§ 3.07. State financial assistance for improvement, expansion or
rehabilitation of existing buildings. 1. Any other provision of any
other law to the contrary notwithstanding, state financial assistance
may be provided for up to fifty percent of the approved costs (excluding
feasibility studies, plans or similar activities) of eligible projects
for the rehabilitation of existing buildings, including leasehold
improvements, by an eligible nonprofit cultural organization, as
provided herein. Such financial assistance may be in the form of grants
and/or loans.

2. A nonprofit cultural organization may submit an application for
state financial assistance for eligible projects as provided herein. The
council, after review of the programmatic and fiscal needs and resources
of the project and the organization, shall make a determination, subject
to the restrictions, limitations, responsibilities and requirements of
this section, as to the amount of state financial assistance in the form
of a grant and/or state financial assistance in the form of a loan, or
any combination thereof, that the organization may receive, provided,
however, that subject to the requirements established herein:

(a) Any financial assistance in the form of a grant may be provided
for any amount from funds appropriated specifically therefor up to and
including the amount of fifty thousand dollars.

(b) Any financial assistance in the form of a loan may be provided
from the arts capital revolving fund established pursuant to section
ninety-seven-z of the state finance law for any amount up to and
including the amount of one hundred thousand dollars, provided that
interest in any such loan shall not exceed a maximum of ten or a minimum
of three percent per annum.

(c) Any combined financial assistance in the form of a grant and a
loan may be provided for an amount up to and including the amount of one
hundred fifty thousand dollars and may include any amount of state
financial assistance in the form of a grant and any amount of state
financial assistance in the form of a loan, as shall be determined by
the council subject to the provisions of paragraphs (a) and (b) of this
subdivision and the requirements, duties and responsibilities imposed by
this section.

(d) Nothing contained herein shall be deemed to require approval of a
total of fifty thousand dollars in state financial assistance in the
form of a grant, or approval of a total of one hundred thousand dollars
in state financial assistance in the form of a loan, or to prevent the
council from approving a loan or any combination of a grant and loan in
any amount, subject only to the limitation on such financial assistance
imposed by paragraphs (a) and (b) of this subdivision, and the council's
determination of the programmatic and fiscal needs and resources of the
project and the organization, and other requirements of this section,
irrespective of the amount of state financial assistance in the form of
a grant and/or state financial assistance in the form of a loan
requested or suggested by the applicant.

(e) The council may contract with outside entities to effect the
purposes of this paragraph and to disburse loans and receive payments on
such loans.

3. (a) For the purposes of this section, organizations or eligible
organizations shall mean nonprofit cultural organizations which received
funding from the council in each of the three previous state fiscal
years and which own a condominium or a building or a part of a building
or which own shares representing a cooperative interest in a building or
which have entered into a lease-purchase agreement to own a building or
which lease a building or space in it, and which operate a program
therein, provided that evidence of such ownership, lease or
lease-purchase agreement shall be provided by the eligible organization
in such manner and form as is satisfactory to the council. Nothing
contained herein shall prevent an eligible organization from receiving
financial assistance under this section which has satisfactory occupancy
agreements in a building which is owned by a local government.

(b) Eligible organizations shall not include:

(1) public school districts, their components, and affiliate
organizations, state agencies or departments, or, except as provided
hereunder, public universities, their components and affiliate
organizations; or

(2) the provisions of subparagraph one of this paragraph to the
contrary notwithstanding, a public university, its components or
affiliate organizations may be funded if it serves and is located in a
rural or minority community, as such shall be determined by the council
pursuant to subdivisions seven and fifteen of this section and meets all
other applicable requirements for funding under this section, provided
that applications from such entities for state financial assistance
shall not be considered by the council prior to December thirty-first in
any state fiscal year.

(c) Eligible projects shall include:

(1) improvement, expansion or rehabilitation of a building for arts
purposes;

(2) improvement, expansion or rehabilitation of existing buildings to
increase or assure public access;

(3) improvement or rehabilitation of existing buildings for energy
conservation purposes or for such other purposes as will serve to reduce
the organization's costs of operation in such building;

(4) improvement or rehabilitation of existing buildings to address
known health and safety deficiencies;

(5) improvement, expansion or rehabilitation of existing buildings to
provide for handicapped accessibility;

(6) such other projects of substantive character as are in keeping
with the spirit and intent of this section.

