agency or instrumentality thereof with respect
          to  such  guarantee or any matters related thereto and to comply
          with such terms and conditions.
            7. The board may appoint qualified individuals to  participate
          as  members of such audit, productivity or similar committees or
          councils as  the  city  may  from  time  to  time  establish  in
          consultation  with  the board.  Such individuals, however, shall
          not be deemed to be officers, employees or agents of the  board.
          The  board  shall  review and report on, not less than annually,
          the development and implementation of methods for enhancing  the
          productivity  of  the  city's  labor  force proposed by any such
          committee or council.
            * Terminates July 1, 2008 or ... see § 13
            * § 7-a. Reports of the city. 1.  The  city  shall  take  such
          action  as  may  be  necessary to enable a nationally recognized
          independent certified public accounting firm  or  consortium  of
          firms,  one  of  which  at  least  is  a  nationally  recognized
          independent certified public  accounting  firm,  to  perform  an
          annual  audit  in  accordance  with  generally accepted auditing
          standards and to furnish to the board the report on  such  audit
          prepared by such firm or consortium of firms, which report shall
          include an opinion as to whether the city's financial statements
          have   been  prepared  in  accordance  with  generally  accepted
          accounting principles subject to the provisions  of  subdivision
          two-a  of  section eight of this act and shall state whether the
          audit of such financial statements was made in  accordance  with
          generally  accepted  auditing standards and accordingly included
          such tests of the accounting records  and  such  other  auditing
          procedures as were considered necessary under the circumstances.
          Such  report  shall note the nature and extent of variations, if
          any, from generally accepted accounting principles reflected  in
          the  city's  financial statements. The city shall make available
          for inspection and copying all books, records, work  papers  and
          other  data  and  material as required by such auditors, and the
          city shall make its officers and  employees  available  to,  and
          shall  cooperate  with such auditors so as to permit such annual
          audit to be completed and the report issued to the city  and  to
          the  board  within  four  months  after  the close of the city's
          fiscal year.

            2.  Not  later  than  January  fifteenth,   nineteen   hundred
          eighty-one,  the  city  shall issue a report to the board on its
          program designed to enable the city (i) during its fiscal  years
          ending  June  thirtieth,  nineteen hundred eighty-three and June
          thirtieth,   nineteen   hundred  eighty-four,  to  minimize  its
          dependence upon the state financing agency to the extent that it
          shall be prudent to satisfy the city's financing  needs  by  the
          sale  of  obligations  of the city or its agencies in the public
          markets, and (ii) thereafter  to  satisfy  its  financing  needs
          entirely  by  the  sale  of  such  obligations. The report shall
          describe such  actions  that  the  city  proposes  to  take,  in
          addition  to  those  actions  required  by law, to implement the
          program and shall contain such further information as the  board
          may  reasonably  specify.  After  the  issuance  of such initial
          report,  the  city  shall  report  to   the   board   at   least
          semi-annually   through   June   thirtieth,   nineteen   hundred
          eighty-two and thereafter at least quarterly on the  actions  it
          has  taken  to implement the program and on the results thereof.
          The city may revise the program from  time  to  time  but  shall
          promptly  describe any revisions and the reasons therefor to the
          board.   The city may  comply  with  the  requirements  of  this
          subdivision   by   submitting   the   necessary  information  as
          supplementary material to a financial  plan  or  financial  plan
          modification  in accordance with the standards and procedures of
          section eight of this act. The provisions  of  this  subdivision
          shall terminate on June thirtieth, nineteen hundred eighty-five.
            * Terminates July 1, 2008 or ... see § 13
            * §  8.  Development of the financial plan. 1. Pursuant to the
          procedures contained in subdivision three of this section,  each
          year  the  city shall develop, and may from time to time modify,
          with the approval of the board during a control period,  a  four
          year   financial   plan   covering  the  city  and  the  covered
          organizations.
            Each such financial plan and financial plan modification shall
          comply with the requirements of subdivision four of this section
          and shall, except as otherwise provided pursuant to  subdivision
          two-a of this section, conform to the following standards:
            a.  For  its  fiscal  years  ending  June  thirtieth, nineteen
          hundred seventy-nine through June  thirtieth,  nineteen  hundred
          eighty-one,  the  city's  budget covering all expenditures other
          than capital items shall be prepared and balanced  so  that  the
          results  thereof  would  not  show  a  deficit  when reported in
          accordance with the accounting principles set forth in the state
          comptroller's uniform system of accounts for municipalities,  as
          the  same  may  be  modified by the comptroller, in consultation
          with the city comptroller, for application to the city;  subject
          to  the  provision of subdivision four of section three thousand
          thirty-eight of the  public  authorities  law  with  respect  to
          contributions  by  the  city  or  other  public  employer to any
          retirement system or pension fund and subject to  the  provision
          of  paragraph  (c) of subdivision five of section three thousand
          thirty-eight of the  public  authorities  law  with  respect  to
          expense  items  included  in the capital budget of the city. For
          the  fiscal  year  ending  June  thirtieth,   nineteen   hundred
          eighty-two,  and  for  each  fiscal  year thereafter, the city's
          budget covering all expenditures other than capital items  shall
          be  prepared  and balanced so that the results thereof would not
          show a  deficit  when  reported  in  accordance  with  generally

          accepted  accounting  principles  and would permit comparison of
          the budget with the report of actual financial results  prepared
          in  accordance  with  generally  accepted accounting principles.
          With  respect  to  financial plans that include the fiscal years
          ending June thirtieth,  nineteen  hundred  seventy-nine  through
          June  thirtieth,  nineteen hundred eighty-one, the city's budget
          covering all expenditures other  than  capital  items  shall  be
          prepared   in  accordance  with  generally  accepted  accounting
          principles and there shall be substantial progress in each  such
          fiscal  year  towards  achieving  a  city  budget  covering  all
          expenditures other than capital items the results of which would
          not show a deficit when reported in  accordance  with  generally
          accepted accounting principles. The city shall eliminate expense
          items from its capital budget not later than the commencement of
          the   fiscal   year  ending  June  thirtieth,  nineteen  hundred
          eighty-two. For the fiscal year ending June thirtieth,  nineteen
          hundred  eighty-nine,  and  for each fiscal year thereafter, the
          budgets covering all expenditures other than  capital  items  of
          each of the covered organizations shall be prepared and balanced
          so  that  the  results  thereof  would  not  show a deficit when
          reported  in  accordance  with  generally  accepted   accounting
          principles;  and for each fiscal year prior thereto, there shall
          be substantial progress towards such goal.  Notwithstanding  the
          foregoing and the provisions of any general or special state law
          or  local  law to the contrary, including but not limited to the
          New York city charter, all costs that would be capital costs  in
          accordance  with  generally  accepted accounting principles, but
          for the application of governmental accounting  standards  board
          statement number forty-nine, shall be deemed to be capital costs
          for purposes of this chapter and any other provision of state or
          local  law,  including  but  not  limited  to  the New York city
          charter, relevant to the treatment of such costs.
            b. The limitations on its outstanding  short-term  obligations
          required   by   subdivision   nine  of  section  three  thousand
          thirty-eight of the public authorities law and by section nine-b
          of this act shall be observed at all times, as each  is  amended
          from time to time.
            c. Provision shall be made for the payment in full of the debt
          service  on  all  bonds  and  notes  of the city and the covered
          organizations (other than notes held by the municipal assistance
          corporation for the city of New York to  the  extent  that  such
          corporation  has  evidenced  its  intention  not to present such
          notes  for  payment  during  the  fiscal  year  in   which   the
          determination is made provided that such notes were held by such
          corporation on June thirtieth, nineteen hundred seventy-eight or
          were  issued in exchange for or in refunding or renewal of notes
          held by such corporation on such date), for the adequate funding
          of programs of the city and the covered organizations which  are
          mandated  by  state or federal law and for which obligations are
          going to be incurred during the fiscal year and for payment of a
          guarantee fee or any other amounts required by the United States
          of  America  or  any  agency  or  instrumentality   thereof   in
          connection with the guarantee of the payment of the principal of
          or interest on bonds or notes issued by the city.
            d. All projections of revenues and expenditures contained in a
          financial  plan  shall  be  based  on reasonable and appropriate
          assumptions and methods of estimation. All cash flow projections
          shall be based upon reasonable and appropriate assumptions as to

