S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8870
 
                        2025-2026 Regular Sessions
 
                           I N  A S S E M B L Y
 
                               June 9, 2025
                                ___________
 
 Introduced  by  M. of A. PRETLOW -- (at request of the Governor) -- read
   once and referred to the Committee on Ways and Means
 
 AN ACT in relation to authorizing a loan from the state to the  city  of
   Dunkirk (Part A); and making an appropriation therefor (Part B)
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. This act enacts into law components of  legislation  neces-
 sary  to  authorize  a  loan  for the city of Dunkirk. Each component is
 wholly contained within a Part identified as  Parts  A  through  B.  The
 effective  date for each particular provision contained within such Part
 is set forth in the last section of such  Part.  Any  provision  in  any
 section  contained  within  a  Part, including the effective date of the
 Part, which makes a reference to a section "of this act", when  used  in
 connection  with  that particular component, shall be deemed to mean and
 refer to the corresponding section of the Part in  which  it  is  found.
 Section  three of this act sets forth the general effective date of this
 act.
 
                                  PART A

   Section 1. Legislative findings.  The  legislature  hereby  finds  and
 declares  that  a  condition of severe fiscal difficulties exists in the
 city of Dunkirk as a result  of  expenditures  exceeding  revenues  over
 numerous  years,  with the substantial accumulation of deficits expected
 for the close of the city's fiscal year 2024. Such condition,  including
 late and overdue financial statements, has contributed to a current loss
 of  confidence  by  investors in short-term and long-term obligations of
 the city of Dunkirk as demonstrated by  major  municipal  credit  rating
 agencies withdrawing credit ratings of the city.
   It is hereby further found and declared that the city of Dunkirk pres-
 ently has a $12.7 million revenue anticipation note with a maturity date
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD12017-01-5
              

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 of  July  24, 2025. The city has indicated that it would not have suffi-
 cient cash to repay the revenue anticipation note's principal and inter-
 est and has not attained the willingness of investors  to  purchase  new
 obligations  of  the  city  in time to provide for the repayment of such
 $12.7 million note so owed.
   It is hereby further found and declared that the inability to pay  the
 revenue  anticipation  note  could  have  significant negative financial
 implications for the city, other municipalities across  the  state,  and
 the  people  of the state through a loss of credit access or higher cost
 for borrowing.
   Based upon the fiscal condition of the city of Dunkirk and the  state-
 wide concerns of the financial implications that an inability to pay the
 revenue  anticipation  note  may result in, the legislature through this
 act authorizes an additional debt option for the city of  Dunkirk  as  a
 matter of last resort.
   §  2.  Short  title.  This  act shall be known and may be cited as the
 "City of Dunkirk Revenue Anticipation Note Refinancing Act".
   § 3. Definitions. As used in this act, the following words  and  terms
 shall  have  the  following meanings respectively, unless the text shall
 indicate another or different meaning or intent:
   (a) "Budget director" means the state director of the budget.
   (b) "City" means the city of Dunkirk, in the county of Chautauqua.
   (c) "City council" means the city council of the city.
   (d) "Deficit bonds" means the bonds authorized by the  Dunkirk  fiscal
 recovery act.
   (e)  "Deficit  notes"  means  bond anticipation notes issued in antic-
 ipation of the issuance of deficit bonds, as authorized by  the  Dunkirk
 fiscal recovery act.
   (f) "Dunkirk fiscal recovery act" means the act pursuant to part DD of
 chapter 56 of the laws of 2024.
   (g) "Mayor" means the mayor of the city.
   §  4.  Establishment  of a state loan to the city. Any payment made to
 the city from an appropriation made by part B of this  chapter,  enacted
 by  a  chapter  of  the  laws of 2025, shall be used by the city for the
 repayment and settlement of its revenue anticipation note due  July  24,
 2025,  and shall, notwithstanding any provision of the local finance law
 to the contrary, constitute a loan from the state to the city to address
 a budgetary deficit, the repayment of which  by  the  city  shall  be  a
 general  obligation  of  the  city and which shall be backed by the full
 faith and credit of the city, pursuant to the terms  and  structure  set
 forth in this act.
   §  5. Authorized loan amortization period and interest rate.  Notwith-
 standing any provision of law to the contrary, the  amortization  period
 of  the  loan  and  the  period  of probable usefulness shall be fifteen
 years. The rate of interest applied to the principal amount owed on such
 loan shall be seven and one-half percent per annum. If the reduction  of
 any  payment  or  payments  made on or on behalf of the city pursuant to
 section six of this act is insufficient to satisfy the annual  repayment
 amount set forth in the loan repayment schedule, the budget director may
 modify the terms of the loan, including term and interest.
   §  6. Loan repayment by the city. The city shall be obligated to repay
 the loan in accordance with a loan repayment schedule  provided  by  the
 budget  director  that reflects the amount and date of all loan payments
 made by the state to the city from an appropriation pursuant to  part  B
 of  this  chapter  during the state fiscal year beginning April 1, 2025.
 Such loan repayment schedule may be revised from time to time to reflect
 A. 8870                             3
 
