2023 New York Laws › PBA - Public Authorities › Article 5 - Public Utility Authorities › Title 12 - New York State Environmental Facilities Corporation › 1285-J - Water Pollution Control Revolving Fund.

§   1285-j.  Water  pollution  control  revolving  fund.  1.  (a)  The
corporation shall undertake and provide assistance  in  support  of  the
program  to  make  financial  assistance  available to municipalities to
encourage and support the  planning,  development  and  construction  of
municipal  water  pollution  control  projects  in  accordance  with the
provisions  of  this  section,  section  17-1909  of  the  environmental
conservation law, and to make financial assistance available to eligible
borrowers  through  linked  deposits  made  in  accordance  with article
sixteen of the state finance law.
(b) There is hereby established in the custody of  the  corporation  a
special  fund to be known as the water pollution control revolving fund.
Moneys in the water pollution control revolving fund shall be segregated
from all other funds of or in the custody of the corporation subject  to
any  rights  of  holders  of  corporation  bonds or notes issued for the
purposes  of  this  section.  Moneys  in  the  water  pollution  control
revolving  fund  shall only be used in accordance with the provisions of
this section and section 17-1909 of the environmental conservation  law.
The  moneys  in such fund shall be applied to or paid out for authorized
purposes  of  such  fund  on  the  direction  of  the  chairman  of  the
corporation  in  accordance  with  subdivision  four of this section and
section 17-1909 of the environmental conservation  law,  or  such  other
person  as  the  corporation  shall authorize to make such direction. In
consultation with the director  of  the  division  of  the  budget,  the
corporation  may,  subject  to  subparagraph  (ii)  of  paragraph  a  of
subdivision seven of section 17-1909 of the  environmental  conservation
law,  and  shall,  at the direction of the commissioner of environmental
conservation pursuant to such subdivision, establish  within  the  water
pollution  control revolving fund additional accounts or subaccounts and
specify any conditions applicable to the transfer of moneys between such
accounts or subaccounts. With respect  to  each  eligible  project,  the
corporation  shall  establish  and  maintain  a record of the allocation
provided for the benefit of such project in accordance with the terms of
the applicable project financing agreement or loan agreement.
2. As used in this section, the  terms  "allocation",  "construction",
"eligible project", "fund", and "project financing agreement" shall have
the   meanings  set  forth  in  section  17-1909  of  the  environmental
conservation law.
3. Such fund shall consist  of  all  of  the  following:  (a)  federal
capitalization  grants  and  awards or other federal assistance provided
pursuant to Title II or Title VI of the Federal Water Pollution  Control
Act,  exclusive of any such grants, awards or assistance available under
Title II, except as may be necessary to avoid the loss to New York state
of any unobligated Title II money which can not be made available  as  a
grant  or  grant  increase to a municipality, for purposes of deposit in
the fund and appropriated by the state for deposit therein, (b)  federal
capitalization  grants  and  awards or other federal assistance provided
pursuant  to,  or  for  the  purposes  of,  the   Omnibus   Consolidated
Rescissions  and  Appropriations  Act  of  1996 (Pub. L. 104-134) or wet
weather quality grants as provided in  the  Consolidated  Appropriations
Act  of  2001  (Pub.  L.  106-554), (c) moneys appropriated by the state
legislature for the purpose of such fund or otherwise transferred by the
state for deposit therein by the comptroller as  required  by  law,  (d)
payments  of  principal  and interest made by municipalities pursuant to
loan or other agreements entered into pursuant to subdivisions eight and
nine of this section: provided, however, if such loans were financed  by
the  issuance  of  bonds  or  notes  of the corporation, deposit of such
payments into the fund shall be subject to the rights of the holders  of
such  bonds  or notes to receive such moneys, (e) investment earnings on

amounts  in  such  fund,  (f)   any   other   payments   received   from
municipalities  pursuant  to  a loan or other agreement made pursuant to
subdivisions eight and nine of this section for costs  of  managing  and
administering  the program, (g) the proceeds of bonds or notes issued by
the corporation  for  purposes  of  providing  financial  assistance  to
municipalities,  (h)  the balance of any fees or penalties paid pursuant
to the terms and conditions of a compliance or enforcement agreement for
violations of the federal Marine Protection,  Research  and  Sanctuaries
Act, as amended (33 U.S.C. §§ 1401 et seq.), occurring prior to December
thirty-first,  nineteen hundred ninety-four, after payment has been made
to the administrator  of  the  United  States  environmental  protection
agency, a trust account, the ocean dumping alternatives account, and (i)
the  balance  of  any  amount  in  a  trust  account  or, if applicable,
municipal trust accounts of the clean oceans fund upon a finding by  the
administrator  of the United States environmental protection agency that
fees or penalties were not paid into such  trust  account  or  municipal
trust  account  as  required  by  the  Marine  Protection, Research, and
Sanctuaries Act, or an applicable compliance or enforcement agreement.
