New York Codes, Rules and Regulations › Title 8 - EDUCATION DEPARTMENT › Chapter II - Regulations of the Commissioner › Subchapter L - Finance › Part 175 - State Aid › Section 175.41 - Analysis of average interest rates applied to capital debt incurred by the city of new york for school purposes, or by the new york city transitional finance authority for school purposes if no such capital debt is incurred by the city of new york, for use in the apportionment of building aid to the city school district of the city of new york

Current through Register Vol. 46, No. 28, July 10, 2024
(a) Definitions. For the purpose of this
				  section, the following definitions shall apply:
(1) Obligation shall mean any amortized debt
				  incurred by the City of New York for the funding of capital expenditures for
				  school purposes of the city and its departments, agencies or subdivisions,
				  including but not limited to the city school district of the City of New York
				  and the School Construction Authority of the City of New York. In the event
				  that no amortized debt is incurred by the City of New York for the funding of
				  capital expenditures for school purposes, obligation shall mean any amortized
				  debt incurred by the New York City transitional finance authority for the
				  funding of capital expenditures for school purposes of the city and its
				  departments, agencies or subdivisions, including but not limited to the City
				  School District of the City of New York and the School Construction Authority
				  of the City of New York.
(2) Total
				  principal for school purposes shall mean that portion of the original proceeds
				  received by the City of New York from the sale of an obligation that is
				  expended for school purposes.
(3)
				  Term shall mean the number of years represented by the amortization of an
				  obligation, expressed to the nearest whole number of years.
(4) Total net proceeds shall mean the sum of
				  the total principal for school purposes less costs of issuance (including
				  underwriters discount and bond insurance), less original issue discount, plus
				  original issue premium attributable to such total principal for school
				  purposes. Bond insurance, original issue discount and original issue premium
				  shall be allocated to such principal on the basis of actual cost for that
				  portion of principal. Costs of issuance, including underwriters discount, but
				  not bond insurance, shall be allocated pro rata on the basis of the ratio of
				  proceeds (adjusted for original issue discount and premium only) attributable
				  to school purposes to total proceeds (adjusted for original issue discount and
				  premium only) in the bond series.
(5) Average interest rate shall be determined
				  by doubling the semi-annual interest rate, compounded semi-annually, necessary
				  to discount the debt service payments (including interest, principal and
				  mandatory redemptions) from the payment dates to the dated date such that the
				  sum of such discounted payments equal the total net proceeds.
(i) When a particular maturity of bonds has
				  more than one interest rate, the principal amount allocated to school purposes
				  shall be allocated pro rata based on the ratio of principal amount of an
				  interest rate in a maturity to the total principal amount of the
				  maturity.
(ii) When there are
				  proceeds of more than one series of bonds in a calculation period, then the
				  average interest rate shall be determined by doubling the semi-annual interest,
				  compounded semi-annually, necessary to discount the debt service payments
				  (including interest, principal and mandatory redemptions) from the payment
				  dates to the dated date of the series of bonds with the earliest dated date
				  such that the sum of such discounted payments equals the sum of the net
				  proceeds discounted to the dated date of the series of bonds with the earliest
				  dated date.
(iii) The interest rate
				  for adjustable rate bonds shall be determined by taking the municipal swap
				  index selected by the commissioner (or if such index is no longer available,
				  using comparable data) averaged over the last 10 years, plus the costs of
				  credit facilities, remarketing fees, broker-dealers fees and auction agent
				  fees, as applicable, that are in effect at the time of the issuance of the
				  bonds.
(iv) If there is an interest
				  rate swap associated with the adjustable rate bonds that creates a synthetic
				  fixed rate, then the interest rate shall be determined by the sum of the fixed
				  swap rate plus the cost of credit facilities, remarketing fees, broker-dealers
				  fees and auction agent fees, as applicable, that are in effect at the time of
				  the issuance of the bonds.