          sources and uses of cash  (including  but  not  limited  to  the
          timing  thereof),  and  shall provide for operations of the city
          and covered  organizations  to  be  conducted  within  the  cash
          resources so projected.
            e.  The  city  shall provide a general reserve for each fiscal
          year to cover potential reductions in its projected revenues  or
          increases  in its projected expenditures during each such fiscal
          year. The amount provided for  such  general  reserve  shall  be
          estimated  by  the  city  in accordance with paragraph d of this
          subdivision, but in no event shall it be less than  one  hundred
          million dollars at the beginning of any fiscal year.
            f.  For  financial plans beginning with the fiscal year ending
          June thirtieth, nineteen hundred eighty-three or any  succeeding
          fiscal  year,  the  first  fiscal year included in any financial
          plan shall make provision  for  the  repayment  of  any  deficit
          incurred by the city during the preceding fiscal year.
            2.  In  developing  the  financial plan the city shall seek to
          achieve a stabilized work force for the city and, to the  extent
          a  reduction  in  the  work  force is required, primary recourse
          shall be  had  to  the  attrition  process  to  accomplish  such
          reduction.
            2-a.  The  city  and  the  board  shall  confer concerning the
          projected effect on the budgets of  the  city  and  the  covered
          organizations  of  any  change  in generally accepted accounting
          principles, or change in the application of  generally  accepted
          accounting principles to the city and the covered organizations,
          made  after  the  effective  date  of  this  act.  If  the board
          determines that immediate compliance with such change will  have
          a   material   effect   on  such  budgets  over  a  time  period
          insufficient to accommodate the  effect  without  a  substantial
          adverse  impact on the delivery of essential services, the board
          may authorize and approve a method of phasing  the  requirements
          of   such   change   into  such  budgets  over  such  reasonably
          expeditious time period as the board deems appropriate.
            3. The financial plan shall be developed and, during a control
          period, shall  be  approved,  and  may  from  time  to  time  be
          modified, in accordance with the following procedures:
            a.   The   city   shall,   by  June  first,  nineteen  hundred
          seventy-eight, prepare and submit a financial plan to the  board
          covering  the four year period which begins with the fiscal year
          ending   June   thirtieth,   nineteen   hundred    seventy-nine.
          Thereafter,  at  least fifty days prior to the beginning of each
          fiscal year or on such other date as the board may approve  upon
          the  request  of  the  city, the city shall prepare and submit a
          financial plan to  the  board  covering  the  four  year  period
          beginning  with  such fiscal year. On such dates the mayor shall
          also submit to the board the city's executive  expense,  revenue
          and   capital   budgets  for  the  ensuing  fiscal  year  and  a
          certificate  of  the  mayor  stating  that  such   budgets   are
          consistent  with  the  financial  plan submitted therewith, that
          projections contained in the  budgets  and  financial  plan  are
          based upon reasonable and appropriate assumptions and methods of
          estimation, and that operation within the budgets is feasible.
            b. (i) During a control period the board shall promptly review
          each financial plan and financial plan modification submitted by
          the  city.   Not more than forty-five days after submission of a
          financial plan or more than thirty days after  submission  of  a
          financial  plan  modification  the board shall determine whether

          the financial plan or financial plan  modification  is  complete
          and  complies with the standards set forth in subdivision one of
          this section and shall approve or disapprove the financial  plan
          or financial plan modification in accordance with the provisions
          of this section. If the board determines that the financial plan
          or financial plan modification is complete and complies with the
          standards  set  forth  in  subdivision  one of this section, the
          board  shall  approve  the  financial  plan  or  financial  plan
          modification.  Upon  making  such  determination the board shall
          make a certification to the city setting forth revenue estimates
          approved by the board in accordance with such determination.
            (ii) At all times other than during a control period the board
          shall promptly review each financial  plan  and  financial  plan
          modification  submitted  by  the  city.  If the board determines
          after such review that the  financial  plan  or  financial  plan
          modification submitted by the city is not in accordance with the
          standards  set  forth  in  subdivision  one of this section, the
          board shall promptly so notify the city and may take such  other
          action under this act as it deems appropriate.
            c.  The  board  shall disapprove a financial plan or financial
          plan modification if during a control period it determines  that
          the  financial plan or financial plan modification is incomplete
          or fails to comply with the provisions  of  subdivision  one  of
          this  section.  In  disapproving a financial plan or a financial
          plan modification the board may order that one or  more  of  the
          following actions be taken:
            (i) expenditures or reserves to assure availability of amounts
          required for debt service requirements on all bonds and notes of
          the  city and the covered organizations or expenditures required
          for adequate funding of programs of the  city  and  the  covered
          organizations  mandated  by  state  or federal law and for which
          obligations are going to be incurred during the fiscal year,  be
          increased to the levels required to provide for their payment in
          full;
            (ii)  the revenue projections (or any item thereof) during any
          period be adjusted to comply with the  standards  set  forth  in
          subdivision one of this section; and
            (iii)  the  aggregate expenditures projected for any period be
          reduced to conform to revenue estimates certified by  the  board
          in  order  to comply with the standards set forth in subdivision
          one of this section.
            d. During a control period in the event that the  city  shall,
          for  any  reason,  fail  to submit a financial plan prior to the
          beginning of a fiscal year, as required by paragraph a  of  this
          subdivision,  or  in  the  event that the board has not, for any
          reason permitted under  this  act,  approved  a  financial  plan
          submitted  by  the city prior to the beginning of a fiscal year,
          the board shall formulate and  adopt  a  financial  plan  to  be
          effective until the board approves a financial plan submitted by
          the  city.  Any  financial plan so formulated by the board shall
          comply with the standards set forth in subdivision one  of  this
          section.  The budgets and operations of the city and the covered
          organizations  at  all  times  shall  be  in   conformance   and
          compliance with the financial plan then in effect.
            e.  After the initial adoption by the city, or the approval by
          the  board  during  a  control  period,  of  a  financial  plan,
          projections  of  revenues  and  expenditures and other estimates
          contained in the financial plan shall be reexamined by the board

