S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   9809
 
                           I N  A S S E M B L Y
 
                              April 19, 2022
                                ___________
 
 Introduced by M. of A. THIELE -- read once and referred to the Committee
   on Local Governments
 
 AN  ACT  to  amend the local finance law, in relation to the delivery of
   the good faith deposit following award of the bonds to the  successful
   bidder
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section 1. Subdivision 3 of paragraph c of section 58.00 of the  local
 finance  law,  as amended by chapter 416 of the laws of 2012, is amended
 to read as follows:
   3. [A requirement that as a condition precedent to  the  consideration
 of  his  or her bid, each] THE SUCCESSFUL bidder shall deposit with such
 official as the agency in charge of the sale may designate, a  certified
 or  cashier's  check drawn upon an incorporated bank or trust company to
 the order of the municipality, school district or  district  corporation
 or  such  official,  for  the  amount specified in the notice, but in no
 event less than one-half of one      per centum of the amount  of  bonds
 to  be  bid  for.  NOTWITHSTANDING THE PROVISIONS OF THIS SUBDIVISION, A
 MUNICIPALITY, SCHOOL DISTRICT OR DISTRICT CORPORATION MAY  REQUIRE  THAT
 SUCH  DEPOSIT BE MADE AS A CONDITION PRECEDENT TO THE CONSIDERATION OF A
 BID FOR THE BONDS. Such notice may also  provide  that,  in  lieu  of  a
 certified  or  cashier's  check,  [bidders  may furnish as security] THE
 DEPOSIT MAY ALSO BE IN THE FORM OF cash in such amount remitted by  wire
 transfer  to  an  account  specified in the notice or an eligible surety
 bond or an eligible letter of credit, approved by such  official  as  to
 form,  sufficiency,  and  manner  of  execution.  For  purposes  of this
 section, "eligible surety bond" shall mean a bond executed by an  insur-
 ance  company authorized to do business in this state, the claims-paying
 ability of which is rated in one of the three highest rating  categories
 by  at  least one nationally recognized statistical rating organization;
 and "eligible letter of credit" shall  mean  an  irrevocable  letter  of
 credit  issued in favor of the municipality, school district or district
 corporation, for a term not to exceed ninety days by  a  bank,  as  that
 term  is  defined  in  section  two of the banking law, whose commercial
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD14833-01-2
 A. 9809                             2
 
 paper and other unsecured short-term debt obligations (or, in  the  case
 of  a bank which is the principal subsidiary of a holding company, whose
 holding company's commercial paper and other unsecured  short-term  debt
 obligations)  are  rated  in  one of the three highest rating categories
 (based on the credit of such bank or holding company) by  at  least  one
 nationally  recognized statistical rating organization or by a bank that
 is in compliance with  applicable  federal  minimum  risk-based  capital
 requirements.
   § 2. This act shall take effect immediately.