2023 New York Laws › UDR - Urban development research corporation act 173/68

Chapter 173 of the laws of 1968
NEW YORK STATE URBAN
DEVELOPMENT AND RESEARCH CORPORATION ACT
Section 1.  Short title.
2.  Statement of legislative findings and purposes.
3.  Definitions.
4.  Corporation for urban development and research of New York.
5.  Membership council.
6.  Purposes of the corporation.
7.  Powers and limitations.
8.  Cooperation with municipalities.
9.  Subsidiaries; how created.
10. Acquisition of real property.
11. Acquisition  of  real property acquired by a municipality or
urban renewal agency.
12. Designation and service of process on secretary of state and
registered agent.
13. Limitation of liability.
14. Bonds and notes of the corporation.
15. Security for bonds or notes; construction and acquisition of
projects.
16. Reserve funds.
17. Trust funds.
18. Bonds and notes as legal investment.
19. Agreement of the state.
20. Remedies of bondholders and noteholders.
21. Monies of the corporation.
22. Permissible relations.
23. Inconsistent provisions of other laws superseded.
24. Construction.
25. Actions against corporation.
26. Separability.
§ 1. Short title. This act shall be known and may be cited as the "New
York state urban development and research corporation act".
§ 2. Statement of legislative findings and purposes.  The  legislature
hereby finds, determines and declares that there exists in this state:
(a)  a  seriously  inadequate  supply  of  safe  and sanitary dwelling
accommodations within the financial reach of  a  substantial  number  of
families and persons, including aged persons, living within the state;
(b)  a  substantial  number of dwelling accommodations, including many
sheltering one to four  families,  which  are  structurally  sound,  but
substandard or deteriorating;
(c)    a   serious   condition   of   involuntary   unemployment   and
underemployment   causing   severely   adverse   social   and   economic
consequences,  including  the  waste  of  human resources, the growth of
crime and delinquency, the loss of educational opportunities for many of
our youth, and  the  burden  on  the  state  and  local  governments  of
increasing public assistance payments and decreasing tax revenues;
(d)  many  residential,  commercial  and  industrial  areas  which are
substandard  and  insanitary  or  which  are  becoming  substandard  and
insanitary  because of blighted, obsolete, deteriorated or deteriorating
conditions;
(e)  a  serious  need  for  extensive  and   in-depth   research   and
experimentation   to  discover  new,  better,  and  cheaper  methods  of
constructing and  rehabilitating  low  cost  housing;  of  constructing,
reconstructing,  rehabilitating  and improving commercial, manufacturing
and  industrial  facilities;  of  rehabilitating,   reconstructing   and

renewing  substandard,  deteriorated  and  deteriorating  areas;  and of
protecting  against  the  hazards  of   involuntary   unemployment   and
underemployment.
The legislature further finds and declares that such conditions cannot
be  corrected  by  the ordinary operations of private enterprise and are
contrary to the public  interest.  They  threaten  the  health,  safety,
welfare, morale, comfort and security of the people of this state.
The  legislature  hereby declares it to be the policy of this state to
provide an adequate supply of safe and sanitary dwelling accommodations;
to  increase  job  opportunities   and   protect   against   involuntary
unemployment  and  underemployment by promoting, attracting, stimulating
and revitalizing business, commerce, industry and manufacturing  in  the
urban  areas of the state; and to arrest the spread of deterioration and
blight and promote the economic and physical development of  such  areas
through the construction, reconstruction, rehabilitation and improvement
of  residential,  commercial  and  industrial  structures and facilities
therein.
For these purposes, there should be created  a  nonprofit  corporation
known  as  "Corporation  for Urban Development and Research of New York"
which, with grants and loans from private sources, through the  issuance
of bonds and notes to the investing public, and through participation in
federal, state, and local programs, may independently and in cooperative
effort  with  the  New  York state urban development corporation and the
urban development  guarantee  fund  of  New  York,  acquire,  construct,
reconstruct,  rehabilitate  and  improve,  and  finance the acquisition,
construction, reconstruction, rehabilitation and improvement of, housing
accommodations   and   industrial,   manufacturing,    commercial    and
recreational  structures and facilities; clear, replan, reconstruct, and
rehabilitate such substandard and insanitary areas; and conduct research
and experimentation in all these fields.
The legislature further finds and  declares  that  such  a  non-profit
corporation  organized  for  such  purposes  and  with  the  powers  and
authorities necessary to accomplish them cannot  be  created  under  any
general  law;  that  such  a  corporation  being necessary and proper to
obtain the ends here recited, it should be created by a special  act  of
the legislature.
§  3.  Definitions. As used in this act, the following words and terms
shall have the following meanings  unless  the  context  shall  indicate
another or different meaning or intent:
(a)  "Corporation". The corporation for urban development and research
of New York created by section four of this act.
(b) "Urban development guarantee fund of New York". The  fund  created
by the urban development guarantee fund of New York act.
(c) "New York state urban development corporation". The public benefit
corporation  created by the New York state urban development corporation
act.
(d) "Bonds" and "notes". The bonds and notes  respectively  issued  by
the corporation pursuant to this act.
(e) "Comptroller". The comptroller of the state.
(f)   "Housing  Development  Fund  Company".  A  company  incorporated
pursuant to the provisions of article  eleven  of  the  private  housing
finance law.
(g)  "Limited-Profit Housing Company". A company incorporated pursuant
to the provisions of article two of the private housing finance law or a
company incorporated pursuant to the provisions of article two  of  such
law and the not-for-profit corporation law.
(h)   "Limited  Dividend  Housing  Company".  A  company  incorporated
pursuant to the provisions  of  article  four  of  the  private  housing
finance law.
(i)  "Redevelopment  Company".  A company incorporated pursuant to the
provisions of article five of the private housing finance law.
(j) "Local Development Corporation".  A  corporation  incorporated  or
reincorporated  pursuant  to  the  provisions of article fourteen of the
not-for-profit corporation law.
(k)  "Project".  A  specific  work  or  improvement  including  lands,
buildings,  improvements,  real  and personal properties or any interest
therein, acquired, owned, constructed, reconstructed,  rehabilitated  or
improved  by  the  corporation  or  any  subsidiary  thereof.  The  term
"project" as used herein shall include a project, or  projects,  or  any
portion thereof.
(1) "Housing project". A project designed and intended for the purpose
of providing housing accommodations for persons or families which cannot
afford  the prices or rentals of housing provided by the unaided efforts
of  private  enterprise,  including  such   recreational,   educational,
cultural  and  other  community  facilities  as  may  be  incidental  or
appurtenant thereto.
(2) "Industrial project". A project  designed  and  intended  for  the
purpose  of providing facilities for manufacturing, warehousing research
or other industrial, business or commercial purposes, including but  not
limited  to  machinery  and equipment deemed necessary for the operation
thereof (excluding raw material, work in process or stock in trade).
