2019 New York Laws
FEA - NYS Financial Emergency Act for the city of NY 868/75

NEW YORK STATE FINANCIAL EMERGENCY ACT FOR THE CITY OF NEW YORK * Section 1. Short title.

2. Definitions.

2-a. Legislative declaration of financial emergency.

3. General rights and prohibitions.

4. Power of city or covered organization to determine the

expenditure of available funds.

5. New York state financial control board; created.

6. Administration of the board.

7. Functions of the board.

7-a. Reports of the city.

8. Development of the financial plan.

9. Establishment and application of the board fund.

9-a. Establishment and application of a general debt service

fund.

9-b. Limitations on short-term borrowing.

10. Wage freeze.

10-a. Covenants, authorizations to agree and remedies.

11. Prohibitions; penalties.

12. Indemnification.

13. Termination.

14. Separability.

15. Court preference.

* Terminates July 1, 2008 or ... see § 13

* Section 1. Short title. This act shall be known and may

be cited as the "New York State Financial Emergency Act for The

City of New York".

* Terminates July 1, 2008 or ... see § 13

* § 2. Definitions. As used in this act, the following words

and terms shall have the following meanings unless the context

shall indicate another or different meaning or intent.

1. "Comptroller" means the comptroller of the state of New

York.

2. "City" means the city of New York.

3. "Mayor" means the mayor of the city of New York.

4. "City comptroller" means the comptroller of the city.

5. "Covered organization" means any governmental agency,

public authority or public benefit corporation which receives or

may receive monies directly, indirectly or contingently, (other

than monies received for the sale of goods or the rendering of

services or the loan of monies to the city) from the city, and

in any event includes, without limitation, the board of

education of the city of New York, the board of higher education

of the city of New York, the New York city transitional finance

authority, the health and hospitals corporation, the New York

city transit authority, the New York city housing authority, the

New York city housing development corporation, city university

construction fund, Battery park city authority, New York city

convention and exhibition center corporation, Manhattan and

Bronx surface transit operating authority, Staten Island rapid

transit operating authority, the New York city sports authority

and the Brooklyn sports center authority but shall not include

(i) any governmental agency, public authority or public benefit

corporation specifically exempted from the provisions of this

act by order of the board upon application of such agency,

authority, or corporation to the board or at the board's own

motion upon a finding by the board that such exemption does not

materially affect the ability of the city to adopt and maintain

a budget pursuant to the provisions of this act and provided

that at the time of such exemption there shall have been and

during the period of such exemption there shall be an annual

audit by a nationally recognized independent certified public

accounting firm or consortium of firms, one of which shall be a

nationally recognized firm, of the covered organization's

financial statements performed in accordance with generally

accepted auditing standards and report by such auditor thereon

which includes an opinion that the financial statements so

audited have been prepared in accordance with generally accepted

accounting principles (subject to the provisions of subdivision

two-a of section eight of this act) and such other information

as such auditors deem appropriate, (ii) any state public

authority as defined in section two hundred one of the civil

service law, unless specifically named above, or (iii) any

governmental agency, authority, commission or instrumentality

created by compact or agreement between the state of New York

and another state or states; provided, however, that the board

may terminate any exemption granted by order of the board

pursuant to this subdivision upon a determination that the

circumstances upon which such exemption was granted are no

longer applicable.

6. "Board" means the governmental agency created by section

five of this act.

7. "Deputy comptroller" means the deputy comptroller for the

city of New York created by section forty-one-a of the executive

law.

8. "Municipal assistance corporation for the city of New York"

means the corporate governmental agency created by section three

thousand thirty-three of the public authorities law.

9. "Short-term obligations" means tax anticipation notes, bond

anticipation notes, revenue anticipation notes, budget notes and

urban renewal notes of the city.

10. "Revenues" mean all taxes, federal and state aid, rents,

fees, charges, payments, all proceeds from borrowings and other

income and receipts paid or payable to or for the account of the

city or any of the covered organizations.

11. "Financial plan" means the financial plan of the city and

the covered organizations to be developed pursuant to section

eight of this act, as from time to time modified.

12. "Control period" means the period of time from the

effective date of this act until the date when (a) there shall

no longer be effective or outstanding any guarantee by the

United States of America as to payment of principal of or

interest on any note or bond issued by the city or a state

financing agency, (b) the board shall determine, based on annual

audit reports furnished in accordance with section seven-a, that

for each of the three immediately preceding fiscal years, the

city has adopted and adhered to budgets covering all

expenditures other than capital items, the results of which did

not show a deficit when reported in accordance with generally

accepted accounting principles subject to the provisions of

subdivision two-a of section eight of this act and (c) the

comptroller of the state and the comptroller of the city jointly

shall certify that securities sold by or for the benefit of the

city during the fiscal year immediately preceding such date and

the then current fiscal year in the general public market

satisfied the capital and seasonal financing requirements of the

city during such period and that there is a substantial

likelihood that such securities can be sold in the general

public market from such date through the end of the next

succeeding fiscal year in amounts which will satisfy

substantially all of the capital and seasonal financing

requirements of the city during such period in accordance with

the financial plan then in effect, provided that for these

purposes sales to any fund whose governing body includes any

designated representative of the state or city or to any

financial institution which participates in a private placement

for the purchase of securities for the benefit of the city

during its nineteen hundred seventy-nine fiscal year shall not

be deemed sales in the general public market, unless in the case

of sales to such a financial institution such comptrollers

jointly certify at the time of each such sale that a sale could

have been made in such amount and on reasonably comparable terms

in the general public market. After termination of the control

period in accordance with the foregoing provisions and until

there shall no longer be outstanding any notes or bonds issued

by the city or a state financing agency which are entitled to

the benefits of the pledge and agreement authorized by section

ten-a hereof, the board shall reimpose a control period upon a

determination at any time that any of the following events has

occurred or that there is a substantial likelihood and imminence

of such occurrence: (i) the city shall have failed to pay the

principal of or interest on any of its bonds or notes when due

or payable (other than notes held by the municipal assistance

corporation for the city of New York to the extent that such

corporation has evidenced its intention not to present such

notes for payment during the fiscal year in which the

determination is made provided that such notes were held by such

corporation on June thirtieth, nineteen hundred seventy-eight or

were issued in exchange for or in refunding or renewal of notes

held by such corporation on such date), (ii) the city shall have

incurred a deficit of more than one hundred million dollars

during its fiscal year in the results of operations covered by a

budget covering all expenditures other than capital items as

reported in accordance with generally accepted accounting

principles, subject to the provisions of subdivision two-a of

section eight of this act, (iii) the city shall have issued

notes in violation of section nine-b of this act as amended from

time to time, (iv) the city shall have otherwise violated any

provision of this act and such violation substantially impairs

the ability of the city to pay principal of or interest on its

bonds or notes when due and payable or its ability to adopt or

adhere to a budget covering all expenditures other than capital

items balanced in accordance with this act or (v) the

comptrollers' joint certification at any time, at the request of

the board or on the comptrollers' joint initiative, which joint

certification shall be made from time to time as promptly as

circumstances warrant and reported to the board, that on the

basis of facts existing at such time they could not make the

joint certification described by clause (c) of the preceding

sentence. The board shall terminate any such reimposed control

period when it determines that none of the conditions which

would permit the board to reimpose a control period exist. After

termination of a control period the board shall annually

consider items (i) through (v) above and determine whether, in

its judgment, any of the events described in such items have

occurred and the board shall publish each such determination.

Each such joint certification made by the comptrollers hereunder

shall be based on their separate written determinations which

shall take into account a report and opinion of a nationally

recognized independent expert in the marketing of municipal

securities selected by the board as well as any other

information which may be available to each comptroller and each

such separate written determination by the comptrollers shall

have annexed thereto the report and opinion of such expert and

any other information taken into account and shall be made

public when delivered to the board. Notwithstanding any part of

the foregoing to the contrary, in no event shall any control

period continue beyond the earlier of (a) July first, two

thousand eight or (b) the date (i) when all bonds and notes

containing the pledge and agreement authorized by section ten-a

of this act are refunded, redeemed, discharged or otherwise

defeased or (ii) when there shall no longer be outstanding any

guarantee by the United States of America or any agency or

instrumentality thereof as to payment of principal of or

interest on any note or bond issued by the city or a state

financing agency, whichever of (i) or (ii) shall occur later.

13. "Debt service repayment account" means the special account

established pursuant to subdivision four of section nine of this

act.

14. "Fund" means the general debt service fund established

pursuant to section nine-a of this act.

15. "Board fund" means the board fund established pursuant to

section nine of this act.

16. "TAN debt service account" means the tax anticipation note

debt service account established within the fund pursuant to

section nine-a of this act.

17. "RAN debt service account" means the revenue anticipation

note debt service account established within the fund pursuant

to section nine-a of this act.

18. "Available funds" means at any date of computation the

monies held by the city or a covered organization which (i) are

not required (a) to be applied to the fund, the TAN debt service

account, the RAN debt service account or otherwise to meet the

debt service requirements of the city and the covered

organizations on their bonds and notes (other than bonds and

notes of covered organizations payable from revenues not

included in the fund) as they become due, or (b) to pay other

liabilities of the city and the covered organizations having

statutory or contractual priority over remaining liabilities of

the city and the covered organizations, and (ii) therefore, may

be applied to the payment of other obligations on an allocated

basis as specified by the city for expenditures in accordance

with a financial plan.