4. Moneys in the water  pollution  control  revolving  fund  shall  be
applied   by   the   corporation  to  provide  financial  assistance  to
municipalities  for  construction  of  eligible   projects   and,   upon
consultation  with  the  director  of the division of the budget and the
commissioner, for such other purposes permitted  by  the  Federal  Water
Pollution Control Act, as amended, and to provide for the administrative
and   management   costs   of  the  program.  All  moneys  from  federal
capitalization grants  and  awards  or  other  federal  assistance  made
available  pursuant to, or for the purposes of, the Omnibus Consolidated
Rescissions and Appropriations Act of 1996  (Pub.  L.  104-134)  or  wet
weather  quality  grants  as provided in the Consolidated Appropriations
Act of 2001 (Pub. L.  106-554),  which  are  deposited  into  the  water
pollution  control  fund  pursuant to subdivision three of this section,
and any corresponding state match moneys, may be used by the corporation
for the purposes permitted by the Omnibus Consolidated  Rescissions  and
Appropriations  Act  of  1996 (Pub. L.   104-134) or wet weather quality
grants as provided in the Consolidated Appropriations Act of 2001  (Pub.
L.  106-554),  and  for  no  other  purposes.    As used in this section
"financial assistance to municipalities" means any one or  more  of  the
following:
(a)  making  loans  to  municipalities  for  construction  of eligible
projects, provided such loans (i) are made at  market  or  below  market
rates,  (ii)  do  not  have  a  final maturity of more than twenty years
following scheduled completion  of  the  eligible  project,  (iii)  have
principal  and  interest payments which commence not later than one year
after scheduled completion of the eligible project, and (iv) require the
municipality to establish a dedicated source of revenue (which may be  a
general  obligation of the municipality); unless otherwise determined by
the  corporation  or  directed  by  the  commissioner  of  environmental
conservation  pursuant  to  subdivision  eight of section 17-1909 of the
environmental conservation law, the corporation shall  make  such  loans
only  from  the  proceeds of the corporation's bonds or notes issued for
purposes of this section;
(b) buying or refinancing debt obligations of municipalities at market
or below market rates, if work was commenced and debt was  incurred  for
the eligible project after March seventh, nineteen hundred eighty-five;
(c)  guarantying,  or purchasing insurance or other credit enhancement
for municipal obligations where such action would improve credit  market
access for or reduce interest rates on such municipal obligations;
(d) providing a source of revenue or security for payment of principal
and interest on bonds or notes issued by the corporation if the proceeds
of the sale of such bonds or notes will be deposited in the fund;
(e)  providing interest rate subsidy allocations to subsidize loans to
municipalities made from the proceeds  of  the  corporation's  bonds  or
notes;
(f)  using  investment earnings on moneys in the fund to pay, pursuant
to subdivision seven of this section, the costs of the  corporation  and
the  department  of  environmental  conservation  of  administering  and
managing the program described in this section and  section  17-1909  of
the environmental conservation law.
Subject  to  any  applicable  provisions  of federal or state law, any
financial assistance at an interest rate of  zero  percent  provided  to
municipalities  that  meet  the  financial hardship criteria regulations
established  pursuant  to   section   17-1909   of   the   environmental
conservation  law, may have a final maturity up to forty years following
scheduled completion of the eligible project.
5. The corporation may make payments to the sewage  treatment  program
management  and administration fund in accordance with subdivision seven
of this section to reimburse such fund for expenditures made pursuant to
appropriation to pay the cost of the corporation and the  department  of
environmental  conservation  for  administering  and  managing the water
pollution  control  revolving  fund  program  established   in   section
ninety-seven-l   of   the  state  finance  law,  for  such  costs.  Such
reimbursement shall be made from (a) available  investment  earnings  on
all  amounts in the water pollution control revolving fund excluding all
amounts in the fund which  are  the  subject  of  allocations  or  other
financial assistance to a municipality; and (b) payments received from a
municipality  for such purpose pursuant to a project financing agreement
or loan agreement; and (c) if the sources of revenue described  in  this
paragraph  and  paragraphs  (a)  and  (b) of this subdivision are or are
anticipated to be  insufficient,  then  from  the  proceeds  of  federal
capitalization grants, awards or assistance appropriated to the fund for
administration and management of such program.
