senate Bill S1925

2013-2014 Legislative Session

Creates a debt management board; repealer

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Archive: Last Bill Status - In Committee


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Jan 08, 2014 referred to finance
Jan 09, 2013 referred to finance

S1925 - Bill Details

Current Committee:
Law Section:
State Finance Law
Laws Affected:
Rpld & add Art 5-B §§67-a - 67-f, amd §§68-a, 68-c, 97-rrr & 24, St Fin L; amd §§51 & 365, Pub Auth L
Versions Introduced in Previous Legislative Sessions:
2011-2012: S2392A
2009-2010: S521

S1925 - Bill Texts

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Creates a debt management board with authority to set a limit on state debt; authorizes the use of surplus moneys to reduce outstanding state debt; limits the amount of state debt that may be incurred; limits the debt of public authorities.

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BILL NUMBER:S1925

TITLE OF BILL: An act to amend the state finance law, in relation to
the creation of a debt management board, using surplus moneys to reduce
outstanding state funded debt and limiting the amount of state funded
debt that may be incurred; to amend the public authorities law, in
relation to defining and listing public authorities, limiting the debt
of public authorities, the approval by the comptroller of the terms and
conditions of bonds or notes issued by public authorities, the powers
and duties of the public authorities control board, and the issuance of
bonds and notes of the New York state thruway authority; and to repeal
article 5-B of the state finance law relating to limitations on state-
supported debt

PURPOSE: To impose discipline on the State's borrowing practices by
establishing a State Debt Management Board and strict limitations on
State and public authority debt.

SUMMARY OF PROVISIONS:

Section 1 adds a new Article 5-8 ("Debt Management Board and Limitations
on State Funded Debt") to the State Finance Law, including six sections:

Section 67-a defines the terms "State debt," "State backed debt" and
"State funded debt" to clarify the full scope of the State's debt obli-
gation.

Section 67-a also defines the terms "Board" (i.e., the New York State
Debt Management Board), "Total personal income of the state, "capital
purpose," "conduit debt obligation" and "cash surplus."

Section 67-b requires, after any transfer to the Tax Stabilization
Reserve Fund, that a portion of any cash surplus accumulated in the
General Fund as of the end of any fiscal year, be deposited in the Debt
Reduction Reserve Fund for the exclusive purpose of reducing the aggre-
gate amount of outstanding State funded debt obligations.

Section 67-c creates the New York. State Debt Management Board consist-
ing of the Governor, the Comptroller, and a third person, who shall be a
financial expert jointly selected by the Governor and the Comptroller.

Section 67-d sets forth the powers and duties of the Board, which
include monitoring all debt of the State and public authorities, estab-
lishing an annual debt affordability level, and adopting debt policy
standards addressing:

* structure for State funded debt;

* criteria for refunding, including extending debt and use of savings;

* use of credit enhancements and derivative instruments;

* goals for the proportion of state capital spending to be financed with
debt and the proportion to be financed with current appropriations;

* methods of sale;

* criteria for selecting State funded obligations to be retired or
defeased by the use of a portion of any cash surplus;

* the definition of non-recurring revenues to be used for the funding of
capital projects or for the purpose of retiring or defeasing bonds or
notes previously issued;

* other policy standards the Board may determine to be appropriate; and

* policy standards for the issuance of debt obligations by Class A and
Class B public authorities.

Section 67-e requires the Comptroller to annually report to the Debt
Management Board on the amount of State funded debt outstanding.

Section 67-f sets forth general limitations on State funded debt and
State debt service payments, including:

* implementation of an overall debt cap, effective on and after April 1,
2015, on all State funded debt to limit debt to no more than 5% of the
total personal income in the State;

* implementation of the annual debt affordability level established by
the Debt Management Board;

* prohibiting the use of State funded debt for any purpose other than a
capital purpose;

* requiring all State funded debt to be in the form of obligations
issued by the Comptroller, beginning with the fiscal year that is at
least one year after the effective date of an amendment to the Constitu-
tion;

* prohibiting the issuance of any state funded debt obligation with a
final maturity exceeding the probable life of the capital project
financed by such debt, as well as prohibiting any maturity longer than
30 years;

* up to and including State fiscal year 2015-2016, limiting the issuance
of new State funded debt obligations in any fiscal year to no more than
9596 of the amount of the State funded debt incurred in the last
complete fiscal year.

* Prohibiting the issuance of new debt supported by a state agreement to
make payments only if expected debt service sources fall short.

Section 2 amends subdivision 2 of section 6B-a of Article 5-C ("Revenue
Bond Financing Program") of the State Finance Law to conform the defi-
nition of "authorized purpose" to the definition of "state funded debt"
set forth in new State Finance Law Article 5-B, as added by this bill.

Section 3 amends subdivision 6 and adds a new subdivision 7 to section
68-c of the State Finance Law to prohibit, on a contingent basis, the
issuance of revenue bonds when and if the Constitution is amended to
eliminate backdoor borrowing.

Section 4 amends section 97-rrr of the State Finance Law to dedicate the
moneys of the Debt Reduction Reserve Fund to the purpose of retiring or
defeasing State funded debt obligations.

Section 5 adds a new subdivision 4 to section 24 of the State Finance
Law to require the inclusion in the budget bills submitted with each
year's Executive Budget an appropriation of the available balance from
the Debt Reduction Reserve Fund to be used exclusively for the purpose
of retiring or defeasing State funded debt obligations.

Section 6 adds a new section 2 to the Public Authorities Law to estab-
lish a new comprehensive definition of a public authority. The term
"public authority' is defined as:

(i) any public authority, public benefit corporation, or commission
created by or existing under the Public Authorities Law ox any other
law;

(ii) a public authority or a public benefit corporation, at least one of
whose members is appointed by the governor or who serves by virtue of
holding a civil office of the State;

(iii) a not-for-profit corporation affiliated with, sponsored by, or
created by a State agency;

(iv) a not-for-profit corporation created by or existing under article 2
of the racing, pari-mutuel wagering and breeding law and operating under
an exclusive franchise granted by the state;

(v) a local industrial development agency or other local public benefit
corporation; or

(vi) a subsidiary or affiliate of such a public authority.

Section 6 also adds definitions of the terms "affiliate," "affiliated
with," "subsidiary" and "other debt obligations." This section categor-
izes all current or future public authorities into four classes: Class
A: major public authorities with statewide or regional significance and
their subsidiaries; Class B: entities affiliated with a State agency or
created by the State that have limited jurisdiction but a majority of
board members appointed by the Governor or other State officials; Class
C: entities with local jurisdiction; and Class D: entities with inter-

state or international jurisdiction. Classes A, B, C and D include, but
are not limited to, the more than 720 public authorities specified by
name in the bill.

Section 7 adds a new section 3 to the Public Authorities Law imposing
limitations on the terms and conditions of any Class A or Class B public
authority debt obligations issued after the effective date of this
legislation. No Class A or Class B public authority may include in a
bond covenant or other debt instrument a requirement or guarantee that
the public authority will remain in existence until the debt is repaid.
Unless (i) permitted under a statutory debt cap applicable to a Class A
or Class B Public authority, or (ii) specifically authorized by an act
of the Legislature, no Class A or Class B public authority can issue any
bonds or notes, nor incur any other similar debt. Refundings or refi-
nancings would be permitted if they achieve cost savings without extend-
ing the maturity of any existing debt. Further, no Class A or Class B
public authority can include any provision having the effect of extend-
ing the life of the authority when refunding or refinancing any current
debt obligation.

Section 8 amends subdivision 1 of section 51 of the Public Authorities
Law to expand the jurisdiction of the Public Authorities Control Board
to approving the financing and construction of projects of all Class A
and Class B public authorities.

