N.Y. Education Law § 407-b: Authorization for dormitory authority financing of capital facilities for state-supported schools for blind and deaf students

§ 407-b. Authorization for dormitory authority financing of capital

facilities for state-supported schools for blind and deaf students. 1.

The legislature declares that it is in the interest of the state and the

children of the state to assure that state-supported schools for the

instruction of blind and deaf students and other children with

handicapping conditions pursuant to article eighty-five of this chapter

and chapter one thousand sixty of the laws of nineteen hundred

seventy-four have sufficient facilities related to the education of such

children. The legislature finds that state-supported schools for blind

and deaf students providing such education are in need of improved and

additional facilities related to the education of such children, and the

means to finance the construction of such improvements and additional

facilities. The legislature, therefore, enacts the following provisions.

2. This section shall apply to state-supported schools for the

instruction of the blind and deaf students and children with other

handicapping conditions, subject to the appointment of the commissioner,

pursuant to article eighty-five of this chapter and chapter one thousand

sixty of the laws of nineteen hundred seventy-four.

3. Such state-supported schools may enter into leases, subleases or

other agreements with the dormitory authority pursuant to title four of

article eight of the public authorities law for the financing of the

design, construction, reconstruction, rehabilitation, improvement,

renovation or otherwise providing for furnishing or equipping of

educational or residential facilities where the total estimated cost of

such facilities exceeds ten thousand dollars. The plans and

specifications of such capital facilities shall be subject to approval

of the commissioner. Such educational or residential facilities may be

constructed only on land owned by such state-supported school or, if the

land is leased, where the lease is for a period at least equal to the

appropriate period of probable usefulness for such facilities as listed

in section 11.00 of the local finance law, or the length of the lease,

sublease or other agreement with the dormitory authority, whichever is

longer.

4. Each state-supported school shall, notwithstanding any other

provision of law, have the power to convey, lease, sublease or otherwise

make available to the dormitory authority without consideration, title

or any other rights in real property satisfactory to the dormitory

authority.

5. In addition to providing for all other matters deemed necessary and

proper, such leases, subleases and other agreements shall (a) require

the state-supported school to pay to the dormitory authority annual

rentals which shall include the amount required to pay the principal of

and interest on obligations of the dormitory authority issued in

relation to providing such facilities and all incidental expenses of the

dormitory authority incurred in relation thereto, (b) require the

state-supported school to include an amount sufficient to meet its

obligations under the lease, sublease or other agreement in each

proposed budget submitted during the term of the lease, sublease or

other agreement, and (c) a provision that such agreement shall not be

effective unless and until it is approved by the commissioner and the

director of the budget.

6. Title or other real property rights, to the capital facilities

financed pursuant to this section shall remain with the dormitory

authority until the dormitory authority certifies to the commissioner

and the comptroller the receipt by it of the amount necessary to pay the

aggregate amount of annual rentals to the dormitory authority. At such

time, title or other real property rights thereto shall be transferred

by the dormitory authority to the state-supported school. In order to

avail itself of the provisions of this section, each state-supported

school must also agree to continue to operate a program for the

education of children pursuant to article eighty-five of this chapter

and chapter one thousand sixty of the laws of nineteen hundred

seventy-four, and any lease, sublease or other agreement with the

dormitory authority shall provide that, if the state-supported school

shall cease to operate at any time during the term of the agreement, the

school shall have the obligation to pay the total aggregate amount of

annual rentals to the dormitory authority. Upon a determination that the

state-supported school is unable to satisfy such obligations, the state

may take such title or other real property rights of the dormitory

authority in such land, buildings, equipment and other properties which

the state-supported school uses for its program upon payments, subject

to appropriations, by the state to the dormitory authority of the amount

required to pay the total aggregate amount of annual rentals to the

dormitory authority.

7. On or before November fifteenth of each year, the dormitory

authority shall submit, and thereafter may resubmit, to the director of

the budget, the state comptroller, the chairman of the senate finance

committee and the chairman of the assembly ways and means committee a

report setting forth the amounts, if any, of all annual rentals

estimated to become due in the succeeding state fiscal year to the

dormitory authority from the state-supported schools pursuant to any

leases, subleases or other agreements between the dormitory authority

and state-supported schools to provide educational and residential

facilities for such state-supported schools.

The state comptroller shall pay over to the dormitory authority

pursuant to appropriations therefor solely from moneys available in the

school capital facilities financing reserve fund the amount set forth in

such report at the times and in the amounts set forth in the certificate

filed with the comptroller by the dormitory authority pursuant to

subparagraph (iv) of paragraph (b) of subdivision eight of this section.