          at least quarterly in consultation with the city and the covered
          organizations, and  during  a  control  period  the  city  shall
          prepare  and submit to the board financial plan modifications at
          such  times,  in such detail and within such time periods as the
          board may require in order  to  modify  the  financial  plan  to
          conform  to  the  standards set forth in subdivision one of this
          section.  During  a  control  period  in  the  event  the  board
          determines that (i) revenue estimates (or any item thereof) must
          be adjusted to ensure compliance with the standards set forth in
          subdivision  one  of  this  section,  or (ii) that the city or a
          covered organization is expending funds at  a  rate  that  would
          cause   expenditures   to   exceed   the  aggregate  expenditure
          limitation for the city or covered organization provided for  in
          the  financial  plan  then in effect, prior to the expiration of
          the  fiscal  year,  the  city  shall  submit  a  financial  plan
          modification to effect such adjustments in revenue estimates and
          reductions  in total expenditures as may be necessary to conform
          to such  standards  or  aggregate  expenditure  limitations.  If
          during   a   control  period  the  city  fails  to  submit  such
          modification after  such  determination  as  to  adjustments  in
          revenue   estimates   or  such  determination  as  to  rates  of
          expenditures, or to submit a financial plan modification in  the
          detail  or  within the time period specified by the board, or if
          such modification is disapproved by the board as not  conforming
          to  the  standards set forth in subdivision one of this section,
          the  board  may  formulate  and  adopt   such   financial   plan
          modification   as  it  deems  appropriate  to  ensure  that  the
          financial  plan  continues  to   meet   such   standards.   Such
          modification   shall   become   effective   on   its   adoption.
          Notwithstanding the provisions of this section, in the event the
          city shall determine that, due to  unforeseen  events  during  a
          fiscal   year,  compliance  with  the  standards  set  forth  in
          paragraph a of subdivision one of this section would result in a
          material adverse impact upon the delivery of essential services,
          the city shall notify the board of such determination,  together
          with  such information, projections or analyses relating thereto
          as the board may require, and shall submit a modification to the
          financial plan reflecting such determination. During  a  control
          period  the  board shall disapprove any such modification unless
          it finds that (i)  the  city's  determination  is  supported  by
          information,  projections  and  analyses  which  the board deems
          substantially accurate in all material respects  and  (ii)  such
          events,  in  its  judgment,  warrant  such  modification  to the
          financial plan to avoid such adverse impact on the  delivery  of
          essential services.
            f.  The  city  may,  from  time to time, submit financial plan
          modifications for review by the board. During a  control  period
          the  board shall approve such modifications unless it determines
          that such modifications would constitute grounds for disapproval
          of  the  financial  plan  pursuant  to  paragraph  c   of   this
          subdivision,  or  if applicable, pursuant to paragraph e of this
          subdivision.
            g.  Anything  contained  in   this   act   to   the   contrary
          notwithstanding,  during  a  control period the board may at any
          time disapprove or after consultation with the city  revise  the
          revenue  estimates (or any item thereof) prepared by the city in
          connection with the preparation  of  a  financial  plan  or  any
          modification thereto and determined by the board not to be based

          on  assumptions  and  methods of estimation which are reasonable
          and appropriate under the  circumstances  and  in  view  of  the
          objectives  and  purposes  of  the  act.  The  board  may  after
          consultation  with  the city determine the estimated revenues of
          the city and the covered organizations provided,  however,  that
          any revenues estimated by the board shall be based on reasonable
          and appropriate assumptions and methods of estimation.
            4. Each financial plan shall be in such form and shall contain
          such  information  for each year during which the financial plan
          is in effect as the board may specify, and shall, in such detail
          as  the  board  may  from  time  to  time   prescribe,   include
          projections   of  all  revenues,  expenditures  and  cash  flows
          (including but not limited to projected capital expenditures and
          debt issuances) and a schedule of projected capital  commitments
          of  the  city and except in such instances as the board may deem
          appropriate each of the covered organizations. In addition, each
          financial plan and financial plan modification shall  include  a
          statement   of   the  significant  assumptions  and  methods  of
          estimation  used  in  arriving  at  the  projections   contained
          therein,  set forth in such form and in such detail as the board
          may from time to time prescribe.
            5. The city  and  the  covered  organizations  shall  promptly
          furnish  the  board  with  any  information  which the board may
          request to satisfy itself that (i) projected employment  levels,
          collective  bargaining  agreements  and other action relating to
          employee costs, capital construction and such other  matters  as
          the  board  may specify, are consistent with the provisions made
          for such costs in the financial plan,  (ii)  the  city  and  the
          covered  organizations  are  taking whatever action is necessary
          with respect to programs mandated by state and  federal  law  to
          ensure  that  expenditures  for such programs are limited to and
          covered by the expenditures stated in the  financial  plan,  and
          (iii)  adequate  reserves  are  provided  to  maintain  programs
          mandated by state and federal law and for which obligations  are
          going  to  be  incurred  in  the fiscal year and other essential
          programs in  the  event  revenues  have  been  overestimated  or
          expenditures underestimated for any period.
            6.  For each financial plan and financial plan modification to
          be prepared and submitted by the city to the board  pursuant  to
          the  provisions of this section, the covered organizations shall
          submit to the  city  such  information  with  respect  to  their
          projected  expenditures,  revenues, cash flows and a schedule of
          projected capital commitments for  each  year  covered  by  such
          financial  plan  or  modification  as  the city shall determine.
          Notwithstanding  any  other  provision  of  law   limiting   the
          authority  of the city with respect to any covered organization,
          the city, in the preparation and  submission  of  the  financial
          plan  and  modifications thereof, shall (except for debt service
          or for other expenditures to the extent that  such  expenditures
          are  required  by law) have the power to determine the aggregate
          expenditures to be allocated to any covered organization in  the
          financial plan and any modifications thereto.
            * Terminates July 1, 2008 or ... see § 13
            * §  9.  Establishment  and  application of the board fund. 1.
          There is hereby established a fund designated  the  board  fund.
          Commencing  on October twentieth, nineteen hundred seventy-five,
          and for the duration of a control period, all revenues  received
          or to be received by the city or any covered organization shall,

          unless  exempted by order of the board, be revenues of the board
          fund and shall be for the account of the city or the appropriate
          covered  organizations,  except  (i)  to  the  extent  expressly
          prohibited  by  federal law, (ii) where revenues of the city are
          deposited in the general debt service fund, the TAN debt service
          account or the RAN debt service account,  or  (iii)  where  such
          revenues  are  pledged  to the payment of any outstanding bonds,
          notes or other obligations of  covered  organizations  or  state
          public  authorities as defined in section two hundred one of the
          civil service law.  Disbursement from the board  fund  shall  be
          made by the board in accordance with the approved financial plan
          except  as  provided  in  subdivision five of this section nine.
          Commencing on October twentieth, nineteen hundred  seventy-five,
          and for the duration of a control period, all funds and accounts
          established or thereafter established by the city or the covered
          organizations  shall,  unless  exempted  by  order of the board,
          thereafter be funds and accounts of the board fund except to the
          extent expressly prohibited by federal  law  or  to  the  extent
          pledged  by  covenants or agreements relating to any outstanding
          bonds, notes or other obligations of  covered  organizations  or
          public  authorities as defined in section two hundred one of the
          civil service law; and no monies or funds held  in  the  general
          debt  service fund, the TAN debt service account or the RAN debt
          service account shall be  part  of  the  board  fund.  All  such
          accounts  of  the  board shall have such captions and entries as
          the  board  shall  determine  to  be  necessary  to  credit  the
          foregoing revenues and receipts to the board fund. The monies of
          the  fund  shall not be deemed to be money of the state or money
          under its control.
            2. The deposit  of  revenues  into  the  board  fund  and  the
          investment  or  deposit  of  monies  therein  shall  be  made in
          accordance with and pursuant to procedures  established  by  the
          board.
            3.  In order to assure compliance with the financial plan, the
          board shall from time to time adopt procedures  controlling  the
          disbursement  of  monies  from  the  board fund. The board shall
          authorize the city to make all disbursements  of  city  revenues
          from  the  board  fund,  which  disbursements  shall  be made in
          accordance with the approved financial plan; provided, that  the
          board  may withdraw such authorization if it determines that (a)
          any disbursements made or to be made by the city have  not  been
          or  are  likely  not  to  be  in  compliance  with  the approved
          financial plan, (b) the city has violated any  other  provisions
          of  this act, or (c) the city has violated an agreement with any
          holder or guarantor of bonds or notes issued by the  city  or  a
          state financing agency.
            4. Within the board fund there is hereby established a special
          account designated the debt service repayment account. The board
          shall  from  time  to time direct, in accordance with procedures
          adopted by the board, the deposit in the debt service  repayment
          account  of  such amounts as the board shall, in its discretion,
          determine to be sufficient to meet the debt service requirements
          of the covered organizations on their  bonds  and  notes  (other
          than  bonds  and  notes  of  covered  organizations payable from
          revenues not included in the board fund)  as  they  become  due.
          Amounts  in  the debt service repayment account shall be used to
          meet   such   debt   service   requirements   of   the   covered
          organizations.