Section 9 adds a new subdivision 6 to section 51 of the Public Authori-
ties Law to require an annual report by the Public Authorities Control
Board detailing (i) the aggregate amount of debt approved by the Board
during the fiscal year, (ii) a list of the individual projects approved
by the Board for each public authority during the fiscal year, and (iii)
the total amount of new debt obligations the Board has approved during
the fiscal year for issuance by each public authority.

Section 10 amends subdivision 2 of section 365 of the Public Authorities
Law to delete the requirement that Thruway Authority bonds and notes
sold at public sale must be issued by the Comptroller.

Section 11 provides for an immediate effective date.

JUSTIFICATION: The construction of roads, bridges, canals, housing
developments, hospitals, universities mass transit and other. govern-
ment facilities has made New York the Empire State. Debt is a tool that,
when used prudently, helps governments plan and pay for such large
public works projects. Borrowing in moderation allows those who will
benefit from necessary, worthwhile capital investment to pay the costs.

Since 1990, New York State's outstanding debt has grown from $14.4
billion to $45.4 billion in 2004, representing a 215 percent increase.
From 1996 to 2001 when the State experienced unprecedented surpluses,
the State continued to borrow, rather than utilizing surplus dollars and
responsibly paying for capital expenditures through more pay-as-you go
(PAYGO) spending.

Furthermore, New Yorkers bear one of the highest debt burdens in the
country. New York is ranked second to California in total outstanding
debt. According to Moody's 2004 State Debt Medians, New York is fourth
highest in debt per capita just behind Connecticut, Massachusetts and
Hawaii. New York's $2,420 debt per capita is over two and one-half times
the national average of $944. According to the Census, New York ranks
second only to Alaska for state and local combined debt per capita.

This bill proposes major reforms that should be enacted into law to
restore accountability, and transparency and limit debt to an affordable
level. It is long past time for effective reform that will decrease the
State's propensity to utilize debt financing, recognize the value of pay
as-you-go spending and open the process to the public. Successful
reforms must implement debt management policy that balances need with
capacity and intergenerational equity. To be competitive with other
states, New York must continue to make needed, affordable capital
investments.

Establishing a new, all-inclusive definition of "State funded debt" will
provide a more comprehensive accounting of the State's debt portfolio,
eliminate loopholes in the current statutes and insure that all State
funded debt is subject to the cap equal to 5 percent of the State's
personal income beginning in 2014. As New York's outstanding debt is
currently equal to 6.5 percent of personal income, steps will have to be
taken to bring down the debt to 5 percent.

To force discipline and reach the proposed Constitutional debt cap of 5
percent by State Fiscal Year 2015-16, the legislation limits annual debt
issuance to 95 percent of the last complete fiscal year's issuance
starting immediately and continuing through March 31, 2016. The estab-
lishment of a Debt Management Board will provide coordinated policy
direction, monitoring and reporting for all debt, including debt issued
by public authorities. The three-person Debt Management Board made up of
the Governor, the State Comptroller, and a financial expert, selected
jointly by the Governor and Comptroller, would be vested with the
responsibility to issue a binding debt affordability study, annually by
October 31. Additionally, the board would forecast the debt affordabili-
ty level expected for the two succeeding fiscal years based on multiyear
projections of State revenues and spending. With this structure, the
State's chief executive and the State's chief fiscal officer jointly
would be responsible for controlling, planning, implementing, reporting
and managing the State's borrowing from beginning to end. Beginning in,
the issuance of State debt will be subject to the Board's debt afforda-
bility level.

Additional oversight of public authority debt is provided by expanding
the responsibilities of the Public Authorities Control Board (PACB) to
include the oversight of all major State and regional authorities,
requiring an annual report from the PACB and requiring that all public
authority negotiated bond sales be submitted to the Comptroller for
approval of their terms and conditions.

There is a suitable time and an inappropriate time to utilize debt. In
New York State, debt has been utilized all too often, for objectionable
purposes, and has become an easy answer to solving the State's fiscal
problems. With no sign of this harmful trend ceasing anytime in the
future, it is time for reform. Fox the foregoing reasons, the Comp-
troller respectfully urges passage of this legislation.

PRIOR LEGISLATIVE HISTORY: S.8175 of 2006: Referred to Rules S.1303 of
2007: Referred to Finance S.1303 of 2008: Referred to Finance S.521 of
2010: Referred to Finance S.2392 of 2012: Referred to Finance

EFFECTIVE DATE: This act shall take effect immediately, provided,
however, that paragraph a of subdivision 3 and subdivision 6 of section
67-f of the state finance law, as added by section one of this act, and
section three of this act, shall take effect on the same date as a
concurrent resolution of the Senate and Assembly entitled "proposing
amendments to article 7 of the state constitution, in relation to the
authorization of debt in times of public emergency, a limit on the total
amount of state debt, the establishment of a debt management board, and
refunding of state debts", takes effect.

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                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  1925

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 9, 2013
                               ___________

Introduced  by  Sen.  LIBOUS -- read twice and ordered printed, and when
  printed to be committed to the Committee on Finance

AN ACT to amend the state finance law, in relation to the creation of  a
  debt  management  board,  using  surplus  moneys to reduce outstanding
  state funded debt and limiting the amount of state  funded  debt  that
  may  be  incurred; to amend the public authorities law, in relation to
  defining and listing public authorities, limiting the debt  of  public
  authorities,  the  approval by the comptroller of the terms and condi-
  tions of bonds or notes issued by public authorities, the  powers  and
  duties  of  the  public authorities control board, and the issuance of
  bonds and notes of the New York state thruway authority; and to repeal
  article 5-B of the state finance law relating to limitations on state-
  supported debt

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1. Article 5-B of the state finance law is REPEALED and a new
article 5-B is added to read as follows:
                               ARTICLE 5-B
                          DEBT MANAGEMENT BOARD
                                   AND
                    LIMITATIONS ON STATE FUNDED DEBT
SECTION 67-A. DEFINITIONS.
        67-B. USE OF SURPLUS MONEYS TO REDUCE OUTSTANDING  STATE  FUNDED
                DEBT.
        67-C. NEW YORK STATE DEBT MANAGEMENT BOARD; CREATION; PROCEDURE.
        67-D. POWERS AND DUTIES OF THE BOARD.
        67-E. COMPTROLLER'S DUTIES WITH RESPECT TO BOARD.
        67-F. LIMITATIONS  ON  STATE  FUNDED DEBT AND STATE DEBT SERVICE
                PAYMENTS.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD05274-01-3

