2023 New York Laws › PBG - Public Housing › Article 15 - New York City Public Housing Preservation Trust › 637 - Borrowing by the Trust and for Its Benefit; Effects of Certain Defaults.

§  637. Borrowing by the trust and for its benefit; effects of certain
defaults. 1. For the purposes of this section, the term "project"  means
the  acquisition,  development,  design,  construction,  reconstruction,
improvement,  rehabilitation,  repairing  and   operation   of   housing
facilities.
2.  The  trust shall have the power and is hereby authorized from time
to time to issue bonds, notes or other obligations  in  conformity  with
applicable  provisions of the uniform commercial code, in such principal
amounts as it may determine to be necessary  to  pay  the  cost  of  any
project  and  to  fund  reserves  to  secure  such bonds, notes or other
obligations, including costs  of  issuance  and  any  administrative  or
incidental expenses in connection therewith, provided that the aggregate
principal  amount  of  such  bonds, notes or other obligations shall not
exceed ten billion dollars plus a principal amount of such bonds,  notes
or other obligations issued (a) to fund any related debt service reserve
fund,  (b)  to provide capitalized interest, and (c) to provide fees and
other charges and expenses, including underwriters' discount, related to
the  issuance  of  such  bonds,  notes  or  other  obligations  and  the
maintenance  of  such reserves. The trust shall have the power from time
to time to refund any bonds, notes or other obligations of the trust  by
the  issuance  of  new  bonds, notes or other obligations, and may issue
bonds, notes or other obligations partly to refund bonds, notes or other
obligations of the trust then outstanding and partly to pay the cost  of
any project. Bonds, notes or other obligations issued by the trust shall
be  payable  as  may  be designated in the resolution of the trust under
which the bonds, notes or other obligations shall be  authorized  to  be
issued, subject to any agreements with the holders of outstanding bonds,
notes  or  other obligations pledging any particular revenues or moneys.
No bonds, notes or other obligations of the trust or any entity referred
to in subdivision thirteen of section six hundred  twenty-nine  of  this
article  shall  be issued or incurred without the prior written approval
of the director of management and budget of the city of New York, and no
such bonds, notes or other obligations shall be issued for  the  purpose
of  refinancing any bonds, notes or other obligations of NYCHA, provided
that the proceeds of up to six hundred million  dollars  of  the  bonds,
notes  or  other  obligations  of the trust or any entity referred to in
subdivision thirteen of section six hundred twenty-nine of this  article
may  be  applied to the payment of outstanding debt incurred by NYCHA in
connection with one or more housing facilities, in  furtherance  of  the
purposes of this article, including, but not limited to, for the purpose
of payment of outstanding energy performance contract debt.
3.  The  trust  shall  be  authorized  to obtain insurance, letters of
credit and other credit or liquidity facilities related  to  its  bonds,
notes or other obligations.
4.  The  board may delegate to the chair or the president of the trust
the power to set the final terms of bonds, notes or other obligations.
5. Whenever the trust shall determine that the issuance of its  bonds,
notes  or  other  obligations  is  appropriate,  the  trust shall make a
determination as to the arrangements necessary for the issuance and sale
of such bonds, notes or other obligations, including the underwriting of
such bonds, notes or other obligations through  the  public  or  private
sale  of  such bonds, notes or other obligations, and such determination
shall include compensation for services  rendered  as  the  trust  deems
appropriate.  Such  determination  shall be set forth in a resolution of
the trust, which shall authorize issuance of such bonds, notes or  other
obligations.  The  bonds, notes or other obligations shall bear interest
at such fixed or variable rates and shall be in such  denominations,  be
in  such  form,  either  coupon or registered, be sold at such public or

private sale, be executed in  such  manner,  be  denominated  in  United
States currency, be payable in such medium of payment, at such place and
be  subject to such terms of redemption as the trust may provide in such
resolution.
