§ 21.11. Special provisions relating to tax-equivalency payments. 1.
The trust shall use and apply in the following order the tax-equivalency
payments it receives in respect of each combined-use facility:

(a) the trust shall first pay the costs of administration of the trust
allocable to such combined-use facility in accordance with generally
accepted accounting principles consistently applied, including without
limitation, the costs of collecting such tax-equivalency payments, and
establish or maintain such reserves for the payment of such costs as the
trust deems necessary;

(b) the trust shall then pay to the city, from and after the date on
which the trust acquires any real property described in subdivision two
of section 21.09 of this article or any other real property in or on
which all or any part of a combined use facility is or is designed to be
developed after January first, nineteen hundred ninety-seven, as nearly
as practicable in accordance with the applicable schedule for making
real property tax payments to the city with respect to such property,
annual amounts equal to the total assessed valuation, for the fiscal
year of such acquisition, of any such acquired real property with
respect to which real property taxes were paid to the city during the
fiscal year immediately preceding such acquisition, multiplied by the
real property tax rate applicable to such acquired property during each
fiscal year in which such amounts are required to be paid; provided that
the amount paid by the trust pursuant to this paragraph during any
fiscal year shall not be less than the amount paid by the trust pursuant
to this paragraph during the immediately preceding fiscal year;

(c) if, for any fiscal year of the city up to and including the fiscal
year ending ten years after the taxable status date next following the
completion of construction of the non-institutional portion of such
facility, the amount required to be paid by the trust pursuant to
paragraph (b) of this subdivision is less than ten per centum of the
aggregate amount of tax-equivalency payments received by the trust in
respect of such portion during the same fiscal year, then the trust
shall pay to the city, in lieu of the amount required to be paid by the
trust pursuant to paragraph (b) of this subdivision, an amount equal to
ten per centum of the aggregate amount of such tax-equivalency payments;

(d) the trust shall then pay to the city an amount equal to fifty per
centum of the increase in the amount of tax-equivalency payments
received by the trust in respect of the non-institutional portion of
such facility, during each fiscal year of the city following the fiscal
year beginning ten years after the taxable status date next following
the completion of construction of such portion, above the amount of the
tax-equivalency payments received by it during the fiscal year beginning
ten years after such taxable status date, such payments to be made by
the trust at the end of each fiscal year of the city for which they are
required to be made; to the extent that such increase has resulted from
a change in the assessed valuation or the real property tax rate applied
to such portion;

(e) with remaining amounts, to pay principal and interest on bonds,
notes and other obligations of the trust issued to finance development
of all or any part of the institutional portion of such combined-use
facility, and establish or maintain reserves to pay or secure such
bonds, notes or other obligations equal to no more than the sum required
to be paid to such reserves so that the moneys then held in such
reserves equal the aggregate amount of the then outstanding principal of
such bonds plus any redemption premium thereon and any interest to
accrue thereon to the earliest or subsequent date of payment or
redemption thereof;

(f) unless otherwise provided by a resolution of the board of estimate
of the city, or successor body, beginning with the fiscal year of the
trust in which the trust has paid, redeemed or otherwise retired or
provided a reserve to redeem or otherwise retire all bonds, notes and
obligations of the trust issued to finance development of all or any
part of the institutional portion of such combined-use facility, the
trust shall then pay from time to time the costs of operating and
maintaining the institutional portion, developed by or on behalf of the
trust, of such combined-use facility, including without limitation, the
costs of lighting, heating, cooling, security, maintenance, repairs and
necessary replacements; provided that at the end of each fiscal year of
the city after commencement of payment of such costs, the trust shall
have sufficient funds to make the payments then required under
paragraphs (b), (c) and (d) of this subdivision; and

(g) the trust shall then pay to the city the entire remaining balance
at the end of each fiscal year of the trust.

The provisions of paragraphs (b), (c) and (d) of this subdivision
shall be subject to any agreement under subdivision five of section
20.13 of article twenty of this chapter.

2. Solely for purposes of determining the amount of the
tax-equivalency payments required to be paid in respect of the real
property, consisting of the non-institutional portion, or any part
thereof, of a combined-use facility or in or on which all or any part of
such portion prior to completion is designed to be and upon completion
is developed for residential use, such real property shall be deemed to
be exempt from real property taxation as follows: during the period of
construction of such portion, such exemption shall consist of full
exemption, and for a period not to exceed ten years in the aggregate
after the taxable status date in the city next following the completion
of such construction, such exemption shall consist of two years of full
exemption, followed by two years of exemption from eighty percent of
such taxation, followed by two years of exemption from sixty percent of
such taxation, followed by two years of exemption from forty percent of
such taxation, followed by two years of exemption from twenty percent of
such taxation; provided that during such period of construction and such
ten-year period tax-equivalency payments shall be made with respect to
such real property at least equal to the amount computed by multiplying
(a) the amount which bears the same ratio to the assessed valuation, for
the fiscal year of the city prior to the commencement of such
construction, of the land comprising the zoning lot or lots, exclusive
of the real property described in subdivision two of section 21.09 of
this article on which all or any part of such combined-use facility is
or is designed to be developed as the floor area used or designed to be
used in the non-institutional portion of such facility for residential
use bears to the aggregate floor area permitted to be constructed on
such lot or lots under applicable zoning regulations in effect at the
time of commencement of such construction by (b) the real property tax
rate in the city for such fiscal year.

3. The exercise of the power granted to the trust by this article and
article twenty of this chapter to collect tax-equivalency payments from
owners is in all respects for the general welfare and benefit of the
people of the state, and with respect to such owners, has the same
effect as though such tax-equivalency payments were taxes as defined in
the real property tax law which had been duly levied and imposed upon
such owners by the city.

4. If any owner shall fail to make tax-equivalency payments as
required by this article and article twenty of this chapter, the trust
shall have a lien on the real property in respect of which such payments
were required to be made as if the tax-equivalency payments were real
property taxes and the trust were a tax district within the meaning of
the real property tax law. Such lien shall have all the priorities of a
lien for taxes of such real property in favor of the city and shall be
enforceable by the trust in the manner provided for the collection of
tax liens in title two of such article eleven; provided that in place of
any period of redemption provided by law no judgment of foreclosure
shall be entered until three years after the date on which such owner
first failed to make such payments; and provided further that from such
date interest shall accrue on such lien at the rate for late payment of
real property taxes in the city.