N.Y. Public Authorities Law § 2429-b: Mortgage insurance fund

§ 2429-b. Mortgage insurance fund. * 1. (a) The agency shall create

and establish a mortgage insurance fund. Within such fund, the agency

shall establish: (i) a special account, which shall be divided into

sub-accounts for each region as defined in subdivision nine of section

twenty-four hundred twenty-six of this title; (ii) a single family pool

insurance account; (iii) a project pool insurance account; and (iv) a

development corporation credit support account. The single family pool

insurance account shall be used for all business relating to the

insurance of mortgages on properties with one to four dwelling units,

the project pool insurance account shall be used for all business

relating to the insurance of mortgages on properties other than those

with one to four dwelling units, and the development corporation credit

support account shall be used for all business relating to development

corporation credit support. Separate sub-accounts may be established

within the special account, the pool insurance accounts, and the

development corporation credit support account as deemed appropriate by

the agency.

(b) (i) The mortgage insurance fund shall be used as a revolving fund

for carrying out the provisions of this title with respect to mortgages

insured and development corporation credit support, provided thereunder.

(ii) The agency shall pay into such fund all moneys which may be made

available to the agency for the purposes of such fund from any source,

including but not limited to the moneys received from recording officers

pursuant to the provisions of subdivision two of section two hundred

sixty-one of the tax law. The agency shall credit the amount of moneys

received from the recording officer of each county, pursuant to

subdivision two of section two hundred sixty-one of the tax law, to the

special account. In any fiscal year, no more than fifty per centum of

the amount received from the recording officers during the consecutive

twelve month period ending on the preceding March thirty-first may be

used by the agency for the purpose of insuring mortgages on property

located in any one region pursuant to section two thousand four hundred

twenty-eight of this part, provided, however, that this provision shall

not include or be applied to pool insurance of mortgage loans purchased

by the agency. The agency shall credit any other moneys which may be

made available to the agency for the purposes of such fund from any

other source to the special account, the single family pool insurance

account, the project pool insurance account, or the development

corporation credit support account, as appropriate. Any income or

interest earned by, or increment to, the mortgage insurance fund due to

the investment thereof shall be credited to the special account, the

applicable pool insurance account, or the development corporation credit

support account, as appropriate.

(c) The agency may credit from the special account to the single

family pool insurance account, to the project pool insurance account and

to the development corporation credit support account such moneys as are

required to satisfy the mortgage insurance fund requirement of such

accounts, except that during any twelve-month period ending on March

thirty-first the aggregate amount credited to the development

corporation credit support account (excluding amounts described in the

last sentence of paragraph (b) of this subdivision) shall not exceed the

lesser of (i) fifty million dollars or (ii) the aggregate of the amounts

required under the contracts executed by the agency to provide

development corporation support.

(d) Moneys, investments and cash equivalents of the special account,

the single family pool insurance account, the project pool insurance

account and the development corporation credit support account shall be

kept separate and shall not be commingled with each other or with any

other accounts which may be established from time to time, except as

otherwise authorized by this section.

(e) Moneys, investments and cash equivalents of the pool insurance

accounts and the development corporation credit support account shall be

excluded from the excess balance calculation set forth in subdivision

two of this section. However, if at any time the moneys, investments and

cash equivalents (valued as determined by the agency) of either pool

insurance account or the development corporation credit support account

exceed the amount necessary to attain and maintain the credit rating or,

with respect to development corporation credit support, credit

worthiness (as determined by the agency) required to accomplish the

purposes of such account the agency shall transfer such excess to the

special account and such excess shall be included in the excess balance

calculation.

* NB Effective until July 23, 2027

* 1. The agency shall create and establish a mortgage insurance fund.

Within such fund, the agency shall establish a special account, which

shall be divided into sub-accounts for each region as defined in

subdivision nine of section twenty-four hundred twenty-six of this part

and a development corporation credit support account. The development

corporation credit support account shall be used for all business

related to development corporation credit support. Separate sub-accounts

may be established within the development corporation credit support

account as deemed appropriate by the agency. The mortgage insurance fund

shall be used as a revolving fund for carrying out the provisions of

this title with respect to mortgages insured and development corporation

support provided thereunder. The agency shall pay into such fund all

moneys which may be made available to the agency for the purposes of

such fund from any source, including but not limited to the moneys

received from recording officers pursuant to the provisions of

subdivision two of section two hundred sixty-one of the tax law. The

agency shall credit the amount of moneys received from the recording

officer of each county, pursuant to subdivision two of section two

hundred sixty-one of the tax law, to the special account. In any

calendar year, no more than fifty per centum of the amount received from

the recording officers and credited to the special account during the

consecutive twelve month period ending on the preceding December

thirty-first may be used by the agency for the purpose of insuring

mortgages on property located in any one region pursuant to section two

thousand four hundred twenty-eight of this part. The agency shall credit

any other moneys which may be made available to the agency for the

purposes of such fund from any other source to the special account or

the development corporation credit support account, as appropriate. Any

income or interest earned by, or increment to, the mortgage insurance

fund due to the investment thereof shall be credited to the special

account or the development corporation credit account, as appropriate.

