New York State Assembly

 
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A06592 Summary:

A06592 Actions:

A06592 Committee Votes:

Committee:CITIES   Chair:Braunstein      
DATE:04/25/2023AYE/NAY:15/0  Action: Favorable refer to committee Ways and Means        
Braunstein
Aye
Reilly
Aye
Carroll
Aye
Tannousis
Aye
Taylor
Aye
Beephan
Aye
Jacobson
Aye
Brook-Krasny
Aye
Sayegh
Aye
Novakhov
Aye
Eichenstein
Aye
Fall
Absent
Gonzalez-Rojas
Aye
Mamdani
Aye
Jackson
Aye
Meeks
Aye

Committee:WAYS AND MEANS   Chair:Weinstein      
DATE:05/09/2023AYE/NAY:30/3  Action: Favorable         
Weinstein
Aye
Ra
Aye
Glick
Excused
Fitzpatrick
Nay
Pretlow
Aye
Hawley
Aye
Colton
Aye
Blankenbush
Nay
Cook
Aye
Norris
Excused
Aubry
Aye
Brabenec
Aye
Benedetto
Aye
Palmesano
Aye
Weprin
Aye
Walsh
Aye
Ramos
Aye
DeStefano
Aye
Braunstein
Aye
Manktelow
Aye
McDonald
Aye
Smullen
Nay
Rozic
Aye
Dinowitz
Aye
Joyner
Aye
Magnarelli
Aye
Zebrowski
Aye
Bronson
Aye
Dilan
Aye
Seawright
Aye
Hyndman
Aye
Walker
Aye
Bichotte Hermel
Aye
Simon
Aye
Cruz
Aye

A06592 Floor Votes:

A06592 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          6592
 
                               2023-2024 Regular Sessions
 
                   IN ASSEMBLY
 
                                     April 20, 2023
                                       ___________
 
        Introduced  by  M.  of  A.  BRAUNSTEIN  -- read once and referred to the
          Committee on Cities
 
        AN ACT to amend the local finance law, in relation to the sale of  bonds
          and notes of the city of New York, the issuance of bonds or notes with
          variable  rates  of interest, interest rate exchange agreements of the
          city of New York, the selling of bonds at private sale, the  refunding
          of  bonds,  and  the  down  payment for projects financed by bonds; to
          amend the New York state financial emergency act for the city  of  New
          York, in relation to a pledge and agreement of the state; and to amend
          chapter 142 of the laws of 2004, amending the local finance law relat-
          ing  to  interest rate exchange agreements of the city of New York and
          refunding bonds of such city, in relation to the effectiveness thereof
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1. The opening paragraph of paragraph (a) of section 54.10 of
     2  the local finance law, as amended by chapter 362 of the laws of 2022, is
     3  amended to read as follows:
     4    To facilitate the marketing of any issue of bonds or notes of the city
     5  of New York issued on or before June thirtieth,  two  thousand  [twenty-
     6  three]  twenty-four, the mayor and comptroller of such city may, subject
     7  to the approval of the state comptroller and the limitations on  private
     8  sales of bonds and notes, respectively, provided by law:
     9    §  2.  The  closing  paragraph  of paragraph a of section 54.90 of the
    10  local finance law, as amended by chapter 362 of the  laws  of  2022,  is
    11  amended to read as follows:
    12    Notwithstanding the foregoing, whenever in the judgment of the finance
    13  board  of the city of New York the interest of such city would be served
    14  thereby, the city of New York may without further approval  issue  bonds
    15  or  notes, on or before July fifteenth, two thousand [twenty-three]twen-
    16  ty-four, with interest rates that vary in accordance with a  formula  or
    17  procedure  and  are  subject  to a maximum rate of interest set forth or
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD10835-01-3
        A. 6592                             2
 
