2023 New York Laws › EDN - Education › Title 1 - General Provisions › Article 10 - New York City Educational Construction Fund › 460 - Lease and Other Agreements.

§ 460. Lease  and  other  agreements.  1.  Any  agreement entered into
between the fund and the owner  or  developer  of  a  proposed  combined
occupancy  structure pursuant to section four hundred fifty-four of this
chapter  shall  provide   for   (i)   the   construction,   acquisition,
reconstruction,  rehabilitation  or  improvement of one or more combined
occupancy structures, and the purchase or acquisition  of  the  original
furnishings, equipment, machinery and apparatus to be used in the school
portion  of  a combined occupancy structure upon completion of the work,
(ii) the reconveyance, retransfer or  leasing  of  all  or  any  portion
thereof  and  of  the real property or interest therein related thereto,
including real property originally acquired by the board of education in
the name of the city of New York, upon the completion  of  construction,
acquisition,  reconstruction,  rehabilitation  or  improvement upon such
terms and conditions as may be agreed  upon  in  those  instances  where
there  has been a prior conveyance, transfer or lease by the Fund to the
owner or developer, (iii) the leasing or  subleasing  of  such  combined
occupancy  structures  and  property,  or  separately  of the school and
non-school portions thereof, by the fund upon completion for a term  not
exceeding ninety-nine years and upon such terms and conditions including
annual  rental  as  may  be  agreed upon, and (iv) the conveyance to the
board of education in the name of the city of New York of title  to  the
school  portion  of  any  such  combined  occupancy  structures  at  the
expiration of the term  of  the  lease,  or  any  renewal  or  extension
thereof,  or  upon earlier payment in full of the total amount specified
therein, without additional charge therefore.  The  board  of  education
shall approve any such agreement.
2.  a. Any lease, sublease or other agreement entered into between the
fund and the  owner  or  developer  of  a  proposed  combined  occupancy
structure shall provide for payment to the fund of the fair market value
of  such  easements,  space rights, air rights or other fee or leasehold
interests as are to be held or retained by such owner  or  developer  or
his  successor  in  interest under the terms of such agreement; provided
that where subsidized housing, as hereinafter defined, is intended to be
built in or on said easements, space rights, air rights or other fee  or
leasehold  interests,  the  appropriate  document  may  provide,  in the
discretion of the fund, for payment to the fund of less  than  the  fair
market  value  of such easements, space rights, air rights, or other fee
or leasehold interests. As used in this  paragraph,  subsidized  housing
shall  mean  dwelling  units  aided  by  one  or  more federal, state or
municipal programs designed to provide low or moderate income housing.
b. Whenever the easements, space rights, air rights or  other  fee  or
leasehold  interests  held  or  retained  by such owner or developer, if
other than the New York city housing authority,  and/or  the  non-school
improvements  constructed or erected therein or thereon, shall be exempt
from real property taxes pursuant to  the  provisions  of  section  four
hundred  sixty-eight  of  this  article,  such  lease, sublease or other
agreement shall also provide for the payment to the fund  of  annual  or
other  periodic  amounts equal to the amount of real property taxes that
would  otherwise  have  been  paid  or  payable  with  respect  to  such
easements, space rights, air rights or other fee or leasehold interests,
and  with  respect to the non-school improvements constructed or erected
therein or thereon, over the term  of  such  lease,  sublease  or  other
agreement.  Where  such lease, sublease, or other agreement provides for
the annual or other periodic payment of a fixed sum or  sums  as  a  tax
equivalency  payment during the term of such a lease, sublease, or other
agreement, or any part thereof, the sum or sums to be paid may be either
greater or less than the actual amount of real property taxes that would
otherwise have been paid or payable with respect to  the  said  property

rights  affected,  if said property rights were not exempt, provided the
city shall approve such provision. In the event provision  is  made  for
the  annual  or  other  periodic payment of a fixed sum or sums as a tax
equivalency  payment,  such  lease,  sublease,  or  other  agreement may
further provide, upon approval by the city of such provision,  that  (i)
such lessee, sublessee or vendee shall be required to pay such fixed sum
or  sums  to  the fund during the term of such lease, sublease, or other
agreement regardless of whether the said property rights are exempt from
real property taxes, (ii) if for any year during such term an ad valorem
tax shall be levied and paid by such lessee, sublessee or vendee on  the
said  property  rights, such lessee, sublessee or vendee shall receive a
credit against any taxes thereafter payable by it to the city the amount
of such ad valorem tax paid by it, and (iii) in the  event  during  such
term  a  substitute  tax,  in place either in whole or in part of a real
property tax on said property rights, is levied and paid by such lessee,
sublessee or vendee, such lessee, sublessee, or vendee shall  receive  a
credit  against  any  taxes thereafter payable by it to the city for the
amount of such substitute tax paid by it.
c. (1) Notwithstanding the provisions  of  section  fifty-two  of  the
public housing law, whenever the New York city housing authority is such
owner  or  developer, such lease, sublease or other agreement shall also
provide for the payment by such authority to the fund  or  the  city  of
such  amount, for any year or years, as payment in lieu of real property
taxes on the non-school portion constituting a project,  as  defined  by
the  public  housing law, as may be agreed upon among the fund, the city
and the authority, and as may be approved by  the  commissioner  of  the
state  division  of  housing  and community renewal if such project is a
state project as defined in the public housing law, and by  the  federal
government if such project is a federal project as defined in the public
housing law.
(2)  For  any  of  the  purposes of the public housing law, including,
specifically, section seventy-three  thereof,  and  notwithstanding  any
other provision in the public housing law for establishing the amount of
taxes  paid  or  payable with respect to a project for such year and the
resulting amount of tax  exemption,  in  computing  the  amount  of  tax
exemption  granted to such non-school portion constituting a project, as
defined by the public housing law, the amount of such payment in lieu of
taxes paid or payable with respect thereto for any year shall be  deemed
to be the amount of taxes paid or payable for such year.
3.  Any  lease,  sublease  or other agreement entered into between the
fund and the city of New York or the  board  of  education  pursuant  to
section  four  hundred  fifty-four of this chapter shall provide for (i)
the  construction,  acquisition,   reconstruction,   rehabilitation   or
improvement  of  one  or more combined occupancy structures and (ii) the
leasing or subleasing of the school portion of such  structures  to  the
city  or the board for a term not exceeding ninety-nine years, upon such
terms and conditions as may be agreed upon.
4. Every lease, sublease or other agreement executed pursuant to  this
article  shall be subject to the approval of the commissioner of general
services and the director of management and budget with respect  to  all
rentals or other payments to be made thereunder by the city of New York,
the  board  of  education  or  by  the  owner or developer of a combined
occupancy structure and shall contain a clause that any agreement of the
city of New York thereunder shall be deemed executory to the  extent  of
the  moneys  available  to the city therefor and no liability on account
thereof shall be incurred by the city beyond the  moneys  available  for
the purpose thereof.