S. 1925                             2

  S 67-A. DEFINITIONS. AS USED IN THIS ARTICLE  AND  ARTICLE  FIVE-C  OF
THIS  CHAPTER  THE  FOLLOWING  TERMS  SHALL  HAVE THE MEANINGS SET FORTH
BELOW:
  1.  "BOARD" SHALL MEAN THE NEW YORK STATE DEBT MANAGEMENT BOARD ESTAB-
LISHED BY SECTION SIXTY-SEVEN-C OF THIS ARTICLE.
  2. "CAPITAL PURPOSE" SHALL MEAN ANY PROJECT INVOLVING:
  (A) THE ACQUISITION, CONSTRUCTION,  DEMOLITION  OR  REPLACEMENT  OF  A
FIXED ASSET;
  (B)  THE MAJOR REPAIR OR RENOVATION OF A FIXED ASSET, WHICH MATERIALLY
EXTENDS ITS USEFUL LIFE OR MATERIALLY IMPROVES OR INCREASES ITS  CAPACI-
TY;
  (C)  THE  PLANNING OR DESIGN OF THE ACQUISITION, CONSTRUCTION, DEMOLI-
TION, REPLACEMENT, MAJOR REPAIR OR RENOVATION OF A FIXED ASSET,  INCLUD-
ING  THE  PREPARATION  AND  REVIEW OF PLANS AND SPECIFICATIONS INCLUDING
ENGINEERING AND OTHER SERVICES, FIELD SURVEYS AND  SUB-SURFACE  INVESTI-
GATIONS INCIDENTAL THERETO; OR
  (D)  THE  COSTS  OF  ISSUING  DEBT  OBLIGATIONS  TO  FINANCE A CAPITAL
PURPOSE.
  3. "CASH SURPLUS" SHALL MEAN THE AMOUNT BY WHICH GENERAL FUND RECEIPTS
IN A FISCAL YEAR EXCEED GENERAL FUND EXPENDITURES IN SUCH FISCAL YEAR.
  4. "CONDUIT DEBT OBLIGATIONS" SHALL MEAN A DEBT OBLIGATION ISSUED BY A
PUBLIC AUTHORITY (HEREINAFTER REFERRED TO IN  THIS  SUBDIVISION  AS  THE
"CONDUIT ISSUER") ON BEHALF OF A THIRD PARTY (HEREINAFTER REFERRED TO IN
THIS  SUBDIVISION  AS  THE "CONDUIT BORROWER") OTHER THAN THE STATE OR A
POLITICAL SUBDIVISION OF THE STATE, WHERE PAYMENT OF THE  OBLIGATION  IS
TO  BE  MADE  FROM  FUNDS  OF THE CONDUIT BORROWER, THE SECURITY FOR THE
OBLIGATION IS THE CREDIT OF THE CONDUIT BORROWER AND  NO  FUNDS  OF  THE
CONDUIT  ISSUER,  THE  STATE OR A POLITICAL SUBDIVISION OF THE STATE ARE
PLEDGED TO SECURE THE OBLIGATION, WHETHER OR NOT THE OBLIGATION  OF  THE
CONDUIT  ISSUER,  THE  STATE  OR  POLITICAL  SUBDIVISION OF THE STATE IS
SUBJECT TO APPROPRIATION OR IS OTHERWISE CONTINGENT.
  5. "STATE BACKED DEBT" SHALL MEAN ANY DEBT OR OBLIGATION,  OTHER  THAN
STATE  DEBT,  THAT  IS  SUPPORTED  IN  WHOLE OR IN PART BY ANY FINANCING
ARRANGEMENT WHEREBY THE STATE AGREES OR HAS IN THE PAST AGREED,  WHETHER
BY  LAW,  CONTRACT  OR  OTHERWISE,  TO MAKE PAYMENTS WHICH WILL BE USED,
DIRECTLY OR INDIRECTLY,  FOR  THE  PAYMENT  OF  PRINCIPAL,  INTEREST  OR
RELATED  PAYMENTS  ON  INDEBTEDNESS  INCURRED OR CONTRACTED BY THE STATE
ITSELF FOR ANY PURPOSE, OR BY ANY STATE AGENCY,  MUNICIPALITY,  INDIVID-
UAL,  PUBLIC  AUTHORITY  OR  OTHER  PUBLIC OR PRIVATE CORPORATION OR ANY
OTHER ENTITY FOR STATE CAPITAL  OR  OPERATING  PURPOSES  OR  TO  FINANCE
GRANTS,  LOANS  OR OTHER ASSISTANCE PAYMENTS MADE OR TO BE MADE BY OR ON
BEHALF OF THE STATE FOR ANY PURPOSE. IF THE STATE AGREES TO MAKE  FUTURE
REVENUES  FROM  A  SPECIFIC  STATE  SOURCE  AVAILABLE FOR THE PURPOSE OF
SUPPORTING DEBT OF ANY MUNICIPALITY,  INDIVIDUAL,  PUBLIC  AUTHORITY  OR
OTHER PUBLIC OR PRIVATE CORPORATION OR ANY OTHER ENTITY, SUCH DEBT SHALL
BE  CONSIDERED  TO BE A DEBT FOR THE PURPOSE OF FINANCING A STATE GRANT,
LOAN OR OTHER ASSISTANCE PAYMENT AND SHALL BE A "STATE BACKED DEBT"  FOR
THE  PURPOSES  OF  THIS ARTICLE. THE TERM "STATE BACKED DEBT" APPLIES TO
ALL DEBT OR OBLIGATIONS DESCRIBED IN  THIS  SUBDIVISION  FOR  WHICH  THE
STATE AGREES, OR HAS IN THE PAST AGREED, TO MAKE PAYMENTS (A) WHETHER OR
NOT THE OBLIGATION OF THE STATE TO MAKE PAYMENTS IS SUBJECT TO APPROPRI-
ATION  OR IS OTHERWISE CONTINGENT, OR (B) WHETHER OR NOT DEBT SERVICE IS
TO BE PAID FROM A REVENUE STREAM TRANSFERRED BY  THE  STATE  TO  ANOTHER
PARTY THAT IS RESPONSIBLE FOR MAKING SUCH PAYMENTS.
  6. "STATE FUNDED DEBT" SHALL MEAN THE COMBINED TOTAL OF ALL STATE DEBT
AND ALL STATE BACKED DEBT, EXCEPT SHORT TERM DEBT INCURRED IN ACCORDANCE