(d) No project shall be considered eligible if it is approved for
financing from any other state assistance program.

4. Each application for financial assistance shall be submitted to the
council by the governing body of the eligible organization. Each
application shall:

(a) demonstrate that adequate operating support and resources will be
available at the completion of the project to provide an improved or
increased level of service;

(b) contain verification in such form as may be acceptable to the
council that the remaining cost of the project, exclusive of state
financial assistance, has been or will be obtained;

(c) demonstrate that the project will be completed promptly and in
accordance with the application;

(d) either demonstrate that the operation of the organization will be
made more economical or efficient as a consequence of approval or
demonstrate that health and safety concerns will be repaired or access
to handicapped provided;

(e) demonstrate that the project will be conducted in accordance with
applicable federal, state and local laws and regulations;

(f) demonstrate that, where appropriate, competitive bidding
procedures will be followed as required by law, or provide such other
evidence of competition as shall be satisfactory to the council;

(g) provide an assessment of the useful life of the project, and such
recommendation, analysis of needs or feasibility studies as may be
required by the council provided, however, that for the purposes of this
section the term "useful life" shall mean such method of calculating the
worth of a project and the amount of annual depreciation necessary for
effecting contracts under this section as the council shall require
after consultation with the state comptroller and upon approval by the
state division of the budget;

(h) demonstrate that contracts for the project will be executed in
accordance with subdivision twelve of this section;

(i) provide such other information as may be required by the council
including such guarantees as are further required by subdivisions eight
and nine of this section.

5. Each organization may submit no more than one application annually.
Any other provision of this section to the contrary notwithstanding, no
organization shall receive state financial assistance under this section
funding more than three years in any consecutive five-year period.

6. (a) Each application for state financial assistance shall be
reviewed by the council for its merits and for the programmatic and
fiscal needs and resources of the proposed project and the applicant
organization. Any application for a project whose total cost equals or
exceeds the sum of one million dollars which is deemed preliminary
acceptable shall be submitted by the council to the dormitory authority
of the state of New York for technical review. Provided, however, that
nothing contained herein shall prevent the council from submitting any
application for financial assistance, irrespective of the amount of
financial assistance requested or the total project cost, to the
authority for technical review and recommendations pursuant to the
provisions of this section.

(b) Within thirty days of the receipt of an application from the
council, the authority shall provide the council with a written
evaluation of the project which shall include the following factors:

(1) feasibility of the proposed project from an engineering
standpoint;

(2) total project cost estimate;

(3) proposed project schedule;

(4) useful life of the proposed project as defined pursuant to
paragraph (b) of subdivision four of this section;

(5) such other factors which the authority shall determine are
applicable to its evaluation of the project.

(c) If within the thirty-day period the authority finds more
information is necessary, the authority shall so notify the council and
shall have a maximum of ninety days to complete its review.

(d) Concurrent with its approval of any application, the authority
shall include its recommendation as to the manner in which the design
and construction of the project should be managed.

(e) In any case where the authority and the council and the
organization have agreed that the authority will award contracts for the
design and construction of the project, the authority shall prepare or
cause to be prepared a feasibility design and performance plan which
shall set forth the terms and conditions associated with the
construction management process. Such plan shall contain provisions
relating to the relative responsibilities of the authority, appropriate
performance and surety bonds, remedies against architects, contractors
and sureties deemed to be in default in the performance of their
obligations, and, generally, the management of the construction process
in a professional manner in accordance with prevailing construction
industry standards.

(f) Should the authority fail to provide the council with an approval,
disapproval or request for additional information within thirty days of
receipt of the original application or within ninety days as may be
appropriate, the application shall be submitted to the council for its
final approval or disapproval.

(g) If approved by the authority, the application shall be returned to
the council, which may provide final approval for state financial
assistance.