 any modification of the terms of the loan as provided in section five of
 this act. By no later than September 30, of any year while such loan  is
 outstanding,  the budget director shall notify the mayor, the city coun-
 cil,  the  state  comptroller,  the chair of the assembly ways and means
 committee, and the chair of the senate finance  committee,  of  (a)  any
 offset  payment  deemed  made  by or on behalf of the city in accordance
 with section seven of this act,  and  (b)  the  principal  and  interest
 repayment  schedule reflecting the remaining amounts owed by the city to
 the state, for each state fiscal year, starting with  the  state  fiscal
 year that begins April 1, 2026.
   §  7. City state aid withholding. For so long as the loan shall remain
 outstanding, the budget director may direct any department,  agency,  or
 instrumentality thereof, to reduce the amount of any payment or payments
 owed in a fiscal year to the city of Dunkirk, or any department, agency,
 or  instrumentality thereof; provided however, that such reduction shall
 be in an amount no greater than the amount due  for  such  year  as  set
 forth in the loan repayment schedule. The budget director shall effectu-
 ate such reduction through a budget certification and authorization sent
 to  the  office  of the state comptroller. To the extent the city or any
 department, agency, or instrumentality thereof is entitled to  any  cash
 disbursement  authorized by any appropriation, such entitlement shall be
 reduced commensurate with the reductions determined pursuant to sections
 four and five of this act.
   § 8. Early termination and payoff of the loan.  The  state  shall  not
 require  the  early  termination  of  the  loan or the prepayment of any
 amounts set forth in the loan repayment schedule. The mayor, with  sepa-
 rate  concurrence  from a majority of the city council, may at any time,
 upon fifteen days' notice to the budget director, the state comptroller,
 the chair of the assembly ways and means committee, and the chair of the
 senate finance committee, prepay the loan in whole or in part, and if in
 whole, subject to the written confirmation of the budget director of the
 calculated amount of principal and interest owed by the city as  of  the
 proposed date of loan repayment.
   §  9.  Miscellaneous  provisions.  (a)  This  loan shall be treated as
 indebtedness of the city with respect to  article  eight  of  the  state
 constitution,  and, provided further, the amount of the annual principal
 and interest of such loan necessary to be raised from a tax on city real
 estate, in order to equally compensate  and  replenish  the  city's  all
 funds  budget  for  the annual withholding of state payments to the city
 pursuant to section seven of this act, shall be excluded  from  the  tax
 limit  imposed  by  section  ten  of article eight of the New York state
 constitution.
   (b) For so long as the state loan shall remain outstanding,  the  city
 shall  comply  with the requirements of sections seven, eight, nine, and
 ten of the "Dunkirk fiscal recovery act", whether  or  not  any  deficit
 bonds  or deficit notes as authorized within such act shall be outstand-
 ing.
   (c) Notwithstanding section four of the Dunkirk fiscal  recovery  act,
 or  any  other law to the contrary, the period of probable usefulness of
 the first issuance of deficit bonds or deficit notes  pursuant  to  such
 act shall be computed from the effective date of this act.
   (d)  On  or before July 9 of each state fiscal year for which the loan
 is still outstanding, beginning with state fiscal year 2026,  the  mayor
 shall  attest and provide notice of such attestation to the state direc-
 tor of the budget, the state comptroller, the chair of the assembly ways
 and means committee, and the chair of the senate finance committee, that
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 either: (i) the city, after a good faith  effort,  has  been  unable  to
 issue  deficit  notes  or  deficit  bonds pursuant to the Dunkirk fiscal
 recovery act, in order to prepay in whole  or  in  part  the  loan  made
 pursuant to this act, or (ii) the city has issued deficit notes or defi-
 cit  bonds  and is able to use such proceeds to prepay in whole the loan
 made pursuant to this act.
   § 10. This act shall take effect on the same  date  and  in  the  same
 manner as part B of this chapter, takes effect.
 