(l) "Project cost". The  sum  total  of  all  costs  incurred  by  the
corporation  in  carrying  out  all  works  and  undertakings  which the
corporation deems reasonable and necessary  for  the  development  of  a
project.  These  shall  include  but  are not necessarily limited to the
costs of all  necessary  studies,  surveys,  plans  and  specifications,
architectural,  engineering  or  other  special services, acquisition of
land and  any  buildings  thereon,  site  preparation  and  development,
construction,   reconstruction,   rehabilitation,  improvement  and  the
acquisition of such machinery and equipment as may be  deemed  necessary
in  connection  therewith  (other than raw materials, work in process or
stock in trade); the necessary expenses incurred in connection with  the
initial   occupancy   of  the  project;  an  allocable  portion  of  the
administrative and operating expenses of the corporation;  the  cost  of
financing  the  project, including interest on bonds and notes issued by
the corporation to finance the project from the date thereof to the date
when  the  corporation  shall  determine  that  the  project  be  deemed
substantially  occupied; and the cost of such other items, including any
indemnity and surety bonds and premiums on insurance, legal  fees,  fees
and  expenses  of trustees, depositories and paying agents for the bonds
and notes issued by the corporation; and relocation costs,  all  as  the
corporation shall deem necessary.
(m)  "Real  property".  Lands, structures, franchises and interests in
land, including lands under water and riparian rights, space rights  and
air  rights  and  any  and  all other things and rights usually included
within said term. Real property shall also mean and include any and  all
interests  in  such  property  less  than full title, such as easements,
incorporeal hereditaments and every estate, interest or right, legal  or
equitable,  including  terms  for  years  and  liens  thereon  by way of
judgments, mortgages or otherwise, and also all claims for  damages  for
such real estate.
(n) "State". The state of New York.
(o)  "State  agency".  Any  officer,  department,  board,  commission,
bureau, division, public corporation, agency or instrumentality  of  the
state.
(p) "Subsidiary corporation". A corporation created by the corporation
in accordance with section nine of this act.
(q)  "Substandard  or  insanitary  area".  Such  area as is defined by
section five hundred two of the general municipal law.
(r) "Municipality". Any county, city, town and village.
(s)  "Local  governing  body".  The  board  of   supervisors,   county
legislature,  board  of  aldermen,  common council, commission, or other
elective governing board or  body  now  or  hereafter  vested  by  state
statute,  charter  or  other law with jurisdiction to initiate and adopt
local laws, whether or not such local laws  or  ordinances  require  the
approval  of  the  elective chief executive officer or other official or
body to become effective, and except that with respect to a city  having
a  population  of  one  million  or more the term "local governing body"
shall mean the board of estimate.
§ 4. Corporation for urban development and research of  New  York.  1.
There is hereby created a non-profit corporation which shall be known as
the "Corporation for Urban Development and Research of New York." Except
as  otherwise  provided  in this act, the corporation shall have all the
powers, privileges and immunities which are  now  or  may  hereafter  be
conferred on business corporations by the business corporations law.
2.  The  business  of  the  corporation  shall  be managed by, and its
powers, functions and duties shall  be  exercised  through  a  board  of
directors,  consisting  of  nine directors who shall be the directors of
the New York state urban development corporation.
3. The chairman of the corporation shall be the chairman  of  the  New
York  State  urban  development  corporation.  The directors shall serve
without salary, but each director shall be entitled to reimbursement for
his actual and necessary expenses incurred in  the  performance  of  his
official duties with the corporation.
4.  Notwithstanding  any  inconsistent  provisions  of  law,  general,
special or local, no officer or employee of the state or  of  any  civil
division thereof, shall be deemed to have forfeited or shall forfeit his
office  or  employment  by reason of his acceptance of membership on the
corporation created by this section; provided, however, a  director  who
holds such other public office or employment shall receive no additional
compensation  or  allowance  for services rendered pursuant to this act,
but shall be entitled to reimbursement  for  his  actual  and  necessary
expenses incurred in the performance of such services.
5.  The  corporation  and its corporate existence shall continue until
terminated by law, provided, however, that no such law shall take effect
so long as the corporation shall have bonds, notes and other obligations
outstanding, unless adequate provision has been  made  for  the  payment
thereof  in  the  documents  securing  the same. Upon termination of the
existence of the corporation, all its rights and properties  shall  pass
to and be vested in the state.
6.  The  powers  of  the corporation shall be exercised by affirmative
vote of no less than five of  the  directors  thereof  then  in  office,
except as otherwise provided by subdivision two of section eight hereof.
The  corporation  may  delegate  to one or more of its directors, or its
officers, agents and employees, such powers and duties as  it  may  deem
proper.
§  5.  Membership  council.  (1)  The  corporation  shall  establish a
membership council which shall have  the  powers  and  duties  specified
herein.  The council shall consist of no less than fifteen nor more than
forty-five members. The members of the council shall be elected by  vote

of  the  certificate  holders  as  provided  in  subdivision two of this
section at the first annual meeting of such certificate holders  and  at
each  annual  meeting  thereafter. If a vacancy occurs in the membership
council  through  death, resignation or otherwise, the remaining members
shall elect a person to fill such vacancy for the unexpired term.
(2) Corporations, trusts, associations, partnerships and  individuals,
including without implied limitation, any banking institution, insurance
or  surety  company,  labor  union,  employers' association, educational
institution, utility or railroad, located or authorized to  do  business
in New York may be admitted to membership in the corporation at any time
by  action  of  the  directors  of  the corporation. Membership shall be
evidenced by membership certificates in amounts  of  multiples  of  five
hundred  dollars.  Members  shall  pay  such  annual  dues  as  shall be
determined by the directors of the corporation. Each member  shall  have
one  vote  for  each five hundred dollars of stated value represented by
the membership certificates of such member. Each member entitled to vote
may vote by proxy. No voting rights shall  arise  with  respect  to  any
payment  or  transfer which shall be made to the corporation in the form
of a contribution, bequest or devise.
(3) The membership council shall  elect  a  chairman  from  among  the
members  of  the  council.  The  council  shall  meet at the call of the
chairman or on petition of any three members thereof. A majority of  the
council  shall  constitute  a  quorum  to  transact  the business of the
council. The council shall advise and assist the corporation in carrying
out its corporate purposes.  It  shall  coordinate  the  activities  and
programs of the corporation with business interests in the community and
shall  seek  to enlist the support and membership of such businesses and
of  institutional  lenders.  The  council  shall  have   the   following
additional duties:
(a)  to  cause such studies, research and investigations to be made as
it may deem advisable and necessary;
(b) to collect and  compile  information  and  data  relating  to  the
planning  and  development  of urban areas and the investment of private
capital therein;
(c) to recommend  to  the  corporation  the  undertaking  of  specific
housing and industrial projects or any combination thereof;
(d)  to  assist  and  cooperate with municipalities and with civic and
planning associations in furtherance of the corporate  purposes  of  the
corporation;
(e)  to recommend to the directors of the corporation persons to serve
as directors of subsidiary corporations, pursuant  to  section  nine  of
this act.
(4)  All  actions  of  the  membership  council involving an estimated
expenditure of more than one thousand dollars shall be  subject  to  the
approval of the directors of the corporation.
§  6. Purposes of the corporation. (1) To facilitate the comprehensive
development of urban areas throughout  the  state  and  to  promote  the
health,  safety,  welfare  and  prosperity of the people of the state by
maximizing the resources, talents and energies of the private sector  of
the  economy, by encouraging local initiative and local participation in
the projects of  the  corporation,  and  by  relieving  the  burdens  of
government in connection with such development.
(2)  In  cooperation  with  the private sector of the economy and with
federal, state and local government, to assist  in  providing  safe  and
decent  housing  for persons and families which cannot afford the prices
and rentals of housing provided through the unaided efforts  of  private
enterprise, and in connection therewith:
(a)  To  carry  out  and  to facilitate the acquisition, construction,
reconstruction, and  rehabilitation  of  housing  projects,  as  defined
herein  and  to  sell  or  lease  such  projects to families which would
otherwise be unable to afford safe and decent housing accommodations.