S. 1925                             3

WITH  SECTION  NINE OF ARTICLE SEVEN OF THE CONSTITUTION, EMERGENCY DEBT
INCURRED IN ACCORDANCE WITH SECTION TEN OF ARTICLE SEVEN OF THE  CONSTI-
TUTION,  AND REFUNDING DEBT INCURRED IN ACCORDANCE WITH SECTION THIRTEEN
OF ARTICLE SEVEN OF THE CONSTITUTION.
  7.  "STATE  DEBT"  SHALL  MEAN  ALL  BONDS AND BOND ANTICIPATION NOTES
ISSUED BY THE STATE COMPTROLLER PURSUANT TO ARTICLE FIVE OF  THIS  CHAP-
TER.
  8.  "TOTAL  PERSONAL INCOME OF THE STATE" SHALL MEAN THE MOST RECENTLY
PUBLISHED ESTIMATED DOLLAR AMOUNT DETERMINED AS TOTAL PERSONAL INCOME OF
THE STATE BY THE UNITED STATES DEPARTMENT OF COMMERCE OR  ANY  SUCCESSOR
AGENCY  FOR  THE FOUR MOST RECENT SUCCESSIVE CALENDAR QUARTERS FOR WHICH
INFORMATION IS AVAILABLE PRIOR TO OCTOBER  THIRTY-FIRST  OF  EACH  YEAR.
SUBSEQUENT  REVISIONS  OF THE PUBLISHED ESTIMATED DOLLAR AMOUNT FOR SUCH
CALENDAR QUARTERS SHALL NOT AFFECT THE  VALIDITY  OF  THE  DETERMINATION
MADE BY THE BOARD FOR ANY FISCAL YEAR.
  S 67-B. USE OF SURPLUS MONEYS TO REDUCE OUTSTANDING STATE FUNDED DEBT.
AT  THE CLOSE OF EACH FISCAL YEAR, A PORTION OF ANY CASH SURPLUS REMAIN-
ING  IN  THE  GENERAL  FUND  AFTER  THE  TRANSFER  PURSUANT  TO  SECTION
NINETY-TWO  OF  THIS  CHAPTER SHALL BE TRANSFERRED TO THE DEBT REDUCTION
RESERVE FUND ESTABLISHED BY SECTION NINETY-SEVEN-RRR OF THIS CHAPTER, AS
ADDED BY SECTION THIRTY-SIX OF PART B OF CHAPTER FIFTY-SEVEN OF THE LAWS
OF NINETEEN HUNDRED NINETY-EIGHT.  THE PORTION TO BE  TRANSFERRED  SHALL
BE  EQUAL TO THE PROJECTED RATIO OF TOTAL DEBT SERVICE DISBURSEMENTS FOR
THE FISCAL YEAR TO TOTAL  GOVERNMENTAL  FUNDS  DISBURSEMENTS  FOR  STATE
AGENCY OPERATIONS FOR THE FISCAL YEAR.
  S  67-C. NEW YORK STATE DEBT MANAGEMENT BOARD; CREATION; PROCEDURE. 1.
THE NEW YORK STATE DEBT MANAGEMENT BOARD IS HEREBY ESTABLISHED  TO  HAVE
AND  EXERCISE  THE  POWERS,  DUTIES  AND  PREROGATIVES  PROVIDED  BY THE
PROVISIONS OF THIS ARTICLE AND ANY OTHER PROVISION OF LAW.
  2. THE MEMBERSHIP OF THE BOARD SHALL CONSIST OF THREE PERSONS, INCLUD-
ING THE GOVERNOR, THE COMPTROLLER AND A THIRD PERSON WHO SHALL BE JOINT-
LY APPOINTED BY THE GOVERNOR AND THE COMPTROLLER. THE TERM OF OFFICE  OF
THE MEMBERS OF THE BOARD SHALL BE THE SAME AS THE TERMS OF OFFICE OF THE
GOVERNOR  AND THE COMPTROLLER. IF THE THIRD MEMBER OF THE BOARD RESIGNS,
BECOMES INCAPACITATED, IS JOINTLY REMOVED BY THE GOVERNOR AND THE  COMP-
TROLLER  OR  IS  OTHERWISE  UNABLE  TO SERVE, THE GOVERNOR AND THE COMP-
TROLLER SHALL JOINTLY APPOINT A SUCCESSOR TO SERVE THE REMAINDER OF  THE
UNEXPIRED  TERM.    THE  GOVERNOR SHALL BE THE CHAIRPERSON OF THE BOARD.
THE BOARD SHALL ACT BY MAJORITY OF ALL OF  THE  MEMBERS  OF  THE  BOARD,
EXCEPT THAT CHANGING THE DEBT AFFORDABILITY LEVEL PREVIOUSLY ESTABLISHED
BY  THE BOARD SHALL REQUIRE UNANIMOUS APPROVAL BY ALL THE MEMBERS OF THE
BOARD. ANY ACTION BY THE BOARD SHALL BE  EVIDENCED  BY  A  CERTIFICATION
THEREOF SIGNED BY A MAJORITY OF ALL THE MEMBERS, EXCEPT THAT ALL MEMBERS
SHALL  SIGN  A CERTIFICATION OF ANY ACTION REQUIRING UNANIMOUS APPROVAL.
EACH MEMBER OF THE BOARD SHALL BE ENTITLED TO DESIGNATE A REPRESENTATIVE
TO ATTEND MEETINGS OF THE BOARD IN HIS OR  HER  PLACE  AND  TO  VOTE  OR
OTHERWISE ACT ON HIS OR HER BEHALF IN HIS OR HER ABSENCE. NOTICE OF SUCH
DESIGNATION  SHALL BE FURNISHED IN WRITING TO THE BOARD BY THE DESIGNAT-
ING MEMBER. A REPRESENTATIVE SHALL SERVE AT THE PLEASURE OF  THE  DESIG-
NATING MEMBER DURING THE MEMBER'S TERM OF OFFICE. A REPRESENTATIVE SHALL
NOT  BE AUTHORIZED TO DELEGATE ANY OF HIS OR HER DUTIES OR POWERS TO ANY
OTHER PERSON.
  3. THE THIRD MEMBER JOINTLY APPOINTED BY THE GOVERNOR  AND  THE  COMP-
TROLLER  SHALL  BE A FINANCIAL EXPERT WITH EXPERIENCE IN PUBLIC FINANCE,
ECONOMICS, ACADEMICS OR GOVERNMENT.

S. 1925                             4

  4. ALL THE MEMBERS OF THE BOARD AND  THEIR  REPRESENTATIVES  SHALL  BE
ENTITLED  TO  REIMBURSEMENT  FOR  THEIR  ACTUAL  AND  NECESSARY EXPENSES
INCURRED IN THE PERFORMANCE OF THEIR OFFICIAL DUTIES  PURSUANT  TO  THIS
SECTION OR ANY OTHER PROVISION OF LAW.
  5.  THE  BOARD SHALL MEET SEMI-ANNUALLY OR MORE FREQUENTLY AT THE CALL
OF THE CHAIRPERSON. MEETINGS OF THE BOARD SHALL BE SUBJECT TO  THE  OPEN
MEETINGS LAW ESTABLISHED BY ARTICLE SEVEN OF THE PUBLIC OFFICERS LAW.
  S  67-D.  POWERS AND DUTIES OF THE BOARD.  1. THE BOARD SHALL HAVE THE
POWER AND THE DUTY TO (A) ANNUALLY DETERMINE THE TOTAL DEBT LIMIT OF THE
STATE BY CALCULATING THE DOLLAR AMOUNT EQUIVALENT TO FIVE PERCENT OF THE
TOTAL PERSONAL INCOME OF THE STATE, AS DEFINED IN SECTION  SIXTY-SEVEN-A
OF  THIS ARTICLE, AND (B) ANNUALLY PRESCRIBE A DEBT AFFORDABILITY LEVEL,
WHICH ON AND AFTER APRIL FIRST, TWO  THOUSAND  TWENTY-TWO  SHALL  BE  NO
HIGHER THAN THE TOTAL DEBT LIMIT OF THE STATE.
  2.  ON  OR  BEFORE  OCTOBER THIRTY-FIRST OF EACH YEAR, THE BOARD SHALL
DETERMINE THE TOTAL DEBT LIMIT OF THE STATE FOR THE  NEXT  FISCAL  YEAR,
AND  REPORT  THE  LIMIT  TO  THE  TEMPORARY PRESIDENT OF THE SENATE, THE
SPEAKER OF THE ASSEMBLY, THE CHAIRPERSON AND RANKING MINORITY MEMBER  OF
THE  SENATE  FINANCE COMMITTEE, AND THE CHAIRPERSON AND RANKING MINORITY
MEMBER OF THE ASSEMBLY WAYS AND MEANS COMMITTEE. ON OR BEFORE  THE  SAME
DATE, THE BOARD SHALL ISSUE A PUBLIC ANNOUNCEMENT OF SUCH LIMIT.
  3.  ON  OR  BEFORE  OCTOBER THIRTY-FIRST OF EACH YEAR, THE BOARD SHALL
PRESCRIBE THE DEBT AFFORDABILITY LEVEL OF THE STATE FOR THE NEXT  FISCAL
YEAR, AND REPORT THE LEVEL TO THE TEMPORARY PRESIDENT OF THE SENATE, THE
SPEAKER  OF THE ASSEMBLY, THE CHAIRPERSON AND RANKING MINORITY MEMBER OF
THE SENATE FINANCE COMMITTEE, AND THE CHAIRPERSON AND  RANKING  MINORITY
MEMBER  OF  THE ASSEMBLY WAYS AND MEANS COMMITTEE. ON OR BEFORE THE SAME
DATE, THE BOARD SHALL ISSUE A PUBLIC ANNOUNCEMENT OF SUCH LEVEL.  WITHIN
THE  LIMITATION  ESTABLISHED  BY  THE TOTAL DEBT LIMIT OF THE STATE, THE
DEBT AFFORDABILITY LEVEL OF THE STATE SHALL BE BASED  UPON  THE  BOARD'S
EVALUATION  OF  THE TOTAL AMOUNT OF ADDITIONAL DEBT THAT MAY BE INCURRED
AND THE TOTAL DEBT SERVICE OBLIGATIONS AND RELATED PAYMENTS THAT MAY  BE
UNDERTAKEN  BY  THE STATE WITHOUT OVERBURDENING PRESENT OR FUTURE GENER-
ATIONS, TAKING INTO  ACCOUNT  THE  CURRENT  AND  EXPECTED  REVENUES  AND
EXPENSES  OF  THE  STATE,  THE CURRENT AND EXPECTED TRENDS AFFECTING THE
ECONOMY OF THE STATE, AND SUCH OTHER FACTORS AS THE  BOARD  DEEMS  RELE-
VANT.  IN  ADDITION TO THE DEBT AFFORDABILITY LEVEL OF THE STATE FOR THE
NEXT FISCAL YEAR, THE BOARD'S REPORT TO THE LEGISLATURE AND ANNOUNCEMENT
TO THE PUBLIC SHALL INCLUDE THE BOARD'S FORECAST OF THE DEBT AFFORDABIL-
ITY LEVELS EXPECTED FOR THE TWO SUCCEEDING FISCAL YEARS.  FOLLOWING  THE
BOARD'S  ESTABLISHMENT  OF A DEBT AFFORDABILITY LEVEL OF THE STATE FOR A
FISCAL YEAR, THERE SHALL BE NO CHANGE IN SUCH LEVEL (OTHER THAN  A  DEBT
AFFORDABILITY  LEVEL  FORECAST  FOR  A FISCAL YEAR AFTER THE NEXT FISCAL
YEAR) EXCEPT WITH THE UNANIMOUS APPROVAL OF THE MEMBERS OF THE BOARD.
  4. THE BOARD SHALL HAVE THE POWER AND IT SHALL BE  ITS  DUTY  TO  MAKE
RECOMMENDATIONS  TO  THE  GOVERNOR  AND  THE  LEGISLATURE OF POLICIES TO
GOVERN THE ISSUANCE OF ALL STATE FUNDED DEBT AND OTHER CAPITAL FINANCING
MATTERS.
  5. THE BOARD SHALL ADOPT POLICY STANDARDS RELATING TO THE ISSUANCE  OF
ALL  STATE  FUNDED  DEBT AND FOR CAPITAL FINANCING. SUCH STANDARDS SHALL
REQUIRE THE UNANIMOUS APPROVAL OF ALL THREE MEMBERS OF  THE  BOARD,  AND
SHALL COVER, AMONG OTHER ITEMS, THE FOLLOWING:
  (A)  STRUCTURES FOR STATE FUNDED DEBT, SUCH AS RATE OF AMORTIZATION OF
PRINCIPAL, THE USE OF PREMIUMS AND CAPITALIZATION OF INTEREST  ON  STATE
FUNDED DEBT;