Notwithstanding the foregoing, if the sources of revenues described in
paragraphs  (a),  (b)  and  (c)  of  this  subdivision  are  at any time
insufficient to make a reimbursement  to  the  state  pursuant  to  this
subdivision when due, the corporation shall make such reimbursement from
any  other  available  amounts  in the water pollution control revolving
fund, excluding  all  amounts  that  are  the  subject  of  allocations,
provided,  that  the  amounts  paid  from  fund sources other than those
described in paragraphs (a), (b) and (c) of this  subdivision  shall  be
reimbursed  upon  a  determination  by  the  director of the budget that
future revenues obtained from sources described in paragraphs  (a),  (b)
and  (c)  of  this  subdivision  are in excess of the amounts reasonably
needed to make future reimbursements pursuant to this subdivision.
* 6. Moneys in the water  pollution  control  revolving  fund  may  be
invested  as  provided  in  subdivision  four  of section twelve hundred
eighty-four of this title and may be further invested (a) in  investment
agreements  continuously  secured  by  obligations with any insurance or
reinsurance company or corporate affiliate thereof rated by a nationally
recognized rating agency in one of its two highest categories, any bank,
trust company or broker or dealer, as defined by the securities exchange
act of 1934, which is a dealer in government bonds,  which  reports  to,
trades  with  and is recognized as a primary dealer by a federal reserve
bank and is a member of the securities investors protection corporation,
if,  (i)  such  obligations  securing  such  investment  agreements  are
obligations  as  set  forth in section ten of the general municipal law,

(ii) such obligations are delivered to a trustee for the benefit of  the
corporation  or,  with  respect  to moneys pledged under an indenture of
trust relating to bonds or notes of  the  corporation,  to  the  trustee
under  such indenture, or are supported by a safe keeping receipt issued
by a depository satisfactory to the corporation as applicable,  provided
that  such  investment  agreements  must  provide  that the value of the
underlying obligations shall be maintained at a  current  market  value,
calculated  no less frequently than monthly, of not less than the amount
deposited thereunder, (iii) a prior perfected security interest  in  the
obligations  which  are  securing such agreement has been granted to the
corporation, as applicable, and (iv) such obligations are free and clear
of adverse third party claims, or (b) in obligations  as  set  forth  in
section  ten of the general municipal law that are rated by a nationally
recognized rating agency in one of its two highest rating categories.
* NB Effective until September 30, 2026
* 6. Moneys in the water  pollution  control  revolving  fund  may  be
invested  as  provided  in  subdivision  four  of section twelve hundred
eighty-four of this title and may be further invested (a) in  investment
agreements  continuously  secured  by  obligations with any insurance or
reinsurance company or corporate affiliate thereof rated by a nationally
recognized rating agency in one of its two highest categories, any bank,
trust company or broker or dealer, as defined by the securities exchange
act of 1934, which is a dealer in government bonds,  which  reports  to,
trades  with  and is recognized as a primary dealer by a federal reserve
bank and is a member of the securities investors protection corporation,
if,  (i)  such  obligations  securing  such  investment  agreements  are
obligations  as  set  forth in section ten of the general municipal law,
(ii) such obligations are delivered to a trustee for the benefit of  the
corporation  or,  with  respect  to moneys pledged under an indenture of
trust relating to bonds or notes of  the  corporation,  to  the  trustee
under  such indenture, or are supported by a safe keeping receipt issued
by a depository satisfactory to the corporation as applicable,  provided
that  such  investment  agreements  must  provide  that the value of the
underlying obligations shall be maintained at a  current  market  value,
calculated  no less frequently than monthly, of not less than the amount
deposited thereunder, (iii) a prior perfected security interest  in  the
obligations  which  are  securing such agreement has been granted to the
corporation, as applicable, and (iv) such obligations are free and clear
of adverse third party claims, or (b) in  obligations  the  interest  on
which is excludable from gross income under section one hundred three of
the internal revenue code, provided that such obligations are rated by a
nationally  recognized  rating  agency  in one of its two highest rating
categories.
* NB Effective September 30, 2026
7. The corporation  may  transfer  to  the  sewage  treatment  program
management  and  administration  fund  established  pursuant  to section
ninety-seven-l  of  the  state  finance  law  no  less  frequently  than
semi-monthly  amounts  from  the fund sufficient to reimburse the sewage
treatment program management and administration fund in accordance  with
the provisions of subdivision five of this section.
8.  In  addition to the powers of the corporation granted elsewhere in
this chapter, the corporation shall have the power to enter into project
financing agreements authorized by section 17-1909 of the  environmental
conservation  law. Notwithstanding the powers granted to the corporation
elsewhere in this title, the corporation's  power  to  finance  eligible
projects from the fund is limited to eligible projects for which project
financing  agreements  have been executed pursuant to section 17-1909 of
the environmental conservation law.