(b)  To  make  loans  or  grants  for  the  acquisition, construction,
reconstruction and rehabilitation of housing projects, as defined herein
and in connection therewith to provide technical advice  and  assistance
to  persons  and  firms undertaking such rehabilitation and to encourage
new means and technologies to carry out such rehabilitation to  the  end
that  persons  previously unable to enjoy the benefits of home ownership
will be able to afford their own homes.
(c) To utilize the state capital grant low  rent  assistance  program,
pursuant  to section forty-four-a of the private housing finance law, in
housing  projects  of  the  corporation,  in  order  to   increase   the
availability  of  housing accommodations for persons and families of low
income.
(3)  In  order  to  reduce  unemployment,  provide  opportunities  for
additional   and   maximum   employment,  the  creation  of  better  job
opportunities, and the improvement of individual job skills, to  attract
new  industries  to  urban areas of the state and to promote the economy
and prosperity of such areas, to carry out, facilitate  and  make  loans
for  the acquisition, construction, reconstruction and rehabilitation of
industrial plants and facilities, including the furnishing of  machinery
and equipment therein, manufacturing, commercial, research and warehouse
and  other business facilities; and to lease space in such facilities to
qualified users thereof.
(4)  To  acquire  land,  whether  or  not  such  land  constitutes   a
substandard  or  insanitary  area,  for  any  of its corporate purposes,
including the development of housing and industrial projects, as defined
herein, to clear, improve and prepare  such  land  for  development,  to
carry out the development of such land, or to make the same available by
sale,  lease  or otherwise to private investors and developers when such
disposition is,  in  the  judgment  of  the  corporation,  necessary  or
desirable  for  the  development  of the community in which such land is
situated.
(5) To cooperate with the private sector of the economy, including the
urban development guarantee fund of New  York,  and  with  the  federal,
state  and  local  governments,  and agencies thereof, including the New
York state urban development corporation, in order to coordinate  public
and  private  efforts  in  the development of urban areas throughout the
state,  including  housing,  industry  and  commerce,  educational   and
recreational  facilities,  and  transportation and other public services
and facilities.
(6) To encourage  and  facilitate,  in  connection  with  any  of  its
projects, participation in construction work by residents of the area in
which  such  projects are to be located, and to encourage and facilitate
participation by such residents in the business  operations  of  tenants
and occupants of industrial projects of the corporation.
(7)   To   conduct,   assist,   promote   and   encourage  scientific,
technological and administrative research  and  experimentation  in  the
fields  of  low  cost  housing,  of  rehabilitating,  reconstructing and
renewing  blighted,  deteriorated  and  deteriorating  areas,   and   of
protecting  against  the hazards of unemployment and underemployment; of
developing and testing and encouraging the development  and  testing  of
new  methods  of  constructing,  rehabilitating  and  improving low cost
housing, of developing and testing and encouraging the  development  and
testing  of  new methods of rehabilitating, reconstructing, and renewing
blighted, deteriorated and deteriorating  areas;  of  planning  for  the

comprehensive  development of communities; of acting as a clearing house
and  distributing  agency  of  the  results   of   such   research   and
experimentation,  and  of conducting, assisting and encouraging research
and  experimentation  on  such other aspects of providing safe, sanitary
and adequate low cost housing;  of  rehabilitating,  reconstructing  and
renewing  blighted  or  deteriorated  and  deteriorating  areas,  and of
providing increased job opportunities  as  the  corporation  shall  deem
advisable.
§  7. Powers and limitations. (1) In addition to the powers granted by
the business corporation law and except as otherwise limited by this act
the corporation shall have power:
(a)  to  provide  advisory,  consultative,  training  and  educational
services,   technical   assistance  and  advice  to  any  person,  firm,
partnership or corporation, either public or private.
(b) to acquire, construct, reconstruct, rehabilitate,  improve,  alter
or repair, or provide for the acquisition, construction, reconstruction,
improvement, alteration or repair of any project.
(c)  to  sell, lease, exchange, mortgage, donate or convey any project
and to grant options to renew any leases entered into in connection with
any project.
(d) to create subsidiaries pursuant to the provisions of the  business
corporation  law,  not-for-profit corporation law or articles two, four,
five or eleven of the  private  housing  finance  law,  as  provided  in
section nine of this act.
(e)  to  lend  or  donate  monies, whether secured or unsecured to any
subsidiary, and  to  purchase  the  shares,  bonds,  or  obligations  or
securities of such subsidiary.
(f)  as  security  for the payment of the principal of and interest on
any  bonds  issued  by  the  corporation  and  any  agreements  made  in
connection  therewith, to mortgage and pledge any or all of its projects
or any part or parts thereof, whether then owned or thereafter acquired,
and to pledge the revenues and receipts therefrom or from  any  thereof,
and  to  assign  or  pledge the lease or leases on any portion or all of
said projects and to assign or pledge the income received by  virtue  of
said lease or leases.
(g)  to do any and all things necessary or convenient to carry out its
purposes and exercise the powers given and granted under  this  act,  or
under any other law, special, general or local.
(2)  No part of the net earnings of the corporation shall inure to the
benefit of any individual and no member, employee, director  or  officer
of  the  corporation  shall  receive  any  pecuniary  benefit  from  the
corporation  except  reasonable  compensation  for   services   actually
rendered  to  the  corporation.  The  corporation  shall  not  carry  on
propaganda or otherwise attempt to influence legislation.
(3) The corporation shall not issue shares nor shall any bonds,  notes
or debentures of the corporation be convertible to shares.
§ 8. Cooperation with municipalities. (1) In effectuating the purposes
of  this  act, the corporation shall work closely, consult and cooperate
with local elected officials  and  community  leaders  at  the  earliest
practicable  time.  The  corporation shall give primary consideration to
local  needs  and  desires  and  shall  foster  local   initiative   and
participation  in  connection  with  the planning and development of its
projects. Wherever possible, activities  of  the  corporation  shall  be
coordinated  with  local urban renewal and other community projects, and
the corporation shall assist localities in carrying out  such  projects.
Consideration  shall  also  be  given  to  local  and regional goals and
policies as expressed in urban  renewal,  community  renewal  and  local
comprehensive land use plans and regional plans.
(2) Except with respect to a project consisting in whole or in part of
real  property acquired by the corporation pursuant to section eleven of
this   act,   before   commencing   the    acquisition,    construction,
reconstruction,   rehabilitation,   alteration  or  improvement  of  any
project:  (a)  the  corporation shall file a copy of the general project
plan in its corporate offices and in the office  of  the  clerk  of  any
municipality  in which the project is to be located, and shall provide a
copy thereof to the chief executive officer of  any  such  municipality,
the   chairman   of  the  planning  board  or  commission  of  any  such
municipality, or if there is no planning board  or  commission,  to  the
presiding  officer  of the local governing body. Upon request, any other
person  shall  be  furnished  with  a  digest  of  such  plan;  (b)  the
corporation  shall  publish  a notice of the filing of such plan and the
availability of digests thereof in one newspaper of general  circulation
within  the  municipality,  which  notice shall also state that a public
hearing will be held to consider the plan at a specified time and  place
on  a  date  not  less  than thirty days after such publication; (c) the
corporation shall conduct a public hearing pursuant to such notice;  (d)
any person shall have the opportunity to present written comments on the
plan  within  thirty days after the public hearing; (e) any municipality
within which the project is to be  located,  by  majority  vote  of  its
planning board or commission, or in the event there is no planning board
or  commission,  by  majority  vote  of  its  local  governing body, may
recommend approval, disapproval  or  modification  of  the  plan,  which
recommendation  shall  be submitted in writing to the corporation within
thirty days after such hearing: (f)  after  due  consideration  of  such
testimony  and  comments  and  municipal  recommendations,  if  any, the
corporation may affirm, modify  or  withdraw  the  plan  in  the  manner
provided  for  the  initial filing of such plan in paragraph (a) of this
subdivision, provided, however, that in the event any such  municipality
has  recommended  disapproval  or  modification of the plan, as provided
herein, the corporation may affirm the plan only by a vote of two-thirds
of the directors thereof then in office.
