NY Gen Mun L § 6-C (2021)
2021 New York Laws GMU - General Municipal Article 2 - General Municipal Finances 6-C - Capital Reserve Funds for Counties, Cities, Villages, Towns and Sewer and Water Improvement Districts.

§ 6-c. Capital reserve funds for counties, cities, villages, towns and sewer and water improvement districts. 1. As used in this section:   a. The term "governing board", insofar as it is used in reference to a village, shall mean the board of trustees thereof; insofar as it is used in reference to a town, shall mean the town board thereof; insofar as it is  used  in  reference  to  a  county,  shall mean the legislative body thereof; insofar as it is used in reference to a city,  shall  mean  the "local legislative body" thereof, as that term is defined in subdivision seven  of  section  two  of the municipal home rule law, as amended from time to time; insofar as it is used in reference to  a  town  or  county improvement  district,  shall  mean  the  town  board of the town or the legislative body of the county in which such district is located unless, in the case of a town improvement district, such district has a separate board of commissioners, in which  case  it  shall  mean  such  board  of commissioners.   b. The term "capital improvement" shall mean:  (1)  Any  physical public betterment or improvement or any preliminary studies and surveys relative thereto.  (2) Land or rights in land.  (3)  Any  furnishings,  equipment,  machinery  or  apparatus  for  any physical public betterment or improvement acquired at the time when such betterment or improvement is constructed, reconstructed or acquired.   c.  The  term  "equipment"  shall  include any equipment, machinery or apparatus  not  included  in  the  definition  of  the   term   "capital improvement"  and  for  the  acquisition  of  which a period of probable usefulness has been provided by law.   d. The term "obligations" shall include bonds, notes, certificates  or other evidences of indebtedness.   2. The governing board of any county, city, village, town or sewer and water  improvement  district may establish capital reserve funds for the financing of all or part of the cost of:   a. The construction,  reconstruction  or  acquisition  of  a  specific capital  improvement  or  the acquisition of a specific item or specific items of equipment.   b. The construction,  reconstruction  or  acquisition  of  a  type  of capital improvement or the acquisition of a type of equipment.   3. The provisions of paragraph two shall not apply to:   a.  Capital improvements to be constructed, reconstructed or acquired, or equipment to be acquired, on behalf of  an  improvement  district  or other  similar  district  located  within such municipality other than a sewer and/or water improvement district, or   b. Capital improvements or equipment, all or part of the cost of which is to be borne by assessments for benefit or ad valorem taxes  upon  the real  property  within an area of benefit within such municipality other than a sewer and/or water improvement district.   4. If the governing board authorizes the establishment  of  a  capital reserve  fund  for  the  financing  of  all  or  part of the cost of the construction,  reconstruction  or  acquisition  of  a  specific  capital improvement  or  the acquisition of a specific item or specific items of equipment, it shall  set  forth  in  such  authorization  the  estimated maximum  cost  thereof.  However, if the authorization by such governing board of the issuance of obligations for  such  capital  improvement  or equipment  is required by law to be subject to a permissive or mandatory referendum, then the authorization of the establishment of such  a  fund shall  be  subject  to  a  permissive  referendum. In the event that the authorization by such governing board of the issuance of obligations for such capital improvement or equipment is required by law to  be  subject to  a permissive or mandatory referendum only if such obligations are to  have a maturity of more than five years or  not  less  than  some  other minimum  period,  then  the authorization of the establishment of such a fund shall be subject to a permissive referendum only if the  period  of probable usefulness of such capital improvement or equipment is equal to or more than such minimum period of maturity. A permissive referendum on the  authorization  of  the establishment of such a capital reserve fund shall be governed by:   a. Sections twenty-four, twenty-five and twenty-six of  the  municipal home  rule  law,  as  amended  from  time to time, so far as they may be applicable, in the case of cities.   b. Article seven of the town law, as amended from time to time, in the case of towns.   c. Article nine of the village law, as amended from time to  time,  in the case of villages.   5. There may be paid into any fund:   a.   Such   an  amount  as  may  be  provided  therefor  by  budgetary appropriation or raised by tax therefor.   b. Such revenues as are not required by law to be paid into any  other fund  or  account,  including  the proceeds from the sale of any capital improvement or equipment owned by such county, city,  village  or  town. This  provision shall not prevent the use of town highway moneys for the establishment of a capital reserve fund, provided that such  moneys  are expended  therefrom  for  the  purpose  for  which  they  were levied or received, that the consent of the town superintendent  of  highways  and town  board,  together with the approval of the county superintendent of highways, is given to the establishment thereof, and  that  such  moneys are  only  expended  therefrom  on  order  of the town superintendent of highways upon audit and with the consent of the town board.   7. The moneys in each such fund shall be deposited and secured in  the manner  provided  by section ten of this article. The governing board or the chief fiscal officer of such municipality, if  the  governing  board shall delegate such duty to him, may invest the moneys in each such fund in  the  manner provided in section eleven of this article. Any interest earned or capital gains realized on the moneys so deposited or  invested shall accrue to and become part of each such fund. The separate identity of  each  such  fund  shall be maintained, whether its assets consist of cash or investments or both.   8. An expenditure shall be made from a fund only by  an  authorization of  the  governing  board  and  for  a specific capital improvement or a specific item or specific items of equipment, the cost of which  may  be financed  therefrom.  