NY Pub Auth L § 2436-B (2021)
2021 New York Laws PBA - Public Authorities Article 8 - Miscellaneous Authorities Title 18 - State of New York Municipal Bond Bank Agency Act 2436-B - Local Arra Bonds.

§  2436-b.  Local  ARRA  bonds. (1) The agency may purchase local ARRA bonds  using  the  proceeds  of  recovery  act  bonds,  subject  to  the provisions  of this section and to any other provision of law applicable to the municipality and bonds it issues, including any  debt  limitation applicable  to the municipality that issued the local ARRA bond, as well as to the other provisions of this title. To the extent  that  any  such other  provision  of law conflicts with a provision of this section, the provision of this section shall control, except as otherwise stated.  (2) Subject to the provisions of this section:  (a) Local ARRA bonds issued by a county, except a county wholly within a city, may be additionally secured by a pledge to  the  agency  of  its available  county  sales  tax  revenues  subject  to  the  provisions of subdivision five of this section.  (b) Local ARRA bonds issued by a city may be additionally secured by a pledge to the agency of its available city sales  tax  revenues  or  its available  mortgage  recording  tax  revenues,  or  both  subject to the provisions of subdivision five of this section.  (c) Local ARRA bonds issued by a town may be additionally secured by a pledge to the agency of its available mortgage  recording  tax  revenues subject to the provisions of subdivision five of this section.  (d)  Local  ARRA bonds issued by a village may be additionally secured by a pledge to the  agency  of  its  available  mortgage  recording  tax revenues subject to the provisions of subdivision five of this section.  (3)  (a)  Nothing  contained  in  this title shall limit the right and obligations of a municipality to  comply  with  the  provisions  of  any existing  contract  with or for the benefit of the holders of any of its other bonds, notes or other obligations.  (b) Nothing contained in this title shall be construed  to  limit  the power  of  a  municipality  to  determine,  from  time  to  time, within available  funds  for  the  municipality,   the   purposes   for   which expenditures  are to be made by the municipality and the amounts of such expenditures.  (c) Nothing contained in this title  shall  alter,  limit,  modify  or impair the right of any school district or of any city, town, or village within  a  county  to  receive  from  the  county  net  collections,  as authorized by section twelve hundred sixty-two of the tax law  or  other applicable  provision of part four of article twenty-nine of the tax law or by an unconsolidated state law that notwithstands such  provision  of the  tax law, from the county's sales and compensating use taxes imposed pursuant  to  the  authority  of  subpart  B  of  part  one  of  article twenty-nine  of  the  tax  law. Further, nothing contained in this title shall alter, limit, modify or impair the  right  of  any  city  or  town within  a  county  to receive from the county the net amount of mortgage recording tax revenues imposed by subdivision one of section two hundred fifty-three of the tax  law,  as  authorized  by  subdivision  three  of section two hundred sixty-one of the tax law.  (d)  The  agency's recovery act bonds secured by payments of principal and interest due with respect to local ARRA bonds shall not be a debt of either the state or any municipality, and  neither  the  state  nor  any municipality  shall  be liable thereon, nor shall they be payable out of any funds other than those of the agency; and such  recovery  act  bonds shall contain on the face thereof a statement to such effect.  (e)  Subject  to the provisions of any contract with holders of bonds, notes or other obligations, proceeds of recovery act bonds to be paid to a municipality to purchase its local ARRA bonds shall  be  paid  to  the municipality  and  shall  not  be commingled with any other money of the agency.  (f) Nothing contained in this title shall be  construed  to  create  a debt  of the state within the meaning of any constitutional or statutory provisions. Any provision with respect to  state  aid  shall  be  deemed executory only to the extent of moneys available, and no liability shall be  incurred  by the state beyond the moneys available for that purpose, and any payment to be made by the comptroller of state aid is subject to annual appropriation of state aid by the state legislature.  (g) Nothing contained in this title shall be deemed  to  restrict  the right  of  the  state  to  amend, repeal, modify, or otherwise alter any provision of law relating to state aid  to  municipalities.  The  agency shall  include in any resolution, contract, or agreement with holders of its bonds, notes or other obligations a provision which states  that  no default occurs as a result of the state's exercising its right to amend, repeal,  modify,  or  otherwise  alter  any provision of law relating to state aid to municipalities.  (4) (a) A municipality may covenant and agree  that  the  municipality will  not  limit, alter or impair the rights hereby vested in the agency to fulfill the terms of any agreements made with holders of the agency's recovery act bonds, the proceeds of which  were  used  to  purchase  the municipality's local ARRA bonds, such holders pursuant to this title, or in  any  way  impair  the  rights  and  remedies  of such holders or the security for such bonds, until such bonds, together  with  the  interest thereon  and  all  costs  and  expenses in connection with any action or proceeding by  or  on  behalf  of  such  holders,  are  fully  paid  and discharged.  