2013 New York Consolidated Laws
PVH - Private Housing Finance
Article 12 - (650 - 670) NEW YORK CITY HOUSING DEVELOPMENT CORPORATION
656 - Reserve funds and appropriations.

 
    §  656.  Reserve funds and appropriations. 1. a. The corporation shall
  create and establish  special  funds  (herein  referred  to  as  capital
  reserve  funds)  and  shall pay into such a capital reserve fund (1) any
  moneys appropriated and made available by the  state  or  city  for  the
  purpose of such fund, (2) any proceeds of sale of notes or bonds, to the
  extent  provided  in  the  resolution  or resolutions of the corporation
  authorizing the issuance thereof, and (3) any other moneys which may  be
  made  available to the corporation for the purpose of such fund from any
  other source or sources. All moneys held  in  a  capital  reserve  fund,
  except  as  hereinafter provided, shall be used, as required, solely for
  the payment of the principal of bonds as the same mature or  the  annual
  sinking  fund payments, the purchase or redemption of bonds, the payment
  of interest on bonds or the payment of any redemption  premium  required
  to  be  paid  when  such bonds are redeemed prior to maturity; provided,
  however, that moneys in such fund shall not be  withdrawn  therefrom  at
  any  time in such amount as would reduce the amount of such fund to less
  than the maximum  capital  reserve  fund  requirement,  except  for  the
  purposes  of  paying  interest  on  bonds, principal of bonds and annual
  sinking fund payments, as the same become due and  for  the  payment  of
  which  other  moneys of the corporation are not available. Any income or
  interest earned by, or increment to, a capital reserve fund due  to  the
  investment  thereof  or  any  amount  in  excess  of the maximum capital
  reserve fund requirement may be transferred by the corporation to  other
  funds  or  accounts  of the corporation to the extent it does not reduce
  the amount of such  capital  reserve  fund  below  the  maximum  capital
  reserve fund requirement.
    b.  The corporation shall not issue bonds at any time if upon issuance
  the amount in the capital reserve fund will be  less  than  the  maximum
  capital reserve fund requirement, unless the corporation, at the time of
  issuance  of such bonds, shall deposit in such fund from the proceeds of
  the bonds so to be issued, or otherwise, an amount which, together  with
  the  amount then in such fund, will not be less than the maximum capital
  reserve fund requirement.
    c. No bonds or notes of the corporation shall be issued if  upon  such
  issuance  the  aggregate  principal  amount  of  bonds  and notes of the
  corporation then outstanding exceeds the lesser of  eleven  billion  two
  hundred  fifty million dollars or such amount as would cause the maximum
  capital reserve fund requirement to exceed eighty-five million  dollars;
  provided  that,  in  determining  such aggregate principal amounts there
  shall be deducted (i) all sums then available for the  payment  of  such
  bonds  or notes either at maturity or through the operation of a sinking
  fund; (ii) the aggregate principal amount of  outstanding  bonds  issued
  (a) to refund notes and (b) to refund bonds, theretofore issued and then
  outstanding;  and  (iii)  the  aggregate principal amount of outstanding
  notes issued to renew notes theretofore issued and then outstanding. The
  provisions of the prior sentence notwithstanding, the corporation  shall
  not  issue  bonds  if such issuance shall cause the maximum reserve fund
  requirement to exceed  thirty  million  dollars  unless  prior  to  such
  issuance  the  senate  and  assembly  shall  have  adopted  a concurrent
  resolution passed by the votes of a majority of all the members  elected
  to  each such house and, subsequent thereto, the governor shall evidence
  in  writing  the  governor's  agreement  with  such  resolution  to  the
  chairperson  of the corporation, which resolution shall be in full force
  and effect on the date of issuance of the bonds, permitting the  maximum
  capital  reserve  fund  requirement to equal or exceed the amount of the
  maximum capital reserve fund requirement which would be  effective  upon
  the issuance of the bonds in question, but in no event shall the maximum
  capital reserve fund requirement exceed eighty-five million dollars.

