N.Y. Const. art. VII, § 16: Payment of state debts; when comptroller to pay without appropriation

§ 16. The legislature shall annually provide by appropriation for the

payment of the interest upon and installments of principal of all debts

or refunding debts created on behalf of the state except those

contracted under section 9 of this article, as the same shall fall due,

and for the contribution to all of the sinking funds created by law, of

the amounts annually to be contributed under the provisions of section

12, 13 or 15 of this article. If at any time the legislature shall fail

to make any such appropriation, the comptroller shall set apart from the

first revenues thereafter received, applicable to the general fund of

the state, a sum sufficient to pay such interest, installments of

principal, or contributions to such sinking fund, as the case may be,

and shall so apply the moneys thus set apart. The comptroller may be

required to set aside and apply such revenues as aforesaid, at the suit

of any holder of such bonds.

Notwithstanding the foregoing provisions of this section, the

comptroller may covenant with the purchasers of any state obligations

that they shall have no further rights against the state for payment of

such obligations or any interest thereon after an amount or amounts

determined in accordance with the provisions of such covenant is

deposited in a described fund or with a named or described agency or

trustee. In such case, this section shall have no further application

with respect to payment of such obligations or any interest thereon

after the comptroller has complied with the prescribed conditions of

such covenant.