            5.  If  at  any time the board determines that the amount then
          held in the board fund or the amount estimated by the  board  to
          be held in the board fund is or will be insufficient to meet the
          expenditures  in  the  amounts  and at the times required by the
          financial  plan,  the board shall require disbursements from the
          board fund to be made in the following order or priority  unless
          otherwise  required  by law of the United States of America: (i)
          the payment of amounts from the board fund to the  debt  service
          repayment  account,  the general debt service fund, the TAN debt
          service account and the RAN debt service  account,  to  maintain
          therein  the  amount required, to meet debt service requirements
          of the city and the covered organizations  on  their  bonds  and
          notes  as  they  may  become  due,  (ii)  the  payment  of other
          liabilities  having  statutory  or  contractual  priority   over
          remaining  liabilities of the city and the covered organizations
          whose monies are included in  the  board  fund,  and  (iii)  the
          payment  of other obligations on an allocated basis as specified
          by the city for expenditures in accordance  with  the  financial
          plan  provided  that,  in  the  event  that the city fails to so
          specify, the board may withhold payment of  any  of  such  other
          obligations or may direct their payment pro rata.
            6.  The  board  shall cause to be performed such pre-audit and
          post-audit  reviews  of  the  board  funds   and   disbursements
          therefrom as it may determine.
            * Terminates July 1, 2008 or ... see § 13
            * §  9-a.  Establishment  and  application  of  a general debt
          service fund.  1. Commencing on the first day of the first  full
          fiscal  quarter  subsequent  to  the  first  sale of a federally
          guaranteed city obligation, the city shall establish  a  general
          debt  service fund for the purpose of paying debt service due or
          becoming due in the then current fiscal year and  in  subsequent
          fiscal  years.  All  monies  in  the  fund  shall be held by the
          comptroller, who shall  administer  and  maintain  the  fund  in
          accordance with the provisions of this section.
            2.  All  payments  of  or  on  account of real estate taxes or
          assessments, other than the proceeds of tax anticipation  notes,
          shall  be  immediately  upon receipt deposited in such fund. The
          comptroller shall retain, disburse and apply monies in the  fund
          during each month as follows:
            a.  During the first month of each fiscal quarter, there shall
          be  retained  in  the  fund,  subject  to  the   provisions   of
          subdivision  three of this section, all real estate tax payments
          deposited in the fund until there shall have been retained  from
          monies  so  deposited  during  such month an amount equal to the
          total monthly debt service, computed  as  of  the  date  of  any
          disbursement  of  money  from the fund, for the second and third
          months of such fiscal quarter; provided that such  amount  shall
          be  reduced  by  any amount already on deposit in the fund which
          may be used to pay the monthly debt service for such months.
            For purposes of this section, fiscal quarter  shall  mean  the
          three-month  period beginning July first, October first, January
          first or April first, and monthly debt service shall mean, as of
          any date of computation, the  amount  of  monies  equal  to  the
          aggregate of (i) all interest payable during such month on bonds
          and  notes  of  the  city,  plus  (ii)  the  amount of principal
          (including payments into sinking funds)  maturing  or  otherwise
          coming due during such month on all bonds of the city (excluding
          principal payments made from sinking funds required by the terms

          of certain city bonds), plus (iii) the amount of principal to be
          paid  on  notes of the city during such month from sources other
          than the proceeds  of  bonds  or  renewal  notes  (exclusive  of
          revenue   anticipation  notes  and  tax  anticipation  notes  or
          renewals thereof issued less than two years prior to the date of
          computation).
            b. During the second and third months of each fiscal  quarter,
          there  shall  be retained in the fund, subject to the provisions
          of subdivision three  of  this  section,  all  real  estate  tax
          payments  deposited  in  the  fund  until  there shall have been
          retained from monies so deposited during such  month  an  amount
          equal to the total monthly debt service, computed as of the date
          of any disbursement of monies from the fund, for the first month
          of the next succeeding fiscal quarter; provided that such amount
          shall  be  reduced  by any amount already on deposit in the fund
          which may be used to pay  the  monthly  debt  service  for  such
          month.
            c.  During any month of a fiscal quarter, after the retentions
          required by paragraphs a and b of  this  subdivision  have  been
          made for such month, the comptroller shall deposit any remaining
          balance  of  real estate taxes received during such month, first
          into the TAN debt service account to the extent  required  under
          subdivision  six of this section, and second into the board fund
          to be applied in accordance with procedures of the board.
            d. The city may at any time  pay  into  the  fund  any  monies
          required  by  law to be used to pay monthly debt service and any
          other monies available for such purpose.
            3. The board may approve, subject to agreements made with  the
          holders or guarantors of outstanding notes or bonds issued by or
          for  the  benefit  of  the city after the effective date of this
          act, criteria for calculating a proportion of  real  estate  tax
          receipts  to be retained in the fund in order to provide for the
          retention of amounts required by the provisions  of  subdivision
          two  of  this  section  in  lieu of the retention of all initial
          receipts as required by such subdivision; provided, that if  the
          board  at  any  time  determines  that  retentions  in  the fund
          pursuant to the provisions of such subdivision are or are likely
          to be insufficient to provide for the payment  of  monthly  debt
          service when due, in order to ensure that the amounts on deposit
          in  the fund will be sufficient to pay monthly debt service when
          due, the board shall require (i) that real estate  tax  receipts
          be  retained  in the fund in greater amounts or at earlier dates
          than the provisions of such subdivision require,  or  (ii)  that
          other  revenues  or  cash resources of the city be paid into the
          fund.  The board shall consider the impact of earlier or  larger
          retention  of  real  estate  tax receipts on the city's seasonal
          borrowing requirements when determining whether it shall require
          such  additional  retention  or  that  other  revenues  or  cash
          resources  of  the  city  be  paid into the fund.   Prior to the
          issuance by the city of any bonds  or  notes,  the  board  shall
          review   any   criteria  then  in  effect  which  determine  the
          proportion of real estate tax receipts to  be  retained  in  the
          fund to determine whether the proposed debt service schedule for
          such  bonds or notes is consistent with the monies which will be
          available therefor or whether such criteria should  be  revised.
          The  board  shall  from  time  to  time  take  such action as it
          determines is necessary, including  disapproval  of  a  proposed
          issue  pursuant  to  paragraph  f  of subdivision one of section

