N.Y. City of Troy Issuance of Serial Bonds § 8-a: Establishment and application of a general debt service fund

§ 8-a. Establishment and application of a general debt service fund.

(a) 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 and for making payments to the

county of Rensselaer in accordance with section eight-b of this act. 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 and section eight-b.

(b) All payments of or on account of real estate taxes or assessments

collected by the city on its own behalf or on behalf of the county of

Rensselaer shall be immediately upon receipt deposited in such fund. On

or before the fifth business day of each month, the city shall certify

to the comptroller the amount of deposits during the immediately

preceding month that constitute collections of or on account of real

estate taxes or assessments on behalf of the county of Rensselaer.

Except as otherwise provided in section eight-b of this act, the

comptroller shall retain, disburse and apply monies in the fund during

each month as follows:

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

retained in the fund, subject to the provisions of subdivision (c) 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 January first, April first, July first or

October 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).

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

shall be retained in the fund, subject to the provisions of subdivision

(c) 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.

3. 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.

(c) 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 (b) 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. 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 (vi) of

subdivision (g-1) of section 10 of this act, so that the monies in the

fund shall be adequate to meet debt service requirements.

(d) The board may approve 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 section eight-b of this act,

but only in accordance with the real property tax law, the charter of

the city, and any agreement concerning such matters between the city and

the county of Rensselaer.

(e) The comptroller shall invest the monies in the fund in permissible

investments under sections 98 and 98-a of the state finance law, subject

in all respects to any 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 subdivision. Any earnings accruing on

such investment shall inure to the benefit of the city. At least one

business day prior to the beginning of each month the city shall provide

the comptroller with a detailed schedule of cash flow requirements from

the fund under this section and section eight-b of this act for the

ensuing three month period. Notwithstanding any other provision of law

to the contrary, the decisions of the comptroller as to the investments

purchased from monies in the fund shall be conclusive.

(f) 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.