S. 1925                             5

  (B)  CRITERIA  FOR  REFUNDING OUTSTANDING STATE FUNDED DEBT INCLUDING,
BUT NOT LIMITED TO, SUCH MATTERS AS EXTENSION OF THE TERM OF OUTSTANDING
DEBT, PRESENT VALUE SAVINGS AND DISTRIBUTION OF ACTUAL SAVINGS;
  (C)  THE  USE OF CREDIT ENHANCEMENTS, DERIVATIVE INSTRUMENTS AND VARI-
ABLE OR FIXED RATE DEBT OBLIGATIONS WITH RESPECT TO STATE FUNDED DEBT;
  (D) GOALS FOR THE PROPORTION OF STATE CAPITAL SPENDING TO BE  FINANCED
WITH DEBT AND THE PROPORTION TO BE FINANCED WITH CURRENT APPROPRIATIONS;
  (E)  THE  METHOD  OF SALE, SUCH AS COMPETITIVE OR NEGOTIATED, OF STATE
FUNDED DEBT OBLIGATIONS;
  (F) CRITERIA TO BE USED IN SELECTING STATE FUNDED DEBT OBLIGATIONS  TO
BE  RETIRED  OR  DEFEASED BY THE USE OF THE PORTION OF ANY CASH SURPLUS,
DETERMINED PURSUANT TO SECTION SIXTY-SEVEN-B OF THIS ARTICLE, THAT SHALL
BE DEDICATED TO THE EXCLUSIVE PURPOSE OF REDUCING THE  AGGREGATE  AMOUNT
OF OUTSTANDING STATE FUNDED DEBT OBLIGATIONS;
  (G)  THE  DEFINITION OF NON-RECURRING REVENUES WHICH SHALL BE USED FOR
THE FUNDING OF CAPITAL PROJECTS WHICH HAVE BEEN AUTHORIZED BY LAW TO  BE
FINANCED THROUGH THE ISSUANCE OF STATE FUNDED DEBT OR FOR THE PURPOSE OF
RETIRING OR DEFEASING BONDS OR NOTES PREVIOUSLY ISSUED;
  (H) SUCH OTHER POLICY MATTERS RELATING TO THE ISSUANCE OF STATE FUNDED
DEBT AS THE BOARD MAY DETERMINE TO BE APPROPRIATE; AND
  (I)  POLICY  STANDARDS TO BE FOLLOWED BY STATE AUTHORITIES, AS DEFINED
IN SECTION TWO OF THE PUBLIC AUTHORITIES LAW, IN RELATION TO  THE  ISSU-
ANCE  BY  SUCH PUBLIC AUTHORITIES OF DEBT OBLIGATIONS OTHER THAN CONDUIT
DEBT OBLIGATIONS.  IN THE DISCRETION OF  THE  COMPTROLLER,  SUCH  POLICY
STANDARDS  MAY  BE  APPLIED BY THE COMPTROLLER IN THE EXERCISE OF HIS OR
HER CONSTITUTIONAL AUTHORITY TO SUPERVISE THE ACCOUNTS OF PUBLIC AUTHOR-
ITIES, AS DEFINED IN SECTION TWO OF  THE  PUBLIC  AUTHORITIES  LAW,  AND
POLITICAL SUBDIVISIONS.
  THE  BOARD  SHALL  ANNUALLY REVIEW THE POLICY STANDARDS AND ADOPT SUCH
CHANGES OR ADDITIONS AS IT DEEMS ADVISABLE ON OR BEFORE THE  ANNIVERSARY
DATE OF ITS ORIGINAL STANDARDS.
  S  67-E.  COMPTROLLER'S DUTIES WITH RESPECT TO BOARD.  THE COMPTROLLER
SHALL COLLECT AND ANALYZE DATA WITH RESPECT TO OUTSTANDING STATE  FUNDED
DEBT  AND,  AT LEAST ANNUALLY, ON OR BEFORE THE ONE HUNDRED FIFTIETH DAY
FOLLOWING THE END OF THE STATE FISCAL YEAR, REPORT  TO  THE  BOARD,  THE
GOVERNOR, THE TEMPORARY PRESIDENT AND THE MINORITY LEADER OF THE SENATE,
AND  THE SPEAKER AND MINORITY LEADER OF THE ASSEMBLY ON THE CONDITION OF
STATE FUNDED DEBT.  SUCH REPORT SHALL INCLUDE, BUT NOT  BE  LIMITED  TO,
THE  AMOUNT  OF STATE FUNDED DEBT OUTSTANDING, THE DIFFERENT ISSUERS AND
CATEGORIES OF SUCH DEBT, AND ANY DIFFERENCES  IN  CREDIT  RATINGS  AMONG
CATEGORIES AND ISSUES.
  S  67-F.  LIMITATIONS  ON  STATE  FUNDED  DEBT  AND STATE DEBT SERVICE
PAYMENTS.  1. NO ADDITIONAL STATE FUNDED DEBT SHALL  BE  INCURRED  AFTER
APRIL  FIRST,  TWO  THOUSAND TWENTY-TWO IF THE TOTAL PRINCIPAL AMOUNT OF
SUCH ADDITIONAL DEBT, TOGETHER WITH THE TOTAL PRINCIPAL AMOUNT OF  STATE
FUNDED  DEBT ALREADY OUTSTANDING AND THE TOTAL PRINCIPAL AMOUNT OF STATE
FUNDED DEBT ALREADY AUTHORIZED BUT NOT YET  INCURRED,  IS  EQUAL  TO  OR
GREATER  THAN  THE  TOTAL  DEBT  LIMIT OF THE STATE AS DETERMINED BY THE
BOARD PURSUANT TO SECTION SIXTY-SEVEN-D OF THIS ARTICLE.
  2. WITH THE EXCEPTION OF SHORT TERM DEBT INCURRED IN  ACCORDANCE  WITH
SECTION  NINE  OF  ARTICLE  SEVEN  OF  THE  CONSTITUTION, EMERGENCY DEBT
INCURRED IN ACCORDANCE WITH SECTION TEN OF ARTICLE SEVEN OF THE  CONSTI-
TUTION,  AND  REFUNDING  DEBT,  NO  STATE  FUNDED DEBT SHALL BE INCURRED
EXCEPT TO FINANCE A CAPITAL PURPOSE.
  3. (A) ALL DEBT SUBJECT TO THE PROVISIONS OF THIS SECTION  (I)  SHALL,
EXCEPT  FOR  REFUNDING  DEBT,  BE  INCURRED  ONLY  FOR A CAPITAL PURPOSE