     1  referred to in the bonds or notes and may provide  the  holders  thereof
     2  with  such  rights to require the city or other persons to purchase such
     3  bonds or notes or renewals thereof from the proceeds of the resale ther-
     4  eof  or  otherwise from time to time prior to the final maturity of such
     5  bonds or notes as the finance board of the city of New York  may  deter-
     6  mine  and  the city may resell, at any time prior to final maturity, any
     7  such bonds or notes acquired as a result of the exercise of such rights;
     8  provided, however, that at no time shall the total principal  amount  of
     9  bonds  and  notes  issued by the city of New York pursuant to this para-
    10  graph (other than bonds and notes (1) bearing interest at rates and  for
    11  periods of time that are specified without reference to future events or
    12  contingencies,  or  (2)  described  in  section  136.00 of this article)
    13  exceed twenty-five percent of the limit prescribed by section 104.00  of
    14  this article.
    15    §  3. The opening paragraph of subdivision 1 of paragraph d of section
    16  54.90 of the local finance law, as amended by chapter 362 of the laws of
    17  2022, is amended to read as follows:
    18    On or before July fifteenth, two thousand  [twenty-three]  twenty-four
    19  the mayor and comptroller of the city of New York may:
    20    §  4.  The  opening  paragraph  of paragraph a of section 57.00 of the
    21  local finance law, as amended by chapter 362 of the  laws  of  2022,  is
    22  amended to read as follows:
    23    Bonds  shall  be  sold  only at public sale and in accordance with the
    24  procedure set forth in this section and sections 58.00 and 59.00 of this
    25  title, except as otherwise provided in this paragraph. Bonds may be sold
    26  at private sale to the United States government or any agency or instru-
    27  mentality thereof, the state of New York municipal bond bank agency,  to
    28  any sinking fund or pension fund of the municipality, school district or
    29  district corporation selling such bonds, or, in the case of sales by the
    30  city  of New York prior to July first, two thousand [twenty-three] twen-
    31  ty-four, also to the municipal assistance corporation for  the  city  of
    32  New York or to any other purchaser with the consent of the mayor and the
    33  comptroller  of  such city and approval of the state comptroller, or, in
    34  the case of sales by the county of  Nassau  prior  to  December  thirty-
    35  first,  two  thousand  seven,  also to the Nassau county interim finance
    36  authority with the approval of the state comptroller, or, in the case of
    37  sales by the city of Buffalo prior to June thirtieth, two thousand thir-
    38  ty-seven, also to  the  Buffalo  fiscal  stability  authority  with  the
    39  approval  of  the  state  comptroller, or, in the case of bonds or other
    40  obligations of a municipality issued for the construction of any  sewage
    41  treatment  works,  sewage  collecting  system,  storm  water  collecting
    42  system, water management facility, air  pollution  control  facility  or
    43  solid  waste disposal facility, also to the New York state environmental
    44  facilities corporation, or, in the case of bonds or other obligations of
    45  a school district or a city acting on behalf of a city  school  district
    46  in a city having a population in excess of one hundred twenty-five thou-
    47  sand  but  less  than  one  million  inhabitants according to the latest
    48  federal census, issued to  finance  or  refinance  the  cost  of  school
    49  district  capital  facilities  or  school district capital equipment, as
    50  defined in section sixteen hundred seventy-six of the public authorities
    51  law, also to the dormitory authority of the state of New York. Bonds  of
    52  a  river  improvement  or  drainage district established by or under the
    53  supervision of the department of environmental conservation may be  sold
    54  at private sale to the state of New York as investments for any funds of
    55  the state which by law may be invested, provided, however, that the rate
    56  of  interest  on  any  such bonds so sold shall be approved by the water
        A. 6592                             3
 