(3)  After  consultation  with  local  officials,   as   provided   in
subdivision  one  of  this  section,  the corporation and any subsidiary
thereof shall, in constructing, reconstructing, rehabilitating, altering
or improving any project, comply with the requirements  of  local  laws,
ordinances,   codes,   charters   or   regulations  applicable  to  such
construction, reconstruction, rehabilitation, alteration or improvement,
provided however, that when, in the discretion of the corporation,  such
compliance  is  not  feasible  or  practicable,  the corporation and any
subsidiary thereof shall comply  with  the  requirements  of  the  state
building  construction  code,  formulated  by  the  state  building code
council pursuant to article eighteen of the executive law, applicable to
such  construction,  reconstruction,   rehabilitation,   alteration   or
improvement.  No  municipality  shall have power to modify or change the
drawings, plans or specifications for the construction,  reconstruction,
rehabilitation,   alteration  or  improvement  of  any  project  of  the
corporation or of any subsidiary thereof, or the construction, plumbing,
heating, lighting or  other  mechanical  branch  of  work  necessary  to
complete  the  work in question, nor to require that any person, firm or
corporation employed on any such work shall perform any such work in any
other  or  different  manner  than  that  provided  by  such  plans  and
specifications, nor to require that any such person, firm or corporation
obtain   any   other   or  additional  authority,  approval,  permit  or
certificate from such municipality in relation to the work  being  done,
and  the  doing  of  any such work by any person, firm or corporation in
accordance with the terms of such  drawings,  plans,  specifications  or

contracts  shall  not  subject  said  person, firm or corporation to any
liability or penalty, civil or criminal, other than as may be stated  in
such  contracts  or  incidental  to  the proper enforcement thereof; nor
shall  any  municipality  have  power  to require the corporation or any
subsidiary thereof or successor in interest thereto to obtain any  other
or additional authority, approval, permit, certificate or certificate of
occupancy  from  such  municipality  as  a  condition  of owning, using,
maintaining, operating or occupying any project  acquired,  constructed,
reconstructed,  rehabilitated, altered or improved by the corporation or
by any subsidiary thereof.  The foregoing provisions shall not  preclude
any municipality from exercising the right of inspection for the purpose
of  requiring compliance by any such project with local requirements for
operation and maintenance, affecting the health, safety and  welfare  of
the  occupants thereof, provided, however, that such compliance does not
require changes, modifications or additions to the original construction
of such project.
(4) Each municipality or  political  subdivision,  including  but  not
limited  to  a  county,  city,  town,  village or district, in which any
project of the corporation or of  any  subsidiary  thereof  is  located,
shall  provide  for such project, whether then owned by the corporation,
any subsidiary thereof or any successor  in  interest  thereto,  police,
fire,  sanitation, health protection and other municipal services of the
same character and to the  same  extent  as  those  provided  for  other
residents of such municipality or political subdivision.
§  9.  Subsidiaries;  how  created. (1) The corporation shall have the
right to exercise and perform its powers and functions  through  one  or
more  subsidiary  corporations. The corporation by resolution may direct
any of its directors, officers or employees  to  organize  a  subsidiary
corporation  pursuant  to  either  the  business  corporation  law,  the
not-for-profit corporation law or articles two, four, five or eleven  of
the  private  housing  finance  law. Such resolution shall prescribe the
purposes for which such subsidiary corporation is to be formed.
Such corporation shall be deemed a subsidiary corporation whenever and
so long as (a) more than half of any voting shares  of  such  subsidiary
are owned or held by the corporation or (b) a majority of the directors,
trustees or members of such subsidiary are designees of the corporation.
(2) In the case of a subsidiary incorporated pursuant to provisions of
articles  two,  four, five or eleven of the private housing finance law,
the corporation shall cause the certificate  of  incorporation  of  such
subsidiary  to  state  that such subsidiary corporation shall have seven
directors,  of  whom  four  shall  be  officers  or  employees  of   the
corporation  and  of  whom  three shall be persons from the community in
which the project to be undertaken by such subsidiary corporation is  to
be  located;  the  latter  three  directors  shall  be  appointed by the
directors of the  corporation  upon  recommendation  of  the  membership
council.
(3)  The  corporation  may  transfer to any subsidiary corporation any
moneys, real or personal or mixed property or any project  in  order  to
carry  out  the  purposes  of this act. Each such subsidiary corporation
shall  have  all  the  privileges,  immunities  and  exemptions  of  the
corporation to the extent the same are not inconsistent with the statute
or statutes pursuant to which such subsidiary was incorporated.
§  10. Acquisition of real property. (1) Real property may be acquired
by the corporation or by a subsidiary, or  by  a  municipality  for  the
corporation   or   a  subsidiary,  by  gift,  grant,  devise,  purchase,
condemnation or otherwise.
(2) The corporation or a subsidiary, electing to acquire real property
through  acquisition,  may  petition  the  municipality   to   institute

proceedings  pursuant  to the provisions of the eminent domain procedure
law, to acquire property described in the petition for  a  project.  The
resolution  granting  the petition shall set forth the amount to be paid
by  the  corporation or subsidiary to the municipality for such property
or, in lieu thereof, that the corporation or subsidiary shall pay to the
municipality all sums  expended  or  required  to  be  expended  by  the
municipality  in  the  acquisition  thereof, and the time of payment and
manner  of  securing  payment  thereof,  and  may   require   that   the
municipality  shall  receive,  before proceeding with the acquisition of
such property, such assurances as to payment  or  reimbursement  by  the
corporation  or  subsidiary  or  otherwise  as the municipality may deem
advisable. Upon the passage of a resolution by the local governing  body
of the municipality granting the petition, the corporation or subsidiary
shall  cause  two copies of surveys or maps of the property described in
the petition to be made, one of which shall be filed in  the  office  of
the  corporation  or  subsidiary,  one  in the office of the corporation
counsel or chief law officer of the municipality.  The  filing  of  such
copies of surveys or maps shall be conclusive evidence of the acceptance
by  the  corporation  or  subsidiary of the terms and conditions of such
resolution. When  title  to  the  property  shall  have  vested  in  the
municipality,  it shall convey the same to the corporation or subsidiary
upon payment by the corporation or subsidiary of the sums or the  giving
of  the  security  required  by the resolution granting the petition. As
soon as title shall have vested in the municipality, the corporation  or
subsidiary  may,  upon the authorization of the chief executive officer,
enter upon the  property  taken,  take  over  and  dispose  of  existing
improvements,  and  carry  out  the  terms  of  the project with respect
thereto. Whenever in connection with such  proceedings,  requirement  is
made in any applicable general, special or local law for the performance
of  an  act  by a department or officer of the municipality, it shall be
regarded for the purposes of this section  as  compliance  therewith  if
with  the  approval of the chief executive officer such act is performed
by the corporation or subsidiary or by persons specially  designated  by
it.