                                  PART B
 
   Section  1.  The sum of up to thirteen million, seven hundred thousand
 dollars ($13,700,000), or so much thereof as may be necessary, is hereby
 appropriated from any moneys in the state treasury in the  general  fund
 for  payment  to  the  city  of  Dunkirk solely to refinance its revenue
 anticipation note with a final maturity and due date of July  24,  2025.
 No  payment  shall  be  made  from this appropriation without a written,
 signed attestation by the mayor of the city of  Dunkirk  sent  electron-
 ically  to  the budget director, the state comptroller, the chair of the
 assembly ways and means committee, and the chair of the  senate  finance
 committee  by  no  later  than  July  9,  2025, stating that the city of
 Dunkirk has made good faith efforts, to date, to secure the full  amount
 of  principal  and  interest due on the city of Dunkirk's revenue antic-
 ipation note due on July 24, 2025 through and including any  combination
 of  city cash on hand, issuances of new city revenue or tax anticipation
 notes, or issuances of new deficit bonds or  deficit  bond  anticipation
 notes,  yet  the city is unable to secure enough funding to pay the full
 amount of principal and interest owed, and is in  need  of  a  specified
 dollar amount of the full principal and interest amount due to be loaned
 from  the state on behalf of the city of Dunkirk by means of this appro-
 priation.  Such attestation and request shall also include, on behalf of
 the city of Dunkirk, a pledge that the repayment of such loan  shall  be
 met with the full faith and credit of the city of Dunkirk. If the amount
 of  the  state  loan so requested by the mayor of the city of Dunkirk is
 less than the total principal and interest owed on  the  revenue  antic-
 ipation  note,  the  mayor shall further attest and certify, within such
 communication to the state no later than July 9, 2025, that the city  of
 Dunkirk  has  secured and shall cause to be deposited no later than July
 24, 2025, sufficient funds that, together with the requested state  loan
 amount  paid to the city of Dunkirk, shall completely pay off and settle
 the principal and interest of the note so  due,  thus  avoiding  a  city
 default  of  non-payment.  Such  funds shall be payable on the audit and
 warrant of the state comptroller on vouchers certified  or  approved  in
 the manner provided by law.
   §  2.  This  act shall take effect upon receipt of the written, signed
 attestation submitted by the mayor of the city of  Dunkirk  required  by
 section  one  of this act; provided, however, that the state director of
 the budget, state comptroller, chair of  the  assembly  ways  and  means
 committee,  and  chair  of the senate finance committee shall notify the
 legislative bill drafting  commission  upon  receipt  of  such  written,
 signed attestation in order that the commission may maintain an accurate
 and  timely  effective data base of the official text of the laws of the
 state of New York in  furtherance  of  effectuating  the  provisions  of
 section  44  of the legislative law and section 70-b of the public offi-
 cers law.
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   § 2. Severability clause. If any clause, sentence, paragraph, subdivi-
 sion, section or part of this act shall be  adjudged  by  any  court  of
 competent  jurisdiction  to  be invalid, such judgment shall not affect,
 impair, or invalidate the remainder thereof, but shall  be  confined  in
 its  operation  to the clause, sentence, paragraph, subdivision, section
 or part thereof directly involved in the controversy in which such judg-
 ment shall have been rendered. It is hereby declared to be the intent of
 the legislature that this act would  have  been  enacted  even  if  such
 invalid provisions had not been included herein.
   §  3.  This act shall take effect immediately; provided, however, that
 the applicable effective date of Parts A through B of this act shall  be
 as specifically set forth in the last section of such Parts.