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This entry was published on 2014-09-22
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SECTION 34
Issue of bonds by city
Rapid Transit (RAT) CHAPTER 48-A, ARTICLE 4
§ 34. Issue of bonds by city. a. For the purpose of providing the
necessary means for such construction, or equipment, or both, as the
case may be, or acquiring by purchase, at the public expense, of any
such road or subsurface structures, and the necessary means to pay for
property rights which shall be acquired by the city for the purposes of
the construction or the operation of any such road as provided in this
chapter, and the necessary means to pay awards made as provided in this
chapter for damages for change of grade on any street and to pay the
expenses of proceedings to determine such damages, and of meeting the
interest on obligations, issued for the purposes of this section,
accruing thereon prior to the completion and readiness for operation of
the portion of such road, and such sub-surface structures, for the
purchase, construction, or equipment of which such obligations shall
have been respectively issued, the mayor, from time to time, as the same
shall be necessary, upon the requisition of the board of transportation,
shall make available such sums as may be necessary, upon vouchers
certified by the board of transportation. In case any person shall claim
to be entitled to any money on account of a contract entered into under
the terms of this chapter, for the construction of any part of a
municipal railroad and the board of transportation shall fail, neglect
or refuse to certify a proper or sufficient voucher for the payment of
the money so claimed, a proper or sufficient voucher shall not be a
condition precedent to the liability of the city, but an action may be
brought directly against the city for the recovery of such money as such
person may be entitled to. This section shall not affect the powers of
the board or its engineers, as set forth in this chapter or as they may
be prescribed in any contract entered into pursuant thereto, or to
change or alter in any respect the existing rules of law as to the force
or effect of any certificate which shall have been or may hereafter be
made under any contract. This section shall be deemed to apply also to
any such actions instituted before May sixth, nineteen hundred
twenty-one. If bonds are issued by the city for the purposes of this
section they may be made payable out of a sinking fund to be established
and created out of the annual rentals or revenues of such road,
including sub-surface structures, as provided in this chapter. In case
the board shall request the mayor to have any part of the work of
restoration of street surfaces or property incidental to the
construction of any such road performed by or under the direction of any
head of an agency of such city or any subdivision of such city, the
mayor may set apart out of any appropriation theretofore made under the
foregoing provisions of this section such amount as the board of
transportation may specify and shall make such amount available for the
use of such head of such agency for the purposes of such restoration of
street surfaces or property.

b. A contract for the construction of such road shall not be made
unless and until the mayor shall have consented thereto and prescribed a
limit to the amount of funds available for the purposes of this section
which shall be sufficient to meet the requirements of such contract in
addition to all obligations theretofore incurred and to be satisfied
from such funds. The board of transportation of the city of New York, in
its discretion, may request the mayor to make available either such
amounts from time to time as it shall deem the progress of the work to
require, or the full amount sufficient to pay the entire estimated
expenses of executing any contract made pursuant to this chapter. The
certificate of the comptroller, mentioned in section 93c-3.0 of the
administrative code of the city of New York shall not be necessary to
make any such contract binding on the city. Before finally fixing the
terms and conditions of any contract for any of the purposes contained
and set forth in this chapter, the board of transportation may set a
date or dates for a public hearing upon the proposed terms and
conditions thereof, at which citizens shall be entitled to appear and be
heard. No such hearing shall be held, however, until notice thereof
shall have been published for at least two weeks immediately prior
thereto in the city record, or other official publication of the city,
and at least twice in two daily newspapers published in the city. In any
case where such a public hearing has been scheduled, it shall be the
duty of the board of transportation to cause as many copies of a draft
of the proposed contract to be printed at least two weeks in advance of
such hearing as may be necessary. Such notice of such public hearing
shall state where copies of such drafts may be obtained upon payment of
a fee, to be fixed by such board, but not to exceed one dollar for each
copy. The board, after the hearing to be held as above required, may
alter, modify or amend such draft contract in any manner in its
discretion.