9. In addition to the powers granted to the corporation  elsewhere  in
this  chapter,  the  corporation  may  make  loans to municipalities for
purposes of financing eligible projects for which the fund may be  used,
subject  to  the  limitations  of subdivision eight of this section, may
accept the obligations of any municipality as security for the repayment
of a loan to such municipality, and may assign and pledge such municipal
obligations  and  loan  agreements  for  the  benefit  of  the holder of
obligations of the corporation from the proceeds of which such loans are
made. Loan proceeds may be disbursed to  a  municipality  in  accordance
with  such  restrictions  as  may  be  imposed  by  the  corporation  in
connection with such loan or obligations of  the  corporation  from  the
proceeds of which such loan is made.
10.  The  corporation is authorized to arrange for any audits required
by law for the  purpose  of  issuing  its  bonds  or  notes  to  provide
financial   assistance   to   municipalities,   and   provide   for  the
implementation of any independently conducted reviews or audits arranged
pursuant to subdivision seven of section 17-1909  of  the  environmental
conservation law.
11. In the event a municipality shall fail to make any payment due the
corporation  pursuant  to  any  loan  agreement, financing agreement, or
other obligation of the municipality sold to the corporation  or  issued
as  security  for  the  undertaking  of the municipality thereunder, the
corporation shall certify to the comptroller, and notify the chairman of
the senate finance committee, the chairman  of  the  assembly  ways  and
means  committee,  the  director  of  the division of the budget and the
governing body of the municipality that such municipality has failed  to
make  such  payment.  Such  certificate  shall be in such form as may be
determined by the corporation provided such  certificate  shall  specify
the  exact amount of debt service and surcharge, if applicable, required
to satisfy such municipality's unpaid obligation. The comptroller,  upon
receipt  of  such certificate from the corporation, is authorized to and
shall, to the extent not otherwise prohibited by law and subject to  any
other  provision  of  law  providing  for withholding of payments to the
municipality which take precedence over this subdivision, withhold  from
such  municipality  the  next  succeeding payments of state aid or local
assistance otherwise payable to it to the extent necessary to  meet  the
certified  amount  of debt service and surcharge, if applicable, due the
corporation and shall immediately pay over to the corporation as a  debt
service payment on behalf of such municipality the amount so withheld.
12.  (a)  Notwithstanding the provisions of any general or special law
to the contrary,  the  commissioner  of  environmental  conservation  on
behalf  of the state and the corporation, subject to the approval of the
director of the budget, are each hereby authorized to enter into a state
revolving  fund  service  contract  or  contracts  providing   for   the
administration  of  the  water  pollution control revolving fund and the
financing by the corporation of the contributions made by the  state  to
the  water  pollution  control  revolving  fund.  Any  such  contract or
contracts shall be upon such terms and conditions as the corporation and
the commissioner of environmental conservation  shall  determine  to  be
reasonable,  including,  but  not limited to, provisions relating to the
respective obligations of the state and the corporation with respect  to
the  administration  of  the  water pollution control revolving fund and
provisions providing for the payment of (i) all fees and  other  charges
of,  and  expenses  incurred  by, the corporation in connection with the
issuance and administration of special obligation bonds to provide funds
to the state or reimburse the  state  for  contributions  to  the  water
pollution  control  revolving fund and (ii) all debt service payments on
such bonds.
(b) Any such contract entered into pursuant to paragraph (a)  of  this
subdivision shall provide that the obligation of the state to fund or to
pay  the amounts therein provided for shall not constitute a debt of the
state within the meaning of any constitutional  or  statutory  provision
and  shall  be  deemed  executory only to the extent of moneys available
therefore and that no liability shall be incurred by  the  state  beyond
the  moneys  available  for  such  purpose,  and that such obligation is
subject to annual appropriation by the legislature.
(c) Any such contract or any payments made or to  be  made  thereunder
may be assigned and pledged by the corporation as security for its bonds
and  notes issued for the purpose of financing the state contribution to
the water pollution control revolving fund.
(d)  The  comptroller  is  hereby  authorized  to  receive  from   the
corporation  any  portion  of  special  obligation bond proceeds paid to
provide funds to or reimburse the state  for  its  contribution  to  the
water pollution control revolving fund and to credit such amounts to the
capital projects fund or any other appropriate fund.
13.  In  addition  to  the  powers  granted to the corporation in this
section, the corporation is authorized to exercise the  powers,  perform
the  responsibilities  and take the actions assigned to it under section
17-1909 of the environmental conservation law.