(3)  In any proceedings for the assessment of compensation and damages
for property taken or  to  be  taken  by  condemnation  by  or  for  the
corporation or subsidiary, the following provisions shall be applicable:
(a)  Evidence  of  the price and other terms upon any sale or the rent
received or reserved, whichever  is  less,  and  other  terms  upon  any
option,  lease or tenancy relating to any of the property taken or to be
taken or to any similar property in the vicinity when the  option,  sale
or lease was given, occurred or the tenancy existed, within a reasonable
time  of  the  trial,  shall be admissible on direct examination. At any
stage of the proceedings, the court or tribunal may require  such  prior
notice to be given of an intention to introduce evidence as to the sale,
option,  leasing or tenancy of property other than the property directly
involved in the proceeding and of particulars relating thereto as it may
deem necessary to prevent surprise.
(b) The deposition of any person, whether or not a party, may be taken
in the manner provided by article thirty-one of the civil  practice  law
and  rules,  and  the provisions of this section. Such deposition may be
taken upon any question or issue in the proceeding, including the  facts
as to any sale, option, lease or tenancy admissible in evidence pursuant
to  this subdivision. The deposition may be taken at the instance of the
corporation or subsidiary, the municipality or of any owner  or  at  the
direction of the court, at any time during the pendency of the action or
proceeding.  At  least five days' notice shall be given of the taking of
the testimony, if on the  part  of  an  owner,  to  the  corporation  or

subsidiary  and to all other owners who have appeared in the proceeding;
if by the corporation or subsidiary or a municipality, to all owners who
have appeared in the proceeding.
(c)  Any  time  during  pendency  of  such  action  or proceedings the
corporation or subsidiary, municipality or an owner  may  apply  to  the
court  for  an order directing an owner or the corporation or subsidiary
or the municipality as the case  may  be,  to  show  cause  why  further
proceedings  should  not  be  expedited,  and  the  court  may upon such
application make an order requiring that hearings proceed and  that  any
other steps be taken with all possible expedition.
(d)  For the purposes of this act, the award of compensation shall not
be increased by reason of any increase in  the  value  of  the  property
caused  by  the  clearance,  reconstruction  or  proposed  clearance  or
reconstruction of the property or of the area in which the  property  is
situated.  No allowance shall be made for improvements begun on property
after notice to the owner of such property of  the  institution  of  the
proceedings to condemn such property.
(e)  Evidence  shall be admissible bearing upon the insanitary, unsafe
or substandard condition of the premises, or the illegal use thereof, or
the enhancement of rentals from such illegal use, and such evidence  may
be  considered  in  fixing  the compensation to be paid, notwithstanding
that no steps to remedy or abate such conditions have been taken by  the
department  or  officers having jurisdiction. If a violation order is on
file against the premises in any such department,  it  shall  constitute
prima facie evidence of the existence of the condition specified in such
order.
(f) If any of the property included within the project is devoted to a
public  use,  it  may nevertheless be acquired provided that no property
belonging to the municipality or  to  any  government  may  be  acquired
without  its  consent,  and  no  property  belonging to a public utility
corporation may be acquired without the approval of  the  commission  or
other officer or tribunal having regulatory power over such corporation.
(g)  Upon the trial, evidence of the price and other terms upon a sale
or assignment or of a contract for the sale or assignment of a mortgage,
award, proposed award, transfer of a tax lien  or  lien  of  a  judgment
relating  to  property taken, shall be relevant, material and competent,
upon the issue of value or damage and  shall  be  admissible  on  direct
examination.
(h)  Upon  the  trial  a  statement,  affidavit,  deposition,  report,
transcript of testimony in an action or proceeding, or appraisal made or
given by any owner or prior owner of  the  premises  taken,  or  by  any
person  on  his behalf, to any court, governmental bureau, department or
agency respecting the value of the property for tax purposes,  shall  be
relevant,  material  and competent upon the issue of value or damage and
shall be admissible on direct examination.
(4) A municipality may take private property for  the  corporation  or
subsidiary  for  the  purposes provided by this act and for recreational
and other facilities incidental or appurtenant thereto, but in excess of
that required for public use after such purposes have been accomplished.
A municipality or the corporation or subsidiary may improve and  utilize
such  excess  property  or  may  leave or sell such excess property with
restrictions  to  preserve  and  protect  the   project   or   projects.
Proceedings  to  acquire  such  excess  property  may  be brought by the
municipality for the corporation or subsidiary in the same manner as for
real property required for the  project  and  may  be  included  in  the
proceedings  for  the  acquisition  of  real  property  required for the
project.
(5) (a) The local governing body of a municipality, by resolution, may
determine  that  real  property  of  the  municipality,  specified   and
described in such resolution is not required for use by the municipality
and  may  authorize the municipality to sell or lease such real property
to the corporation or subsidiary.
(b)  Notwithstanding  the  provisions of any general, special or local
law or ordinance, such sale or lease  may  be  made  without  appraisal,
public  notice  or public bidding for such price or rental and upon such
terms (and, in case of a lease, for such term not exceeding fifty  years
with  a right to one renewal term of thirty years) as may be agreed upon
between the municipality and the corporation or subsidiary.
(c) Before any sale or lease to the corporation or subsidiary shall be
authorized, a public hearing shall be held by the local  governing  body
to consider the proposed sale or lease.
(d) Notice of such hearing shall be published at least ten days before
the  date  set for the hearing in such publication and in such manner as
may be designated by the local governing body.
(e) The deed or lease of such property shall be executed in  the  same
manner  as  a  deed or lease by the municipality for other real property
and shall contain appropriate conditions and provisions  to  enable  the
municipality to re-enter the property in the event of a violation by the
corporation  or subsidiary of any of the provisions of this act relating
to the corporation or subsidiary or of the conditions or  provisions  of
such deed or lease.
(f)  The  corporation  or subsidiary purchasing or leasing land from a
municipality  shall  not,  without   the   written   approval   of   the
municipality,  use such land for any purpose except in connection with a
project approved under this act. The deed shall contain a condition that
the corporation or subsidiary will devote the land granted only for  the
purposes  of  a  project,  subject  to  the restrictions of this act for
breach of which the municipality shall have the right  to  re-enter  and
repossess itself of the land.
§ 11. Acquisition of real property acquired by a municipality or urban
renewal  agency.  Notwithstanding  anything to the contrary contained in
article fifteen or article fifteen-a of the general municipal law or  in
any  general,  special  or  local  law  applicable  to  the sale of real
property by a municipality or an urban renewal agency, a municipality or
an urban renewal agency may, in addition to employing any  other  lawful
method  of utilizing or disposing of any real property and appurtenances
thereto or any interest therein owned  by  such  municipality  or  urban
renewal  agency or acquired by such municipality or urban renewal agency
pursuant  to  article  fifteen  or  article  fifteen-a  of  the  general
municipal  law,  sell, lease for a term not exceeding ninety-nine years,
or otherwise dispose of any such real property and appurtenances thereto
or any interest therein to the corporation for the effectuation  of  any
of  the purposes of an urban renewal program, without public auction, or
sealed bids or public notice.
