A02787 Summary:

BILL NO    A02787 

SAME AS    Same as S 2216

SPONSOR    Dinowitz (MS)

COSPNSR    Englebright, Gabryszak, Rivera J, Jaffee, Gunther, Abbate

MLTSPNSR   Alfano, Finch, Maisel, McEneny, Sweeney

Add S209-a, Eld L

Enacts the New York State Senior Housing Opportunities Partnership Act and
establishes the New York state senior housing opportunities partnership
authority; such authority will finance or collaborate in the financing of
senior housing opportunities facility projects.

A02787 Actions:

BILL NO    A02787 

01/21/2009 referred to aging
01/06/2010 referred to aging

A02787 Votes:

A02787 Memo:

 BILL NUMBER:  A2787

 TITLE OF BILL :  An act to amend the elder law, in relation to
establishing the New York state senior housing opportunities
partnership act

 PURPOSE OR GENERAL IDEA OF BILL : To provide senior housing financing
for NORCs, adult homes, market rate independent, and others.

 SUMMARY OF SPECIFIC PROVISIONS : The bill amends the State Office for
the Aging to create the New York State Senior Housing Opportunities
Partnership Act as a new section 536-G of the Executive Law. The new
section creates the New York State Senior Housing Opportunities
Partner- ship Authority, which will work with small-cap banks and
developers to expand senior housing in this State.

1. Definitions. Key definitions include: * Bank is any bank that has a
market capitalization (determined by multiplying the number of shares
times the current market price), of less than $2 billion. * "Senior"
is a person sixty years of age or older who is the head of a
household. The section allows rental or ownership of a project to be
restricted to persons 60 years old and their spouses. * Senior housing
opportunities partnership financing instrument is any financing
instrument, including bank loan, bonds, notes, or credit enhancement
for a senior housing opportunities development corporation for a
senior housing opportunities facility. * Senior housing opportunities
facility is a facility or project that is or is to be 50% or more
owned or occupied by seniors. The definition includes NORCs,
market-rate independent living, and adult homes, plus all ancillary
recreational, educational, cultural, office, etc., facilities in
connection with the activities of the senior facility.  It also
includes scattered site housing, or housing units scattered throughout
an area which is broadly defined by traditional neighborhood or
community boundaries, and where appropriate, bounded by major natural
or man- made physical boundaries, such as bodies of water, railroad
lines, or limited access highways.

2. Creates The New York State Senior Housing Opportunities Partnership
Authority to finance or collaborate in the financing of senior housing
opportunities facility projects. The authority is empowered to make
loans or provide credit for loans, or provide other financing
instruments. The authority has seven directors, of whom six are
appointed by the governor with the advice and consent of the senate.
Two are appointed on recommendation of the temporary president of the
senate, and two on recommendation of the speaker of the assembly. Each
director shall at the time of appointment have had at least five years
experience in finance, as an officer in an entity, and/or as a
developer of senior housing or other projects for seniors with a
development cost in excess of five million dollars. Directors serve
for terms of six years. The director of the New York State office for
the aging serves as ex officio member, and also as chairman and CEO of
the authority.  For purposes of the public officers law, the authority
is a state agency, and its directors officers of the authority. The
authority may have two persons loaned as staff from the office for the
aging, plus administrative-secretarial support staff as required and
such counsel, and professional consultants as required on a contract
basis. Four directors constitute a quorum for transaction of business.
The authority is given power to conduct meetings by televideo or
teleconference, or by telephone conference, provided that at least
three members of the board shall be physically present.

3. Power of the Authority. Powers are the standard powers of an
authority (to sue and be sued, have a seal, etc). for the development
of projects in an amount not to exceed the cost of such project. The
section requires that the authority be the last approval, after the
banks have approved the project. The authority may also sell a credit
enhancement, letter of credit, or other credit device to help the
development of a project to a bank, consortium of banks, or a senior
housing opportunities development corporation at an appropriate and
competitive market rate. To provide maximum flexibility in financing
arrangements, this section also allows the authority to contract out
management and operations of a project which it owns (e.g., through
default, title change, or taking of debt).