19. "Available tax levy" with respect to an issue of tax

anticipation notes means at any date of computation the total

amount of city real estate taxes or assessments projected,

consistent with the financial plan then in effect, to be

received in cash on or before the fifth day preceding the

maturity date of such tax anticipation note issue, less amounts

required during the period between the date of computation and

the fifth day preceding such maturity date to be paid into the

general debt service fund or otherwise required to pay interest

payable on other outstanding city bonds and notes, principal

(including payments into sinking funds) coming due on

outstanding city bonds and principal to be paid from sources

other than the proceeds of bonds or renewal notes on other

outstanding city notes (exclusive of revenue anticipation notes

or renewals thereof issued less than two years prior to the date

of computation) but not including payments from sinking funds

required by the terms of certain city bonds. For the purposes of

this subdivision such amounts required shall not include

principal of or interest on any notes of the city held by the

municipal assistance corporation for the city of New York to the

extent that such corporation has evidenced its intention not to

present such notes for payment of principal or interest during

the fiscal year in which the computation is made provided that

such notes were held by such corporation on June thirtieth,

nineteen hundred seventy-eight or were issued in exchange for or

in refunding or renewal of notes held by such corporation on

such date.

20. "State financing agency" means the municipal assistance

corporation for the city of New York or its successor.

* Terminates July 1, 2008 or ... see § 13

* § 2-a. Legislative declaration of financial emergency. The

legislature hereby finds and declares that a state of financial

emergency continues to exist within the city. The legislature

further finds and declares that the maintenance by the city of a

balanced budget in accordance with generally accepted accounting

principles and the city's borrowing practices are and will

continue to be a matter of overriding state concern, and that it

is also appropriate and desirable for the legislature to

exercise its duty under section twelve of article eight of the

state constitution to restrict the powers of the city to prevent

abuses in taxation and assessments and in contracting of

indebtedness by the city.

* Terminates July 1, 2008 or ... see § 13

* § 3. General rights and prohibitions. 1. Neither the city

nor any covered organization shall borrow or expend any monies,

or in any way, directly or indirectly, expressly or implicitly,

engage its credit during any control period except in compliance

with the provisions of this act.

2. Nothing contained in this act shall limit the right of the

city or any covered organization to comply with the provisions

of any existing contract with or for the benefit of the holders

of any bonds or notes of the city or such covered organization

or any public authority or public benefit corporation.

3. Nothing contained in this act shall be construed to impair

the right of employees to organize or to bargain collectively.

* Terminates July 1, 2008 or ... see § 13

* § 4. Power of city or covered organization to determine the

expenditure of available funds. Nothing contained in this act

shall be construed to limit the power of the city or a covered

organization to determine, from time to time, within available

funds for the city or for such covered organization, the

purposes for which expenditures are to be made by the city or

such covered organization and the amounts of such expenditures,

consistent with the aggregate expenditures then permitted under

the financial plan for the city or such covered organization.

* Terminates July 1, 2008 or ... see § 13

* § 5. New York state financial control board; created. There

is hereby created the New York state financial control board.

The board shall be a governmental agency and instrumentality of

the state and it shall have such powers and functions as are set

forth in this act.

* Terminates July 1, 2008 or ... see § 13

* § 6. Administration of the board. 1. The membership of the

board shall be the governor, the state comptroller (pursuant to

his authority to supervise the accounts of any political

subdivision of the state), the mayor, the city comptroller and

three members appointed by the governor with the advice and

consent of the senate. At least two of the appointed members

shall be residents of the city or have their principal place of

business in the city. Such appointed members shall serve at the

pleasure of the governor. The governor shall be the chairman of

the board and the governor or his representative shall preside

over all meetings of the board. The board shall act by majority

vote of the entire board. The board shall maintain a record of

its proceedings in such form as it may determine, but such

record shall indicate attendance and all votes cast by each

member. Every member of the board, who is otherwise an elected

official of the state or city, shall be entitled to designate a

representative to attend, in his place, meetings of the board

and to vote or otherwise act in his behalf. Written notice of

such designation shall be furnished to the board by the

designating member prior to any meeting attended by his

representative. Any such representative shall serve at the

pleasure of the designating member. No such representative shall

be authorized to delegate any of his duties or functions to any

other person. The lieutenant governor, temporary president of

the senate, the minority leader of the senate, speaker and

minority leader of the assembly, the president of the council of

the city of New York, the city board of estimate acting by

majority vote, and the vice-chairman and the minority leader of

the council of the city of New York, shall each be entitled to

appoint a representative to the board. Each such representative

shall be entitled to receive notice of and to attend all

meetings of the board but shall not be entitled to vote. No

representative shall be an employee or officer of the federal,

state or city governments. Each representative shall serve at

the pleasure of the appointing official or body, shall be

eligible for reappointment, and shall hold office until his

successor has been appointed.

2. Notwithstanding any inconsistent provisions of law,

general, special or local, no officer or employee of the state,

or political subdivision of the state, any governmental entity

operating any public school or college or other public agency or

instrumentality or unit of government which exercises

governmental powers under the laws of the state, shall forfeit

his office or employment by reason of his acceptance or

appointment as a member, representative, officer, employee or

agent of the board nor shall service as such member,

representative, officer, employee or agent of the board be

deemed incompatible or in conflict with such office or

employment.

3. The members of the board appointed by the governor and all

representatives designated by members of the board shall serve

without salary or per diem allowance but shall be entitled to

reimbursement for actual and necessary expenses incurred in the

performance of official duties under this act, provided however

that such members and representatives are not, at the time such

expenses are incurred, public employees otherwise entitled to

such reimbursement.

4. The governor and the mayor, jointly, shall appoint an

executive director of the board who shall serve at the pleasure

of the board and may be removed by the board. The board may

delegate to the executive director or to one or more of its

other officers, employees or agents, such powers and duties as

the board may deem proper, except any duties inconsistent with

the duties and functions prescribed by any other office or

position any such person may hold.

* Terminates July 1, 2008 or ... see § 13

* § 7. Functions of the board. 1. In carrying out the purposes

of this act, the board shall perform the following functions:

a. In accordance with the provisions of section eight of this

act, the board shall (i) consult with the city and the covered

organizations in the preparation of the financial plan, and

certify to the city the revenue estimates approved therein, (ii)

prescribe the form of the financial plan and the supporting

information required in connection therewith, and (iii) exercise

the rights of approval, disapproval and modification with

respect to the financial plan, including but not limited to the

revenue estimates contained therein.

b. The board, to the extent it deems it necessary or

appropriate in order to accomplish the purposes of this act,

shall establish and adopt procedures with respect to the (i)

proper maintenance of the board fund, (ii) the deposit and

investment of revenues in such fund and (iii) disbursement of

monies from such fund.

c. The board shall, from time to time and to the extent it

deems necessary or appropriate in order to accomplish the

purposes of this act, (i) review the operations, management,

efficiency and productivity of such city operations and of such

covered organizations or portions thereof as the board may

determine, and make reports thereon; (ii) audit compliance with

the financial plan in such areas as the board may determine;

(iii) recommend to the city and the covered organizations such

measures relating to their operations, management, efficiency

and productivity as it deems appropriate to reduce costs and

improve services so as to advance the purposes of this act; and

(iv) obtain information of the financial condition and needs of

the city and the covered organizations. Nothing herein shall

diminish the powers of the comptroller otherwise provided by law

and the board may request the assistance of the comptroller in

performing the above functions.

d. The board (i) shall receive from the city and review the

reports to be prepared by or on behalf of the city pursuant to

section seven-a; (ii) shall receive from the city and the

covered organizations and from the deputy comptroller, and shall

review such financial statements and projections, budgetary data

and information, and management reports and materials as the

board deems necessary or desirable to accomplish the purposes of

this act; and (iii) shall inspect, copy and audit such books and

records of the city and the covered organizations as the board

deems necessary or desirable to accomplish the purposes of this

act.

e. All contracts entered into by the city or any covered

organization must be consistent with the provisions of this act

and must comply with the requirements of the financial plan as

approved by the board. With respect to all contracts or other

obligations to be entered into by the city or any covered

organization after October fifteenth, nineteen hundred

seventy-five, requiring the payment of funds or the incurring of

costs by the city or any covered organization:

(i) Within twenty days from the effective date of this act the

mayor shall present to the board proposed regulations respecting

the categories and types of contracts and other obligations

required to be reviewed by the board pursuant to this

subdivision e. Within thirty days from the effective date of

this act, the board shall approve or modify and approve such

proposed regulations or promulgate its own in the event that

such proposed regulations are not submitted to it within the

twenty days as provided for herein. Such regulations may

thereafter be modified by the board from time to time on not

less than thirty days notice to the mayor and the mayor may from

time to time propose modifications to the board. Unless

expressly disapproved or modified by the board within thirty

days from the date of submission by the mayor, any such proposed

regulations or modifications shall be deemed approved by the

board;

(ii) Prior to entering into any contract or other obligations

subject to review of the board under its regulations, the city

or any covered organization shall submit a copy of such contract

or other obligation to the board accompanied by an analysis of

the projected costs of such contract or other obligation and a

certification that performance thereof will be in accordance

with the financial plan, all in such form and with such

additional information as the board may prescribe. The board

shall promptly review the terms of such contract or other

obligation and the supporting information in order to determine

compliance with the financial plan;

(iii) During a control period the board shall, by order,

disapprove any contract or other obligation reviewed by it only

upon a determination that, in its judgment, the performance of

such contract or other obligation would be inconsistent with the

financial plan and the city or covered organization shall not

enter into such contract or other obligation;

(iv) During a control period if the board approves the terms

of a reviewed contract or other obligation, the city or covered

organization may enter into such contract or other obligation

upon the terms submitted to the board. Failure of the board to

notify the city or covered organization within thirty days (or

such additional time not exceeding thirty days as the board

shall have notified the city or covered organization, that it

requires to complete its review and analysis) after submission

to it of a contract or other obligation that such contract or

other obligation has been disapproved shall be deemed to

constitute board approval thereof.