§ 12. Designation and service of process on  secretary  of  state  and
registered  agent.  The directors of the corporation shall file with the
secretary of state a certificate setting forth the  street  address  and
the  city and county in which the principal office of the corporation is
located within ten  days  of  the  establishment  of  such  office.  The
secretary  of  state  shall  note  such  address  upon  his records. The
provisions of sections three hundred four, three hundred five and  three
hundred  six  of the business corporation law shall be applicable to the
corporation.
§ 13. Limitation of liability. Neither the directors nor  any  member,
officer or employee of the corporation, while acting within the scope of

his authority, shall be subject to any personal liability resulting from
the activities of the corporation.
§  14.  Bonds  and  notes  of  the  corporation.  (1)  Subject  to the
provisions of subdivision (2)  of  section  sixteen  of  this  act,  the
corporation  shall  have the power and is hereby authorized from time to
time to issue its negotiable bonds and notes in such principal  amounts,
as,  in  the  opinion  of the corporation, shall be necessary to provide
sufficient funds for achieving any of its corporate purposes,  including
the  payment  of  interest  on  bonds  and  notes  of  the  corporation,
establishment of reserves to secure such bonds and notes, and all  other
expenditures  of the corporation incident to and necessary or convenient
to carry out its corporate purposes and powers.
(2) All bonds and notes issued by the  corporation  shall  be  general
obligations  of the corporation payable out of any revenues or monies of
the  agency,  subject  only  to  any  agreements  with  the  holders  of
particular  notes or bonds pledging any particular revenues or receipts,
except as may otherwise be expressly provided by the  corporation.  Such
bonds  and notes may be executed and delivered by the corporation at any
time and from time to time, may be in such form and denominations and of
such tenor and maturities, may be in bearer form or in registered  form,
as  to  principal  and  interest  or  as  to principal alone, all as the
corporation may determine.
(3) Bonds may be payable in such installments  and  at  such  time  or
times  as  shall  be  determined by the corporation, not exceeding fifty
years from the date thereof.
(4)  Notes,  or  any  renewals  thereof,  may  be  payable   in   such
installments  and  at  such  time or times as shall be determined by the
corporation, not exceeding ten years from the date of the original issue
of such notes.
(5) Bonds and notes may be payable at such  place  or  places  whether
within  or  without  the  state, may bear interest at such rate or rates
payable at such time or times and at such place or places and  evidenced
in  such  manner,  and  may  contain  such  provisions  not inconsistent
herewith, all as shall be provided in the proceedings of the corporation
under which the bonds or notes shall be authorized to be issued.
(6) If deemed advisable by the corporation, there may be  retained  in
the  proceedings  under  which any bonds or notes of the corporation are
authorized to be issued an option to redeem all or any part  thereof  as
may  be  specified in such proceedings at such price or prices and after
such notice or notices and on such terms and conditions as  may  be  set
forth  in  such  proceedings,  and  as may be recited on the face of the
bonds or notes, but nothing  herein  contained  shall  be  construed  to
confer  on  the  corporation  any right or option to redeem any bonds or
notes except as may be provided in  the  proceedings  under  which  they
shall be issued.
(7) Any bonds or notes of the corporation may be sold at such price or
prices,  at public or private sale, in such manner and from time to time
as may be determined by the corporation, and the corporation may pay all
expenses, premiums and  commissions  which  it  may  deem  necessary  or
advantageous  in connection with the issuance and sale thereof. No bonds
or notes of the corporation may be sold at private sale, however, unless
such sale and the terms thereof have been approved in writing by (a) the
comptroller where such sale is not to the comptroller or (b)  the  state
director of the budget, where such sale is to the comptroller.
(8) Any moneys of the corporation, including proceeds from the sale or
any  bonds  or  notes, and revenues, receipts and income from any of its
projects  or  mortgages,  may  be  invested  and  reinvested   in   such
obligations,  securities  and  other investments as shall be provided in

the resolution or resolutions  under  which  such  bonds  or  notes  are
authorized.
(9) The resolution under which the bonds or notes are authorized to be
issued shall contain provisions that
(a) title to any industrial project for the acquisition, construction,
reconstruction,  rehabilitation  or  improvement of which bonds or notes
are authorized to be issued shall pass to the state upon  retirement  of
such indebtedness, and
(b) the state shall have the option to purchase, subject to the rights
of  any  lessee,  mortgagee  or  beneficiary  of  any deed of trust, any
industrial project for the  acquisition,  construction,  reconstruction,
rehabilitation  or improvement of which bonds or notes are authorized to
be issued at any time for an  amount  equal  to  the  indebtedness  then
outstanding,  together  with  the interest thereon, with interest on any
unpaid installments of interest. In the event of any such  sale  to  the
state, the corporations shall either
(i) redeem the bonds or notes which were issued to acquire, construct,
reconstruct,  rehabilitate or improve the industrial project so sold the
state, or
(ii) create a special reserve fund for the payment of the principal of
and interest on such bonds or notes and pay into such reserve  fund  the
receipts  derived  from such sale. The funds paid into such reserve fund
may be invested and reinvested in obligations of or  guaranteed  by  the
United States of America, or in certificates of deposit or time deposits
secured  in  such manner as the corporation shall determine, maturing at
such time or times as shall be appropriate to assure the prompt  payment
of  the  principal  of  and  interest on such bonds or notes. Any moneys
received by the corporation from the sale of such project to  the  state
after  the  redemption  of  such  bonds or notes or the creation of such
reserve fund may be used by the corporation in any lawful manner.
(10) Issuance by the corporation of one or more  series  of  bonds  or
notes  for one or more purposes shall not preclude it from issuing other
bonds or notes in connection with the same project or any other project,
but the proceedings whereunder any subsequent  bonds  or  notes  may  be
issued shall recognize and protect any prior pledge or mortgage made for
any  prior issue of bonds or notes unless in the proceedings authorizing
such prior issue the right is reserved  to  issue  subsequent  bonds  or
notes on a parity with such prior issue.
(11)  The corporation is authorized to provide for the issuance of its
bonds or notes for the purpose of refunding any bonds or  notes  of  the
corporation  then  outstanding,  including the payment of any redemption
premium thereon and any interest accrued or to accrue to the earliest or
subsequent date of redemption, purchase or maturity  of  such  bonds  or
notes,  and,  if deemed advisable by the corporation, for the additional
purpose  of  paying  all  or  any  part  of  the  cost   of   acquiring,
constructing,  reconstructing, rehabilitating, or improving any project,
or the making of any mortgage loan on any project. The proceeds  of  any
such  bonds  or  notes  issued  for the purpose of refunding outstanding
bonds or notes, may, in the discretion of the corporation, be applied to
the purchase or retirement at maturity or redemption of such outstanding
bonds or notes either on their earliest  or  any  subsequent  redemption
date,  and  may,  pending  such  application,  be placed in escrow to be
applied to such purchase or retirement at maturity or redemption on such
date as  may  be  determined  by  the  corporation.  Any  such  escrowed
proceeds,   pending   such  use,  may  be  invested  and  reinvested  in
obligations of or guaranteed by the United  States  of  America,  or  in
certificates  of  deposit or time deposits secured in such manner as the
corporation shall determine, maturing at such time or times as shall  be

appropriate  to assure the prompt payment, as to principal, interest and
redemption premium, if any, on the outstanding bonds or notes to  be  so
refunded.  The  interest, income and profits, if any, earned or realized
on  any  such  investment  may  also  be  applied  to the payment of the
outstanding bonds or notes to be so refunded. After  the  terms  of  the
escrow  have  been  fully satisfied and carried out, any balance of such
proceeds and interest, income and profits, if any, earned or realized on
the investments thereof may be returned to the corporation for use by it
in any lawful manner. The portion of the proceeds of any such  bonds  or
notes issued for the additional purpose of paying all or any part of the
cost  of  acquiring,  constructing,  reconstructing,  rehabilitating, or
improving any project, or  the  making  of  any  mortgage  loan  on  any
project,  may be invested and reinvested in obligations of or guaranteed
by the United States of America, maturing not later  than  the  time  or
times when such proceeds will be needed for the purpose of paying all or
any  part  of  such  cost  or  the making of any such mortgage loan. The
interest, income and  profits,  if  any,  earned  or  realized  on  such
investments  may  be  applied  to the payment of all or any part of such
cost or the making of any such mortgage loan  or  may  be  used  by  the
corporation  in  any  lawful  manner.  All  such bonds or notes shall be
issued and secured and shall be subject to the provisions of this act in
the same manner and to the same extent  as  any  other  bonds  or  notes
issued pursuant to this act.