     1  power and control commission and the state comptroller. Bonds  may  also
     2  be  sold  at private sale as provided in section 63.00 of this title. No
     3  bonds shall be sold on option or on a deferred payment plan, except that
     4  options  to purchase, effective for a period not exceeding one year, may
     5  be given:
     6    § 5. Subdivision 3 of paragraph  g  of  section  90.00  of  the  local
     7  finance  law,  as amended by chapter 362 of the laws of 2022, is amended
     8  to read as follows:
     9    3. Outstanding bonds may, pursuant to a power to recall and redeem  or
    10  with  the  consent  of  the  holders thereof, be exchanged for refunding
    11  bonds (i) if the refunding bonds are to bear interest at a rate equal to
    12  or lower than that borne by the bonds to be refunded or (ii) if, in  the
    13  case  of the city of New York prior to July first, two thousand [twenty-
    14  three] twenty-four, the annual payment required for principal and inter-
    15  est on the refunding bond is less than the annual payment  required  for
    16  principal  and  interest  on  the bond to be refunded, in each case such
    17  annual payments to be determined by dividing  the  total  principal  and
    18  interest  payments due over the remaining life of the bond by the number
    19  of years to maturity of the bond or (iii) if the bonds  to  be  refunded
    20  were  issued  by  the  city  of  New York after June thirtieth, nineteen
    21  hundred seventy-eight and prior to July  first,  two  thousand  [twenty-
    22  three]  twenty-four  and contain covenants referring to the existence of
    23  the New York state financial control board for the city of New  York  or
    24  any other covenants relating to matters other than the prompt payment of
    25  principal  and  interest  on  the obligations when due and the refunding
    26  bond omits or modifies any such covenant.
    27    § 6. Subdivision 8 of paragraph d  of  section  107.00  of  the  local
    28  finance  law,  as amended by chapter 362 of the laws of 2022, is amended
    29  to read as follows:
    30    8. Notwithstanding any other provision of law, the  financing  by  the
    31  city  of New York prior to July first, two thousand [twenty-three] twen-
    32  ty-four of any object or purpose which has a period of probable  useful-
    33  ness  determined by law by the issuance of any bonds or notes, including
    34  (i) the issuance of bonds or notes to  obtain  reimbursement  for  funds
    35  heretofore  advanced  for  the  object or purpose for which the bonds or
    36  notes are being issued, (ii) the issuance of bonds or  notes  to  redeem
    37  notes previously issued for the object or purpose for which the bonds or
    38  notes  are  being  issued or (iii) the issuance of bonds to refund bonds
    39  previously issued for the object or purpose for which  bonds  are  being
    40  issued.
    41    §  7. Subdivision 1 of section 10-a of section 2 of chapter 868 of the
    42  laws of 1975, constituting the New York state  financial  emergency  act
    43  for the city of New York, as amended by chapter 362 of the laws of 2022,
    44  is amended to read as follows:
    45    1.  In  the  event that after the date on which the provisions of this
    46  act become operative, any notes or bonds are issued by the city prior to
    47  July 1, [2023] 2024, or any bonds are issued by a state financing  agen-
    48  cy,  the state of New York hereby authorizes the city and authorizes and
    49  requires such state financing agency to include a pledge  and  agreement
    50  of the state of New York in any agreement made by the city or such state
    51  financing  agency with holders or guarantors of such notes or bonds that
    52  the state will not take any action which will (a)  substantially  impair
    53  the authority of the board during a control period, as defined in subdi-
    54  vision  twelve  of section two of this act as in effect on the date such
    55  notes or bonds are issued (i) to  approve,  disapprove,  or  modify  any
    56  financial  plan  or  financial  plan modification, including the revenue
        A. 6592                             4
 