f. Upon submission thereof by the city, the board shall review

the terms of each proposed long-term and short-term borrowing by

the city and any covered organization to be affected during a

control period but after October fifteenth, nineteen hundred

seventy-five, and no such borrowing shall be made unless

approved by the board. Each such proposed borrowing by a covered

organization shall be submitted to the city by the covered

organization before it may be considered by the board. Not more

than thirty days after any such submission by a covered

organization the city shall transmit any such proposed terms of

borrowing to the board together with the certification of the

city as to whether such proposed terms of borrowing are in

accordance with the financial plan and are consistent with the

objectives and purposes of this act. Any such submission to the

city shall be accompanied by a certification of the covered

organization that the terms thereof are in accordance with the

financial plan and are consistent with the objectives or

purposes of this act. The transmittal by the city to the board

shall include a recommendation by the city for the approval or

disapproval of such proposed terms of borrowing pursuant to the

terms of this paragraph. In the event the city does not make

such transmittal within such thirty day period, such covered

organization may submit such proposed borrowing directly to the

board. The board shall disapprove any borrowing if it determines

that such borrowing is inconsistent with the financial plan or

the objectives or purposes of this act. The board shall consult

and coordinate with the municipal assistance corporation for the

city of New York with respect to borrowings of the city and any

covered organization and shall receive reports from the muncipal

assistance corporation for the city of New York on its review of

borrowings by the city. No covered organizations shall be

prohibited from issuing bonds or notes to pay outstanding bonds

or notes.

g. The board and the comptroller shall receive quarterly

reports from the city comptroller setting forth the debt service

requirements on all bonds and notes of the city and the covered

organizations for the following quarter, which reports shall be

in such form and contain such information as the board shall

determine. Such reports shall be issued no later than sixty days

prior to the start of the quarter to which they pertain and

shall be updated immediately upon each issuance of bonds or

notes after the date of such report to reflect any change in

debt service requirements as a result of such issuance. The

board also shall receive from the city monthly and quarterly

financial reports, which reports shall be in such form and

contain such information as the board shall determine and shall

be made available by the city to the public. In order to avoid

duplicative reports and reporting requirements, to the extent

that the city is required to submit monthly or quarterly

financial reports to the department of the treasury pursuant to

any agreement or arrangement made in connection with federal

guarantees of notes or bonds issued by the city or a state

financing agency, copies of such reports shall be submitted to

the board in satisfaction of the monthly and quarterly reporting

requirements set forth above, together with such additional

information as the board may require. Each monthly and quarterly

report herein required to be submitted to the board must

indicate any variance between actual and budgeted revenues,

expenses or cash for the period covered by such report.

h. The board shall issue, to the appropriate officials of the

city and the covered organizations, such orders as it deems

necessary to accomplish the purposes of this act, including but

not limited to timely and satisfactory implementation of an

approved financial plan. Any order so issued shall be binding

upon the official to whom it was issued and failure to comply

with such order shall subject the official to the penalties

described in section eleven of this act.

i. The board shall coordinate with the municipal assistance

corporation for the city of New York and the deputy comptroller

with respect to the performance of its review and monitoring of

the revenues and expenditures of the city and the covered

organizations.

2. In the event of any default by the city on its outstanding

bonds or notes, and so long as such default has not been cured,

the board may, any provisions of this act notwithstanding, take

any action that it is authorized to take pursuant to title six-A

of article two of the local finance law, and may direct the city

to take any action that the city is authorized to take under

such law.

* 3. (a) Notwithstanding any provision of the New York City

Collective Bargaining Law, codified as chapter fifty-four of the

New York city administrative code, or any general or special law

to the contrary, any report or recommendation of an impasse

panel constituted pursuant to such chapter which provides for an

increase in wages or fringe benefits of any employee of the city

or covered organization, in addition to considering any standard

or factor required to be considered by applicable law, including

the standards enumerated in section 1173-7.0(c)(3)(b) of such

chapter, shall also take into consideration and accord

substantial weight to the financial ability of the city and or

covered organization to pay the cost of such increase in wages

or fringe benefits.

(b) The board of collective bargaining constituted pursuant to

such chapter, when reviewing such report or recommendation

before proceeding to other issues, shall make a threshold

determination as to whether such report or recommendation for an

increase in wages or fringe benefits is within the city's and or

covered organization's financial ability to pay. If the

threshold determination is in the negative, the matter shall be

remitted to the impasse panel for further consideration. If the

threshold determination is in the affirmative, the further

review of the report or recommendation with respect to other

issues, if any, shall proceed as provided by law. Unless the

parties stipulate otherwise, the threshold determination shall

be made within thirty days after submission of the report or

recommendation to the board of collective bargaining.

(c) Any determination pursuant to article eight of the labor

law or any agreement or stipulation entered into in lieu thereof

which provides for an increase in wages or fringe benefits of

any employee of the city or covered organization shall, in

addition to considering any standard or factor required to be

considered by applicable law, also take into consideration and

accord substantial weight to the financial ability of the city

and or covered organization to pay the cost of such increase.

(d) Any report or recommendation of a fact finding or similar

type panel or any interest arbitration award which provides for

an increase in wages or fringe benefits of any employee of the

city or covered organization not subject to the provisions of

the New York City Collective Bargaining Law, codified as chapter

fifty-four of the New York city administrative code, shall, in

addition to considering any standard or factor required to be

considered by applicable law, also take into consideration and

accord substantial weight to the financial ability of the city

and or covered organization to pay the cost of such increase.

(e) Any party to a proceeding before the board of collective

bargaining as described in paragraph (b) or other body as

described in paragraphs (c) or (d) hereof may commence a special

proceeding in the appellate division, first department, supreme

court, state of New York, to review the threshold determination

as to the city and or covered organization's financial ability

to pay. Such proceeding shall be commenced not later than thirty

days after the final determination has been made by the board of

collective bargaining in the case of paragraph (b) or other body

in the case of paragraphs (c) or (d). Such proceeding shall have

preference over all other causes in such appellate division,

other than causes relating to the election law.

(f) The court shall make a de novo review of the record solely

for the purpose of determining whether an award of an increase

in wages or fringe benefits was within the city's and or covered

organization's financial ability to pay. The court's findings as

to such issue shall be based upon a preponderance of all the

evidence set forth in the record. Unless the parties stipulate

otherwise, arguments or submission shall be had within fifteen

days after commencement of the special proceeding and the court

shall render its decision within fifteen days thereafter. All

questions, other than the question relating to the threshold

determination, shall be reviewed by the appellate division in

the same proceeding in the manner provided by articles

seventy-five or seventy-eight of the civil practice law and

rules as may be appropriate, notwithstanding that the issue

would otherwise have been cognizable in the first instance

before a special or trial term of the supreme court. If an

appeal shall otherwise lie from such determination of the

appellate division to the court of appeals, notice of such

appeal shall be filed within thirty days after the entry of the

final order or judgment of the appellate division if such appeal

is of right or within ten days after entry of an order granting

leave to appeal and such appeal shall have preference over all

other appeals other than appeals relating to the election law.

(g) At any stage of any proceeding under paragraphs (a), (b),

(c), (d) and (e) hereof or any appeal from an order or judgment

therefrom, the board may intervene as a party on the issue of

the financial ability of the city and or covered organization to

pay the cost of an increase in wages or fringe benefits.

(h) For the purposes of this subdivision, financial ability to

pay shall mean the financial ability of the city and or covered

organization to pay the cost of any increase in wages or fringe

benefits without requiring an increase in the level of city

taxes existing at the time of the commencement of a proceeding

under paragraph (a), (c) or (d) hereof.

(i) The provisions of this subdivision shall terminate on June

thirtieth, nineteen hundred eighty-six.

* NB Expires June 30, 1986

4. During a control period, except upon approval by the board

in accordance with the provisions of paragraph e or f of

subdivision one of this section, as the board shall determine,

neither the city nor a covered organization shall enter any

agreement or other arrangement, whether or not it creates a debt

of the city or a covered organization, pursuant to which the

revenues or credit of the city may be directly or indirectly

pledged, encumbered, committed or promised, contingently or

otherwise, for the payment of obligations of a public benefit

corporation. Nothing in this subdivision shall limit the right

of the city to comply with the provisions of any existing

agreement or other arrangement in respect of the obligations of

a public benefit corporation.

5. The board may employ such consultants as it may deem

necessary to assist it in performing its functions required

under this act.

6. The board shall have the authority to make and execute

agreements and all other instruments which the board deems

necessary for the exercise of its powers and functions

including, in connection with any agreement by the federal

government or any agency or instrumentality thereof to guarantee

the payment of the principal of or interest on bonds or notes

issued by the city or by a state financing agency, to enter into

one or more agreements containing terms and conditions required

by the secretary of the treasury pursuant to the New York City

Loan Guarantee Act of l978, Public Law 95-339 with the federal

government or any agency or instrumentality thereof with respect

to such guarantee or any matters related thereto and to comply

with such terms and conditions.

7. The board may appoint qualified individuals to participate

as members of such audit, productivity or similar committees or

councils as the city may from time to time establish in

consultation with the board. Such individuals, however, shall

not be deemed to be officers, employees or agents of the board.

The board shall review and report on, not less than annually,

the development and implementation of methods for enhancing the

productivity of the city's labor force proposed by any such

committee or council.