4. Miscellaneous provisions. Allows the authority to create additional
authorities with the same board, and declares the authority a
political subdivision or agent of the state for purposes of IRS
revenue rulings or revenue procedure, including revenue ruling 63-20
and revenue procedure 82-26 and successors and amendments.

5. Revolving fund. This section creates a revolving fund for financing
projects and creating a corpus allocation. Monies in the fund consist
of federal grants, moneys appropriated by the state legislature and
payments of principal and interest by senior housing opportunity
corporations. Monies in the fund may be used to * making loans for
projects at market or below market rates; * buy or refinance debt at
market or below market rates; * guarantee or purchase insurance or
other credit enhancement for senior housing opportunity corporation
bonds and notes or other senior housing opportunities partnership
financing instruments; provide a source of revenue or security for
payment of principal and interest on bonds or notes issued by the
authority if the proceeds of the sale of such bonds or notes will be
deposited in the fund; * provide interest rate subsidies from
investment earnings on corpus allocations to subsidize loans to senior
housing opportunity corporations made from the proceeds of the
authority's bonds or notes; * using investment earnings on moneys in
the fund to pay the costs of the authority of administering and
managing the program.

6. Audits. Requires the authority to arrange for any audits required
by law for the purpose of issuing its bonds or notes or otherwise to
provide financial assistance to senior housing opportunity
corporations.  7. Default. Allows the authority to notify the
comptroller in the event of a default who will withhold any payments
of state aid or local assistance otherwise payable and to take any
action permitted by law to recover such amount.

8. Issuance and sale of loan recipient bonds and notes. Allows a
recipient of a loan from the authority to validly issue its notes or
bonds to the authority, as evidence of its obligation to repay such
loan.

9. Co-operation and assistance of other agencies. Allows officers and
employees of other agencies and local governments to make available
studies, surveys, plans, data and other materials in their possession
and to serve at the request of the authority on advisory committees.

10. Notes and bonds of the authority. Allows the authority to issue
bonds and notes with several standard restrictions, requires that the
state is not able on notes or bonds of the authority.

11. Reserve funds and appropriations. Allows the authority to create
debt service reserve funds.

12. Agreement of the state. The state agrees not to limit or alter the
rights of bondholders.

13. Right of state to require redemption of bonds. Allows the state to
defease bonds prior to maturity.

14. Remedies of noteholders and bondholders. In the event of default
by the authority for a period of thirty days, the holders of 25% in
aggregate principal amount of the notes or bonds of such issue then
outstanding may have a trustee appointed to represent the holders of
such notes or bonds for the purposes herein provided, who can bring
suit and take other action to collect on the default.

15. Notes and bonds as legal investment.

16. Exemption from taxation; payments in lieu of taxes. Real property
owned by the authority is exempt from any taxation, special ad valorem
levy and special assessment, but shall be subject to a payment in lieu
of taxes. The authority is required to pay no fees or taxes, whether
state or local.

17. Actions against the authority. The complaint must be commenced
with- in one year after the cause of action has accrued. The rate of
interest to be paid by the authority upon any judgment for which it is
liable shall not exceed four per centum per annum.

18. Severability.

 JUSTIFICATION : The ability to finance housing for seniors in New
York is a growing concern. The state is graying, even as the number
and kinds of financial instruments available for development has
become more limited. Further, there is less opportunity for the state
to act as partner and facilitator in projects. This legislation is
intended to close those gaps. It opens a new development tool for
financing senior housing, providing new credit instruments, and
uniquely taking advantage of the expertise of small-cap banks in this
state to act as a filter for projects. The powers of the authority
have intentionally been made as flexible as possible, so as to
recognize and facilitate different forms of financing arrangements.

 PRIOR LEGISLATIVE HISTORY : 2007-08 A.9907- Referred to Aging 2005-06
A.2301 referred to aging

 FISCAL IMPLICATIONS : To be determined.

 EFFECTIVE DATE : This act shall take effect immediately.