Nothing contained in this title shall be deemed to restrict any right of the municipality to  amend,  modify,  repeal  or  otherwise alter  any local laws, ordinances or resolutions imposing or relating to taxes or fees, or appropriations relating to  such  taxes  or  fees,  or setting   aside   or  allocating  and  applying,  paying  or  using  net collections  pursuant  to  the  authority  of  part  four   of   article twenty-nine  of  the  tax  law or pursuant to the authority of any other provision of state law that notwithstands a provision of such  part,  so long  as,  after  giving effect to such amendment, modification or other alteration, the aggregate amount as then projected by  the  municipality of  (i)  sales  and  compensating  use taxes imposed by the municipality pursuant  to  the  authority  of  subpart  B  of  part  one  of  article twenty-nine  of  the  tax  law  (to  the extent that the municipality is authorized to impose such taxes and is imposing  them  at  the  time  it issues  its  local  ARRA bonds); and (ii) all such net collections to be set aside  or  to  be  allocated  and  applied,  paid  or  used  by  the municipality   pursuant  to  the  authority  of  part  four  of  article twenty-nine of the tax law or pursuant to any other provision  of  state law  that notwithstands a provision of such part four during each of the agency's fiscal years following the effective date  of  such  amendment, modification  or  other  alteration  shall  be not less than two hundred percent of maximum annual debt service on the municipality's local  ARRA bonds then outstanding. Notwithstanding anything to the contrary in this section, a municipality that imposes sales and compensating use taxes at the  time  it  issues  local  ARRA  bonds  further  agrees that it shall continue to impose such taxes during the time such bonds are outstanding at  the  maximum  rate  authorized  therefor,  without  regard  to   any additional rate, provided that any increase in the rate of such taxes to satisfy  this  obligation shall comply with the applicable provisions of subpart B of part one of article twenty-nine of the tax law.  (b) Any such agreement with a  municipality  may  be  pledged  by  the agency  to  secure  its  recovery  act bonds used to purchase local ARRA bonds issued by that municipality and may  not  be  modified  thereafter  except  as  provided by the terms of the pledge or subsequent agreements with the holders of such recovery act bonds.  (c)  The  agency  shall not include within any resolution, contract or agreement with  holders  of  recovery  act  bonds  any  provision  which provides  that a default occurs as a result of a municipality exercising its right to amend, modify, repeal or otherwise alter such  taxes,  fees or  appropriations  or such net collections. Nothing in this title shall be deemed to obligate a municipality to make any payments or impose  any taxes  or  set  aside  or allocate and apply, pay or use net collections pursuant to the authority of part four of article twenty-nine of the tax law or pursuant to the authority of an  unconsolidated  state  law  that notwithstands a provision of such part; except that a municipality shall impose  taxes  pursuant  to  the  authority  of subpart B of part one of article twenty-nine of the  tax  law  at  the  maximum  rate  authorized therefor,  without  regard  to  any  additional  rate, provided that any increase in the rate of such taxes  to  satisfy  this  obligation  shall comply  with  the  applicable  provisions  of  subpart  B of part one of article twenty-nine of the tax law.  (5) (a) If a municipality fails to pay to the agency any principal  or interest  due  on  its  local  ARRA  bonds  secured  by  a pledge of its available local sales and use tax revenues  or  its  available  mortgage recording tax revenues, or both, as described in subdivision two of this section,  the  chairman  of  the  agency shall notify the comptroller in writing that such municipality has failed to meet its obligations.  Such notice  shall  set  forth in detail the term, amount, interest rate, and payment schedule of the local ARRA  bonds  in  default,  and  the  exact amounts of principal and interest due from such municipality in default. The  agency  shall  provide  a  copy  of such notice to the chief fiscal officer of such municipality in default and, in the case of a default by a city, town, or village with respect to local  ARRA  bonds  secured  by mortgage recording tax revenues, also to the chief fiscal officer of the county  in which the city, town, or village is located. The agency shall provide such notice to the comptroller at least thirty days prior to the date that the comptroller is expected to withhold  and  pay  over  local sales and use tax revenues to the agency.  (b)  Upon  the  comptroller receiving such complete, certified written notice from the  agency,  the  comptroller  shall,  notwithstanding  any provision  of  section  twelve  hundred  sixty-one of the tax law to the contrary, pay to the agency, on or before  the  fifteenth  day  of  each month,  all or a portion of the local sales and use tax revenues due the municipality in default, until the amount certified in default has  been extinguished.  