N.Y. Energy Law § 5-127: New York state business energy conservation loan program

§ 5-127. New York state business energy conservation loan program. 1.

As used in this section, unless a different meaning clearly appears from

the context, the term:

a. "Agri-business" shall mean (i) an individual, partnership or

corporation involved in farm production which (1) has had twenty

thousand dollars or more in gross farm production related sales in the

twelve-month period prior to the submission of a program application, or

from which at least fifty percent of the applicant's income was derived

during such period, or (2) if the applicant has not been in operation

for the prior twelve-month period, certifies that sales are projected in

excess of twenty thousand dollars, or at least fifty percent of the

applicant's income is projected to be derived, from farm production

during the next twelve-month period; or (ii) a business involved in food

processing.

b. "Financing institution" shall mean and include all banks, trust

companies, savings banks, savings and loan associations and credit

unions, whether incorporated, chartered, organized or licensed under the

laws of this state, any other state of the United States or the federal

government.

This term may also include public authorities, public benefit

corporations, units of local government, domestic insurance companies

and not-for-profit corporations, which make loans for improvements for

the benefit of eligible applicants.

c. "Eligible applicant" or "applicant" shall mean (i) a small to

medium size business or a not-for-profit corporation that is a veteran's

organization which employs less than five hundred workers or has gross

annual sales of less than ten million dollars, or (ii) an agri-business,

and which is the owner or which has a lease or management agreement

extending beyond the loan term of a building located within the state

for which an eligible energy conservation improvement is made, provided

that the commissioner may qualify this definition by rule and

regulation.

d. "Eligible energy conservation improvement" or "improvement" shall

mean the construction, alteration, repair or improvement to a building

or equipment affixed to, contained in or on the grounds of the building

which reduces energy consumption provided that: (i) the cost of such

improvement will be returned in savings in energy costs within a period

of not less than one year nor more than ten years as identified in an

energy audit, (ii) work on such improvement commenced after submittal of

an application under the program, and (iii) such construction,

alteration, repair or improvement is permissible under federal

requirements and court decisions applicable to overcharge funds

appropriated to this program.

e. "Energy audit" shall mean a process which identifies and specifies

the energy and cost savings which are likely to be realized by an

eligible energy conservation improvement.

f. "Loan" or "program loan" shall mean a loan from a financing

institution pursuant to an agreement with the office as part of the New

York state business energy conservation loan program.

g. "Program" shall mean the New York state business energy

conservation loan program.

h. "Region" shall mean one or more of the following named areas

comprised of the counties indicated:

(1) Buffalo-Rochester: Cattaraugus, Chautauqua, Erie, Genesee,

Livingston, Monroe, Niagara, Ontario, Orleans, Seneca, Wayne, Wyoming

and Yates counties;

(2) Syracuse-Southern Tier: Allegany, Broome, Cayuga, Chemung,

Chenango, Cortland, Delaware, Madison, Onondaga, Oswego, Otsego,

Schuyler, Steuben, Tioga and Tompkins counties;

(3) Central-Northern: Albany, Clinton, Essex, Franklin, Fulton,

Hamilton, Herkimer, Jefferson, Lewis, Montgomery, Oneida, Rensselaer,

Saratoga, Schenectady, Schoharie, St. Lawrence, Warren and Washington

counties;

(4) Westchester-Mid-Hudson: Columbia, Dutchess, Greene, Orange,

Putnam, Rockland, Sullivan, Ulster and Westchester counties;

(5) Long Island: Nassau and Suffolk counties;

(6) New York City: the five counties comprising the city of New York.

2. The commissioner is hereby authorized and directed to establish the

New York state business energy conservation loan program. The program

shall facilitate below market interest rate loans by financing

institutions within the state for eligible energy conservation

improvements made to eligible applicants as hereinafter provided.

3. The commissioner may enter into cooperative agreements with

financing institutions within the state for the financing with the

institution's own assets of eligible energy conservation improvements by

eligible applicants at a rate that is at least twenty-five percent below

the prime interest rate. Such interest rate shall initially be five

percent. The commissioner shall agree to utilize such funds as are

appropriated to this program and the earnings produced on such funds to

underwrite interest subsidies on loans made to eligible applicants, if

not inconsistent with federal requirements and court decisions directing

the payment of petroleum overcharge funds to the state. Such agreements

shall provide that: (i) the maximum loan per applicant shall be five

hundred thousand dollars, except that the commissioner may increase the

maximum loan amount up to one million dollars for specific types of

improvements by rule and regulation, (ii) the duration of the loan shall

not to exceed ten years, (iii) program loans shall be made only after an

application has been made to the office, the office has approved the

technical merits of the proposed improvement and the office has notified

the financing institution of its approval and the amount of interest

reduction upon the loan to be funded pursuant to such agreement, and

(iv) loan agreements with program applicants shall provide for a post

installation inspection, as deemed necessary by the office.

4. The commissioner shall apportion the moneys appropriated for this

program for the purpose of providing interest subsidies to applicants

within each of the six regions of the state identified in paragraph g of

subdivision one of this section based on the ratio, calculated by the

commissioner, which reflects:

a. the volume of refined petroleum products consumed within that

region during the period beginning September first, nineteen hundred

seventy-three, and ending January twenty-eighth, nineteen hundred

eighty-one, compared to

b. the volume of refined petroleum products consumed within the six

regions during such period.

Such calculation shall be made by the commissioner upon estimates

determined by him in reliance upon reasonably available information.

The commissioner may reapportion the funds available for interest

subsidies for applicants within any region under this subdivision for

use in one or more of the other regions upon finding that participation

in the program within the former region would not be adversely affected,

and that there exists in the latter region or regions inadequate funds

to satisfy the demand for program participation. In any fiscal year of

the state, the amount of funds available to applicants within any region

may be reduced by not more than twenty-five percent of the total amount

apportioned for such region. A copy of the commissioner's finding shall

be given to the chairman of the senate finance committee and the

chairman of the assembly ways and means committee.

5. In addition to the authority granted under subdivision three of

this section, the commissioner shall be authorized to utilize monies

appropriated to this program for the purpose of providing loan

guaranties and principal reductions for eligible applicants, if such

uses are permissible under the conditions applicable to the appropriated

overcharge funds. Principal reductions shall be limited to the amount of

the interest subsidy which would otherwise be available to an eligible

applicant under subdivision three of this section.

6. In implementing the program, the commissioner is authorized to take

such action as he deems necessary and appropriate which may include but

not be limited to the promulgation of rules and regulations formulated

after consultation with the energy research and development authority,

the department of commerce and the department of financial services.

Such rules and regulations may include but not be limited to

requirements for applications and supporting materials and criteria for

the selection of cooperating financing institutions.