N.Y. MCF Law § 7 — New York Code / Act MCF / Section 7
Hospital and nursing home projects reserve funds and appropriations
Status: in_force

§ 7. Hospital and nursing home projects reserve funds and\nappropriations. 1. (a) For the purposes of the issuance by the agency of\nhospital and nursing home project bonds, the term "hospital and nursing\nhome capital reserve fund requirement" shall mean, as of any particular\ndate of computation, an amount of money equal to the greatest of the\nrespective amounts, for the then current or any succeeding calendar\nyear, of annual debt service payments of the agency, such annual debt\nservice payments for any calendar year being an amount of money equal to\nthe aggregate of (i) all interest payable during such calendar year on\nall hospital and nursing home project bonds of the agency then\noutstanding on said date of computation, plus (ii) the principal amount\nof all hospital and nursing home project bonds of the agency then\noutstanding on said date of computation which mature during such\ncalendar year, plus (iii) the amount of all sinking fund payments\npayable during such calendar year with respect to all hospital and\nnursing home project bonds of the agency outstanding on said date of\ncomputation; and the term "sinking fund payment" shall mean the amount\nof money specified in the resolution authorizing term bonds as payable\ninto a sinking fund for the amortization of such term bonds. The agency\nshall create and establish a special fund to be known as the hospital\nand nursing home capital reserve fund and may pay into such reserve fund\n(1) any monies appropriated and made available by the state for the\npurposes of such fund, (2) any proceeds of sale of hospital and nursing\nhome project notes or hospital and nursing home project bonds, to the\nextent provided in the resolution of the agency authorizing the issuance\nthereof, and (3) any other monies which may be made available to the\nagency for the purposes of such fund from any other source or sources.\nThe monies held in or credited to the hospital and nursing home capital\nreserve fund established under this subdivision, except as hereinafter\nprovided, shall be used solely for the payment of the principal of\nhospital and nursing home project bonds of the agency secured by such\nreserve fund, as the same mature, sinking fund payments, the purchase of\nsuch hospital and nursing home project bonds of the agency, the payment\nof interest on such hospital and nursing home projects bonds of the\nagency, or the payment of any redemption premium required to be paid\nwhen such bonds are redeemed prior to maturity; provided, however, that\nmonies in such fund shall not be withdrawn therefrom at any time in such\namount as would reduce the amount of such fund to less than the hospital\nand nursing home capital reserve fund requirement, except for the\npurpose of paying principal and interest on the hospital and nursing\nhome project bonds of the agency secured by such reserve fund maturing\nand becoming due and any sinking fund payments and for the payment of\nwhich other monies of the agency are not available. Any income or\ninterest earned by, or increment to, the hospital and nursing home\ncapital reserve fund due to the investment thereof may be transferred to\nany other fund or account of the agency to the extent it does not reduce\nthe amount of the hospital and nursing home capital reserve fund below\nthe hospital and nursing home capital reserve fund requirement.\n  (b) The agency shall not issue hospital and nursing home project bonds\nand hospital and nursing home project notes in an aggregate principal\namount exceeding twenty billion dollars, excluding hospital and nursing\nhome project bonds and hospital and nursing home project notes issued to\nrefund outstanding hospital and nursing home projects bonds and hospital\nand nursing home project notes; provided, however, that upon any such\nrefunding or repayment the total aggregate principal amount of\noutstanding bonds, notes or other obligations may be greater than twenty\nbillion dollars only if the present value of the aggregate debt service\nof the refunding or repayment bonds, notes or other obligations to be\nissued shall not exceed the present value of the aggregate debt service\nof the bonds, notes or other obligations so to be refunded or repaid.\nFor purposes hereof, the present values of the aggregate debt service of\nthe refunding or repayment bonds, notes or other obligations and of the\naggregate debt service of the bonds, notes or other obligations so\nrefunded or repaid, shall be calculated by utilizing the effective\ninterest rate of the refunding or repayment bonds, notes or other\nobligations, which shall be that rate arrived at by doubling the\nsemi-annual interest rate (compounded semi-annually) necessary to\ndiscount the debt service payments on the refunding or repayment bonds,\nnotes or other obligations from the payment dates thereof to the date of\nissue of the refunding or repayment bonds, notes or other obligations\nand to the price bid including estimated accrued interest or proceeds\nreceived by the agency including estimated accrued interest from the\nsale thereof. The agency shall not issue hospital and nursing home\nproject bonds at any time secured by the hospital and nursing home\ncapital reserve fund if upon issuance, the amount in the hospital and\nnursing home capital reserve fund will be less than the hospital and\nnursing home capital reserve fund requirement, unless the agency, at the\ntime of issuance of such bonds, shall deposit in such reserve fund from\nthe proceeds of the bonds so to be issued, or otherwise, an amount which\ntogether with the amount then in such reserve fund, will be not less\nthan the hospital and nursing home capital reserve fund requirement.