S. 1925                             6

AUTHORIZED BY LAW, AND (II) SHALL, IF INCURRED ON OR AFTER THE FIRST DAY
OF THE FIRST FISCAL YEAR BEGINNING AT LEAST ONE YEAR AFTER THE EFFECTIVE
DATE OF AN AMENDMENT TO SECTION ELEVEN OF ARTICLE SEVEN OF THE CONSTITU-
TION, BE IN THE FORM OF OBLIGATIONS ISSUED BY THE COMPTROLLER.
  (B)  ON  AND  AFTER APRIL FIRST, TWO THOUSAND SEVENTEEN, NO DEBT OBLI-
GATION SUBJECT TO THE PROVISIONS OF THIS SECTION SHALL BE ISSUED  UNLESS
THE COMPTROLLER DETERMINES THAT SUCH ISSUANCE IS WITHIN THE DEBT AFFORD-
ABILITY  LEVEL  FOR  THAT FISCAL YEAR ESTABLISHED BY THE DEBT MANAGEMENT
BOARD PURSUANT TO SECTION SIXTY-SEVEN-D OF THIS  ARTICLE.  ON  OR  AFTER
APRIL  FIRST,  TWO THOUSAND TWENTY-TWO, NO SUCH DEBT OBLIGATION SHALL BE
ISSUED UNLESS THE COMPTROLLER DETERMINES THAT SUCH  ISSUANCE  IS  WITHIN
(I) THE LIMIT ON STATE DEBT AND (II) THE DEBT AFFORDABILITY LEVEL ESTAB-
LISHED BY THE BOARD PURSUANT TO SECTION SIXTY-SEVEN-D OF THIS ARTICLE.
  4. NO STATE FUNDED DEBT SHALL BE INCURRED IN THE FORM OF AN OBLIGATION
WITH A FINAL MATURITY EXCEEDING THE PROBABLE LIFE OF THE CAPITAL PROJECT
FINANCED  BY  SUCH DEBT, AS SPECIFIED IN SECTION SIXTY-ONE OF THIS CHAP-
TER. NOTWITHSTANDING ANY OTHER PROVISION OF  LAW  TO  THE  CONTRARY,  NO
STATE  FUNDED DEBT SHALL BE INCURRED IN THE FORM OF AN OBLIGATION WITH A
FINAL MATURITY OF MORE THAN THIRTY YEARS.
  5. DURING EACH FISCAL YEAR BEGINNING ON OR AFTER THE EFFECTIVE DATE OF
THIS SECTION, UP TO AND INCLUDING ANY FISCAL YEAR ENDING IN TWO THOUSAND
TWENTY-ONE NO NEW STATE FUNDED DEBT SHALL BE INCURRED  IN  AN  AGGREGATE
PRINCIPAL  AMOUNT EXCEEDING NINETY-FIVE PERCENT OF THE AGGREGATE PRINCI-
PAL AMOUNT OF NEW STATE FUNDED DEBT INCURRED  IN  THE  PRECEDING  FISCAL
YEAR.
  6.  NO  STATE  FUNDED  DEBT  OUTSTANDING ON THE EFFECTIVE DATE OF THIS
SUBDIVISION SHALL BE REFUNDED UNLESS (A) SUCH REFUNDING IS CONDUCTED  IN
ALL RESPECTS AS IF SECTION THIRTEEN OF ARTICLE SEVEN OF THE CONSTITUTION
APPLIED,  AND  (B) ANY SUCH REFUNDING OBLIGATIONS ISSUED ON OR AFTER THE
FIRST DAY OF THE FIRST FISCAL YEAR BEGINNING AT LEAST ONE YEAR AFTER THE
EFFECTIVE DATE OF AN AMENDMENT TO SECTION ELEVEN OF ARTICLE SEVEN OF THE
CONSTITUTION IMPOSING A LIMIT ON THE TOTAL AMOUNT  OF  STATE  DEBT,  ARE
ISSUED  BY  THE  COMPTROLLER.  SUCH OUTSTANDING DEBT OBLIGATIONS AND THE
DEBT SERVICE EXPENSES, DIRECT OR INDIRECT, REQUIRED FOR SUCH OBLIGATIONS
SHALL BE INCLUDED IN THE DETERMINATION OF THE DEBT LIMIT  AND  THE  DEBT
AFFORDABILITY LEVEL PURSUANT TO SECTION SIXTY-SEVEN-D OF THIS ARTICLE.
  7.  DEBT  OBLIGATIONS  ISSUED TO REFUND OUTSTANDING STATE FUNDED DEBT,
REGARDLESS OF WHETHER SUCH OUTSTANDING DEBT WAS INCURRED  PRIOR  TO  THE
EFFECTIVE  DATE  OF  THIS  SUBDIVISION,  SHALL  NOT  BE  COUNTED FOR THE
PURPOSES OF THE DEBT LIMIT AND THE DEBT AFFORDABILITY  LEVEL  DETERMINED
PURSUANT  TO  SECTION SIXTY-SEVEN-D OF THIS ARTICLE IF SUCH REFUNDING IS
CONDUCTED IN ALL RESPECTS AS IF SECTION THIRTEEN OF ARTICLE SEVEN OF THE
CONSTITUTION APPLIED. DEBT  SERVICE  EXPENSES  ON  DEBT  THAT  HAS  BEEN
REFUNDED  IN  ACCORDANCE  WITH  SECTION THIRTEEN OF ARTICLE SEVEN OF THE
CONSTITUTION SHALL BE EXCLUDED FOR THE DEBT AFFORDABILITY LEVEL  TO  THE
EXTENT  THAT  SUCH  DEBT  SERVICE EXPENSES ARE TO BE PAID FROM AN ESCROW
FUND ESTABLISHED WITH PROCEEDS OF THE REFUNDING DEBT, BUT  DEBT  SERVICE
EXPENSES  ON  THE  REFUNDING DEBT SHALL BE INCLUDED EXCEPT TO THE EXTENT
THAT SUCH DEBT SERVICE EXPENSES ARE TO BE PAID FROM SUCH AN ESCROW FUND.
FOR THE PURPOSES OF THIS SUBDIVISION AND SUBDIVISIONS SIX AND  EIGHT  OF
THIS  SECTION,  ANY REFUNDING DEBT THAT DOES NOT EXTEND BEYOND THE FINAL
MATURITY OF THE DEBT BEING REFUNDED SHALL BE DEEMED TO BE IN  COMPLIANCE
WITH  THE  PROVISIONS  OF SUBDIVISION SIX OF SECTION THIRTEEN OF ARTICLE
SEVEN OF THE CONSTITUTION MADE APPLICABLE BY THIS SUBDIVISION  IF  THERE
IS  AN ACTUAL DEBT SERVICE SAVINGS IN EVERY YEAR TO MATURITY AS A RESULT
OF THE ISSUANCE OF THE REFUNDING DEBT.

