N.Y. Private Housing Finance Law § 212: Limited return on income debentures and stock

§ 212. Limited return on income debentures and stock. 1. No

redevelopment corporation shall pay any interest on its income

debentures or dividends on its stock during any dividend year, unless

there shall exist at the time of any such payment no default under any

amortization requirements with respect to its indebtedness.

2. No redevelopment corporation shall pay or declare as interest on

its income debentures and as dividends on its stock during any dividend

year during any portion of which there shall exist pursuant to section

two hundred eleven of this article any exemption from local taxation on

any of its real property, an amount which in the aggregate is in excess

of the maximum dividend, except as provided in paragraphs three and four

of this section two hundred twelve.

3. In the event that in any dividend year the maximum exemption period

with respect to some of the parcels of real property held by a

redevelopment corporation shall have expired, and with respect to some

such parcels shall not have expired, then that portion of its net

earnings which may be paid or declared as interest on its income

debentures and as dividends on its stock during such dividend year shall

be determined as follows: multiply the net earnings of the corporation

subject to payment or declaration as such interest or dividends, by a

fraction the numerator of which is the total of the maximum assessed

valuation of all real property for which the maximum exemption period

has not expired and the denominator of which is the total of the maximum

assessed valuation of all the real property of the corporation; and the

result will be the apportioned net earnings restricted as to payment as

such interest or dividends; compute the amount of the maximum dividend

as though no apportionment of the same were to be affected and multiply

the amount so arrived at by the same fraction; and the result will be

the apportioned maximum dividend; only that portion of such apportioned

net earnings which does not exceed such apportioned maximum dividend may

be paid or declared as such interest or dividends; and that portion of

the net earnings obtained by subtracting from total net earnings such

apportioned net earnings restricted as to payment as such interest and

dividends may be paid or declared without restriction as such interest

or dividends.

4. In the event that in any one or more prior dividend years the total

amount paid or declared as interest on the corporation's income

debentures or as dividends on its stock shall have been less than the

amounts allowable pursuant to paragraphs two and three of this section

two hundred twelve, then cumulative interest and dividends equal to the

difference may be paid out of any net income applicable thereto in any

subsequent dividend year despite the limitation imposed by paragraph two

of this section two hundred twelve.