(12) All bonds or notes authorized under this section and the interest
coupons  applicable thereto are hereby made and shall be construed to be
negotiable instruments.
§ 15. Security for bonds or notes;  construction  and  acquisition  of
projects. (1) The principal of and interest on any bonds or notes issued
by  corporation  may be secured by a pledge of any revenues and receipts
of the corporation and may be secured by a mortgage or other  instrument
covering  all  or  any  part  of  a  project,  including  any additions,
improvements, extensions to or enlargements of any  projects  thereafter
made.
(2)   Bonds   or  notes  issued  for  the  acquisition,  construction,
reconstruction, rehabilitation, or improvement of a project may also  be
secured by an assignment of any lease of or mortgage on such project and
by an assignment of the revenues and receipts derived by the corporation
from any such lease or mortgage.
(3) The resolution under which the bonds or notes are authorized to be
issued  and  any  such  mortgage,  lease or other instrument may contain
agreements and provisions respecting the  maintenance  of  the  projects
covered  thereby,  the  fixing and collection of rents or other revenues
therefrom, including monies received in repayment of mortgage loans, and
interest thereon, the creation and maintenance  of  special  funds  from
such  rents  or  other revenues and the rights and remedies available in
the event of default, all as the corporation shall deem advisable.
(4) Each pledge, agreement, mortgage or other instrument made for  the
benefit  or  security  of  any  of the bonds or notes of the corporation
shall continue effective until the principal  of  and  interest  on  the
bonds  or  notes  for the benefit of which the same were made shall have
been fully paid, or until  provision  shall  have  been  made  for  such
payment  in  the  manner provided in the resolution or resolutions under
which the same may be authorized.
(5) The corporation may provide that any proceedings under which bonds
or notes may be authorized that any  project  or  part  thereof  may  be
constructed,   reconstructed,   rehabilitated   or   improved   by   the
corporation, any subsibidiary or any  lessee  or  any  designee  of  the
corporation  and  may  also provide in such proceedings for the time and

manner of and requisites for disbursements to be made for  the  cost  of
such  construction,  and  for  all  such  certificates  and approvals of
construction and disbursements as the corporation shall  deem  necessary
and provide for in such proceedings.
§  16. Reserve funds. (1) The corporation may create and establish one
or more reserve funds to be known as debt service reserve funds and  may
pay  into such reserve funds (a) any proceeds of sale of bonds and notes
to the extent provided in the resolution of the corporation  authorizing
the  issuance  thereof,  and  (b)  any  other  moneys  which may be made
available to the corporation for the purposes of  such  funds  from  any
other  source  or  sources.  The  moneys held in or credited to any debt
service reserve fund  established  under  this  subdivision,  except  as
hereinafter  provided,  shall  be  used  solely  for  the payment of the
principal of bonds of the corporation secured by such reserve  fund,  as
the  same  mature,  the  purchase  of such bonds of the corporation, the
payment of interest on such bonds of the corporation or the  payment  of
any  redemption premium required to be paid when such bonds are redeemed
prior to maturity; provided, however, that moneys in any such fund shall
not be withdrawn therefrom at any time in such amount  as  would  reduce
the amount of such fund to less than the maximum amount of principal and
interest  maturing  and  becoming due in any succeeding calendar year on
the bonds of the  corporation  then  outstanding  and  secured  by  such
reserve fund, except for the purpose of paying principal and interest on
the  bonds  of the corporation secured by such reserve fund maturing and
becoming  due  and  for  the  payment  of  which  other  moneys  of  the
corporation  are  not  available.  Any  income or interest earned by, or
increment to, any such debt service reserve fund due to  the  investment
thereof  may  be  transferred  to  any  other  fund  or  account  of the
corporation to the extent it does not reduce the  amount  of  such  debt
service  reserve fund below the maximum amount of principal and interest
maturing and becoming due in any succeeding calendar year on  all  bonds
of the corporation then outstanding and secured by such reserve fund.
(2)  The  corporation shall not issue bonds at any time if the maximum
amount of  principal  and  interest  maturing  and  becoming  due  in  a
succeeding  calendar year on the bonds outstanding and then to be issued
and secured by a debt service reserve fund will  exceed  the  amount  of
such  reserve  fund  at the time of issuance, unless the corporation, at
the time of issuance of such bonds, shall deposit in such  reserve  fund
from  the proceeds of the bonds so to be issued, or otherwise, an amount
which together with the amount then in such reserve fund,  will  be  not
less  than  the  maximum  amount  of principal and interest maturing and
becoming due in any succeeding calendar year on the  bonds  then  to  be
issued  and  on  all other bonds of the corporation then outstanding and
secured by such reserve fund.
(3) In computing any debt service reserve fund  for  the  purposes  of
this  section, securities in which all or a portion of such reserve fund
shall be invested shall be valued at the lower of cost or market value.
(4) With respect to  any  project,  the  corporation  may  create  and
establish  a  special  fund  to be known as the project reserve fund and
deposit therein (a) such amount as may be determined by the  corporation
in  connection with any lease by the corporation to others to be charged
to such lessee for deposit in such fund, and (b) any other moneys  which
may  be  made  available to the corporation for the purpose of such fund
from any other source or sources. All moneys held in or credited to  any
project  reserve  fund  shall  be  first  used  for  the  payment of the
principal of and interest on the  bonds  or  notes  of  the  corporation
issued for the project secured by such project reserve fund in the event
that other moneys of the corporation, other than moneys held in the debt

service fund, are not available for such purpose. Upon the retirement of
the  bonds or notes of the corporation issued for the project secured by
such project reserve fund, moneys so held in such fund may  be  used  by
the corporation for any lawful purpose.
§  17.  Trust  funds. All moneys received pursuant to the authority of
this act, whether as proceeds from the sale of  bonds  or  notes  or  as
revenues,  receipts  or  income, shall be deemed to be trust funds to be
held and applied solely as provided in the proceedings under which  such
bonds  or  notes  are  authorized.  Any officer with whom or any bank or
trust company with which, such moneys  shall  be  deposited  as  trustee
thereof  shall hold and apply the same for the purposes thereof, subject
to such provisions as this act and the proceedings authorizing the bonds
or notes of any issue or the trust  agreement  securing  such  bonds  or
notes may provide.