* Terminates July 1, 2008 or ... see § 13

* § 7-a. Reports of the city. 1. The city shall take such

action as may be necessary to enable a nationally recognized

independent certified public accounting firm or consortium of

firms, one of which at least is a nationally recognized

independent certified public accounting firm, to perform an

annual audit in accordance with generally accepted auditing

standards and to furnish to the board the report on such audit

prepared by such firm or consortium of firms, which report shall

include an opinion as to whether the city's financial statements

have been prepared in accordance with generally accepted

accounting principles subject to the provisions of subdivision

two-a of section eight of this act and shall state whether the

audit of such financial statements was made in accordance with

generally accepted auditing standards and accordingly included

such tests of the accounting records and such other auditing

procedures as were considered necessary under the circumstances.

Such report shall note the nature and extent of variations, if

any, from generally accepted accounting principles reflected in

the city's financial statements. The city shall make available

for inspection and copying all books, records, work papers and

other data and material as required by such auditors, and the

city shall make its officers and employees available to, and

shall cooperate with such auditors so as to permit such annual

audit to be completed and the report issued to the city and to

the board within four months after the close of the city's

fiscal year.

2. Not later than January fifteenth, nineteen hundred

eighty-one, the city shall issue a report to the board on its

program designed to enable the city (i) during its fiscal years

ending June thirtieth, nineteen hundred eighty-three and June

thirtieth, nineteen hundred eighty-four, to minimize its

dependence upon the state financing agency to the extent that it

shall be prudent to satisfy the city's financing needs by the

sale of obligations of the city or its agencies in the public

markets, and (ii) thereafter to satisfy its financing needs

entirely by the sale of such obligations. The report shall

describe such actions that the city proposes to take, in

addition to those actions required by law, to implement the

program and shall contain such further information as the board

may reasonably specify. After the issuance of such initial

report, the city shall report to the board at least

semi-annually through June thirtieth, nineteen hundred

eighty-two and thereafter at least quarterly on the actions it

has taken to implement the program and on the results thereof.

The city may revise the program from time to time but shall

promptly describe any revisions and the reasons therefor to the

board. The city may comply with the requirements of this

subdivision by submitting the necessary information as

supplementary material to a financial plan or financial plan

modification in accordance with the standards and procedures of

section eight of this act. The provisions of this subdivision

shall terminate on June thirtieth, nineteen hundred eighty-five.

* Terminates July 1, 2008 or ... see § 13

* § 8. Development of the financial plan. 1. Pursuant to the

procedures contained in subdivision three of this section, each

year the city shall develop, and may from time to time modify,

with the approval of the board during a control period, a four

year financial plan covering the city and the covered

organizations.

Each such financial plan and financial plan modification shall

comply with the requirements of subdivision four of this section

and shall, except as otherwise provided pursuant to subdivision

two-a of this section, conform to the following standards:

a. For its fiscal years ending June thirtieth, nineteen

hundred seventy-nine through June thirtieth, nineteen hundred

eighty-one, the city's budget covering all expenditures other

than capital items shall be prepared and balanced so that the

results thereof would not show a deficit when reported in

accordance with the accounting principles set forth in the state

comptroller's uniform system of accounts for municipalities, as

the same may be modified by the comptroller, in consultation

with the city comptroller, for application to the city; subject

to the provision of subdivision four of section three thousand

thirty-eight of the public authorities law with respect to

contributions by the city or other public employer to any

retirement system or pension fund and subject to the provision

of paragraph (c) of subdivision five of section three thousand

thirty-eight of the public authorities law with respect to

expense items included in the capital budget of the city. For

the fiscal year ending June thirtieth, nineteen hundred

eighty-two, and for each fiscal year thereafter, the city's

budget covering all expenditures other than capital items shall

be prepared and balanced so that the results thereof would not

show a deficit when reported in accordance with generally

accepted accounting principles and would permit comparison of

the budget with the report of actual financial results prepared

in accordance with generally accepted accounting principles.

With respect to financial plans that include the fiscal years

ending June thirtieth, nineteen hundred seventy-nine through

June thirtieth, nineteen hundred eighty-one, the city's budget

covering all expenditures other than capital items shall be

prepared in accordance with generally accepted accounting

principles and there shall be substantial progress in each such

fiscal year towards achieving a city budget covering all

expenditures other than capital items the results of which would

not show a deficit when reported in accordance with generally

accepted accounting principles. The city shall eliminate expense

items from its capital budget not later than the commencement of

the fiscal year ending June thirtieth, nineteen hundred

eighty-two. For the fiscal year ending June thirtieth, nineteen

hundred eighty-nine, and for each fiscal year thereafter, the

budgets covering all expenditures other than capital items of

each of the covered organizations shall be prepared and balanced

so that the results thereof would not show a deficit when

reported in accordance with generally accepted accounting

principles; and for each fiscal year prior thereto, there shall

be substantial progress towards such goal. Notwithstanding the

foregoing and the provisions of any general or special state law

or local law to the contrary, including but not limited to the

New York city charter: (i) all costs that would be capital

costs in accordance with generally accepted accounting

principles, but for the application of governmental accounting

standards board statement number forty-nine, shall be deemed to

be capital costs for purposes of this act and any other

provision of state or local law, including but not limited to

the New York city charter, relevant to the treatment of such

costs; and (ii) the determination as to the existence of a

deficit pursuant to this act and any other provision of state or

local law, including but not limited to the New York city

charter, shall be made without regard to changes in restricted

fund balances, as defined by the governmental accounting

standards board, where restrictions in relation to such fund

balances are imposed by state or federal law or regulation, or

otherwise by private or governmental parties other than the city

of New York, and without regard to funds held in the health

stabilization fund, the school crossing guards health insurance

fund and the management benefits fund established by the city of

New York.

b. The limitations on its outstanding short-term obligations

required by subdivision nine of section three thousand

thirty-eight of the public authorities law and by section nine-b

of this act shall be observed at all times, as each is amended

from time to time.

c. Provision shall be made for the payment in full of the debt

service on all bonds and notes of the city and the covered

organizations (other than notes held by the municipal assistance

corporation for the city of New York to the extent that such

corporation has evidenced its intention not to present such

notes for payment during the fiscal year in which the

determination is made provided that such notes were held by such

corporation on June thirtieth, nineteen hundred seventy-eight or

were issued in exchange for or in refunding or renewal of notes

held by such corporation on such date), for the adequate funding

of programs of the city and the covered organizations which are

mandated by state or federal law and for which obligations are

going to be incurred during the fiscal year and for payment of a

guarantee fee or any other amounts required by the United States

of America or any agency or instrumentality thereof in

connection with the guarantee of the payment of the principal of

or interest on bonds or notes issued by the city.

d. All projections of revenues and expenditures contained in a

financial plan shall be based on reasonable and appropriate

assumptions and methods of estimation. All cash flow projections

shall be based upon reasonable and appropriate assumptions as to

sources and uses of cash (including but not limited to the

timing thereof), and shall provide for operations of the city

and covered organizations to be conducted within the cash

resources so projected.

e. The city shall provide a general reserve for each fiscal

year to cover potential reductions in its projected revenues or

increases in its projected expenditures during each such fiscal

year. The amount provided for such general reserve shall be

estimated by the city in accordance with paragraph d of this

subdivision, but in no event shall it be less than one hundred

million dollars at the beginning of any fiscal year.

f. For financial plans beginning with the fiscal year ending

June thirtieth, nineteen hundred eighty-three or any succeeding

fiscal year, the first fiscal year included in any financial

plan shall make provision for the repayment of any deficit

incurred by the city during the preceding fiscal year.

2. In developing the financial plan the city shall seek to

achieve a stabilized work force for the city and, to the extent

a reduction in the work force is required, primary recourse

shall be had to the attrition process to accomplish such

reduction.

2-a. The city and the board shall confer concerning the

projected effect on the budgets of the city and the covered

organizations of any change in generally accepted accounting

principles, or change in the application of generally accepted

accounting principles to the city and the covered organizations,

made after the effective date of this act. If the board

determines that immediate compliance with such change will have

a material effect on such budgets over a time period

insufficient to accommodate the effect without a substantial

adverse impact on the delivery of essential services, the board

may authorize and approve a method of phasing the requirements

of such change into such budgets over such reasonably

expeditious time period as the board deems appropriate.

3. The financial plan shall be developed and, during a control

period, shall be approved, and may from time to time be

modified, in accordance with the following procedures:

a. The city shall, by June first, nineteen hundred

seventy-eight, prepare and submit a financial plan to the board

covering the four year period which begins with the fiscal year

ending June thirtieth, nineteen hundred seventy-nine.

Thereafter, at least fifty days prior to the beginning of each

fiscal year or on such other date as the board may approve upon

the request of the city, the city shall prepare and submit a

financial plan to the board covering the four year period

beginning with such fiscal year. On such dates the mayor shall

also submit to the board the city's executive expense, revenue

and capital budgets for the ensuing fiscal year and a

certificate of the mayor stating that such budgets are

consistent with the financial plan submitted therewith, that

projections contained in the budgets and financial plan are

based upon reasonable and appropriate assumptions and methods of

estimation, and that operation within the budgets is feasible.

b. (i) During a control period the board shall promptly review

each financial plan and financial plan modification submitted by

the city. Not more than forty-five days after submission of a

financial plan or more than thirty days after submission of a

financial plan modification the board shall determine whether

the financial plan or financial plan modification is complete

and complies with the standards set forth in subdivision one of

this section and shall approve or disapprove the financial plan

or financial plan modification in accordance with the provisions

of this section. If the board determines that the financial plan

or financial plan modification is complete and complies with the

standards set forth in subdivision one of this section, the

board shall approve the financial plan or financial plan

modification. Upon making such determination the board shall

make a certification to the city setting forth revenue estimates

approved by the board in accordance with such determination.