          seven, so that the monies in the fund shall be adequate to  meet
          debt service requirements.
            4.  Commencing  on  the  first  day of the second month of the
          first full fiscal quarter subsequent to  the  first  sale  of  a
          federally  guaranteed  city  obligation,  the payment of monthly
          debt service shall be made, first, from amounts retained in  the
          fund.  Amounts  retained  in  the fund shall be used only to pay
          debt service of the city.
            5. Upon the issuance of any tax anticipation  notes  following
          the  effective date of this act, the comptroller shall establish
          and, so long as any tax anticipation notes shall be outstanding,
          shall maintain a tax  anticipation  note  debt  service  account
          within  the  fund for the purpose of paying the principal of tax
          anticipation notes.
            6. The city shall determine the date on  which  the  principal
          due or to become due on an outstanding issue of tax anticipation
          notes  shall equal ninety percent of the available tax levy with
          respect to such issue, and upon reasonable  notice  thereof  the
          comptroller shall commence on such date to pay into the TAN debt
          service  account from collections of such taxes and assessments,
          after retaining amounts required to be deposited  in  the  fund,
          amounts  sufficient to pay when due, the principal of such issue
          of tax anticipation notes. The payments of the principal of  tax
          anticipation  notes  shall be made, first, from amounts retained
          in the TAN debt service account.
            7.  Upon  the  issuance  of  any  revenue  anticipation  notes
          following  the effective date of this act, the comptroller shall
          establish and, so long as any revenue anticipation  notes  shall
          be  outstanding, shall maintain a revenue anticipation note debt
          service account within the fund for the purpose  of  paying  the
          principal  of  revenue anticipation notes. Each specific type of
          revenue in anticipation of  which  such  notes  are  issued  and
          available  for  such  purpose shall be deposited in such account
          immediately  upon  receipt  by  the  city.  Where  such  revenue
          consists of state aid or other revenue to be paid to the city by
          the  comptroller,  on  the  date  such revenue is payable to the
          city, the comptroller shall deposit such revenue  directly  into
          such  account  in  lieu  of  payment  to  the city. All revenues
          deposited  in  the  RAN  debt  service  account  shall  be  paid
          immediately  into the board fund except as otherwise provided in
          subdivision eight of this section.
            8. The city shall determine the date on  which  the  principal
          due  or  to  become  due  on  an  outstanding  issue  of revenue
          anticipation notes shall  equal  ninety  percent  of  the  total
          amount of revenue against which such notes were issued remaining
          to  be  paid to the city on or before the fifth day prior to the
          maturity date of such notes and upon reasonable  notice  thereof
          the comptroller shall commence on such date to retain in the RAN
          debt  service  account from amounts deposited or to be deposited
          therein of each specific type  of  revenue  in  anticipation  of
          which  revenue  such  anticipation  notes were issued, an amount
          sufficient to pay, when  due,  the  principal  of  such  revenue
          anticipation  notes.  Monies retained in such account shall vest
          immediately in the comptroller in trust for the benefit  of  the
          holders  of  the  revenue  anticipation notes in anticipation of
          which such notes were issued. No person having any claim of  any
          kind in tort, contract or otherwise against such city shall have
          any   right  to  or  claim  against  any  monies  of  the  state

          appropriated by the state and  in  anticipation  of  which  such
          notes  have  been  issued, other than a claim for payment by the
          holders of such notes, and such monies shall not be  subject  to
          any  order,  judgment,  lien,  execution,  attachment, setoff or
          counter-claim  by  any  such  person;  provided,  however,  that
          nothing contained in this paragraph 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, instrumentality,
          public benefit corporation  or  political  subdivision  thereof,
          including  the city of New York, under which such purchasers and
          holders and owners have any right of payment of  such  bonds  or
          notes  by  recourse to state aid or local assistance monies held
          by the state or for the payment of which bonds  or  notes  state
          aid  or  local  assistance  monies  are a designated source. The
          payment of the principal of revenue anticipation notes shall  be
          made  first  from  amounts  retained  in  the  RAN  debt service
          account.
            9. Whenever the amount  contained  in  the  TAN  debt  service
          account  or  the  RAN  debt  service  account exceeds the amount
          required to be retained in  such  account  such  excess  monies,
          including  earnings  on investments of monies in the fund, shall
          be withdrawn from such account and paid into the board fund.
            10. Subject to agreements made with holders or  guarantors  of
          outstanding  notes  or bonds issued by or for the benefit of the
          city after the effective date of this act, the comptroller shall
          invest the monies retained in the fund in accordance with law.
            11. The limitations imposed upon  the  city  by  this  section
          shall  be  in  addition to any limitations imposed upon the city
          under the local finance law. In the event any provisions of  the
          local  finance  law shall be inconsistent with the provisions of
          this section, the provisions of this section shall prevail.  The
          requirements  of this section shall not apply to any note of the
          city held by the municipal assistance corporation for  the  city
          of  New  York  to the extent that such corporation has evidenced
          its intention not to present such notes for payment  during  the
          fiscal  year  in  which  the determination is made provided that
          such notes were held by  such  corporation  on  June  thirtieth,
          nineteen hundred seventy-eight or were issued in exchange for or
          in  refunding  or  renewal  of notes held by such corporation on
          such date.
            12. Notwithstanding any other provision of this  section,  the
          city  may,  at any time, subject to approval by the comptroller,
          designate a trust company or bank having its principal place  of
          business  in  the  state  of New York and having the powers of a
          trust company in the state of New York to hold all or  any  part
          of  the  monies  in  the fund and to administer and maintain the
          monies so held in accordance with the applicable  provisions  of
          this section and any agreements made pursuant thereto.
            * Terminates July 1, 2008 or ... see § 13
            * §   9-b.   Limitations   on  short-term  borrowing.  1.  The
          limitations on short-term borrowing imposed  upon  the  city  by
          this  section  shall  be  in  addition  to  the  limitations  on
          short-term borrowing imposed on the city under the local finance
          law. In the event any provisions of the local finance law  shall
          be  inconsistent  with  the  provisions  of  this  section,  the
          provisions of this section shall prevail. For  the  purposes  of
          this   section   the   terms  "bond  anticipation  notes",  "tax

          anticipation notes", "revenue anticipation  notes"  and  "budget
          notes"  shall  not  mean one or more of or any of the respective
          notes held by the municipal assistance corporation for the  city
          of New York on June thirtieth, nineteen hundred seventy-eight or
          any note of the city held by such corporation issued in exchange
          for or in refunding or renewal of any such note.
            2. a. No tax anticipation notes shall be issued by the city in
          anticipation  of  the  collection of taxes or assessments levied
          for a fiscal year which would cause the principal amount of such
          issue of tax anticipation notes to exceed  an  amount  equal  to
          ninety  per  cent of the available tax levy with respect to such
          issue.
            b. Tax anticipation notes and renewals  thereof  shall  mature
          not  later  than  the  last day of the fiscal year in which they
          were issued.
            3. a. No revenue anticipation note shall be issued by the city
          in anticipation of the collection or receipt  of  revenue  in  a
          fiscal  year  which  would cause the principal amount of revenue
          anticipation notes outstanding to exceed ninety per cent of  the
          available  revenues  for  such fiscal year. For purposes of this
          subdivision, available revenues shall be the revenues other than
          real estate taxes and assessments which have been  estimated  in
          the financial plan to be realized in cash during such year, less
          revenues previously collected, other than revenues on deposit in
          the  RAN  debt  service  account or any special fund established
          pursuant to law for the payment of interest and/or principal  of
          revenue anticipation notes.
            b.  Each  issue  of revenue anticipation notes shall be issued
          only in anticipation of the receipt of a specific type or  types
          of  revenue and the amount of revenue, the source of revenue and
          the  anticipated  date  of  payment  shall  be  stated  in   the
          proceedings authorizing the issuance of such notes.
            c.  Revenue anticipation notes shall mature not later than the
          last day of the fiscal year in which they were issued,  and  may
          not  be  renewed  or extended to a date more than ten days after
          the anticipated date of receipt of such revenue. No such renewal
          note shall mature after the last day of such fiscal year  unless
          the  board  shall  certify  that  the revenue against which such
          renewal note is issued has been properly accrued  and  estimated
          in  the financial plan in effect on the date of issuance of such
          renewal note; provided that in no event shall any  such  renewal
          notes  mature  later than one year subsequent to the last day of
          the fiscal year during which  such  revenue  anticipation  notes
          were originally issued.
            4. a. No bond anticipation note shall be issued by the city in
          any  fiscal  year which would cause the principal amount of bond
          anticipation notes outstanding, together with interest due or to
          become due thereon, to exceed fifty per cent  of  the  principal
          amount  of  bonds  issued  by  the  city  in  the  twelve months
          immediately preceding the month in  which  the  note  is  to  be
          issued.
            b.  The proceeds of each bond issue shall be (i) held in trust
          for the payment, at maturity, of the principal of  and  interest
          on   any   bond   anticipation  notes  of  the  city  issued  in
          anticipation of such bonds and outstanding at the  time  of  the
          issuance  of  such bonds, (ii) paid into the general fund of the
          city in repayment of any advance made from such fund pursuant to
          section 165.10 of the local finance law, and (iii)  any  balance

          shall be expended for the object or purpose for which such bonds
          were issued.
            c.  Bond  anticipation  notes  shall mature not later than one
          year after their date of issuance  and  may  be  renewed  for  a
          period  not to exceed two years, or such longer period as may be
          permitted for bond anticipation notes of  the  state,  from  the
          date of original issue.
            5.  Budget notes issued pursuant to section 29.00 of the local
          finance law may only be issued to fund projected expense  budget
          deficits.  No  budget  notes  or  renewals thereof, shall mature
          later than sixty days prior to the last day of the  fiscal  year
          next  succeeding  the fiscal year during which such budget notes
          were originally issued.
            6.  The  city  shall  issue  no  obligations  which  shall  be
          inconsistent with the financial plan or with the limitations set
          forth in subdivisions one through five of this section.
            * Terminates July 1, 2008 or ... see § 13
            * §  10.  Wage  freeze.  1.  Increases  in  salary or wages of
          employees of the city and  employees  of  covered  organizations
          which  have  taken effect since June thirtieth, nineteen hundred
          seventy-five or which will take effect after that date  pursuant
          to   collective   bargaining   agreements   or  other  analogous
          contracts, now in existence or hereafter entered into, requiring
          such  salary  increases  as  of  July  first,  nineteen  hundred
          seventy-five  or as of any date thereafter are hereby suspended.
          All increased payments for holiday and  vacation  differentials,
          shift  differentials,  salary  adjustments according to plan and
          step-ups or increments for employees of the city  and  employees
          of  covered  organizations  which  have  taken effect since June
          thirtieth, nineteen hundred  seventy-five  or  which  will  take
          effect   after  that  date  pursuant  to  collective  bargaining
          agreements or other analogous contracts requiring such increased
          payments as of July first, nineteen hundred seventy-five  as  of
          any  date  thereafter are hereby, in the same manner, suspended.
          For the purposes of computing the  pension  base  of  retirement
          allowances,  the  suspended  salary  or  wage  increases and the
          suspended other payments shall not  be  considered  as  part  of
          compensation or final compensation or of annual salary earned or
          earnable. The suspensions provided herein shall be effective for
          the first pay period ending on or subsequent to September first,
          nineteen  hundred seventy-five and shall continue until one year
          thereafter and, to the extent of any determination of the  board
          that  a continuation of such suspensions, to a date specified by
          the board, is necessary in order to achieve  the  objectives  of
          the  financial  plan, such suspensions shall be continued to the
          date specified by such board, which date shall in  no  event  be
          later than the end of the emergency period.
            2.  This  section  shall not be applicable to employees of the
          city or  employees  of  a  covered  organization  covered  by  a
          collective  bargaining agreement or an employee of the city or a
          covered organization not  covered  by  a  collective  bargaining
          agreement where the collective bargaining representative or such
          unrepresented  employee  has  agreed to a deferment of salary or
          wage increase, by  an  instrument  in  writing  which  has  been
          certified  by  the  mayor on or before September first, nineteen
          hundred seventy-five, or certified by the board after  September
          first,  nineteen hundred seventy-five as being an acceptable and
          appropriate contribution toward alleviating the fiscal crisis of

          the city. The board may, if it finds that the fiscal crisis  has
          been  sufficiently  alleviated  or  for  any  other  appropriate
          reason, direct that the suspensions of salary or wage  increases
          or suspensions of other increased payments shall, in whole or in
          part, be terminated.
            3.  The  provisions  of  this  section shall terminate on July
          first, nineteen hundred seventy-eight.
            * Terminates July 1, 2008 or ... see § 13
            * § 10-a. Covenants, authorizations to agree and remedies.  1.
          In the event that after the date on which the provisions of this
          act become operative, any notes or bonds are issued by the  city
          prior  to  July  1,  2016,  or  any  bonds are issued by a state
          financing agency, the state of New York  hereby  authorizes  the
          city  and authorizes and requires such state financing agency to
          include a pledge and agreement of the state of New York  in  any
          agreement  made  by the city or such state financing agency with
          holders or guarantors of such notes or bonds that the state will
          not take any action which  will  (a)  substantially  impair  the
          authority  of  the  board during a control period, as defined in
          subdivision twelve of section two of this act as  in  effect  on
          the  date  such  notes  or  bonds  are  issued  (i)  to approve,
          disapprove, or modify  any  financial  plan  or  financial  plan
          modification,  including  the  revenue  projections (or any item
          thereof) contained therein, subject to the standards  set  forth
          in  paragraphs  a,  c,  d, e and f of subdivision one of section
          eight of this act as in effect on the date such notes  or  bonds
          are issued and paragraph b of such subdivision as in effect from
          time  to  time,  (ii)  to disapprove a contract of the city or a
          covered organization if the performance of such  contract  would
          be  inconsistent  with  the  financial  plan  or  to  approve or
          disapprove proposed short-term or  long-term  borrowing  of  the
          city  or  a  covered  organization  or  any  agreement  or other
          arrangement referred to in subdivision four of section seven  of
          this  act,  or  (iii)  to  establish  and  adopt procedures with
          respect to the deposit in and disbursement from the  board  fund
          of  city revenues; (b) substantially impair the authority of the
          board to review financial plans, financial  plan  modifications,
          contracts  of the city or the covered organizations and proposed
          short-term or long-term borrowings of the city and  the  covered
          organizations;   (c)   substantially   impair   the  independent
          maintenance of a separate fund for the payment of  debt  service
          on bonds and notes of the city; (d) alter the composition of the
          board  so  that  the majority of the voting members of the board
          are not officials  of  the  state  of  New  York  elected  in  a
          state-wide election or appointees of the governor; (e) terminate
          the existence of the board prior to the time to be determined in
          accordance with section thirteen of this act as in effect on the
          date  such  notes  or bonds are issued; (f) substantially modify
          the requirement that the city's financial statements be  audited
          by   a   nationally   recognized  independent  certified  public
          accounting firm or consortium of firms and that a report on such
          audit be furnished to the board; or (g) alter the definition  of
          a  control period set forth in subdivision twelve of section two
          of this act, as in effect on the date such notes  or  bonds  are
          issued,  or  substantially  alter the authority of the board, as
          set forth in said subdivision to reimpose or terminate a control
          period;  provided,  however,  that  the  foregoing  pledge   and
          agreement shall be of no further force and effect if at any time