§  18. Bonds and notes as legal investment. The bonds and notes of the
corporation are hereby made securities in which all public officers  and
bodies  of this state and all municipalities and municipal subdivisions,
all insurance companies and associations, and other persons carrying  on
an  insurance  business,  all  banks,  bankers, trust companies, savings
banks and savings associations, including savings and loan associations,
building and loan associations, investment companies and  other  persons
carrying   on   a   banking  business,  all  administrators,  guardians,
executors,  trustees  and  other  fiduciaries,  and  all  other  persons
whatsoever who are now or may hereafter be authorized to invest in bonds
or  other  obligations  of  the  state,  may properly and legally invest
funds, including capital, in their control or belonging to them.
§ 19. Agreement of the state. The state  does  hereby  pledge  to  and
agree  with the holders of any bonds or notes issued under this act that
the state will not limit or  alter  the  rights  hereby  vested  in  the
corporation to fulfill the terms of any agreements made with the holders
thereof,  or  in  any way impair the rights and remedies of such holders
until such bonds or notes, together  with  the  interest  thereon,  with
interest  on  any  unpaid  installments  of  interest, and all costs and
expenses in connection with any action or proceeding by or on behalf  of
such   holders,  are  fully  met  and  discharged.  The  corporation  is
authorized to include this pledge and agreement  of  the  state  in  any
agreement with the holders of such bonds or notes.
§  20.  Remedies of bondholders and noteholders. (1) In the event that
the corporation shall default in the payment of principal of or interest
on any issue of bonds or notes after the same shall become due,  whether
at maturity or upon call for redemption, and such default shall continue
for  a period of thirty days, or in the event that the corporation shall
fail or refuse to comply with  the  provision  of  this  act,  or  shall
default  in any agreement made with the holders of any issue of bonds or
notes, the holders of twenty-five  per  centum  in  aggregate  principal
amount  of  the  notes  or  bonds  of  such  issue  then outstanding, by
instrument or instruments filed in the office of the clerk of the county
of Albany and approved or acknowledged in the same manner as a  deed  to
be  recorded,  may  appoint  a  trustee to represent the holders of such
bonds or notes, for the purposes herein provided.
(2) Such trustee may, and upon  written  request  of  the  holders  of
twenty-five  per  centum in principal amount of such bonds or notes then
outstanding shall, in his or its own name:
(a) by suit,  action  or  proceeding  in  accordance  with  the  civil
practice  law  and  rules,  enforce  all  rights  of  the bondholders or
noteholders,  to  require  the  corporation  to  carry  out  any   other
agreements  with  the  holders of such bonds or notes and to perform its
duties under this act;
(b) bring suit upon such bonds or notes;
(c)  by  action  or  suit, require the corporation to account as if it
were the trustee of an express trust for the holders of  such  bonds  or
notes;
(d) by action or suit, enjoin any acts or things which may be unlawful
or in violation of the rights of the holders of such bonds or notes;
(e)  declare  all  such  bonds  or  notes  due and payable, and if all
defaults shall be made good, then, with the consent of  the  holders  of
twenty-five  per  centum  of the principal amount of such bonds or notes
then outstanding, to annul such declaration and its consequences.
(3) Such trustee shall in addition to the foregoing have  and  possess
all  of  the  powers  necessary  or  appropriate for the exercise of any
functions specifically set forth  herein  or  incident  to  the  general
representation  of  bondholders  or  noteholders  in the enforcement and
protection of their rights.
(4) The supreme court shall have jurisdiction of any suit,  action  or
proceeding  by the trustee on behalf of such bondholders or noteholders.
The venue of any such suit, action or proceeding shall be  laid  in  the
county of Albany.
§  21. Monies of the corporation. (1) The corporation shall have power
to contract with the holders of any of its bonds or  notes,  as  to  the
custody,  collection, securing, investment, and payment of any monies of
the corporation, of any monies  held  in  trust  or  otherwise  for  the
payment  of  bonds or notes, and to carry out such contract. Monies held
in trust or otherwise for the payment of bonds and notes or in  any  way
to  secure  bonds or notes and deposits of such monies may be secured by
obligations of the United States or the state of a market value equal at
all times to the amount of the deposit and all banks and trust companies
are authorized to give such security for such deposits.
(2) Subject  to  agreements  with  bondholders  and  noteholders,  the
corporation shall prescribe a system of accounts.
(3)  The  comptroller,  or  his  legally authorized representative, is
hereby authorized and empowered from time to time to examine  the  books
and  accounts  of the corporation including its receipts, disbursements,
contracts, reserve funds, sinking  funds,  investments,  and  any  other
matters relating to its financial standing.
(4)  The  corporation  shall  submit  to the governor, chairman of the
senate finance committee,  chairman  of  the  assembly  ways  and  means
committee and the comptroller,
(a)  within  thirty  days of the receipt thereof by the corporation, a
copy of the report of  every  external  examination  of  the  books  and
accounts  of  the  corporation  other than copies of the reports of such
examinations made by the comptroller;
(b) within ninety days after the end of its fiscal  year,  a  complete
and   detailed   report   setting   forth:   (1)   its   operations  and
accomplishments; (2) its receipts and expenditures  during  such  fiscal
year in accordance with the categories or classifications established by
the corporation for its operating and capital outlay purposes, including
a  listing  of  all  private consultants engaged by the corporation on a
contract basis and a statement of the total amount  paid  to  each  such
private  consultant;  (3)  its  assets and liabilities at the end of its
fiscal year, including a schedule of its leases  and  other  commitments
and the status of reserve, special or other funds; and (4) a schedule of
its  bonds and notes outstanding at the end of its fiscal year, together
with a statement of the amounts redeemed and incurred during such fiscal
year.
§ 22. Permissible relations. (1) Notwithstanding any  rule  at  common
law  or  any  provision  of  any  general,  special  or  local  law, the

corporation may purchase from, sell to, borrow from, loan  to,  contract
with or otherwise deal with any person, corporation, trust, association,
partnership  or other entity which is a member of the corporation and/or
in  which  any  director  of  the  corporation has a financial interest,
direct or indirect, provided that such  interest  is  disclosed  in  the
minutes  of the corporation and provided further that no director having
such a financial interest may participate in any decision affecting such
transaction.
§ 23. Inconsistent provisions of other laws superseded. Insofar as the
provisions of this act are inconsistent with the provisions of any other
law, general, special or local, the provisions  of  this  act  shall  be
controlling.
§  24.  Construction. This act, being necessary for the welfare of the
state and its  inhabitants,  shall  be  liberally  construed  so  as  to
effectuate its purposes.
§  25.  Actions  against corporation. Except in an action for wrongful
death, in any case founded upon tort a notice of claim shall be required
as a condition precedent to the commencement of  an  action  or  special
proceeding  against the corporation, any of its subsidiary corporations,
or any officer, appointee or employee thereof,  and  the  provisions  of
section  fifty-e of the general municipal law shall govern the giving of
such notice. No such action shall be commenced more than  one  year  and
ninety  days  after  the cause of action therefor shall have accrued. An
action for wrongful death shall be  commenced  in  accordance  with  the
notice  of  claim  and  time  limitation  provisions  of title eleven of
article nine of the public authorities law.
§ 26. Separability. If any clause,  sentence,  paragraph,  section  or
part   of  this  act  shall  be  adjudged  by  any  court  of  competent
jurisdiction to be invalid, such judgment shall not affect,  impair,  or
invalidate the remainder thereof, but shall be confined in its operation
to  the  clause,  sentence,  paragraph, section or part thereof directly
involved in the controversy in  which  such  judgment  shall  have  been
rendered.