S. 1925                             7

  8. AFTER THE EFFECTIVE DATE OF  THIS  SECTION  THE  STATE  SHALL  NOT,
EXCEPT  AS  SPECIFICALLY  AUTHORIZED  BY A PROVISION OF THE CONSTITUTION
OTHER THAN SECTION ELEVEN OF ARTICLE SEVEN OF THE CONSTITUTION, AGREE TO
MAKE PAYMENTS, DIRECTLY OR INDIRECTLY, WHETHER OR NOT SUBJECT TO  APPRO-
PRIATION,  THAT  ARE  TO  BE  AVAILABLE  TO PAY DEBT SERVICE ON ANY DEBT
INCURRED BY A MUNICIPALITY, INDIVIDUAL, PUBLIC AUTHORITY OR OTHER PUBLIC
OR PRIVATE CORPORATION OR ANY OTHER ENTITY, FOR  ANY  PURPOSE,  IF  SUCH
PAYMENTS  ARE  EXPECTED  TO  BE  USED  TO PAY DEBT SERVICE ONLY IF OTHER
SOURCES AVAILABLE FOR  THE  PAYMENT  OF  DEBT  SERVICE  ARE  INADEQUATE.
OUTSTANDING  DEBT  THAT  WOULD BE PROHIBITED BY THIS SUBDIVISION IF SUCH
DEBT HAD BEEN INCURRED AFTER THE EFFECTIVE DATE OF THIS SUBDIVISION  MAY
BE  REFUNDED  BY  THE ENTITY THAT INCURRED THE OUTSTANDING DEBT PROVIDED
THAT ALL PROVISIONS OF SUBDIVISIONS SIX AND SEVEN OF  THIS  SECTION  ARE
COMPLIED  WITH  EXCEPT  THE  REQUIREMENT  THAT SUCH REFUNDING DEBT OBLI-
GATIONS BE  ISSUED  BY  THE  COMPTROLLER,  AND  REFUNDING  DEBT  SERVICE
EXPENSES  SHALL ONLY BE INCLUDED IN DEBT AFFORDABILITY DETERMINATIONS IF
DEBT SERVICE EXPENSES  ON  THE  DEBT  BEING  REFUNDED  WOULD  HAVE  BEEN
INCLUDED.
  S  2.  Subdivision  2  of  section  68-a  of the state finance law, as
amended by section 36 of part U of chapter 59 of the laws  of  2012,  is
amended to read as follows:
  2. "Authorized purpose" for purposes of this article and section nine-
ty-two-z  of  this  chapter  shall mean any [purposes] PURPOSE for which
[state-supported] STATE-FUNDED debt, as defined by section sixty-seven-a
of this chapter, may BE or has been issued except  debt  for  which  the
state  is  constitutionally obligated thereunder to pay debt service and
related expenses, and except (a)  as  authorized  in  paragraph  (b)  of
subdivision  one  of  section  three  hundred  eighty-five of the public
authorities law, (b) as authorized for the department of health  of  the
state  of New York facilities as specified in paragraph a of subdivision
two of section sixteen hundred eighty of the public authorities law, (c)
state university of New York dormitory facilities as specified in subdi-
vision eight of section sixteen  hundred  seventy-eight  of  the  public
authorities law, and (d) as authorized for mental health services facil-
ities  by section nine-a of section one of chapter three hundred ninety-
two of the laws of nineteen hundred seventy-three constituting  the  New
York  state  medical  care  facilities  [financing]  FINANCE AGENCY act.
Notwithstanding the provisions of clause (d) of  this  subdivision,  for
the  period  April  first, two thousand nine through March thirty-first,
two thousand thirteen, mental health services facilities, as  authorized
by  section nine-a of section one of chapter three hundred ninety-two of
the laws of nineteen hundred seventy-three  constituting  the  New  York
state  medical  care  facilities  [financing]  FINANCE AGENCY act, shall
constitute an authorized purpose.
  S 3. Subdivision 6 of section 68-c of the state finance law, as  added
by  section  2  of part I of chapter 383 of the laws of 2001, is amended
and a new subdivision 7 is added to read as follows:
  6. Any resolution or other agreement authorizing revenue  bonds  under
this  article  shall  reserve  the right of the state, upon amendment OF
SECTION ELEVEN OF ARTICLE SEVEN  of  the  New  York  state  constitution
allowing the issuance or assumption of bonds, notes or other obligations
secured  by  revenues,  which  may include the revenues securing revenue
bonds of authorized issuers (a) to assume, in whole or in part,  revenue
bonds  of the authorized issuers, (b) to extinguish the existing lien of
such resolution, or other agreement and (c) to substitute  security  for
the  revenue  bonds of the authorized issuers, in each case only so long