(h) Subject to approval by the director of the division of the budget,
the council shall enter into an agreement to insure that the authority
shall be reimbursed for reasonable expenses incurred in fulfilling its
responsibilities under this section and shall authorize payment to the
authority out of monies earned on interest in the arts capital revolving
fund established pursuant to section ninety-seven-z of the state finance
law or from any other funds allocated by it to fulfill the purposes of
this section, provided, however, that in no event shall the council
authorize payment under this paragraph an amount greater than the sum of
fifty thousand dollars in any state fiscal year.

7. In approving any application, the council shall consider:

(a) the condition of the existing building;

(b) the recommendation and analysis of need as provided in the
feasibility study or other documentation required by the council;

(c) the available resources for the project;

(d) the nature of the activities proposed to take place at the site
which is the subject of the application;

(e) such other criteria as the council may deem appropriate or
necessary to the approval of any application, including the fiscal
resources of the applicant, which shall be determined after review of
any one of the prior year's report of the following: a financial
statement prepared by an independent certified public accountant; an
annual statement of income and expenses; a federal tax return with all
itemizations and breakdowns; or a long form report from the office of
charities registration; and

(f) where appropriate and in keeping with the provisions of
subdivision fifteen of this section, the needs of rural and minority
communities.

8. Any other provision of law or of this section to the contrary
notwithstanding, state financial assistance shall not be provided
pursuant to this section until the council has (a) considered the useful
life of the eligible project as such term is defined herein; (b)
determined the grant, loan or combined amount of state financial
assistance to be provided; and (c) executed an agreement to provide such
assistance. Such agreement shall be executed by the council and the
organization or, in the case of a leasehold or lease-purchase agreement,
with the eligible nonprofit cultural organization and, where
appropriate, the owner of the property for which the eligible project
has been proposed. Any such agreement shall provide for the creation of
a lien or other security interest or such other guarantee as shall be
satisfactory to the council to assure repayment of financial assistance
provided under this section. Such agreement shall assure that the length
of a loan shall not exceed the useful life of the project and shall
include, in addition to such other provisions as the council may
require, the following:

(i) the amount of financial assistance, the terms and conditions upon
which it is provided, the useful life of the eligible project and the
method of depreciating the eligible project for purposes of the
repayment provisions of the agreement;

(ii) a requirement that the organization provide the council with such
prior notice as the council may require of a sale or other disposition
of the subject property or of a termination of the lease prior to the
expiration of such useful life or the expiration of the term of any loan
made hereunder;

(iii) a requirement that, in the event of such sale or disposition of
the property or termination of the lease prior to the expiration of the
useful life or the expiration of the term of any loan made hereunder,
the owner of the subject property or such other guarantor shall repay to
the council an amount equal to that portion of the approved costs of the
project financed by financial assistance provided under this section,
less accumulated depreciation, as of the date of such sale, disposition
or termination, or, in the case of a loan or a combination of a grant
and loan, repay an amount equal to the unpaid balance of the loan;

(iv) a requirement that, upon a finding by the council that a project
has not been completed, or has not been completed in accordance with the
terms of the agreement, the full amount of the financial assistance
provided in the form of a grant, or the outstanding balance of financial
assistance provided in the form of a loan shall be repaid to the council
by the guarantor, provided that upon a showing of good cause by the
organization the council shall grant an extension of up to ninety days
from the date of such finding to allow the organization to complete the
project in accordance with the terms of the agreement, and further
provided that the council shall provide no more than two such extensions
from the date of such finding to allow the organization to complete the
project in accordance with the terms of the agreement.

9. In any case in which state financial assistance is provided in the
form of a loan or as a combination of a grant and loan, the following
shall additionally be included in the agreement:

(i) a requirement that the organization shall obtain, in addition to
such other security as may be required by the council or by other
provisions of law, an undertaking or surety bond from any person or
entity which has contracted to perform work on an approved project to
assure the faithful performance of such project and/or a labor and/or
material bond as may be appropriate; and

(ii) a requirement that the authority shall provide such construction
management services as have been specified and agreed to pursuant to
paragraphs (d) and (e) of subdivision six of this section.