8. Method of payment; reserve fund. (a) Each state-supported school

which elects to avail itself of the provisions of this section shall

have established with the state comptroller a school capital facilities

financing reserve account which shall be used to pay to the dormitory

authority the annual rentals payable to the dormitory authority by

state-supported schools which have entered into leases, subleases or

other agreements with the dormitory authority to provide educational or

residential facilities pursuant to this section or to reimburse the

state for expenditures from appropriations made pursuant to subdivision

seven of this section. The dormitory authority shall identify to the

state comptroller and to the commissioner the state-supported schools

with which it has leases, subleases or other agreements pursuant to this

section and shall annually certify the amount of annual rentals required

to be paid pursuant to such leases, subleases or other agreements.

(b) (i) There is hereby established in the custody of the state

comptroller a special fund to be known as the school capital facilities

financing reserve fund. Within such fund, there is hereby established a

special account for each state-supported school which enters into a

lease, sublease or other agreement with the dormitory authority pursuant

to this section.

(ii) Notwithstanding the provisions of any other law, such fund shall

consist of payments as made and determined by the commissioner. The

comptroller shall maintain sufficient amounts in the fund in order to

pay when due the annual rentals due to the dormitory authority from each

such state-supported school pursuant to any lease, sublease or other

agreement entered into pursuant to the provisions of this section. The

dormitory authority shall certify to the state comptroller the dates and

amounts of such payments as scheduled in its lease, subleases or other

agreements with such state-supported school. The commissioner shall

certify the amount of payments due the fund from state-supported

schools, and shall make such payments to the fund at such times as

appropriate, subject to the approval of the director of the budget, and

after consultation with the dormitory authority.

(iii) Revenues in any special account in the school capital facilities

financing reserve fund may be commingled with any other moneys in such

fund. All deposits of such revenues shall be secured by obligations of

the United States or of the state of New York or its political

subdivisions. Such obligations shall have a market value not less than

one hundred five percent of the amount of such deposits. All the banks

and trust companies are authorized to give security for such deposits.

Any such revenues in such fund may, in the discretion of the

comptroller, be invested in obligations of the United States or the

state or obligations the principal of and interest on which are

guaranteed by the United States or by the state. Any interest earned

shall be credited to such fund.

(iv) Upon receipt by the comptroller of a certificate or certificates

from the dormitory authority that it requires a payment or payments from

the appropriate special account established for a state-supported school

to comply with any lease, sublease or other agreement pursuant to this

section, each of which certificate shall specify the required payment or

payments and the date when the payment or payments is required, the

comptroller shall pay from such special account on or before the

specified date or within thirty days after receipt of such certificate

or certificates, whichever is later, to the paying agent designated by

the dormitory authority in any such certificate, the amount or amounts

so certified.

(v) Notwithstanding any other provisions of this subdivision to the

extent that the state makes appropriations for the payment of annual

rentals to the dormitory authority required to be paid pursuant to the

terms of any lease, sublease or other agreement between the dormitory

authority and any state-supported schools and makes such payments,

moneys in the school capital facilities financing reserve fund shall be

used to reimburse the state for moneys so expended from such

appropriation.

(vi) All payments of money from the school capital facilities

financing reserve fund shall be made on the audit and warrant of the

state comptroller.

9. All state officials are authorized and required to take whatever

actions are necessary to carry out the provisions of this section and

any leases, subleases or other agreements entered into pursuant to this

section, including making the required payments to the dormitory

authority.

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

dormitory authority may execute leases, subleases, or other agreements

with state supported schools for financing of the design, construction,

rehabilitation, improvement, renovation, acquisition or provision,

furnishing or equipping of capital facilities; provided, however, that

during the two year period commencing July first, nineteen hundred

ninety-five, the amount of bonds inclusive of principal, interest and

issuance costs to be issued for each individual lease, sublease, or

other agreement shall not exceed fifteen million dollars annually;

provided further that the interest on such bonds may not be deferred

through additional borrowing; and provided finally that the total amount

of such bonds for all such leases, subleases, or agreements with state

supported schools during such period shall not exceed sixty-five million

dollars.

On or before September first of each year, the commissioner shall

submit to the chairs of the assembly ways and means committee, the

senate finance committee and the director of the budget, a capital plan

for those projects expected to be bonded for state supported schools

pursuant to this section, within such sixty-five million dollar

allowance. After application of the principles of the capital assets

preservation program, such plan shall accord priority to health and

safety considerations and shall specify the name, location, estimated

total cost of the project at the time the project is to be bid, the

anticipated bid date and the anticipated completion date and may contain

any further recommendations the commissioner may deem appropriate.