The  comptroller  shall  make such payments to the agency only out of net  collections  not  otherwise  pledged,  required  to  be intercepted  or  otherwise  encumbered  by  provisions  of law in effect immediately prior to  the  date  the  municipality's  local  ARRA  bonds secured by a pledge authorized by this section shall have been issued.  (c)  Upon  receiving  such complete, certified written notice from the agency, the chief  fiscal  officer  of  a  county,  notwithstanding  the provisions  of  section  two hundred sixty-one of the tax law, shall pay over to the comptroller,  the  net  amount  of  mortgage  recording  tax revenues  imposed  by subdivision one of section two hundred fifty-three of the tax law due to the city, town, or village in default.  The  chief fiscal  officer  of  the county shall continue to make those payments to the comptroller until the agency sends certified notice to  the  officer and  to  the  comptroller that the city or town is no longer in default. The comptroller shall pay to the agency, on or before the fifteenth  day of  each  month, all or a portion of the mortgage recording tax revenues  received from the chief fiscal officer of the county, until  the  amount certified in default has been extinguished.  (d)  Such  payments  by the comptroller to the agency shall be made on account of, and for the benefit of, the municipality in default.  If  so requested  by  the  agency,  as indicated in its certified notice to the comptroller, the comptroller shall  make  such  payments  to  a  trustee pursuant to an indenture for holders of the recovery act bonds issued by the  agency  that  were  used  to purchase the municipality's local ARRA bonds in default. Such payments by the comptroller  on  behalf  of  such municipality  shall be applied by the agency or, if paid directly to the trustee, by such trustee, to cure that municipality's  default.  To  the extent the comptroller makes any such payment to the agency or to such a trustee, the municipality's default shall be cured.  (e) The comptroller shall not be responsible for any inaccuracy in the amount  of  such payments based upon the notice furnished by the agency. The comptroller shall not  be  required  to  make  payments  under  this subdivision  which  are  greater than the amounts of local sales and use tax revenues due the municipality, as certified to  the  comptroller  by the  commissioner of taxation and finance as provided in subdivision (c) of section twelve hundred sixty-one of  the  tax  law  (subject  to  the limitation  in  paragraph (b) of this subdivision), or which are greater than the amount of net mortgage  recording  tax  revenues  paid  to  the comptroller  by  the  chief  fiscal  officer  of  the  county. After the comptroller makes any payments of net collections  required  under  this section,  the  comptroller  shall pay any balance of net collections due such municipality  to  such  municipality  in  the  manner  provided  in subdivision  (c)  of  section twelve hundred sixty-one of the tax law or other applicable law. The comptroller shall be required to make payments under this section for only so long as the municipality is in default as certified in the agency's notice to the comptroller.  (f) The authority in this section to withhold local sales and use  tax revenues  and  mortgage  recording tax revenues and pay them over to the agency shall be in addition to the  state  aid  guaranty  set  forth  in section twenty four hundred thirty-six of this title; and the agency may certify  that  either  or  both  revenue  sources may be withheld to the extent necessary to satisfy the municipality's unmet obligations to  the agency.  (g)  Any withholding of revenues pursuant to this subdivision or state aid pursuant to section twenty-four hundred  thirty-six  of  this  title with  respect to local ARRA bonds shall be made in consultation with the director  of  the  budget  of  the  state;   provided,   however,   such consultation  shall not delay or otherwise adversely affect the agency's right to receive timely payment of such revenues and/or state aid.  (6) When used in this section, the  following  terms  shall  have  the following meanings unless the context clearly indicates otherwise:  (a) "Sales and compensating use taxes" means taxes imposed by a county or  city  pursuant  to the authority of subpart B of part one of article twenty-nine of the tax law.  (b) "Net collections" shall have the same meaning  as  in  subdivision (f) of section twelve hundred sixty-two of the tax law.  (c)  "County  sales  tax revenues" means net collections set aside for county purposes pursuant to subdivision (a) of  section  twelve  hundred sixty-two  of  the tax law or other applicable provision of part four of article  twenty-nine  of  the  tax  law,  from  a  county's  sales   and compensating use taxes.  (d)  "City  sales  tax  revenues"  means net collections from a city's sales and compensating use taxes.  (e) "Municipality" means municipality as defined in paragraph  one  of section 2.00 of the local finance law.  (f)  "Local  sales and use tax revenues" means any of the tax revenues defined in paragraph (c) or (d) of this subdivision, or any  combination of them, as the case may be.  (g)  "Secure"  means  a  pledge of sales and compensating use taxes or mortgage recording taxes for the purposes of default by  a  municipality as a result of a failure to pay debt service on its local ARRA bonds.