     1  projections (or any item thereof)  contained  therein,  subject  to  the
     2  standards set forth in paragraphs a, c, d, e and f of subdivision one of
     3  section  eight  of this act as in effect on the date such notes or bonds
     4  are issued and paragraph b of such subdivision as in effect from time to
     5  time,  (ii)  to disapprove a contract of the city or a covered organiza-
     6  tion if the performance of such contract would be inconsistent with  the
     7  financial  plan or to approve or disapprove proposed short-term or long-
     8  term borrowing of the city or a covered organization or any agreement or
     9  other arrangement referred to in subdivision four of  section  seven  of
    10  this act, or (iii) to establish and adopt procedures with respect to the
    11  deposit  in  and  disbursement from the board fund of city revenues; (b)
    12  substantially impair the authority of  the  board  to  review  financial
    13  plans,  financial  plan  modifications,  contracts  of  the  city or the
    14  covered organizations and proposed short-term or long-term borrowings of
    15  the city and the covered organizations;  (c)  substantially  impair  the
    16  independent  maintenance  of  a  separate  fund  for the payment of debt
    17  service on bonds and notes of the city; (d) alter the composition of the
    18  board so that the majority of the voting members of the  board  are  not
    19  officials  of  the state of New York elected in a state-wide election or
    20  appointees of the governor; (e) terminate the  existence  of  the  board
    21  prior  to  the time to be determined in accordance with section thirteen
    22  of this act as in effect on the date such notes or bonds are issued; (f)
    23  substantially modify the requirement that the  city's  financial  state-
    24  ments be audited by a nationally recognized independent certified public
    25  accounting  firm  or consortium of firms and that a report on such audit
    26  be furnished to the board; or (g) alter  the  definition  of  a  control
    27  period set forth in subdivision twelve of section two of this act, as in
    28  effect  on  the  date  such  notes or bonds are issued, or substantially
    29  alter the authority of the board, as set forth in  said  subdivision  to
    30  reimpose  or  terminate  a  control  period; provided, however, that the
    31  foregoing pledge and agreement shall be of no further force  and  effect
    32  if  at any time (i) there is on deposit in a separate trust account with
    33  a bank, trust company or other fiduciary  sufficient  moneys  or  direct
    34  obligations of the United States or obligations guaranteed by the United
    35  States, the principal of and/or interest on which will provide moneys to
    36  pay  punctually when due at maturity or prior to maturity by redemption,
    37  in accordance with their terms, all principal of  and  interest  on  all
    38  outstanding  notes  and bonds of the city or such state financing agency
    39  containing this pledge and agreement and irrevocable  instructions  from
    40  the  city  or such state financing agency to such bank, trust company or
    41  other fiduciary for such payment of such  principal  and  interest  with
    42  such moneys shall have been given, or (ii) such notes and bonds, togeth-
    43  er  with  interest  thereon,  have been paid in full at maturity or have
    44  otherwise been refunded, redeemed, defeased, or discharged; and provided
    45  further that the foregoing pledge and agreement shall be of  full  force
    46  and effect upon its inclusion in any agreement made by the city or state
    47  financing agency with holders or guarantors of such notes or bonds.
    48    Upon  payment  for such obligations issued pursuant to this act by the
    49  original and all subsequent holders inclusion of the foregoing  covenant
    50  shall  be  deemed conclusive evidence of valuable consideration received
    51  by the state and city for such covenant and of reliance upon such pledge
    52  and agreement by any such holder. The state hereby grants any such bene-
    53  fited holder the right to sue the state in a court of  competent  juris-
    54  diction and enforce this covenant and agreement and waives all rights of
    55  defense based on sovereign immunity in such an action or suit.
        A. 6592                             5
 
     1    §  8. Section 5 of chapter 142 of the laws of 2004, amending the local
     2  finance law relating to interest rate exchange agreements of the city of
     3  New York and refunding bonds of such city, as amended by chapter 362  of
     4  the laws of 2022, is amended to read as follows:
     5    §  5.  This  act shall take effect immediately, provided, that section
     6  three of this act shall expire and be deemed repealed  July  15,  [2023]
     7  2024.
     8    § 9. Separability. If any clause, sentence, paragraph, section or part
     9  of  this act shall be adjudged by any court of competent jurisdiction to
    10  be invalid, such judgment shall not affect,  impair  or  invalidate  the
    11  remainder thereof, but shall be confined in its operation to the clause,
    12  sentence,  paragraph,  section  or part thereof directly involved in the
    13  controversy in which such judgment shall have been rendered.
    14    § 10. This act shall take effect immediately.