However,  if a proposed expenditure is from a fund established for a type of capital improvement or equipment and if it  is required  by  law  that the authorization by such governing board of the issuance of obligations for such capital  improvement  or  equipment  be subject  to a permissive or mandatory referendum, then the authorization of such an expenditure shall be subject to a permissive  referendum.  In the event that the authorization by such governing board of the issuance of  obligations for such capital improvement or equipment is required by law to be subject to a permissive or mandatory referendum only  if  such obligations  are  to have a maturity of more than five years or not less than some other minimum  period,  then  the  authorization  of  such  an expenditure  shall  be  subject  to  a permissive referendum only if the period of probable usefulness of such capital improvement  or  equipment is  equal  to  or  more  than  such  minimum  period of maturity. Such a permissive referendum shall  be  governed  in  the  manner  provided  in paragraph  four  of this section. Notwithstanding any other provision of this section, but subject to the provisions  of  this  paragraph,  if  a capital  reserve  fund  has  been  established  for  a  specific capital  improvement and it is later determined that a part of the cost  of  such capital  improvement  is  to  be  borne by assessments for benefit or ad valorem taxes upon real property within an  area  of  benefit  within  a municipality,  such fund may be expended to pay all or part of the share to be borne by the municipality at large.   9. The governing board may authorize the transfer  to  the  credit  of another capital reserve fund of all or part of:   a.  The  unexpended  balance  remaining  in  a  fund established for a specific capital improvement or a specific item  or  specific  items  of equipment,  which  improvement  has been completed or acquired, or which equipment has been acquired, after deducting from  such  balance  a  sum sufficient   to   satisfy   all  outstanding  claims  arising  from  the construction, reconstruction or acquisition of such capital  improvement or the acquisition of such equipment.   b.  The  unexpended  balance  remaining  in  a  fund established for a specific item or  specific  items  of  equipment  which  have  not  been acquired  or a specific capital improvement which has not been completed or acquired, or remaining in a fund established for a  type  of  capital improvement  or  a type of equipment. If the proposed transfer is from a fund established for a specific capital improvement or a  specific  item or specific items of equipment, the authorization of such transfer shall be  subject  to  a  permissive  referendum  if  the authorization of the creation of a fund for such capital improvement  or  item  or  items  of equipment   was   subject  to  a  permissive  referendum.  A  permissive referendum on the authorization of such transfer shall  be  governed  in the manner provided in paragraph four of this section.   c.  Nothing  in  this  subdivision shall be construed to authorize the transfer to the credit of another capital reserve fund  from  a  capital reserve fund having a different tax base.   9-a. The governing board also may appropriate for:   1. An object or purpose for which bonds may be issued, or   2.  The  payment  of  interest on and principal of indebtedness, other than indebtedness evidenced by bonds and notes described in paragraphs A and D of section five of article eight of the  state  constitution,  and indebtedness for assessable improvements or renewals thereof, all  or  part  of the unexpended balance remaining in a fund established for a  specific  capital  improvement  or  specific  item  or  items  of equipment. Any such appropriation may not be made unless the improvement has  been completed or acquired, or the equipment has been acquired, and shall not include any moneys required to satisfy all outstanding  claims arising  from  the  construction,  reconstruction or acquisition of such capital improvement or the acquisition of such equipment.   10. The chief fiscal officer shall keep a separate  account  for  each fund established. Such account shall show:   a. The date and amount of each sum paid into the fund.   b. The interest earned by such fund.   c.  The capital gains or losses resulting from the sale of investments of the fund.   d. The interest or capital gains which have accrued to the fund.   e. The amount and date of each withdrawal from the fund.   f. The assets of the fund, indicating the cash balance therein  and  a schedule of the amounts invested in federal or state obligations. The  chief fiscal officer, at the termination of each fiscal year, shall render a detailed report of the operation and condition of each of  such funds to the governing board.   11. The members of the governing board are hereby declared trustees of such  funds  and shall be subject to all the duties and responsibilities imposed by law on trustees, and such duties and responsibilities may  be  enforced by the county, city, town or village, as the case may be, or by any board, commission, agency, officer or taxpayer thereof.   12.  The  members  of  the  governing  board  shall  be  guilty  of  a misdemeanor if they:   a. Authorize a withdrawal from a fund for any purpose other than for a capital improvement or an item or items of equipment, the cost of  which has been authorized to be financed in whole or in part from such fund.   b.  Expend  any  money  withdrawn from a fund for a purpose other than that for which it was authorized to be withdrawn. The provisions of this paragraph shall be considered to be  in  addition to any other penalties provided by law.   13.  Notwithstanding  the foregoing provisions of this section, in any town which is located wholly or partly within the  Adirondack  park  and has  within  its  boundaries state lands subject to taxation assessed at more than thirty per centum of the total taxable assessed  valuation  of the  town  as  determined  from  the  assessment  rolls  of the town, as completed from time to  time,  a  capital  reserve  fund  shall  not  be established on and after May first, nineteen hundred forty-eight, unless the  state  comptroller,  on behalf of the state, shall consent thereto, and, on and after May first, nineteen hundred forty-eight, in  any  such town  no  expenditure  or  transfer shall be made from a capital reserve fund heretofore or hereafter established unless the  state  comptroller, on behalf of the state, shall consent thereto.