(ii) At all times other than during a control period the board

shall promptly review each financial plan and financial plan

modification submitted by the city. If the board determines

after such review that the financial plan or financial plan

modification submitted by the city is not in accordance with the

standards set forth in subdivision one of this section, the

board shall promptly so notify the city and may take such other

action under this act as it deems appropriate.

c. The board shall disapprove a financial plan or financial

plan modification if during a control period it determines that

the financial plan or financial plan modification is incomplete

or fails to comply with the provisions of subdivision one of

this section. In disapproving a financial plan or a financial

plan modification the board may order that one or more of the

following actions be taken:

(i) expenditures or reserves to assure availability of amounts

required for debt service requirements on all bonds and notes of

the city and the covered organizations or expenditures required

for adequate funding of programs of the city and the covered

organizations mandated by state or federal law and for which

obligations are going to be incurred during the fiscal year, be

increased to the levels required to provide for their payment in

full;

(ii) the revenue projections (or any item thereof) during any

period be adjusted to comply with the standards set forth in

subdivision one of this section; and

(iii) the aggregate expenditures projected for any period be

reduced to conform to revenue estimates certified by the board

in order to comply with the standards set forth in subdivision

one of this section.

d. During a control period in the event that the city shall,

for any reason, fail to submit a financial plan prior to the

beginning of a fiscal year, as required by paragraph a of this

subdivision, or in the event that the board has not, for any

reason permitted under this act, approved a financial plan

submitted by the city prior to the beginning of a fiscal year,

the board shall formulate and adopt a financial plan to be

effective until the board approves a financial plan submitted by

the city. Any financial plan so formulated by the board shall

comply with the standards set forth in subdivision one of this

section. The budgets and operations of the city and the covered

organizations at all times shall be in conformance and

compliance with the financial plan then in effect.

e. After the initial adoption by the city, or the approval by

the board during a control period, of a financial plan,

projections of revenues and expenditures and other estimates

contained in the financial plan shall be reexamined by the board

at least quarterly in consultation with the city and the covered

organizations, and during a control period the city shall

prepare and submit to the board financial plan modifications at

such times, in such detail and within such time periods as the

board may require in order to modify the financial plan to

conform to the standards set forth in subdivision one of this

section. During a control period in the event the board

determines that (i) revenue estimates (or any item thereof) must

be adjusted to ensure compliance with the standards set forth in

subdivision one of this section, or (ii) that the city or a

covered organization is expending funds at a rate that would

cause expenditures to exceed the aggregate expenditure

limitation for the city or covered organization provided for in

the financial plan then in effect, prior to the expiration of

the fiscal year, the city shall submit a financial plan

modification to effect such adjustments in revenue estimates and

reductions in total expenditures as may be necessary to conform

to such standards or aggregate expenditure limitations. If

during a control period the city fails to submit such

modification after such determination as to adjustments in

revenue estimates or such determination as to rates of

expenditures, or to submit a financial plan modification in the

detail or within the time period specified by the board, or if

such modification is disapproved by the board as not conforming

to the standards set forth in subdivision one of this section,

the board may formulate and adopt such financial plan

modification as it deems appropriate to ensure that the

financial plan continues to meet such standards. Such

modification shall become effective on its adoption.

Notwithstanding the provisions of this section, in the event the

city shall determine that, due to unforeseen events during a

fiscal year, compliance with the standards set forth in

paragraph a of subdivision one of this section would result in a

material adverse impact upon the delivery of essential services,

the city shall notify the board of such determination, together

with such information, projections or analyses relating thereto

as the board may require, and shall submit a modification to the

financial plan reflecting such determination. During a control

period the board shall disapprove any such modification unless

it finds that (i) the city's determination is supported by

information, projections and analyses which the board deems

substantially accurate in all material respects and (ii) such

events, in its judgment, warrant such modification to the

financial plan to avoid such adverse impact on the delivery of

essential services.

f. The city may, from time to time, submit financial plan

modifications for review by the board. During a control period

the board shall approve such modifications unless it determines

that such modifications would constitute grounds for disapproval

of the financial plan pursuant to paragraph c of this

subdivision, or if applicable, pursuant to paragraph e of this

subdivision.

g. Anything contained in this act to the contrary

notwithstanding, during a control period the board may at any

time disapprove or after consultation with the city revise the

revenue estimates (or any item thereof) prepared by the city in

connection with the preparation of a financial plan or any

modification thereto and determined by the board not to be based

on assumptions and methods of estimation which are reasonable

and appropriate under the circumstances and in view of the

objectives and purposes of the act. The board may after

consultation with the city determine the estimated revenues of

the city and the covered organizations provided, however, that

any revenues estimated by the board shall be based on reasonable

and appropriate assumptions and methods of estimation.

4. Each financial plan shall be in such form and shall contain

such information for each year during which the financial plan

is in effect as the board may specify, and shall, in such detail

as the board may from time to time prescribe, include

projections of all revenues, expenditures and cash flows

(including but not limited to projected capital expenditures and

debt issuances) and a schedule of projected capital commitments

of the city and except in such instances as the board may deem

appropriate each of the covered organizations. In addition, each

financial plan and financial plan modification shall include a

statement of the significant assumptions and methods of

estimation used in arriving at the projections contained

therein, set forth in such form and in such detail as the board

may from time to time prescribe.

5. The city and the covered organizations shall promptly

furnish the board with any information which the board may

request to satisfy itself that (i) projected employment levels,

collective bargaining agreements and other action relating to

employee costs, capital construction and such other matters as

the board may specify, are consistent with the provisions made

for such costs in the financial plan, (ii) the city and the

covered organizations are taking whatever action is necessary

with respect to programs mandated by state and federal law to

ensure that expenditures for such programs are limited to and

covered by the expenditures stated in the financial plan, and

(iii) adequate reserves are provided to maintain programs

mandated by state and federal law and for which obligations are

going to be incurred in the fiscal year and other essential

programs in the event revenues have been overestimated or

expenditures underestimated for any period.

6. For each financial plan and financial plan modification to

be prepared and submitted by the city to the board pursuant to

the provisions of this section, the covered organizations shall

submit to the city such information with respect to their

projected expenditures, revenues, cash flows and a schedule of

projected capital commitments for each year covered by such

financial plan or modification as the city shall determine.

Notwithstanding any other provision of law limiting the

authority of the city with respect to any covered organization,

the city, in the preparation and submission of the financial

plan and modifications thereof, shall (except for debt service

or for other expenditures to the extent that such expenditures

are required by law) have the power to determine the aggregate

expenditures to be allocated to any covered organization in the

financial plan and any modifications thereto.

* Terminates July 1, 2008 or ... see § 13

* § 9. Establishment and application of the board fund. 1.

There is hereby established a fund designated the board fund.

Commencing on October twentieth, nineteen hundred seventy-five,

and for the duration of a control period, all revenues received

or to be received by the city or any covered organization shall,

unless exempted by order of the board, be revenues of the board

fund and shall be for the account of the city or the appropriate

covered organizations, except (i) to the extent expressly

prohibited by federal law, (ii) where revenues of the city are

deposited in the general debt service fund, the TAN debt service

account or the RAN debt service account, or (iii) where such

revenues are pledged to the payment of any outstanding bonds,

notes or other obligations of covered organizations or state

public authorities as defined in section two hundred one of the

civil service law. Disbursement from the board fund shall be

made by the board in accordance with the approved financial plan

except as provided in subdivision five of this section nine.

Commencing on October twentieth, nineteen hundred seventy-five,

and for the duration of a control period, all funds and accounts

established or thereafter established by the city or the covered

organizations shall, unless exempted by order of the board,

thereafter be funds and accounts of the board fund except to the

extent expressly prohibited by federal law or to the extent

pledged by covenants or agreements relating to any outstanding

bonds, notes or other obligations of covered organizations or

public authorities as defined in section two hundred one of the

civil service law; and no monies or funds held in the general

debt service fund, the TAN debt service account or the RAN debt

service account shall be part of the board fund. All such

accounts of the board shall have such captions and entries as

the board shall determine to be necessary to credit the

foregoing revenues and receipts to the board fund. The monies of

the fund shall not be deemed to be money of the state or money

under its control.

2. The deposit of revenues into the board fund and the

investment or deposit of monies therein shall be made in

accordance with and pursuant to procedures established by the

board.

3. In order to assure compliance with the financial plan, the

board shall from time to time adopt procedures controlling the

disbursement of monies from the board fund. The board shall

authorize the city to make all disbursements of city revenues

from the board fund, which disbursements shall be made in

accordance with the approved financial plan; provided, that the

board may withdraw such authorization if it determines that (a)

any disbursements made or to be made by the city have not been

or are likely not to be in compliance with the approved

financial plan, (b) the city has violated any other provisions

of this act, or (c) the city has violated an agreement with any

holder or guarantor of bonds or notes issued by the city or a

state financing agency.

4. Within the board fund there is hereby established a special

account designated the debt service repayment account. The board

shall from time to time direct, in accordance with procedures

adopted by the board, the deposit in the debt service repayment

account of such amounts as the board shall, in its discretion,

determine to be sufficient to meet the debt service requirements

of the covered organizations on their bonds and notes (other

than bonds and notes of covered organizations payable from

revenues not included in the board fund) as they become due.

Amounts in the debt service repayment account shall be used to

meet such debt service requirements of the covered

organizations.

5. If at any time the board determines that the amount then

held in the board fund or the amount estimated by the board to

be held in the board fund is or will be insufficient to meet the

expenditures in the amounts and at the times required by the

financial plan, the board shall require disbursements from the

board fund to be made in the following order or priority unless

otherwise required by law of the United States of America: (i)

the payment of amounts from the board fund to the debt service

repayment account, the general debt service fund, the TAN debt

service account and the RAN debt service account, to maintain

therein the amount required, to meet debt service requirements

of the city and the covered organizations on their bonds and

notes as they may become due, (ii) the payment of other

liabilities having statutory or contractual priority over

remaining liabilities of the city and the covered organizations

whose monies are included in the board fund, and (iii) the

payment of other obligations on an allocated basis as specified

by the city for expenditures in accordance with the financial

plan provided that, in the event that the city fails to so

specify, the board may withhold payment of any of such other

obligations or may direct their payment pro rata.