S. 1925                             8

as such assumption, extinguishment or substitution is done in accordance
with such resolution or other agreement AND SUCH  CONSTITUTIONAL  AMEND-
MENT.
  7.  ON  AND  AFTER THE FIRST DAY OF THE FIRST FISCAL YEAR BEGINNING AT
LEAST ONE YEAR AFTER THE EFFECTIVE DATE OF AN AMENDMENT OF SECTION ELEV-
EN OF ARTICLE SEVEN OF THE CONSTITUTION IMPOSING A LIMIT  ON  THE  TOTAL
AMOUNT OF STATE DEBT, NO REVENUE BONDS SHALL BE ISSUED.
  S 4. Section 97-rrr of the state finance law, as amended by section 45
of  part  H  of  chapter  56  of the laws of 2000, is amended to read as
follows:
  S 97-rrr. Debt reduction reserve fund. 1. There is hereby  established
in the joint custody of the comptroller and the commissioner of taxation
and finance a fund to be known as the debt reduction reserve fund. [Such
fund shall be established as a capital projects fund.]
  2. Such fund shall consist of all monies credited or transferred ther-
eto  from the general fund or from any other fund or sources pursuant to
law.
  3. The monies in such fund, following appropriation by the legislature
and allocation by the director of the budget, shall  be  available  [for
the following purposes:
  (a)  for  the  payment of principal, interest, and related expenses on
general obligation bonds, lease purchase payments, or special contractu-
al obligation payments, or] ONLY for the [purposes] PURPOSE of  retiring
or  defeasing  bonds  OR  NOTES previously issued, including any accrued
interest thereon, for any [state-supported bonding program or  programs,
and;
  (b)  for  the  funding of capital projects, equipment acquisitions, or
similar expenses which have  been  authorized  by  law  to  be  financed
through the issuance of bonds, notes, or other obligations] STATE FUNDED
DEBT.
  S  5.  Section  24 of the state finance law is amended by adding a new
subdivision 6 to read as follows:
  6. THE BUDGET BILLS SHALL INCLUDE AN APPROPRIATION  OF  THE  AVAILABLE
BALANCE  FROM THE DEBT REDUCTION RESERVE FUND CREATED BY SECTION NINETY-
SEVEN-RRR OF THIS CHAPTER, AS ADDED BY SECTION THIRTY-SIX OF PART  B  OF
CHAPTER  FIFTY-SEVEN OF THE LAWS OF NINETEEN HUNDRED NINETY-EIGHT, TO BE
USED EXCLUSIVELY FOR THE PURPOSE OF RETIRING OR DEFEASING  STATE  FUNDED
DEBT  OBLIGATIONS IN ACCORDANCE WITH THE CRITERIA ESTABLISHED BY THE NEW
YORK STATE DEBT MANAGEMENT BOARD.
  S 6. Subdivision 1 of section 51 of the  public  authorities  law,  as
added  by chapter 838 of the laws of 1983, paragraph k as added by chap-
ter 506 of the laws of 1995, paragraph l as added by chapter 468 of  the
laws  of  2004,  paragraph m as added by section 10 of part E of chapter
494 of the laws of 2009 and paragraph n as added by chapter 533  of  the
laws of 2010, is amended to read as follows:
  1.  [The] SUBJECT TO (A) THE COMPTROLLER'S CONSTITUTIONAL AUTHORITY TO
SUPERVISE THE ACCOUNTS OF  PUBLIC  AUTHORITIES,  (B)  THE  COMPTROLLER'S
STATUTORY  AUTHORITY  TO  APPROVE THE TERMS AND CONDITIONS OF DEBT OBLI-
GATIONS ISSUED BY PUBLIC  AUTHORITIES,  AND  (C)  THE  POLICY  STANDARDS
ESTABLISHED  BY  THE  NEW  YORK  STATE DEBT MANAGEMENT BOARD PURSUANT TO
SECTION SIXTY-SEVEN-D OF THE STATE FINANCE LAW  IN  RELATION  TO  PUBLIC
AUTHORITY  DEBT,  THE  New  York  state public authorities control board
shall have the power and it shall be its duty  to  receive  applications
for  approval  of the financing and construction of any project proposed
by any [of the following state public benefit corporations:
  a. New York state environmental facilities corporation

S. 1925                             9

  b. New York state housing finance agency
  c. New York state medical care facilities finance agency
  d. Dormitory authority
  e. New York state urban development corporation
  f. Job development authority
  g. Battery park city authority
  h. New York state project finance agency
  i. State of New York mortgage agency
  j. New York state energy research and development authority
  k. Long Island Power Authority
  l. Albany Convention Center Authority
  m.  State  of  New  York  Municipal  Bond Bank Agency for bonds issued
pursuant to section two thousand four hundred thirty-six-b of this chap-
ter
  n. North Country Power Authority] CLASS A OR CLASS B PUBLIC AUTHORITY,
AS DEFINED IN SECTION TWO OF THIS CHAPTER.
Any application made concerning  a  project  shall  include  the  terms,
conditions and dates of the repayment of state appropriations authorized
by  law  pursuant to a repayment agreement, AND A CURRENT LISTING OF ALL
OUTSTANDING DEBT AND DEBT SERVICE  OBLIGATIONS  OF  THE  APPLICANT.  Any
subsidiary  of,  or corporation with the same members or directors as, a
public benefit corporation subject to the  provisions  of  this  section
shall  also  be  subject to the provisions of this section. All applica-
tions and submissions to the board required to be made by  a  subsidiary
shall  be made on behalf of such subsidiary by the public benefit corpo-
ration which created  the  subsidiary.  No  public  benefit  corporation
subject  to  the  provisions  of this section shall make any commitment,
enter into any agreement or incur any indebtedness for  the  purpose  of
acquiring,  constructing, or financing any project unless prior approval
has been received from the board by such public benefit  corporation  as
provided herein.
  S  7.  Section 51 of the public authorities law is amended by adding a
new subdivision 6 to read as follows:
  6. NOT LATER THAN NINETY DAYS AFTER THE END OF EACH FISCAL  YEAR,  THE
BOARD SHALL SUBMIT TO THE GOVERNOR, THE COMPTROLLER, THE TEMPORARY PRES-
IDENT  AND  THE  MINORITY  LEADER OF THE SENATE, AND THE SPEAKER AND THE
MINORITY LEADER OF THE ASSEMBLY AN  ANNUAL  REPORT  DETAILING:  (A)  THE
AGGREGATE AMOUNT OF DEBT APPROVED BY THE BOARD DURING SUCH FISCAL YEAR;
  (B)  A  LIST OF THE INDIVIDUAL PROJECTS APPROVED BY THE BOARD FOR EACH
PUBLIC AUTHORITY DURING SUCH FISCAL YEAR; AND
  (C) THE TOTAL AMOUNT OF NEW DEBT OBLIGATIONS THE  BOARD  HAS  APPROVED
DURING SUCH FISCAL YEAR FOR ISSUANCE BY EACH PUBLIC AUTHORITY.
  THE  BOARD  SHALL  PUBLISH  SUCH  REPORT BY POSTING SUCH REPORT ON THE
BOARD'S INTERNET WEBSITE. EACH SUCH REPORT POSTED ON THE BOARD'S  INTER-
NET  WEBSITE  SHALL  BE  MAINTAINED  ON SUCH WEBSITE FOR AT LEAST TWELVE
MONTHS OR UNTIL THE NEXT SUCH REPORT IS POSTED ON SUCH WEBSITE, WHICHEV-
ER IS LATER. THE BOARD SHALL ISSUE A NEWS RELEASE ANNOUNCING SUCH REPORT
TO NEWSPAPERS OF GENERAL  CIRCULATION  AND  RADIO  AND  TELEVISION  NEWS
BUREAUS WITHIN THE STATE.
  S  8.  Subdivision  2 of section 365 of the public authorities law, as
separately amended by sections 349 and 381 of chapter 190 of the laws of
1990, is amended to read as follows:
  2. The notes and bonds shall be authorized by resolution of the board,
shall bear such date or dates and mature at such time or times,  in  the
case  of  notes  and  any renewals thereof within five years after their
respective dates and in the case of bonds not exceeding forty years from

S. 1925                            10

their respective dates, as such resolution or resolutions  may  provide.
The  notes  and  bonds  shall bear interest at such rate or rates, be in
such denominations, be in such form, either coupon or registered,  carry
such  registration privileges, be executed in such manner, be payable in
such medium of payment, at such place or places, and be subject to  such
terms of redemption as such resolution or resolutions may provide. Bonds
and  notes shall be sold by the authority, at public or private sale, at
such price or prices as the authority may determine. Bonds and notes  of
the  authority shall not be sold by the authority at private sale unless
such sale and the terms thereof have been approved  in  writing  by  the
comptroller, where such sale is not to the comptroller, or by the direc-
tor  of  the  budget,  where such sale is to the comptroller. [Bonds and
notes sold at public sale shall be sold by the comptroller, as agent  of
the authority, in such manner as the authority, with the approval of the
comptroller, shall determine.]
  S  9.  This act shall take effect immediately; provided, however, that
paragraph (a) of subdivision 3 and subdivision 6 of section 67-f of  the
state  finance  law,  as  added  by section one of this act, and section
three of this act, shall take effect on the same date  as  a  concurrent
resolution  of the Senate and Assembly entitled "proposing amendments to
article 7 of the constitution, in relation to the authorization of  debt
in times of public emergency, a limit on the total amount of state debt,
the  establishment  of  a  debt  management board and refunding of state
debts", takes effect.

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