    d.  In computing the amount of a capital reserve fund for the purposes
  of this section, securities in which all or a portion of such fund shall
  be invested shall be valued at par if purchased at par or  if  purchased
  at  other  than par, at amortized value. Amortized value, when used with
  respect  to  securities purchased at a premium above or a discount below
  par, shall mean the value as of any given date obtained by dividing  the
  total premium or discount at which such securities were purchased by the
  number  of  interest  payments  remaining to maturity on such securities
  after such purchase and by multiplying the amount so calculated  by  the
  number  of  interest  payment dates having passed since the date of such
  purchase; and (i) in the case of securities purchased at  a  premium  by
  deducting the product thus obtained from the purchase price, and (ii) in
  the  case  of  securities  purchased at a discount by adding the product
  thus obtained to the purchase price.
    e. To assure the continued operation and solvency of  the  corporation
  for  the  carrying  out  of its corporate purposes, provision is made in
  paragraph a of this subdivision for the  accumulation  in  each  capital
  reserve  fund  of  an  amount  equal to the maximum capital reserve fund
  requirement. In order further to assure such maintenance of each capital
  reserve fund, there shall be paid by the city  to  the  corporation  for
  deposit  in  each  capital  reserve  fund  on or before the first day of
  April, in each year, such amount, if any,  needed  for  the  purpose  of
  restoring  each such capital reserve fund to the maximum capital reserve
  fund requirement for such fund, as shall be certified by the chairperson
  of the corporation to the mayor  and  the  director  of  management  and
  budget  on  or before the first day of December next preceding; provided
  that any such amount shall have been first appropriated by or on  behalf
  of the city for such purpose or shall have been otherwise made available
  from  the  proceeds  of notes or bonds of the city authorized and issued
  pursuant to the local finance law for  such  purpose,  which  is  hereby
  determined  to  be  a  specific  object  or  purpose  having a period of
  probable usefulness of five years.  In  the  event  of  the  failure  or
  inability  of  the  city  to pay over to the corporation, in full, on or
  before such first day of April the amount so certified  the  chairperson
  of  the  corporation  shall  forthwith certify to the comptroller of the
  state of New York the amount remaining unpaid and  thereupon  the  state
  comptroller  shall  pay  to  the  corporation,  out  of the first moneys
  available for the next succeeding payments of (i) state aid  apportioned
  to  the  city  of  New  York  as per capita aid for the support of local
  government pursuant to section fifty-four of the state  finance  law  or
  (ii)  such  other aid or assistance payable by the state to the city and
  not otherwise allocated as shall supersede or supplement such state  per
  capita  aid,  including  federal  moneys  apportioned to the city by the
  state, such amount remaining unpaid, after giving written notice to  the
  director  of management and budget of each amount to be paid out of such
  state aid, until the  amount  in  each  such  capital  reserve  fund  is
  restored  to  the  maximum  capital  reserve  fund  requirement thereof;
  provided, however, that prior to the issuance of any notes or  bonds  of
  the  corporation  pursuant to this article the city shall have enacted a
  local law authorizing payments from such sources into  such  a  fund  so
  long  as  any notes or bonds of the corporation shall be outstanding and
  unpaid, and provided further that moneys, if any, payable  to  the  city
  university  construction  fund  pursuant  to  the provisions of the city
  university construction fund act shall be paid, in full, to  such  fund,
  prior  to  any payments therefrom to the corporation. Any amount so paid
  over to  the  corporation  shall  be  deducted  from  the  corresponding
  apportionment of such per capita state aid otherwise payable to the city
  of  New  York,  and shall not obligate the state to make nor entitle the

  city to receive any additional apportionment or payment  of  per  capita
  state  aid. All amounts paid over to the corporation as provided in this
  paragraph, including amounts  paid  by  the  state  comptroller  out  of
  payments  of  such  state  aid, shall constitute and be accounted for as
  non-interest bearing loans by the city to the corporation and,  subject,
  subordinate  and  junior  to  the  rights of the holders of any notes or
  bonds of the corporation theretofore  or  thereafter  issued,  shall  be
  repaid  to  the  city  from  (i)  moneys in such capital reserve fund in
  excess of the maximum capital reserve fund requirement thereof  or  (ii)
  any  moneys  of  the  corporation  not  required  for  any  other of its
  corporate purposes.
    f. In the event the chairperson of the corporation  shall  certify  to
  the  mayor  and  director  of  management  and  budget  or  to the state
  comptroller any amount necessary to restore a capital  reserve  fund  to
  the  maximum  capital  reserve  fund  requirement  thereof  pursuant  to
  subdivision e of this  section,  the  chairperson  shall  simultaneously
  deliver  to  such  persons  a  statement  of the cause or causes of such
  capital reserve fund deficiency and the measures  to  be  taken  by  the
  corporation or the department of housing preservation and development to
  insure  repayment  of  any  loans  made  by the city to the corporation,
  including amounts paid by the state comptroller out of payments of state
  aid, for the purpose of restoring  such  capital  reserve  fund  to  the
  maximum  capital  reserve  fund  requirement  thereof and to prevent the
  recurrence of any such deficiency.
    2. Notwithstanding the  provisions  of  subdivision  one  hereof,  the
  corporation  may  issue bonds for any of its corporate purposes, without
  making any deposit in a capital  reserve  fund  and  the  provisions  of
  subdivision  one  of section six hundred fifty-six of this article shall
  not apply to such bonds and the principal of and interest on such  bonds
  shall not be payable from or secured by any capital reserve fund.
    3. The corporation shall create and establish such other fund or funds
  as may be necessary or desirable for its corporate purposes.