BILL NUMBER:S2907          REVISED MEMO 07/15/2015

TITLE OF BILL:  An act to amend the local finance law, in relation to
the period of probable usefulness of heating systems

PURPOSE OR GENERAL IDEA OF BILL:

Provides that the period of probable usefulness of the installation or
reconstruction of a boiler or furnace, used as a thermal heating
system for a building or complex of buildings, when not in connection
with the original construction or reconstruction of such building, is
15 years for purposes of local financing.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1 amends subdivision 13 of paragraph (a) of section 11.00 of
the local finance law to specify that the period of probable
usefulness of the installation or reconstruction of a heating system
in a building for such purposes is fifteen years.

Section 2 contains the effective date.

EXISTING LAW:

Section 11.00 of the local finance law provides for a ten year period
for a heating, lighting, plumbing, ventilating elevator or power plant
              

or system for class "A" or "B" building and five years for a class "C"
building.

JUSTIFICATION:

Municipalities across the state are looking to undertake new biomass
heating projects in their buildings but are limited to a ten year bond
due to their expected useful life under current law. However, the
useful life of heating systems under the local finance law does not
accurately reflect the actual useful life of these systems. The useful
life of a furnace can be approximately fifteen years or longer and
because the local finance law does not differentiate between furnace
and boiler heating systems, local governments cannot bond for a period
longer than ten years for a new or replacement boiler. This bill aims
to correct the actual useful life of these systems.

This legislation will amend local finance law to mirror what is
currently in state finance law. Extending the probable life of a
heating system from 10 to 15 years or longer would give localities the
option to finance for an additional five years which ultimately
increases their ability to offer better services to residents and
limit tax increases. This legislation is intended for municipal
buildings and does not affect other programs administered by the
state.

PRIOR LEGISLATIVE HISTORY:

2014: A.10052/S.7584-A (Passed Senate)

FISCAL IMPLICATIONS:


None to the state.

EFFECTIVE DATE:

This act shall take effect immediately