* NB Effective July 23, 2027

* 1-a. All moneys held in the mortgage insurance fund, except as

hereinafter provided, shall be used, as required, solely for the payment

of the agency's liabilities arising from mortgages insured as provided

in section twenty-four hundred twenty-nine-a of this part and from the

provision of development corporation credit support as provided in

section twenty-four hundred twenty-eight-a of this part; provided,

however, that no moneys shall be withdrawn from any account at any time

in such amount as would reduce the amount of, as applicable, the special

account, either pool insurance account or the development corporation

credit support account to less than its applicable mortgage insurance

fund requirement, except for the purpose of paying such liabilities as

the same become due and for the payment of which other moneys of the

agency are not available. All payments pursuant to section twenty-four

hundred twenty-nine-a of this part, and expenses attributable thereto

shall be debited to the special account or the single family pool

insurance account or the project pool insurance account or the

development corporation credit support account, as appropriate, within

the mortgage insurance fund. All other operating expenses of the agency

with respect to insurance of mortgages and providing development

corporation credit support shall be debited to the special account, the

single family pool insurance account, the project pool insurance account

or the development corporation credit support account within the

mortgage insurance fund, as appropriate.

* NB Effective until July 23, 2027

* 1-a. All moneys held in the mortgage insurance fund, except as

hereinafter provided, shall be used, as required, solely for the payment

of the agency's liabilities arising from mortgages insured as provided

in section twenty-four hundred twenty-nine-a of this part and from the

provision of development corporation credit support as provided in

section twenty-four hundred twenty-eight-a of this part; provided,

however, that no moneys shall be withdrawn from any account at any time

in such amount as would reduce the amount of, as applicable, the special

account or the development corporation credit support account to less

than its applicable mortgage insurance fund requirement, except for the

purpose of paying such liabilities as the same become due and for the

payment of which other moneys of the agency are not available. All

payments pursuant to section twenty-four hundred twenty-nine-a of this

part, and expenses attributable thereto shall be debited to the special

account or the development corporation credit support account within the

mortgage insurance fund. All other operating expenses of the agency with

respect to insurance of mortgages and providing development corporation

credit support shall be debited to the special account or the

development corporation credit support account within the mortgage

insurance fund, as appropriate.

* NB Effective July 23, 2027

2. On or before March twentieth in each year, the board of directors

of the agency shall determine the amount estimated to be received by the

agency from the additional tax imposed pursuant to subdivision one-a of

section two hundred fifty-three of the tax law and deposited in the

mortgage insurance fund and credited to the special account plus any

other monies deposited in such account plus the amount of reserves

available in such special account with respect to mortgage loans that

were previously insured in accordance with section twenty-four hundred

twenty-eight or development corporation credit support previously

provided pursuant to section twenty-four hundred twenty-eight-a of this

part under contracts or commitments that have been satisfied or

cancelled, pursuant to subdivision one of this section, except charges

and fees levied by the agency pursuant to section twenty-four hundred

twenty-nine-c of this part, which shall be added in the computation only

when such a commitment is cancelled or expires or when the insurance or

contractual arrangement to provide development corporation credit

support applied for is declared effective. Such determination made on or

before March twentieth in each year shall be made for the consecutive

twelve-month period ending on the subsequent March thirty-first. The

board shall then determine the estimated excess balance, if any, in such

special account by determining the amount by which such credits exceed

twenty per centum, or such other per centums or amounts as may have been

established by the board of directors of the agency pursuant to

subdivision seven of section twenty-four hundred twenty-eight of this

part, of the amounts insured or committed to be insured and the amounts

of development corporation credit support established by the board of

directors of the agency pursuant to section twenty-four hundred

twenty-eight-a of this part to be provided during such twelve-month

period plus any payments by the agency during such twelve-month period

on account of a mortgage or development corporation credit support

contract entered into during such twelve-month period ending on such

March thirty-first, plus the operating expenses of the agency during

such twelve-month period with respect to insurance of mortgages or

provision of development corporation credit support, which amount may

not exceed an amount determined and certified by the director of the

budget, with notification to the chairman of the senate finance

committee and chairman of the assembly ways and means committee. On or

before May fifteenth, the board shall determine any adjustment to the

estimated excess balance necessary to reflect the variance, if any,

between such estimated excess balance and the actual excess balance

computed as of March thirty-first, and shall certify such adjustment to

the director of the budget. The agency shall include such adjustment in

the estimated excess balance determination for the following fiscal

year, unless otherwise instructed by the director of the budget. The

agency shall submit to the director of the budget an estimate of such

operating expenses on or before the tenth business day in March of each

year and the director of the budget shall make such certification before

March twentieth of each year.

Upon making the determination of the estimated excess balance, the

agency shall certify such determination to the director of the budget,

the chairmen of the senate finance committee and the assembly ways and

means committee, and the comptroller. Payment of such actual or

estimated excess balance shall be made within ninety days after March

twentieth. The agency shall, at the direction of the director of the

budget, pay such estimated or actual excess balance, if any, from the

special account to the comptroller for deposit to the state general

fund; provided, however, that if the aggregate amount in the special

account as of such date is less than the mortgage insurance fund

requirement, the agency shall retain all or that portion of any such

estimated or actual excess balance in such special account necessary to

increase the aggregate amount in such special account to the mortgage

insurance fund requirement. The director of the budget shall notify the

chairmen of the senate finance committee and the assembly ways and means

committee ten days prior to the issuance of the directive in respect to

the payment of the estimated or actual excess balance to the general

fund.

Further provided, however, that the budget to be submitted to the

legislature by the governor pursuant to article seven of the

constitution shall separately state the amount of such estimated or

actual excess balance determined as hereinabove prescribed, if any,

which shall be included in the monies and revenues estimated to be

available during the current and ensuing fiscal years, respectively.

3. The moneys in such fund shall be deposited in one or more banks or

trust companies designated in the manner provided by law, as

depositories of the funds of the state. The agency may invest the moneys

in such fund in obligations specified in subdivision four of this

section. