124. Participation by certain corporations. One or more insurance companies shall have the power to organize, or cause to be organized, a redevelopment company formed pursuant to the provisions of this article, and to purchase for cash or to receive and hold in exchange for property, and to own and control, the stock or the income debenture certificates or both of any redevelopment company and shall also have power to invest, singly or jointly, in a bond and first mortgage or in an issue of bonds secured by mortgage or trust indenture constituting a first lien upon any project as provided in this article. An insurance company, however, which owns stock or income debenture certificates of a redevelopment company and also owns bonds or a bond and mortgage or an interest in a bond and mortgage of the same redevelopment company shall not, without the consent of the supervising agency, sell all or any part of such bonds or such bond and mortgage or of its interest in such bond and mortgage unless it shall simultaneously sell such stock and such income debenture certificates owned by it.
Notwithstanding any other provision of law, an insurance company or companies operating a redevelopment project or owning all of the stock of a redevelopment company are hereby expressly authorized to enter into contracts contemplated by this article and to agree by contract with the municipality not to sell, assign, or otherwise transfer such project or the stock, income debentures or mortgage bonds of such redevelopment company during the period of tax exemption provided for by the contract pursuant to this article without the consent of the local legislative body of the municipality. An insurance company or companies owning all of the stock of a redevelopment company are hereby expressly authorized to make such capital contributions to any such redevelopment company, in cash or by cancellation of securities or otherwise, as may be necessary to enable such redevelopment company to comply with all conditions precedent to its dissolution and conveyance of its property in accordance with section one hundred twenty-three of this article, and upon dissolution of such a redevelopment company, to acquire the project, complete the same if not theretofore completed, and own and operate the same as a permanent investment for such period as it or they may deem desirable either directly or through acquisition and ownership of the capital stock of any corporation which may acquire title to the project pursuant to subdivision one of section one hundred twenty-three.
An insurance company, instead of investing its funds in the stock and debentures or other obligations of a redevelopment company, may through direct ownership and/or lease acquire, own, construct, manage or operate as an investment for such period as it may deem desirable, one or more projects, in which event the provisions of subsection one of section one hundred twelve of this article applicable to redevelopment companies shall be applicable to such insurance company in its operations with respect to any such project but not otherwise. Said provisions and the ensuing provision of this section shall cease to be applicable to any such project and to such insurance company in its operations with respect to such project after termination of any tax exemption granted pursuant to section one hundred twenty-five of this article with respect to such project, whether such termination shall be by expiration or by any other cause, or in the event that prior thereto the insurance company elects to pay the municipality the total of all accrued taxes for which such exemption was granted and received, together with interest at the rate of five per centum per annum. If any such project shall be sold by an insurance company, the tax exemption with respect to such project shall thereupon cease and terminate unless the local legislative body shall otherwise provide.
Until the termination of any tax exemption granted pursuant to section one hundred twenty-five of this article or until the provisions of this article shall otherwise cease to be applicable:
1. An insurance company shall be entitled to earn and retain annually on a cumulative basis in respect of each project operated by it hereunder, before depreciation but after providing for all expenses, taxes and assessments attributable to such project or to the income therefrom, a sum equal to but not exceeding six per centum of the total actual final cost of the project as defined by subdivision two of section one hundred twelve of this article.
2. Separate accounts shall be kept for each project operated by an insurance company.
3. If the income from any such project for any year, after all expenses, taxes and assessments attributable thereto or to the income therefrom, shall be in excess of six per centum of the total actual final cost of such project as defined by subdivision two of section one hundred twelve of this article, such excess shall be credited to a special reserve account.
4. If the income from any such project for any year, after all expenses, taxes and assessments attributable thereto or to the income therefrom shall be less than six per centum of such total actual final cost, such deficiency shall be charged against such special reserve account.
The amount of any accrued taxes and interest thereon paid by an insurance company pursuant to the second paragraph of section one hundred twenty-five of this article may be charged against such special reserve account. An amount equal to any balance remaining to the credit of such special reserve account on the termination of the period of tax exemption shall be paid into the general fund of the municipality. If any project shall be conveyed to an insurance company in accordance with subdivision five of section one hundred twenty-three of this article, an amount equal to all accrued and unpaid interest, amortization and dividends on the stock and evidences of indebtedness of the redevelopment company theretofore accumulated in accordance with section one hundred seven of this article shall be charged against the special reserve account except to the extent included in total actual final cost, and any remaining cash surplus derived from earnings remaining in the treasury of the redevelopment company shall be transferred to such insurance company and shall be credited by it to the special reserve account provided for in this section applicable to such project.
Except as specifically provided herein this article shall not be deemed to limit or restrict any power or authority granted to insurance companies or to any other corporation or to any fiduciary by any other provision of law heretofore or hereafter enacted.
Last modified: February 3, 2019