10. Any lien, security interest or guarantee established created under
the provisions of subdivision eight or nine of this section shall be in
addition to any other rights or obligations of the council under the
provisions of the lien law or any other law.

11. The council shall cause to be filed and to be recorded in the
office of the county clerk in the county where the subject property is
situated any lien or other security interest as may be required to
assure repayment of financial assistance in accordance with the
provisions of this section. The department of law shall provide such
assistance as the council may require to create and perfect any such
liens or other security interests.

12. (a) All contracts for design, construction, services and materials
pursuant to this section of whatever nature and all documents soliciting
bids or proposals therefor shall contain or make reference to the
following provisions:

(i) That the contractor will not discriminate against employees or
applicants for employment because of race, creed, color, national
origin, sex, age, disability, or marital status, and will undertake or
continue existing programs of affirmative action to ensure that minority
group persons and women are afforded equal opportunity without
discrimination. Such programs shall include, but not be limited to,
recruitment, employment, job assignment, promotion, upgrading, demotion,
transfer, layoff, termination, rates of pay or other forms of
compensation, and selection for training and retraining, including
apprenticeship and on-the-job training;

(ii) That the contractor shall request any employment agency, labor
union, or authorized representative of workers with which it has a
collective bargaining or other agreement or understanding and which is
involved in the performance of the contract to furnish a written
statement that it will not discriminate because of race, creed, color,
national origin, sex, age, disability or marital status and it will
cooperate in the implementation of the contractor's obligations
hereunder;

(iii) That the contractor will state, in any solicitations or
advertisements for employees placed by or on behalf of the contractor in
the performance of the contract, that all qualified applicants will be
afforded equal employment opportunity without discrimination because of
race, creed, color, national origin, sex, age, disability or marital
status;

(iv) That the contractor will include the provisions of subparagraphs
(i) through (iii) of this paragraph in every subcontract or purchase
order in such a manner that such provisions will be binding upon each
subcontractor or vendor as to its work in connection with the contract
with the agency.

(b) The council shall establish appropriate measures, procedures and
guidelines to ensure that contractors and subcontractors undertake
meaningful programs to employ and promote qualified minority group
members and women. Such procedures may require after notice in a bid
solicitation, the submission of a minority and women workforce
utilization program prior to the award of any contract, or at any time
thereafter, and may require the submission of compliance reports
relating to the operation and implementation of any workforce
utilization program adopted hereunder. The council may take appropriate
action, including the impositions of sanctions for non-compliance to
effectuate the provisions of this subdivision and the monitoring of
compliance with this subdivision.

(c) (i) In the performance of projects pursuant to this section,
minority and women-owned business enterprises shall be given the
opportunity for meaningful participation. For purposes hereof, minority
business enterprise shall mean any business enterprise which is at least
fifty-one per centum owned by, or in the case of a publicly owned
business, at least fifty-one per centum of the stock or other voting
interest is owned by citizens or permanent resident aliens who are
Black, Hispanic, Asian, American Indian, Pacific Islander, or Alaskan
native, and such ownership interest is real, substantial and continuing
and has the authority to independently control the day to day business
decisions of the entity for at least one year; and women-owned business
enterprise shall mean any business enterprise which is at least
fifty-one per centum owned by, or in the case of a publicly owned
business, at least fifty-one per centum of the stock to other voting
interests of which is owned by citizens or permanent resident aliens who
are women, and such ownership interest is real, substantial and
continuing and has the authority to independently control the day to day
business decisions of the entity for at least one year.

The provisions of this subdivision shall not be construed to limit the
ability of any minority business enterprise to bid on any contract.

(ii) In order to implement the requirements and objectives of this
section, the council shall request, as appropriate, the assistance of
other state agencies to monitor the contractors' compliance with
provisions hereof, provide assistance in obtaining competing qualified
minority and women-owned business enterprises to perform contracts
proposed to be awarded, and take other appropriate measures to improve
the access of minority and women-owned business enterprises to these
contracts.