          (i) there is on deposit in a separate trust account with a bank,
          trust  company  or  other  fiduciary sufficient moneys or direct
          obligations of the United States or  obligations  guaranteed  by
          the  United  States,  the  principal of and/or interest on which
          will provide moneys to pay punctually when due  at  maturity  or
          prior to maturity by redemption, in accordance with their terms,
          all principal of and interest on all outstanding notes and bonds
          of  the  city  or  such  state  financing agency containing this
          pledge and agreement and irrevocable instructions from the  city
          or  such  state  financing agency to such bank, trust company or
          other fiduciary for such payment of such principal and  interest
          with  such  moneys shall have been given, or (ii) such notes and
          bonds, together with interest thereon, have been paid in full at
          maturity or have otherwise been refunded, redeemed, defeased, or
          discharged; and provided further that the foregoing  pledge  and
          agreement  shall  be of full force and effect upon its inclusion
          in any agreement made by the city or state financing agency with
          holders or guarantors of such notes or bonds.
            Upon payment for such obligations issued pursuant to this  act
          by  the  original  and  all  subsequent holders inclusion of the
          foregoing  covenant  shall  be  deemed  conclusive  evidence  of
          valuable  consideration  received by the state and city for such
          covenant and of reliance upon such pledge and agreement  by  any
          such  holder.  The state hereby grants any such benefited holder
          the right to sue the state in a court of competent  jurisdiction
          and enforce this covenant and agreement and waives all rights of
          defense based on sovereign immunity in such an action or suit.
            2.  Every such bond or note which shall contain the pledge and
          agreement referred to in subdivision one above shall be callable
          for  redemption  commencing  not   later   than   the   eleventh
          anniversary  of  its  date  of issuance and shall contain on its
          face a recital to such  effect,  together  with  the  terms  and
          conditions under which such obligation may be redeemed.
            3. The finance board of the city is hereby authorized to enter
          into agreements and to make covenants with any purchaser, holder
          or  guarantor  of  obligations  issued by the city or by a state
          financing agency to  protect  and  safeguard  the  security  and
          rights  of  a  purchaser,  holder or guarantor or to protect and
          safeguard the source of payment of such obligations or as deemed
          appropriate by the finance board which agreements  or  covenants
          may  contain  provisions providing for (a) (i) the compliance by
          the city with any of the provisions of this act or  of  the  New
          York  City  Loan Guaranty Act of nineteen hundred seventy-eight,
          Public Law 95-339, or, (ii) in any agreements with the guarantor
          of such obligations but only in such agreements unless otherwise
          authorized by law, the compliance with  any  of  the  terms  and
          conditions required by the secretary of the treasury pursuant to
          such  act,  (b)  restrictions on the issuance by the city of its
          obligations, limitations on the inclusion of  expense  items  in
          its   capital  budgets  and  financial  records,  reporting  and
          disclosure requirements in addition to  any  such  restrictions,
          limitations   or   requirements   contained  in  this  act,  (c)
          compliance by the city with its financial plan as modified  from
          time to time, (d) conditions that would give rise to an event of
          default  on  such  obligations,  and (e) remedies available to a
          purchaser, holder or guarantor of such obligations,  other  than
          acceleration   or  the  required  elimination  or  reduction  of
          specific municipal expenditures, including the circumstances, if

          any, under which a trustee or trustees or a fiscal agent may  be
          appointed   or  may  act  as  a  representative  of  holders  of
          obligations issued by the city in connection with  an  issue  or
          issues  of  obligations  of  the city and the rights, powers and
          duties which may be vested in such trustee, trustees  or  fiscal
          agent  as  such  representative.    The state of New York hereby
          pledges and agrees that it will take no action that would impair
          the power of the city to comply with or to perform any  covenant
          or  agreement made pursuant to this subdivision, or any right or
          remedy of a purchaser,  holder  or  guarantor  to  enforce  such
          covenant  or agreement; and the city or a state financing agency
          is hereby authorized to include such pledge and agreement in any
          agreement made pursuant to this subdivision.  Nothing  contained
          in  this  subdivision  shall preclude the state from authorizing
          the city to exercise, or the city  from  exercising,  any  power
          provided by law to seek application of laws then in effect under
          the  bankruptcy  provisions of the United States constitution or
          shall preclude the state  from  validly  exercising  its  police
          powers.
            4. Notwithstanding any other provision of law, the trustees of
          any  retirement,  pension or annuity fund or system of the state
          of New York or of the city of New York are hereby authorized  to
          enter  into commitments to purchase and to purchase notes, bonds
          or other obligations of the city of  New  York  or  of  a  state
          financing  agency, the payment in whole or in part, of interest,
          principal, or both,  is  guaranteed  by  the  secretary  of  the
          Treasury  of  the  United  States of America pursuant to the New
          York City Loan Guarantee Act of  1978,  Public  Law  95-339,  as
          presently  in  effect  or hereafter amended or to purchase other
          bonds or notes of such city or of a state financing agency prior
          to June thirtieth, nineteen hundred eighty-two, or in  the  case
          of  the  trustees  of any retirement, pension or annuity fund or
          system of the city of New York, to  enter  into  commitments  to
          purchase  such  other  bonds or notes of such city or of a state
          financing agency  prior  to  June  thirtieth,  nineteen  hundred
          eighty-two.  Such  commitments to purchase shall be binding upon
          and enforceable against successor trustees of  such  retirement,
          pension  or annuity funds or systems of the state of New York or
          city of New York.
            5. The secretary of the  treasury  shall  have  the  right  to
          initiate  a  proceeding in the supreme court of the state of New
          York in and for the county of New York or the court of claims of
          the state of New York to obtain a court order or other relief in
          connection with any agreements  or  other  transactions  entered
          into   by  the  secretary  relative  to  his  guarantee  of  the
          principal, interest, or both of city indebtedness.
            6. Notwithstanding any other provision of law to the contrary,
          the governor shall have the authority  in  connection  with  any
          agreement   by   the   federal   government  or  any  agency  or
          instrumentality  thereof  to  guarantee  the  payment   of   the
          principal of or interest on bonds or notes issued by the city of
          New  York  or  by a state financing agency, to enter into one or
          more agreements containing terms and conditions required by  the
          secretary  of  the  treasury  pursuant to the New York City Loan
          Guarantee Act of  1978,  Public  Law  95-339,  approved  by  the
          comptroller  and  approved  as  to form by the attorney general,
          with the federal government or  any  agency  or  instrumentality