\n  (c) To assure the continued operation and solvency of the agency for\nthe carrying out of the public purposes of this act, provision is made\nin paragraph (a) of this subdivision for the accumulation in the\nhospital and nursing home capital reserve fund of an amount equal to the\nhospital and nursing home capital reserve fund requirement. In order\nfurther to assure the maintenance of the hospital and nursing home\ncapital reserve fund, there shall be annually apportioned and paid to\nthe agency for deposit in the hospital and nursing home capital reserve\nfund such sum, if any, as shall be certified by the chairman of the\nagency to the governor and director of the budget as necessary to\nrestore such reserve fund to an amount equal to the hospital and nursing\nhome capital reserve fund requirement. The chairman of the agency shall\nannually, on or before December first, make and deliver to the governor\nand director of the budget his certificate stating the sums, if any,\nrequired to restore the hospital and nursing home capital reserve fund\nto the amount aforesaid and the sums so certified, if any, shall be\napportioned and paid to the agency during the then current state fiscal\nyear. The principal amount of bonds secured by the hospital and nursing\nhome capital reserve fund to which state funds are apportionable\npursuant to this paragraph shall be limited to the total amount of bonds\nand notes outstanding on the effective date of this act, plus the total\namount of bonds and notes contracted after the effective date of this\nact to finance projects in progress on the effective date of this act as\ndetermined by the New York state public authorities control board\ncreated pursuant to section fifty of the public authorities law whose\naffirmative determination shall be conclusive as to all matters of law\nand fact solely for the purposes of the limitations contained in this\nparagraph, but in no event shall the total amount of bonds so secured by\nsuch a capital reserve fund or funds exceed two hundred forty million\ndollars, excluding bonds issued to refund such outstanding bonds until\nthe date of redemption of such outstanding bonds. As outstanding bonds\nso secured are paid, the amount so secured shall be reduced accordingly\nbut the redemption of such outstanding bonds from the proceeds of\nrefunding bonds shall not reduce the amount so secured.\n  (d) In computing the hospital and nursing home capital reserve fund\nfor the purposes of this section, securities in which all or a portion\nof such reserve fund shall be invested shall be valued at par if\npurchased at par, or if purchased at other than par, at amortized value.\n  2. The agency shall create and establish one or more special funds\n(herein referred to as hospital and nursing home general reserve funds)\nand shall, to the extent provided in the applicable bond resolution of\nthe agency authorizing the issuance of hospital and nursing home project\nbonds, pay into any such fund the fees and charges collected by the\nagency pursuant to subdivision twelve of section five of this act and\nany monies which the agency shall transfer from the hospital and nursing\nhome capital reserve fund pursuant to the provisions of paragraph (a) of\nsubdivision one of this section. Such monies and any other monies paid\ninto a hospital and nursing home general reserve fund may, in the\ndiscretion of the agency, but subject to agreements with bondholders and\nnoteholders, be used by the agency (a) for the repayment of advances\nfrom the state in accordance with the provisions of repayment agreements\nbetween the agency and the director of the budget, (b) to reimburse the\ndepartment of health the reasonable costs of the services performed by\nthe commissioner of health and the department of health pursuant to\nsubdivision two of section seventeen of this act, (c) to pay all costs,\nexpenses and charges of financing, including fees and expenses of\ntrustees and paying agents, (d) for transfers to the hospital and\nnursing home capital reserve fund, (e) for the payment of principal and\ninterest on hospital and nursing home project bonds and hospital and\nnursing home project notes issued by the agency when the same shall\nbecome due whether at maturity or on call for redemption and for the\npayment of any redemption premium required to be paid where such\nhospital and nursing home project bonds and hospital and nursing home\nproject notes are redeemed prior to their stated maturities and any\nsinking fund payments, and to purchase hospital and nursing home project\nbonds or hospital and nursing home project notes issued by the agency,\nor (f) for such other corporate purposes of the agency as the agency in\nits discretion shall determine and provide.\n