c. A railroad owned or to be owned by the city, and for the
construction of which with public money in whole or in part a contract
was or is authorized by this chapter to be entered into as aforesaid,
shall be a local improvement the cost of which railroad may be met in
whole or in part by assessment on the property benefited. The board,
with the approval of the board of estimate and of the mayor, shall have
power to determine whether all or any, and if any, what portion of the
cost and expense necessary to be incurred for any such road shall be
assessed upon property benefited thereby, and whether all or any, and if
any, what portion of the cost and expense necessary to be incurred, or
which shall have been already necessarily incurred, for the acquisition
of any property for the construction or operation of such railroad shall
be assessed upon property benefited by such railroad. An assessment upon
the property so benefited may be laid, confirmed, enforced and collected
in accordance with such determination and pursuant to the provisions of
the charter, administrative code of such city and other laws respecting
assessments for local improvements in such city.

d. At any time after the consents have been obtained for any such
railroad and the detailed plans and specifications therefor have been
prepared as authorized and directed by this chapter, the board may
certify and transmit to such board of estimate an estimate of the cost
and expense necessary to be incurred for the construction of such
railroad, and for the acquisition of any property, including equipment
other than rolling stock, that shall be necessary either for the
construction or the operation of such railroad, or from time to time an
estimate of the cost and expense necessary to be incurred or a statement
of the cost and expense which has been necessarily incurred for the
acquisition of any property for the construction or operation of such
railroad. With such estimate or statement the board of transportation
shall transmit a statement which shall show:

1. The proportion of such cost and expense, together with the amount
thereof in money, which should be assessed upon the property benefited;

2. The boundaries of the district in such city upon which an
assessment aggregating such amount should in the opinion of the board be
levied, and

3. The amount so to be levied in every such district.

Thereupon the board with the approval of the board of estimate and of
the mayor, shall have power to, and, if in their judgment the interests
of the public so require, after publishing a notice at least one week in
advance in the City Record and in such other newspapers published in
such city as such board of estimate with the approval of the mayor,
shall designate as sufficient, stating the time, place and subjects to
be considered, and after a joint hearing, pursuant to such notice by and
before the board of transportation and the board of estimate, which may
be adjourned from time to time, in accordance with the charter, code,
and laws aforesaid, they shall fix and determine the boundaries of the
district upon which such assessment shall be levied, the whole amount or
proportion of any such cost and expense to be assessed upon property
benefited by such improvement, and the amount or proportion of such
whole assessment to be levied in such district benefited by such
improvement, and take such other and further proceedings as shall be
necessary to levy and collect such assessment. Such decision of the
board of transportation so approved by the board of estimate and the
mayor, shall be final as to each matter so fixed and determined and
shall not be subject to review.

e. The board of estimate, with the approval of the mayor, shall
certify to the board of assessors of such city the amount of such cost
and expense so directed to be assessed upon property benefited in each
such district. Such board of assessors shall thereupon proceed forthwith
to levy and assess such amount upon the real property within the
district benefited thereby in proportion to the amount of such benefit
and shall not be limited in the levying of such assessment to one-half
of the fair value of any house or lot or improved or unimproved land.
Such assessment when laid shall be subject to, and protected by, all
provisions of the charter and administrative code of such city
applicable to assessments for local improvements levied pursuant to such
charter and code.

f. An assessment levied against any property in accordance with this
section shall be payable as follows, namely: one-tenth thereof within
sixty days from the date of the confirmation and entry of each
assessment and the remainder of such assessment in nine installments as
nearly equal in amount as may be with interest thereon from the date of
entry and confirmation at the rate of six per centum per annum in one,
two, three, four, five, six, seven, eight and nine years respectively
thereafter, but all installments not due may be paid at any time with
interest to the date of payment. If any installment and interest thereon
be not paid within three years after it shall become due and payable the
entire assessment less such part thereof as shall have been already
paid, shall become due and payable and must be immediately collected, or
the tax lien therefor sold or enforced in the same manner as other
delinquent assessments are required to be collected by the charter,
administrative code and other laws of such city.

g. Obligations of the city issued in advance of the collection of such
assessments shall be payable out of the rapid transit construction fund
as hereinafter directed to be constituted. They shall be a legal
investment for the sinking funds of such city and for trustees and other
fiduciaries charged with the investment of trust funds.