          thereof  with  respect  to such guarantee or any matters related
          thereto and to comply with such terms and conditions.
            7.  Nothing in this section contained shall preclude the state
          from authorizing the board or the city to exercise, or the board
          or city from exercising, any  power  provided  by  law  to  seek
          application   of  laws  then  in  effect  under  the  bankruptcy
          provisions of the United States constitution or to preclude  the
          state from a further exercise of its powers under article eight,
          section twelve, of the state constitution.
            * Terminates July 1, 2008 or § 13
            * §  11.  Prohibitions; penalties. 1. During a control period,
          (i) no officer or employee of the city or of any of the  covered
          organizations  shall  make  or  authorize an obligation or other
          liability in excess of the amount available therefor  under  the
          financial plan as then in effect; (ii) no officer or employee of
          the  city  or  of any of the covered organizations shall involve
          the city or any of the covered organizations in any contract  or
          other  obligation  or liability for the payment of money for any
          purpose required  to  be  approved  by  the  board  unless  such
          contract, obligation or liability has been so approved or deemed
          to  be approved as provided in paragraphs e and f of subdivision
          one of section seven and unless such contract or  obligation  or
          liability  is  in  compliance with the financial plan as then in
          effect.
            2. No officer or employee of the city or any  of  the  covered
          organizations  shall  take  any action in violation of any valid
          order of the board or shall fail or refuse to  take  any  action
          required  by any such order or shall prepare, present or certify
          any information (including  any  projections  or  estimates)  or
          report  for  the  board  or  any  of its agents that is false or
          misleading, or, upon learning that any such information is false
          or misleading, shall fail promptly to advise the  board  or  its
          agents thereof.
            3.  In  addition  to any penalty or liability under other law,
          any officer or employee of  the  city  or  any  of  the  covered
          organizations   who   shall   knowingly  and  willfully  violate
          subdivision one or two of  this  section  shall  be  subject  to
          appropriate    administrative    discipline,   including,   when
          circumstances warrant,  suspension  from  duty  without  pay  or
          removal from office by order of either the governor or the mayor
          and shall, upon conviction, be guilty of a misdemeanor.
            4.  In  the  case  of a violation of subdivision one or two of
          this section by an officer or employee of the city or any of the
          covered organizations, the mayor or the chief executive  officer
          of  such  covered  organization  shall immediately report to the
          board all pertinent facts  together  with  a  statement  of  the
          action taken thereon.
            * Terminates July 1, 2008 or ... see § 13
            * §  12. Indemnification. a. The state shall save harmless and
          indemnify members, officers and employees of and representatives
          to the board, all of whom shall be deemed officers and employees
          of the state for purposes of section  seventeen  of  the  public
          officers  law,  against  any  claim,  demand,  suit, or judgment
          arising by reason of any act or omission to act by such  member,
          officer,  employee  or representative occurring in the discharge
          of his duties and within the scope of his service on  behalf  of
          such  board  including any claim, demand, suit or judgment based
          on allegations that financial loss was sustained by  any  person

          in  connection  with  the acquisition, disposition or holding of
          securities or other obligations. In the event of any such claim,
          demand, suit or judgment, a member, officer or  employee  of  or
          representative   to  the  board  shall  be  saved  harmless  and
          indemnified, notwithstanding the limitations of subdivision  one
          of  section  seventeen  of  the public officers law, unless such
          individual is found by a final  judicial  determination  not  to
          have  acted,  in  good  faith, for a purpose which he reasonably
          believed to be in the best interest of the board or not to  have
          had reasonable cause to believe that his conduct was lawful.
            b.  In  connection  with  any  such  claim,  demand,  suit, or
          judgment, any member, officer or employee of  or  representative
          to  the  board  shall  be  entitled to representation by private
          counsel of his choice in any civil judicial proceeding  whenever
          the attorney general determines based upon his investigation and
          review   of  the  facts  and  circumstances  of  the  case  that
          representation by the attorney general would  be  inappropriate.
          The  attorney general shall notify the individiual in writing of
          such  determination  that  the  individual  is  entitled  to  be
          represented   by  private  counsel.  The  attorney  general  may
          require, as a condition to payment of the fees and  expenses  of
          such representative, that appropriate groups of such individuals
          be  represented by the same counsel. If the individual or groups
          of individuals is entitled to representation by private  counsel
          under the provisions of this section, the attorney general shall
          so  certify  to  the  comptroller. Reasonable attorneys fees and
          litigation expenses shall be paid by the state to  such  private
          counsel  from  time  to  time  during  the pendency of the civil
          action  or  proceeding,  subject  to  certification   that   the
          individual  is  entitled  to  representation under the terms and
          conditions of this section by the chairman of  the  board,  upon
          the audit and warrant of the comptroller. The provisions of this
          subdivision  shall  be in addition to and shall not supplant any
          indemnification  or  other  benefits  heretofore  or   hereafter
          conferred   upon   members,   officers,   or  employees  of  and
          representatives to the board by section seventeen of the  public
          officers   law,  by  action  of  the  board  or  otherwise.  The
          provisions of this subdivision  shall  inure  only  to  members,
          officers  and  employees  of  and  representatives to the board,
          shall not enlarge or diminish the rights of any other party, and
          shall not impair, limit or modify the rights and obligations  of
          any insurer under any policy of insurance.
            * Terminates July 1, 2008 or ... see § 13
            §  13.  Termination.  This act shall terminate on the later of
          (a) July first, two thousand eight or (b) the date (i) when  all
          bonds  and  notes containing the pledge and agreement authorized
          by subdivision one of section ten-a of this  act  are  refunded,
          redeemed,  discharged  or otherwise defeased, or (ii) when there
          shall no longer be  outstanding  any  guarantee  by  the  United
          States of America or any agency or instrumentality thereof as to
          payment  of  principal of or interest on any note or bond issued
          by the city or a state financing agency,  whichever  of  (i)  or
          (ii) shall occur later.
            * Terminates July 1, 2008 or ... see § 13
            * §  14.  Separability.  If  any  clause, sentence, paragraph,
          subdivision, or other part of this act shall for any  reason  be
          adjudged   by   any   court  of  competent  jurisdiction  to  be
          unconstitutional or otherwise invalid, such judgment  shall  not

          affect,  impair,  or  invalidate  the remainder of this act, but
          shall be confined in its  operation  to  the  clause,  sentence,
          paragraph,  subdivision or part thereof directly involved in the
          controversy  in which such judgment shall have been rendered and
          it shall be construed to have been  the  legislative  intent  to
          pass  this  act  without  such unconstitutional, or invalid part
          therein.
            * Terminates July 1, 2008 or ... see § 13
            * § 15. Court preference. If any section, part or provision of
          this act  shall  be  declared  unconstitutional  or  invalid  or
          ineffective  by  any  court  of  this  state, any appeal of such
          judgment or order shall have preference over all other causes in
          any court of this state. Service upon the  adverse  party  of  a
          notice  of appeal shall stay the effect of the judgment or order
          appealed from pending  the  hearing  and  determination  of  the
          appeal.
            * Terminates July 1, 2008 or ... see § 13

  
Section:

Last modified: September 11, 2016