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S05656 Summary:

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S05656 Floor Votes:

S05656 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          5656
 
                               2011-2012 Regular Sessions
 
                    IN SENATE
 
                                      June 9, 2011
                                       ___________
 
        Introduced  by  Sen. HANNON -- (at request of the Dormitory Authority of
          the State of New York) -- read twice and  ordered  printed,  and  when
          printed  to be committed to the Committee on Corporations, Authorities
          and Commissions
 
        AN ACT to amend the public authorities law, in relation  to  the  powers

          and  duties  of the dormitory authority of the state of New York rela-
          tive to the establishment of subsidiaries for  certain  purposes;  and
          providing for the repeal of such provisions upon expiration thereof
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. Subdivision 25 of section 1678 of  the  public  authorities
     2  law,  as added by chapter 561 of the laws of 2010, is amended to read as
     3  follows:
     4    25. (a) To form [a  subsidiary]  one  or  more  subsidiaries  for  the
     5  purpose  of limiting the potential liability of the authority when exer-
     6  cising the powers and duties conferred upon  the  authority  by  article
     7  eight of this chapter in connection with the exercise of remedies by the

     8  authority  against  [North  General  Hospital,  an eligible secured] any
     9  borrower [(as defined in chapter five hundred ninety of the laws of  two
    10  thousand  two)  located  in the borough of Manhattan, New York] that has
    11  defaulted in its obligations under its loan agreement or  mortgage  with
    12  the authority and for which an event of default has been declared by the
    13  authority.   [Such] Each such subsidiary created pursuant to this subdi-
    14  vision may exercise and perform one or more  of  the  purposes,  powers,
    15  duties,  functions,  rights and responsibilities of the authority (other
    16  than the issuance  of  indebtedness[,])  in  connection  with  real  and
    17  personal  property  with  respect to which the authority holds or held a

    18  mortgage, security interest or other collateral interest including:  (i)
    19  bidding  for,  taking,  holding, selling, conveying, assigning or trans-
    20  ferring title to such property; (ii) entering  into  leases,  subleases,
    21  operating  agreements,  security  agreements,  loan  agreements or other
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD09251-03-1
        S. 5656                             2
 
     1  encumbrances or arrangements with regard to such property and acting  in
     2  a  manner consistent with the rights, obligations or responsibilities of
     3  the owner of such property pursuant to such agreements or  encumbrances;
     4  (iii)  assuming  any  indebtedness  or other liabilities secured by such

     5  property.  Notwithstanding any other provision of law to  the  contrary,
     6  but  in  all  instances  subject  to the provisions of any contract with
     7  bondholders, the transfer of title to any such subsidiary or  any  other
     8  actions  taken  by the authority or [the] such subsidiary to enforce the
     9  authority's rights under the mortgage, security interest or other colla-
    10  teral interest or to protect, acquire, manage or dispose of the property
    11  shall be deemed to be a corporate purpose of the authority and shall not
    12  impair the validity of any bonds, notes  or  other  obligations  of  the
    13  authority  to  which the mortgage, security interest or other collateral
    14  interest relates.
    15    (b) [Such] Each such subsidiary authorized by paragraph  (a)  of  this
    16  subdivision  shall be established in the form of a public benefit corpo-

    17  ration by executing and filing with the secretary of state a certificate
    18  of incorporation which shall identify the authority as the entity organ-
    19  izing such subsidiary and set forth the name of such  subsidiary  public
    20  benefit  corporation, its duration, the location of its principal office
    21  and its corporate purposes as provided in  this  subdivision  and  which
    22  certificate may be amended from time to time by the filing of amendments
    23  thereto  with the secretary of state.  [Such] Each such subsidiary shall
    24  be organized as a public benefit corporation, shall be  a  body  politic
    25  and  corporate,  and  shall  have  all  the  privileges, immunities, tax
    26  exemptions and other exemptions of the authority. The  members  of  each
    27  such  subsidiary  shall  be the same as the members of the authority and

    28  the provisions of subdivision two of section sixteen hundred  ninety-one
    29  of this title shall in all respects apply to such members when acting in
    30  such capacity.
    31    (c)  Nothing  in  this  subdivision  shall  be construed to impose any
    32  liabilities, obligations or responsibilities of any such subsidiary upon
    33  the authority and the authority shall have no liability or  responsibil-
    34  ity therefor unless the authority expressly agrees to assume the same.
    35    (d)  [Such]  Each such subsidiary created pursuant to this subdivision
    36  shall be subject to any other provision of this  chapter  pertaining  to
    37  subsidiaries of public authorities.
    38    §  2.  This  act shall take effect immediately and shall expire and be
    39  deemed repealed July 1, 2012; provided however, that the  expiration  of

    40  this act shall not impair or otherwise affect any of the powers, duties,
    41  responsibilities,  functions,  rights  or  liabilities of any subsidiary
    42  duly created pursuant to subdivision twenty-five of section 1678 of  the
    43  public authorities law prior to such expiration.