6.  Any  resolution  or  resolutions authorizing bonds, notes or other
obligations or any issue  of  bonds,  notes  or  other  obligations  may
contain  provisions which may be a part of the contract with the holders
of the bonds, notes or other obligations thereby authorized as to:
(a) pledging all or part of its revenues, including, but  not  limited
to,  project-based  or tenant-based assistance pursuant to section eight
of the United States housing act of nineteen  hundred  thirty-seven,  as
amended,  or  any  successor provision, and assistance provided to NYCHA
pursuant to section nine of the United States housing  act  of  nineteen
hundred  thirty-seven,  as amended, or any successor provision, together
with any other moneys, securities or contracts, to secure the payment of
the bonds, notes or other obligations, subject to such agreements as may
then exist;
(b) the setting aside of reserves and the creation  of  sinking  funds
and the regulation and disposition thereof;
(c)  limitations on the purpose to which the proceeds from the sale of
bonds, notes or other obligations may be applied;
(d) limitations on the issuance of additional bonds,  notes  or  other
obligations,  the  terms  upon  which  additional  bonds, notes or other
obligations may be issued and secured and the refunding of bonds,  notes
or other obligations;
(e)  the  procedure,  if  any, by which the terms of any contract with
holders  of  bonds,  notes  or  other  obligations  may  be  amended  or
abrogated,  including the proportion of holders of bonds, notes or other
obligations which are needed to consent thereto and the manner in  which
such consent may be given;
(f)  vesting  in  a  bond trustee or trustees such properties, rights,
powers and duties in trust as the trust may determine; and
(g) defining the acts or  omissions  to  act  that  may  constitute  a
default  in  the  obligations  and duties of the trust to the holders of
bonds, notes or other obligations  and  providing  for  the  rights  and
remedies  of  the  holders  of  bonds, notes or other obligations in the
event of such default, including as a matter of right the appointment of
a receiver, provided, however, that such rights and remedies  shall  not
be  inconsistent with the general laws of the state and other provisions
of this article.
7. In addition to the powers herein conferred upon the trust to secure
its bonds, notes or other obligations, the trust  shall  have  power  in
connection  with  the  issuance  of bonds, notes or other obligations to
enter into such agreements for the benefit  of  the  holders  of  bonds,
notes  or  other obligations as the trust may deem necessary, convenient
or desirable concerning the use or disposition of its revenues or  other
moneys,  including  the  entrusting,  pledging  or creation of any other
security interest in any such revenues, moneys and the doing of any act,
including refraining from doing any act, which the trust would have  the
right  to  do  in  the  absence of such agreements. The trust shall have
power to enter into amendments of any such agreements within the  powers
granted to the trust by this article and to perform such agreements. The
provisions  of  any  such  agreements may be made a part of the contract
with the holders of bonds, notes or other obligations of the trust.
8. Notwithstanding any provision of the uniform commercial code to the
contrary, any pledge of or other security interest in revenues,  moneys,
accounts, contract rights, general intangible or other personal property
made  or created by the trust shall be valid, binding and perfected from

the time when such pledge is made or other  security  interest  attaches
without  any physical delivery of the collateral or further act, and the
lien of any such pledge or  other  security  interest  shall  be  valid,
binding  and  perfected against all parties having claims of any kind in
tort, contract or otherwise against the trust irrespective of whether or
not such parties have notice thereof. No  instrument  by  which  such  a
pledge  or security interest is created nor any financing statement need
be recorded or filed.
9. Whether or not the bonds, notes or other obligations of  the  trust
are of such form and character as to be negotiable instruments under the
terms  of  the  uniform  commercial  code,  the  bonds,  notes  or other
obligations are hereby made negotiable instruments within the meaning of
and for all the purposes of the uniform commercial code, subject only to
the  provisions  of  the  bonds,  notes   or   other   obligations   for
registration.
10.  Neither  the  members of the board nor any person executing bonds
shall be liable  personally  thereon  or  be  subject  to  any  personal
liability  or  accountability  solely by reason of the issuance thereof.