6. The board shall cause to be performed such pre-audit and

post-audit reviews of the board funds and disbursements

therefrom as it may determine.

* Terminates July 1, 2008 or ... see § 13

* § 9-a. Establishment and application of a general debt

service fund. 1. Commencing on the first day of the first full

fiscal quarter subsequent to the first sale of a federally

guaranteed city obligation, the city shall establish a general

debt service fund for the purpose of paying debt service due or

becoming due in the then current fiscal year and in subsequent

fiscal years. All monies in the fund shall be held by the

comptroller, who shall administer and maintain the fund in

accordance with the provisions of this section.

2. All payments of or on account of real estate taxes or

assessments, other than the proceeds of tax anticipation notes,

shall be immediately upon receipt deposited in such fund. The

comptroller shall retain, disburse and apply monies in the fund

during each month as follows:

a. During the first month of each fiscal quarter, there shall

be retained in the fund, subject to the provisions of

subdivision three of this section, all real estate tax payments

deposited in the fund until there shall have been retained from

monies so deposited during such month an amount equal to the

total monthly debt service, computed as of the date of any

disbursement of money from the fund, for the second and third

months of such fiscal quarter; provided that such amount shall

be reduced by any amount already on deposit in the fund which

may be used to pay the monthly debt service for such months.

For purposes of this section, fiscal quarter shall mean the

three-month period beginning July first, October first, January

first or April first, and monthly debt service shall mean, as of

any date of computation, the amount of monies equal to the

aggregate of (i) all interest payable during such month on bonds

and notes of the city, plus (ii) the amount of principal

(including payments into sinking funds) maturing or otherwise

coming due during such month on all bonds of the city (excluding

principal payments made from sinking funds required by the terms

of certain city bonds), plus (iii) the amount of principal to be

paid on notes of the city during such month from sources other

than the proceeds of bonds or renewal notes (exclusive of

revenue anticipation notes and tax anticipation notes or

renewals thereof issued less than two years prior to the date of

computation).

b. During the second and third months of each fiscal quarter,

there shall be retained in the fund, subject to the provisions

of subdivision three of this section, all real estate tax

payments deposited in the fund until there shall have been

retained from monies so deposited during such month an amount

equal to the total monthly debt service, computed as of the date

of any disbursement of monies from the fund, for the first month

of the next succeeding fiscal quarter; provided that such amount

shall be reduced by any amount already on deposit in the fund

which may be used to pay the monthly debt service for such

month.

c. During any month of a fiscal quarter, after the retentions

required by paragraphs a and b of this subdivision have been

made for such month, the comptroller shall deposit any remaining

balance of real estate taxes received during such month, first

into the TAN debt service account to the extent required under

subdivision six of this section, and second into the board fund

to be applied in accordance with procedures of the board.

d. The city may at any time pay into the fund any monies

required by law to be used to pay monthly debt service and any

other monies available for such purpose.

3. The board may approve, subject to agreements made with the

holders or guarantors of outstanding notes or bonds issued by or

for the benefit of the city after the effective date of this

act, criteria for calculating a proportion of real estate tax

receipts to be retained in the fund in order to provide for the

retention of amounts required by the provisions of subdivision

two of this section in lieu of the retention of all initial

receipts as required by such subdivision; provided, that if the

board at any time determines that retentions in the fund

pursuant to the provisions of such subdivision are or are likely

to be insufficient to provide for the payment of monthly debt

service when due, in order to ensure that the amounts on deposit

in the fund will be sufficient to pay monthly debt service when

due, the board shall require (i) that real estate tax receipts

be retained in the fund in greater amounts or at earlier dates

than the provisions of such subdivision require, or (ii) that

other revenues or cash resources of the city be paid into the

fund. The board shall consider the impact of earlier or larger

retention of real estate tax receipts on the city's seasonal

borrowing requirements when determining whether it shall require

such additional retention or that other revenues or cash

resources of the city be paid into the fund. Prior to the

issuance by the city of any bonds or notes, the board shall

review any criteria then in effect which determine the

proportion of real estate tax receipts to be retained in the

fund to determine whether the proposed debt service schedule for

such bonds or notes is consistent with the monies which will be

available therefor or whether such criteria should be revised.

The board shall from time to time take such action as it

determines is necessary, including disapproval of a proposed

issue pursuant to paragraph f of subdivision one of section

seven, so that the monies in the fund shall be adequate to meet

debt service requirements.

4. Commencing on the first day of the second month of the

first full fiscal quarter subsequent to the first sale of a

federally guaranteed city obligation, the payment of monthly

debt service shall be made, first, from amounts retained in the

fund. Amounts retained in the fund shall be used only to pay

debt service of the city.

5. Upon the issuance of any tax anticipation notes following

the effective date of this act, the comptroller shall establish

and, so long as any tax anticipation notes shall be outstanding,

shall maintain a tax anticipation note debt service account

within the fund for the purpose of paying the principal of tax

anticipation notes.

6. The city shall determine the date on which the principal

due or to become due on an outstanding issue of tax anticipation

notes shall equal ninety percent of the available tax levy with

respect to such issue, and upon reasonable notice thereof the

comptroller shall commence on such date to pay into the TAN debt

service account from collections of such taxes and assessments,

after retaining amounts required to be deposited in the fund,

amounts sufficient to pay when due, the principal of such issue

of tax anticipation notes. The payments of the principal of tax

anticipation notes shall be made, first, from amounts retained

in the TAN debt service account.

7. Upon the issuance of any revenue anticipation notes

following the effective date of this act, the comptroller shall

establish and, so long as any revenue anticipation notes shall

be outstanding, shall maintain a revenue anticipation note debt

service account within the fund for the purpose of paying the

principal of revenue anticipation notes. Each specific type of

revenue in anticipation of which such notes are issued and

available for such purpose shall be deposited in such account

immediately upon receipt by the city. Where such revenue

consists of state aid or other revenue to be paid to the city by

the comptroller, on the date such revenue is payable to the

city, the comptroller shall deposit such revenue directly into

such account in lieu of payment to the city. All revenues

deposited in the RAN debt service account shall be paid

immediately into the board fund except as otherwise provided in

subdivision eight of this section.

8. The city shall determine the date on which the principal

due or to become due on an outstanding issue of revenue

anticipation notes shall equal ninety percent of the total

amount of revenue against which such notes were issued remaining

to be paid to the city on or before the fifth day prior to the

maturity date of such notes and upon reasonable notice thereof

the comptroller shall commence on such date to retain in the RAN

debt service account from amounts deposited or to be deposited

therein of each specific type of revenue in anticipation of

which revenue such anticipation notes were issued, an amount

sufficient to pay, when due, the principal of such revenue

anticipation notes. Monies retained in such account shall vest

immediately in the comptroller in trust for the benefit of the

holders of the revenue anticipation notes in anticipation of

which such notes were issued. No person having any claim of any

kind in tort, contract or otherwise against such city shall have

any right to or claim against any monies of the state

appropriated by the state and in anticipation of which such

notes have been issued, other than a claim for payment by the

holders of such notes, and such monies shall not be subject to

any order, judgment, lien, execution, attachment, setoff or

counter-claim by any such person; provided, however, that

nothing contained in this paragraph shall be construed to limit,

impair, impede or otherwise adversely affect in any manner the

rights or remedies of the purchasers and holders and owners of

any bonds or notes of the state or any agency, instrumentality,

public benefit corporation or political subdivision thereof,

including the city of New York, under which such purchasers and

holders and owners have any right of payment of such bonds or

notes by recourse to state aid or local assistance monies held

by the state or for the payment of which bonds or notes state

aid or local assistance monies are a designated source. The

payment of the principal of revenue anticipation notes shall be

made first from amounts retained in the RAN debt service

account.

9. Whenever the amount contained in the TAN debt service

account or the RAN debt service account exceeds the amount

required to be retained in such account such excess monies,

including earnings on investments of monies in the fund, shall

be withdrawn from such account and paid into the board fund.

10. Subject to agreements made with holders or guarantors of

outstanding notes or bonds issued by or for the benefit of the

city after the effective date of this act, the comptroller shall

invest the monies retained in the fund in accordance with law.

11. The limitations imposed upon the city by this section

shall be in addition to any limitations imposed upon the city

under the local finance law. In the event any provisions of the

local finance law shall be inconsistent with the provisions of

this section, the provisions of this section shall prevail. The

requirements of this section shall not apply to any note of the

city held by the municipal assistance corporation for the city

of New York to the extent that such corporation has evidenced

its intention not to present such notes for payment during the

fiscal year in which the determination is made provided that

such notes were held by such corporation on June thirtieth,

nineteen hundred seventy-eight or were issued in exchange for or

in refunding or renewal of notes held by such corporation on

such date.

12. Notwithstanding any other provision of this section, the

city may, at any time, subject to approval by the comptroller,

designate a trust company or bank having its principal place of

business in the state of New York and having the powers of a

trust company in the state of New York to hold all or any part

of the monies in the fund and to administer and maintain the

monies so held in accordance with the applicable provisions of

this section and any agreements made pursuant thereto.