h. All moneys derived from the sale of such obligations, and all
moneys derived from the collection of such assessments shall be kept
separate and apart from all other funds of the city and shall be known
as the rapid transit construction fund of such railroad. Unless the
assessment be made separately for the cost and expense of acquisition of
property as aforesaid, they shall be applied only to the following uses
and, among such uses, only in the following order as nearly as may be:

1. To the cost and expenses of the construction of such railroad and
the acquisition of property necessary for such construction, including
equipment other than rolling stock;

2. To the acquisition of real property necessary for the operation
thereof;

3. To the retirement of the obligations therefor.

In case an assessment is made separately for the cost and expense
incurred or to be incurred for the acquisition of any property for the
construction or operation of any such railroad, the money derived from
the sale of such obligations, and all moneys derived from the collection
of such assessment shall be applied only to pay or reimburse the cost
and expense of acquisition of the property for which such assessment was
made or to the retirement of the obligations issued in advance of the
collection of such assessment.

i. In case of default in the payment of any installment of interest or
principal of any such obligations the holder thereof may require, if
necessary, by peremptory order of mandamus, any tax lien of such city
for the amount of any assessment upon the property benefited which is
then due and payable, to be immediately sold or enforced in accordance
with the charter, administrative code and other laws of such city. If at
such time the tax lien so sold shall include, in addition to the lien of
the assessment aforesaid, any lien for delinquent taxes or other
lienable charges due to the city, and if it shall become necessary to
reduce the amount of the tax lien pursuant to such charter, code and
laws of such city, the lien shall not be reduced so as to make it less
in value than the amount of the assessment aforesaid with the interest
thereon. Notwithstanding any reduction as aforesaid, the proceeds of the
sale of such a lien, to the extent of the full amount of the assessment
and interest, shall be paid into the rapid transit construction fund of
the railroad aforesaid, and the balance, if any, shall be applied as
proceeds of the rest of the tax lien.

j. If any assessment shall be reduced for fraud, substantial error or
other reason, the cost and expense aforesaid may be reassessed, and the
reassessment shall stand as security for the obligations aforesaid to
the same degree and in the same manner as if it had been an original
assessment. In case any assessment is reduced below its original amount,
however, either the amount to be expended in constructing the railroad
aforesaid and for acquisition of property necessary for construction and
operation thereof as aforesaid, or to be expended for acquisition of
property, if the assessment reduced is for cost and expense thereof
separately, shall be correspondingly reduced or else the difference
between the original assessment and the reassessment shall be paid by
the city into the rapid transit construction fund of the railroad
aforesaid, either from current revenue or from sums to be made available
as the board of estimate shall determine.

k. If the cost and expenses of construction of any such railroad and
for acquisition of property necessary for construction and operation
thereof as aforesaid shall be only partially assessed as aforesaid upon
the property benefited, no provisions in any contract for the
construction thereof shall become operative until the board of estimate
and the mayor shall have consented thereto and shall have prescribed a
limit to the amount of city funds if any, available for the purpose of
such contract as hereinbefore provided. No provisions in any contract
for the construction of any railroad which construction is to be paid
for wholly or partly by means of local assessments shall become
operative until the board of estimate shall have levied an assessment to
provide for the construction thereof, and until either assessments shall
have been paid in, or obligations issued in advance of the collection of
such assessments, shall have been sold in sufficient amounts when paid
for, to cover the cost and expense payable from assessments levied as
aforesaid and until the board of estimate and the mayor shall have
consented to such a contract.

l. In a case where the moneys collected pursuant to such an assessment
shall be insufficient to discharge the obligations so issued as
aforesaid, or if the amount arising on the sale of such obligations is
insufficient to pay the expenses incurred for the construction of such
railroad and for acquisition of property necessary for construction and
operation thereof as aforesaid, or incurred for acquisition of property,
if the assessment is for cost and expense thereof separately, the
deficiency up to an amount not in excess of ten per centum of the total
amount of the assessment shall be paid by such city into the rapid
transit construction fund, either from current revenue or from sums made
available as the board of estimate and the mayor shall determine.