The bonds, notes or other obligations of the trust shall not be  a  debt
of  NYCHA,  the  city, or the state, and neither NYCHA, the city nor the
state shall be liable thereon, nor shall they  be  payable  out  of  any
funds  other  than  those  of  the trust, and such bonds, notes or other
obligations shall contain on  the  face  thereof  a  statement  to  such
effect.
11. The trust, subject to such agreements with bondholders as then may
exist, shall have power to purchase bonds, notes or other obligations of
the trust out of any moneys available therefor, which shall thereupon be
cancelled.
12.  Notwithstanding  any  provision  of article twelve of the private
housing finance law, section  twenty-nine  hundred  seventy-six  of  the
public authorities law or any other general, special or local law to the
contrary,  (a)  the  purposes  of  the New York city housing development
corporation and its powers granted in  article  twelve  of  the  private
housing finance law also shall include, subject to the provisions of any
contract  with  holders  of  its  bonds, notes or other obligations, the
making of loans to the trust and entities  referred  to  in  subdivision
thirteen  of  section  six  hundred twenty-nine of this article, and (b)
bonds,  notes  or  other  obligations  of  the  New  York  city  housing
development  corporation  issued for, or to refund bonds, notes or other
obligations issued for, such purpose or the purposes of paying costs  of
issuance  thereof  or  funding  reserves  to secure such bonds, notes or
other obligations (i) may be sold without any consultation  or  approval
otherwise  required by subdivision two of section six hundred fifty-five
of the private housing finance law, (ii) shall not be  included  in  any
calculation  of  outstanding  bonds,  notes  or  other  obligations  for
purposes of section six hundred fifty-six of the private housing finance
law and shall not be secured by any  capital  reserve  fund  established
pursuant  thereto, and (iii) shall not be included in any calculation of
bonds, notes or other obligations issued by the New  York  city  housing
development  corporation  for  purposes  of  section twenty-nine hundred
seventy-six of the public authorities law.
13. In the  event  that  any  default  on  any  bond,  note  or  other
obligation  that  is secured by an assignment of, mortgage on, pledge of
or other encumbrance on  any  interest  of  the  trust,  or  any  entity
referred  to  in subdivision thirteen of section six hundred twenty-nine
of this  article,  in  any  housing  facilities,  has  occurred  and  is
continuing  beyond  the  applicable cure period, if any, provided to the
trust or  such  entity  in  the  instrument  granting  such  assignment,

mortgage,  pledge or other encumbrance, notwithstanding any provision in
such instrument, any right of the  beneficiary  of  such  instrument  to
obtain  such interest in such housing facilities as a remedy to any such
default  shall,  for  a  period ending thirty days after the end of such
cure period, be subject to:
(a) the right of the city of New  York  to  remedy,  or  cause  to  be
remedied, such default; and
(b)  the  right  of  the  state  of New York to remedy, or cause to be
remedied,  such  default;  provided,  however,  that  nothing  in   this
subdivision  shall  be construed to impose any obligation on the city of
New York or on the state of New York to remedy, or cause to be remedied,
such default.
14. Notwithstanding any default  on  any  obligation  referred  to  in
subdivision  thirteen  of  this section, and any remedies exercised as a
result of such default, provisions relating to the restricted use of the
housing facilities for  the  provision  and  operation  of  housing  for
low-income families and current residents shall at all times continue to
be  in  effect  in  perpetuity,  and the housing facilities shall remain
subject to the provisions of subdivision four  of  section  six  hundred
thirty  of  this  article  and  section  six  hundred thirty-one of this
article. The trust shall not pledge the fee  ownership  of  the  housing
facilities as part of a financing arrangement.
15.  At  least quarterly, the trust shall provide financial reports to
the director of management and budget of the city of New York containing
such information as the director of management and budget of the city of
New York may request.