* Terminates July 1, 2008 or ... see § 13

* § 9-b. Limitations on short-term borrowing. 1. The

limitations on short-term borrowing imposed upon the city by

this section shall be in addition to the limitations on

short-term borrowing imposed on the city under the local finance

law. In the event any provisions of the local finance law shall

be inconsistent with the provisions of this section, the

provisions of this section shall prevail. For the purposes of

this section the terms "bond anticipation notes", "tax

anticipation notes", "revenue anticipation notes" and "budget

notes" shall not mean one or more of or any of the respective

notes held by the municipal assistance corporation for the city

of New York on June thirtieth, nineteen hundred seventy-eight or

any note of the city held by such corporation issued in exchange

for or in refunding or renewal of any such note.

2. a. No tax anticipation notes shall be issued by the city in

anticipation of the collection of taxes or assessments levied

for a fiscal year which would cause the principal amount of such

issue of tax anticipation notes to exceed an amount equal to

ninety per cent of the available tax levy with respect to such

issue.

b. Tax anticipation notes and renewals thereof shall mature

not later than the last day of the fiscal year in which they

were issued.

3. a. No revenue anticipation note shall be issued by the city

in anticipation of the collection or receipt of revenue in a

fiscal year which would cause the principal amount of revenue

anticipation notes outstanding to exceed ninety per cent of the

available revenues for such fiscal year. For purposes of this

subdivision, available revenues shall be the revenues other than

real estate taxes and assessments which have been estimated in

the financial plan to be realized in cash during such year, less

revenues previously collected, other than revenues on deposit in

the RAN debt service account or any special fund established

pursuant to law for the payment of interest and/or principal of

revenue anticipation notes.

b. Each issue of revenue anticipation notes shall be issued

only in anticipation of the receipt of a specific type or types

of revenue and the amount of revenue, the source of revenue and

the anticipated date of payment shall be stated in the

proceedings authorizing the issuance of such notes.

c. Revenue anticipation notes shall mature not later than the

last day of the fiscal year in which they were issued, and may

not be renewed or extended to a date more than ten days after

the anticipated date of receipt of such revenue. No such renewal

note shall mature after the last day of such fiscal year unless

the board shall certify that the revenue against which such

renewal note is issued has been properly accrued and estimated

in the financial plan in effect on the date of issuance of such

renewal note; provided that in no event shall any such renewal

notes mature later than one year subsequent to the last day of

the fiscal year during which such revenue anticipation notes

were originally issued.

4. a. No bond anticipation note shall be issued by the city in

any fiscal year which would cause the principal amount of bond

anticipation notes outstanding, together with interest due or to

become due thereon, to exceed fifty per cent of the principal

amount of bonds issued by the city in the twelve months

immediately preceding the month in which the note is to be

issued.

b. The proceeds of each bond issue shall be (i) held in trust

for the payment, at maturity, of the principal of and interest

on any bond anticipation notes of the city issued in

anticipation of such bonds and outstanding at the time of the

issuance of such bonds, (ii) paid into the general fund of the

city in repayment of any advance made from such fund pursuant to

section 165.10 of the local finance law, and (iii) any balance

shall be expended for the object or purpose for which such bonds

were issued.

c. Bond anticipation notes shall mature not later than one

year after their date of issuance and may be renewed for a

period not to exceed two years, or such longer period as may be

permitted for bond anticipation notes of the state, from the

date of original issue.

5. Budget notes issued pursuant to section 29.00 of the local

finance law may only be issued to fund projected expense budget

deficits. No budget notes or renewals thereof, shall mature

later than sixty days prior to the last day of the fiscal year

next succeeding the fiscal year during which such budget notes

were originally issued.

6. The city shall issue no obligations which shall be

inconsistent with the financial plan or with the limitations set

forth in subdivisions one through five of this section.

* Terminates July 1, 2008 or ... see § 13

* § 10. Wage freeze. 1. Increases in salary or wages of

employees of the city and employees of covered organizations

which have taken effect since June thirtieth, nineteen hundred

seventy-five or which will take effect after that date pursuant

to collective bargaining agreements or other analogous

contracts, now in existence or hereafter entered into, requiring

such salary increases as of July first, nineteen hundred

seventy-five or as of any date thereafter are hereby suspended.

All increased payments for holiday and vacation differentials,

shift differentials, salary adjustments according to plan and

step-ups or increments for employees of the city and employees

of covered organizations which have taken effect since June

thirtieth, nineteen hundred seventy-five or which will take

effect after that date pursuant to collective bargaining

agreements or other analogous contracts requiring such increased

payments as of July first, nineteen hundred seventy-five as of

any date thereafter are hereby, in the same manner, suspended.

For the purposes of computing the pension base of retirement

allowances, the suspended salary or wage increases and the

suspended other payments shall not be considered as part of

compensation or final compensation or of annual salary earned or

earnable. The suspensions provided herein shall be effective for

the first pay period ending on or subsequent to September first,

nineteen hundred seventy-five and shall continue until one year

thereafter and, to the extent of any determination of the board

that a continuation of such suspensions, to a date specified by

the board, is necessary in order to achieve the objectives of

the financial plan, such suspensions shall be continued to the

date specified by such board, which date shall in no event be

later than the end of the emergency period.

2. This section shall not be applicable to employees of the

city or employees of a covered organization covered by a

collective bargaining agreement or an employee of the city or a

covered organization not covered by a collective bargaining

agreement where the collective bargaining representative or such

unrepresented employee has agreed to a deferment of salary or

wage increase, by an instrument in writing which has been

certified by the mayor on or before September first, nineteen

hundred seventy-five, or certified by the board after September

first, nineteen hundred seventy-five as being an acceptable and

appropriate contribution toward alleviating the fiscal crisis of

the city. The board may, if it finds that the fiscal crisis has

been sufficiently alleviated or for any other appropriate

reason, direct that the suspensions of salary or wage increases

or suspensions of other increased payments shall, in whole or in

part, be terminated.

3. The provisions of this section shall terminate on July

first, nineteen hundred seventy-eight.

* Terminates July 1, 2008 or ... see § 13

* § 10-a. Covenants, authorizations to agree and remedies. 1.

In the event that after the date on which the provisions of this

act become operative, any notes or bonds are issued by the city

prior to July 1, 2020, or any bonds are issued by a state

financing agency, the state of New York hereby authorizes the

city and authorizes and requires such state financing agency to

include a pledge and agreement of the state of New York in any

agreement made by the city or such state financing agency with

holders or guarantors of such notes or bonds that the state will

not take any action which will (a) substantially impair the

authority of the board during a control period, as defined in

subdivision twelve of section two of this act as in effect on

the date such notes or bonds are issued (i) to approve,

disapprove, or modify any financial plan or financial plan

modification, including the revenue projections (or any item

thereof) contained therein, subject to the standards set forth

in paragraphs a, c, d, e and f of subdivision one of section

eight of this act as in effect on the date such notes or bonds

are issued and paragraph b of such subdivision as in effect from

time to time, (ii) to disapprove a contract of the city or a

covered organization if the performance of such contract would

be inconsistent with the financial plan or to approve or

disapprove proposed short-term or long-term borrowing of the

city or a covered organization or any agreement or other

arrangement referred to in subdivision four of section seven of

this act, or (iii) to establish and adopt procedures with

respect to the deposit in and disbursement from the board fund

of city revenues; (b) substantially impair the authority of the

board to review financial plans, financial plan modifications,

contracts of the city or the covered organizations and proposed

short-term or long-term borrowings of the city and the covered

organizations; (c) substantially impair the independent

maintenance of a separate fund for the payment of debt service

on bonds and notes of the city; (d) alter the composition of the

board so that the majority of the voting members of the board

are not officials of the state of New York elected in a

state-wide election or appointees of the governor; (e) terminate

the existence of the board prior to the time to be determined in

accordance with section thirteen of this act as in effect on the

date such notes or bonds are issued; (f) substantially modify

the requirement that the city's financial statements be audited

by a nationally recognized independent certified public

accounting firm or consortium of firms and that a report on such

audit be furnished to the board; or (g) alter the definition of

a control period set forth in subdivision twelve of section two

of this act, as in effect on the date such notes or bonds are

issued, or substantially alter the authority of the board, as

set forth in said subdivision to reimpose or terminate a control

period; provided, however, that the foregoing pledge and

agreement shall be of no further force and effect if at any time

(i) there is on deposit in a separate trust account with a bank,

trust company or other fiduciary sufficient moneys or direct

obligations of the United States or obligations guaranteed by

the United States, the principal of and/or interest on which

will provide moneys to pay punctually when due at maturity or

prior to maturity by redemption, in accordance with their terms,

all principal of and interest on all outstanding notes and bonds

of the city or such state financing agency containing this

pledge and agreement and irrevocable instructions from the city

or such state financing agency to such bank, trust company or

other fiduciary for such payment of such principal and interest

with such moneys shall have been given, or (ii) such notes and

bonds, together with interest thereon, have been paid in full at

maturity or have otherwise been refunded, redeemed, defeased, or

discharged; and provided further that the foregoing pledge and

agreement shall be of full force and effect upon its inclusion

in any agreement made by the city or state financing agency with

holders or guarantors of such notes or bonds.

Upon payment for such obligations issued pursuant to this act

by the original and all subsequent holders inclusion of the

foregoing covenant shall be deemed conclusive evidence of

valuable consideration received by the state and city for such

covenant and of reliance upon such pledge and agreement by any

such holder. The state hereby grants any such benefited holder

the right to sue the state in a court of competent jurisdiction

and enforce this covenant and agreement and waives all rights of

defense based on sovereign immunity in such an action or suit.

2. Every such bond or note which shall contain the pledge and

agreement referred to in subdivision one above shall be callable

for redemption commencing not later than the eleventh

anniversary of its date of issuance and shall contain on its

face a recital to such effect, together with the terms and

conditions under which such obligation may be redeemed.

