N.Y. Local Finance Law § 57.00: Sale of bonds

§ 57.00 Sale of bonds. a. Bonds shall be sold only at public sale and

in accordance with the procedure set forth in this section and sections

58.00 and 59.00 of this title, except as otherwise provided in this

paragraph. Bonds may be sold at private sale to the United States

government or any agency or instrumentality thereof, the state of New

York municipal bond bank agency, to any sinking fund or pension fund of

the municipality, school district or district corporation selling such

bonds, or, in the case of sales by the city of New York prior to July

first, two thousand twenty-seven, also to the municipal assistance

corporation for the city of New York or to any other purchaser with the

consent of the mayor and the comptroller of such city and approval of

the state comptroller, or, in the case of sales by the county of Nassau

prior to December thirty-first, two thousand seven, also to the Nassau

county interim finance authority with the approval of the state

comptroller, or, in the case of sales by the city of Buffalo prior to

June thirtieth, two thousand thirty-seven, also to the Buffalo fiscal

stability authority with the approval of the state comptroller, or, in

the case of bonds or other obligations of a municipality issued for the

construction of any sewage treatment works, sewage collecting system,

storm water collecting system, water management facility, air pollution

control facility or solid waste disposal facility, also to the New York

state environmental facilities corporation, or, in the case of bonds or

other obligations of a school district or a city acting on behalf of a

city school district in a city having a population in excess of one

hundred twenty-five thousand but less than one million inhabitants

according to the latest federal census, issued to finance or refinance

the cost of school district capital facilities or school district

capital equipment, as defined in section sixteen hundred seventy-six of

the public authorities law, also to the dormitory authority of the state

of New York. Bonds of a river improvement or drainage district

established by or under the supervision of the department of

environmental conservation may be sold at private sale to the state of

New York as investments for any funds of the state which by law may be

invested, provided, however, that the rate of interest on any such bonds

so sold shall be approved by the water power and control commission and

the state comptroller. Bonds may also be sold at private sale as

provided in section 63.00 of this title. No bonds shall be sold on

option or on a deferred payment plan, except that options to purchase,

effective for a period not exceeding one year, may be given:

1. in any case to the state of New York municipal bond bank agency

with respect to any bonds or bond anticipation notes; and

2. in the case of a municipality to the New York state environmental

facilities corporation with respect to bonds or other obligations issued

for the construction of any sewage treatment works, sewage collecting

system, storm water collecting system, water management facility, air

pollution control facility or solid waste disposal facility, or, in the

case of bonds or other obligations of a school district or a city acting

on behalf of a city school district in a city having a population in

excess of one hundred twenty-five thousand but less than one million

inhabitants according to the latest federal census, issued to finance or

refinance the cost of school district capital facilities or school

district capital equipment, as defined in section sixteen hundred

seventy-six of the public authorities law, also to the dormitory

authority of the state of New York. A loan commitment may also be

entered into by and between a municipality, and the state of New York

municipal bond bank agency, by and between a school district or a city

acting on behalf of a city school district in a city having a population

in excess of one hundred twenty-five thousand but less than one million

inhabitants according to the latest federal census and the dormitory

authority of the state of New York, and by and between a municipality

and the New York state environmental facilities corporation, such

commitment to be fulfilled by the purchase of the bonds or other

obligations referred to therein by such agency or such corporation, as

the case may be. As used in this paragraph, the term "sinking fund"

means a fund required by law to be established and maintained for the

purpose of amortizing indebtedness evidenced by sinking fund bonds

issued pursuant to the provisions of this chapter or issued by any

municipality, school district or district corporation under any other

law.

b. Bonds shall be sold without limitation as to rate of interest and

for a sum not less than the par value of, and the accrued interest on,

such obligations except as authorized by this chapter, and may also be

sold by municipalities at private sale to the state of New York

municipal bond bank agency and to the New York state environmental

facilities corporation, and in addition by the city of New York to the

municipal assistance corporation for the city of New York, and by the

county of Nassau to the Nassau county interim finance authority, and by

the city of Buffalo to the Buffalo fiscal stability authority, at such

rate or rates of interest as may be agreed upon by and between the

issuing municipality and either of such agency or corporation, as the

case may be. When sold at public sale, the rate of interest shall be

determined in the manner provided in section 59.00 of this title.

However, the agency or corporation prescribing the terms, form and

contents of such bonds, subject to the foregoing provisions of this

paragraph, may fix a maximum rate of interest at which such bonds shall

be sold.

c. Bonds for one or more specific objects or purposes or classes of

objects or purposes, or a combination thereof, may be sold as a single

bond issue.

d. The state comptroller shall adopt a rule or order which he may

amend from time to time:

1. Designating a financial newspaper or newspaper published and

circulated in the city of New York in which notices for the sale of

bonds may be published;

2. Prescribing the procedure for the circularization of notices for

the sale of bonds;

3. Prescribing such other requirements as he may deem necessary

relating to the publication or circularization of notices for the sale

of bonds, in addition to but not inconsistent with the provisions of

this chapter;

4. Prescribing such data and information as he may deem advisable to

be contained in notices for the sale of bonds, in addition to but not

inconsistent with the provisions of this chapter; and

5. Prescribing the requirements for the alternative and permissive

publication or circularization of notices for the sale of bonds of an

issue not exceeding five million dollars, as permitted in section 63.00

of this chapter.

Such rule or order and the amendments thereof shall be filed in his

office and in such other offices as he may designate.

e. Notwithstanding the limitations set forth in paragraph b of this

section, a municipality, school district, or district corporation may

provide for the public sale of its bonds at a price of less than the

face value of such bonds at maturity; provided that no issue of bonds

shall be sold at a price such that the difference between the sale price

of such bonds, not including accrued interest, and the face value of

such bonds at maturity, shall exceed five percent of the face value of

such issue of bonds at maturity unless the municipality, school district

or district corporation issuing such bonds has determined to issue them

pursuant to a substantially level or declining annual debt service

schedule or unless interest is contributed at least annually to a

sinking fund in accordance with section two of article VIII of the

constitution and the procedures of section 22.10 of this article. The

cost of such original issue discount, together with other costs of the

issuance of obligations, shall be deemed a part of the cost of the

object or purpose for which such obligations are issued.

* f. To facilitate the marketing of any issue of bonds issued pursuant

to paragraph e of this section, such municipality, school district or

district corporation may, notwithstanding any limitations on private

sales of bonds provided by law, and subject to rules promulgated by the

state comptroller governing such sales: (A) arrange for the underwriting

of such bonds at private sale through negotiated agreement, compensation

for such underwriting to be provided by negotiated fee or by sale of

such bonds to an underwriter at a price of less than the sum of face

value at maturity of, and the accrued interest on, such obligations; or

(B) arrange for private sale of such bonds through negotiated agreement,

compensation for such sale to be provided by negotiated arrangement, if

required. The cost of such underwriting or private placement shall be

deemed a preliminary cost for purposes of section 11.00 of this chapter.

* NB Repealed July 15, 2027