13. In approving applications pursuant to this section, the council
shall seek to insure that:

(a) sixty percent of the funds appropriated pursuant to this section
and made available for grants, and sixty percent of the funds made
available for loans shall be made available in such a manner as to
insure that the ratio of the amount received within each county to the
whole of the financial assistance made available pursuant to this
paragraph is no greater than the ratio of the population of such county
to the population of the state, provided;

(b) notwithstanding the provisions of paragraph (a) of this
subdivision the council shall make such additional allocations for rural
and minority communities as to insure that the needs of cultural
development are met; and

(c) any funds made available pursuant to paragraph (a) or (b) of this
subdivision which, by December thirty-first of the year in which this
section shall have become a law, and October thirty-first of each year
thereafter are declined by or which cannot be used by such organizations
within such counties, and/or such communities, as such shall be
determined by the council, shall be made available to other eligible
nonprofit cultural organizations for eligible projects.

14. Any other provision of this section or of any other law to the
contrary notwithstanding, the council shall provide a reasonable amount
not exceeding seven and one-half percent of the funds appropriated
pursuant to this section to organizations located in rural or minority
communities, as such shall be determined by the council, to obtain
technical and/or financial assistance necessary to bring a project to
fruition, provided, however that this subdivision shall only be
effective until March thirty-first, nineteen hundred eighty-nine.

15. The council shall establish a written policy recognizing the
importance of and making provision to further cultural development in
rural and minority communities, as such shall be determined by the
council. Copies of the council policy concerning minority and rural
cultural development shall be provided to the senate finance and the
assembly ways and means committees.

16. To insure effective evaluation of applications made to it for
financial assistance under this section at least three or one-fourth
whichever is less of the persons designated by the chairman to provide a
review of such application shall be licensed professional engineers.
Such engineers shall be chosen for their expertise in the disciplines
critical to the design process including but not limited to structural,
mechanical and electrical and acoustical. The recommendations made by
such engineers concerning each application shall be considered
specifically and apart from the reviews of any other persons designated
to provide a review of such applications, and, any other provision of
any other law to the contrary notwithstanding, such engineers may be
designated to conduct audits or may be retained as consultants by the
council. Nothing contained herein shall prevent the council from meeting
the requirements of this subdivision by retaining an engineering firm as
a consultant. Nothing contained in this subdivision shall be deemed to
affect quorum requirements of any review group or panel established by
the chairman to review such applications, or to require the presence of
all of such engineers at each such meeting of each such review group or
panel. The council shall establish appropriate quorum requirements for
this panel or review group.

17. In the event an eligible organization fails to make a payment on a
loan or fails to make any other payment required under the provisions of
this section, the council shall inform the comptroller of such failure
and of the amount overdue, which amount the comptroller may recover from
any payments due from the state to the eligible organization, including
local assistance payments.

18. The council shall adopt guidelines within sixty days of the
effective date of this section, and shall promulgate rules and
regulations not later than September first, nineteen hundred
eighty-eight as are necessary to carry out the purposes and provisions
of this section. In addition to any other requirements set forth by this
section, the council shall, in establishing such guidelines, rules and
regulations, delimit the application process, provide for an appeals
procedure, establish the written policy required by subdivision fifteen
of this section and establish procedures for the recoupment of financial
assistance provided in the event that a project is not completed or not
completed as proposed by the applicant organization. Copies of such
rules and regulations shall be provided at least sixty days prior to the
time they shall be effective to the senate finance committee and the
assembly ways and means committee.

19. The council shall report to the governor, the temporary president
of the senate, the speaker of the assembly, the chairs of the senate
finance committee and assembly ways and means committee not later than
January fifteenth of each year concerning the amounts appropriated and
expended pursuant to this section, the number of applications received,
the total amount of financial assistance requested, the total number of
applications funded, the amount of funding provided, and such other
information as the chairman shall deem appropriate, including any
recommendations for program improvement, recommendations for increasing
the total amount of funding from state and nonstate sources available to
increase total funds for projects available to the arts and cultural
community of this state, in particular for rural and minority
communities, and identification of and proposals for removing barriers
or limits faced by communities in accessing the program or in maximizing
use of funds provided hereunder.