3. The finance board of the city is hereby authorized to enter

into agreements and to make covenants with any purchaser, holder

or guarantor of obligations issued by the city or by a state

financing agency to protect and safeguard the security and

rights of a purchaser, holder or guarantor or to protect and

safeguard the source of payment of such obligations or as deemed

appropriate by the finance board which agreements or covenants

may contain provisions providing for (a) (i) the compliance by

the city with any of the provisions of this act or of the New

York City Loan Guaranty Act of nineteen hundred seventy-eight,

Public Law 95-339, or, (ii) in any agreements with the guarantor

of such obligations but only in such agreements unless otherwise

authorized by law, the compliance with any of the terms and

conditions required by the secretary of the treasury pursuant to

such act, (b) restrictions on the issuance by the city of its

obligations, limitations on the inclusion of expense items in

its capital budgets and financial records, reporting and

disclosure requirements in addition to any such restrictions,

limitations or requirements contained in this act, (c)

compliance by the city with its financial plan as modified from

time to time, (d) conditions that would give rise to an event of

default on such obligations, and (e) remedies available to a

purchaser, holder or guarantor of such obligations, other than

acceleration or the required elimination or reduction of

specific municipal expenditures, including the circumstances, if

any, under which a trustee or trustees or a fiscal agent may be

appointed or may act as a representative of holders of

obligations issued by the city in connection with an issue or

issues of obligations of the city and the rights, powers and

duties which may be vested in such trustee, trustees or fiscal

agent as such representative. The state of New York hereby

pledges and agrees that it will take no action that would impair

the power of the city to comply with or to perform any covenant

or agreement made pursuant to this subdivision, or any right or

remedy of a purchaser, holder or guarantor to enforce such

covenant or agreement; and the city or a state financing agency

is hereby authorized to include such pledge and agreement in any

agreement made pursuant to this subdivision. Nothing contained

in this subdivision shall preclude the state from authorizing

the city to exercise, or the city from exercising, any power

provided by law to seek application of laws then in effect under

the bankruptcy provisions of the United States constitution or

shall preclude the state from validly exercising its police

powers.

4. Notwithstanding any other provision of law, the trustees of

any retirement, pension or annuity fund or system of the state

of New York or of the city of New York are hereby authorized to

enter into commitments to purchase and to purchase notes, bonds

or other obligations of the city of New York or of a state

financing agency, the payment in whole or in part, of interest,

principal, or both, is guaranteed by the secretary of the

Treasury of the United States of America pursuant to the New

York City Loan Guarantee Act of 1978, Public Law 95-339, as

presently in effect or hereafter amended or to purchase other

bonds or notes of such city or of a state financing agency prior

to June thirtieth, nineteen hundred eighty-two, or in the case

of the trustees of any retirement, pension or annuity fund or

system of the city of New York, to enter into commitments to

purchase such other bonds or notes of such city or of a state

financing agency prior to June thirtieth, nineteen hundred

eighty-two. Such commitments to purchase shall be binding upon

and enforceable against successor trustees of such retirement,

pension or annuity funds or systems of the state of New York or

city of New York.

5. The secretary of the treasury shall have the right to

initiate a proceeding in the supreme court of the state of New

York in and for the county of New York or the court of claims of

the state of New York to obtain a court order or other relief in

connection with any agreements or other transactions entered

into by the secretary relative to his guarantee of the

principal, interest, or both of city indebtedness.

6. Notwithstanding any other provision of law to the contrary,

the governor shall have the authority in connection with any

agreement by the federal government or any agency or

instrumentality thereof to guarantee the payment of the

principal of or interest on bonds or notes issued by the city of

New York or by a state financing agency, to enter into one or

more agreements containing terms and conditions required by the

secretary of the treasury pursuant to the New York City Loan

Guarantee Act of 1978, Public Law 95-339, approved by the

comptroller and approved as to form by the attorney general,

with the federal government or any agency or instrumentality

thereof with respect to such guarantee or any matters related

thereto and to comply with such terms and conditions.

7. Nothing in this section contained shall preclude the state

from authorizing the board or the city to exercise, or the board

or city from exercising, any power provided by law to seek

application of laws then in effect under the bankruptcy

provisions of the United States constitution or to preclude the

state from a further exercise of its powers under article eight,

section twelve, of the state constitution.

* Terminates July 1, 2008 or § 13

* § 11. Prohibitions; penalties. 1. During a control period,

(i) no officer or employee of the city or of any of the covered

organizations shall make or authorize an obligation or other

liability in excess of the amount available therefor under the

financial plan as then in effect; (ii) no officer or employee of

the city or of any of the covered organizations shall involve

the city or any of the covered organizations in any contract or

other obligation or liability for the payment of money for any

purpose required to be approved by the board unless such

contract, obligation or liability has been so approved or deemed

to be approved as provided in paragraphs e and f of subdivision

one of section seven and unless such contract or obligation or

liability is in compliance with the financial plan as then in

effect.

2. No officer or employee of the city or any of the covered

organizations shall take any action in violation of any valid

order of the board or shall fail or refuse to take any action

required by any such order or shall prepare, present or certify

any information (including any projections or estimates) or

report for the board or any of its agents that is false or

misleading, or, upon learning that any such information is false

or misleading, shall fail promptly to advise the board or its

agents thereof.

3. In addition to any penalty or liability under other law,

any officer or employee of the city or any of the covered

organizations who shall knowingly and willfully violate

subdivision one or two of this section shall be subject to

appropriate administrative discipline, including, when

circumstances warrant, suspension from duty without pay or

removal from office by order of either the governor or the mayor

and shall, upon conviction, be guilty of a misdemeanor.

4. In the case of a violation of subdivision one or two of

this section by an officer or employee of the city or any of the

covered organizations, the mayor or the chief executive officer

of such covered organization shall immediately report to the

board all pertinent facts together with a statement of the

action taken thereon.

* Terminates July 1, 2008 or ... see § 13

* § 12. Indemnification. a. The state shall save harmless and

indemnify members, officers and employees of and representatives

to the board, all of whom shall be deemed officers and employees

of the state for purposes of section seventeen of the public

officers law, against any claim, demand, suit, or judgment

arising by reason of any act or omission to act by such member,

officer, employee or representative occurring in the discharge

of his duties and within the scope of his service on behalf of

such board including any claim, demand, suit or judgment based

on allegations that financial loss was sustained by any person

in connection with the acquisition, disposition or holding of

securities or other obligations. In the event of any such claim,

demand, suit or judgment, a member, officer or employee of or

representative to the board shall be saved harmless and

indemnified, notwithstanding the limitations of subdivision one

of section seventeen of the public officers law, unless such

individual is found by a final judicial determination not to

have acted, in good faith, for a purpose which he reasonably

believed to be in the best interest of the board or not to have

had reasonable cause to believe that his conduct was lawful.

b. In connection with any such claim, demand, suit, or

judgment, any member, officer or employee of or representative

to the board shall be entitled to representation by private

counsel of his choice in any civil judicial proceeding whenever

the attorney general determines based upon his investigation and

review of the facts and circumstances of the case that

representation by the attorney general would be inappropriate.

The attorney general shall notify the individiual in writing of

such determination that the individual is entitled to be

represented by private counsel. The attorney general may

require, as a condition to payment of the fees and expenses of

such representative, that appropriate groups of such individuals

be represented by the same counsel. If the individual or groups

of individuals is entitled to representation by private counsel

under the provisions of this section, the attorney general shall

so certify to the comptroller. Reasonable attorneys fees and

litigation expenses shall be paid by the state to such private

counsel from time to time during the pendency of the civil

action or proceeding, subject to certification that the

individual is entitled to representation under the terms and

conditions of this section by the chairman of the board, upon

the audit and warrant of the comptroller. The provisions of this

subdivision shall be in addition to and shall not supplant any

indemnification or other benefits heretofore or hereafter

conferred upon members, officers, or employees of and

representatives to the board by section seventeen of the public

officers law, by action of the board or otherwise. The

provisions of this subdivision shall inure only to members,

officers and employees of and representatives to the board,

shall not enlarge or diminish the rights of any other party, and

shall not impair, limit or modify the rights and obligations of

any insurer under any policy of insurance.

* Terminates July 1, 2008 or ... see § 13

§ 13. Termination. This act shall terminate on the later of

(a) July first, two thousand eight or (b) the date (i) when all

bonds and notes containing the pledge and agreement authorized

by subdivision one of section ten-a of this act are refunded,

redeemed, discharged or otherwise defeased, or (ii) when there

shall no longer be outstanding any guarantee by the United

States of America or any agency or instrumentality thereof as to

payment of principal of or interest on any note or bond issued

by the city or a state financing agency, whichever of (i) or

(ii) shall occur later.

* Terminates July 1, 2008 or ... see § 13

* § 14. Separability. If any clause, sentence, paragraph,

subdivision, or other part of this act shall for any reason be

adjudged by any court of competent jurisdiction to be

unconstitutional or otherwise invalid, such judgment shall not

affect, impair, or invalidate the remainder of this act, but

shall be confined in its operation to the clause, sentence,

paragraph, subdivision or part thereof directly involved in the

controversy in which such judgment shall have been rendered and

it shall be construed to have been the legislative intent to

pass this act without such unconstitutional, or invalid part

therein.

* Terminates July 1, 2008 or ... see § 13

* § 15. Court preference. If any section, part or provision of

this act shall be declared unconstitutional or invalid or

ineffective by any court of this state, any appeal of such

judgment or order shall have preference over all other causes in

any court of this state. Service upon the adverse party of a

notice of appeal shall stay the effect of the judgment or order

appealed from pending the hearing and determination of the

appeal.

* Terminates July 1, 2008 or ... see § 13


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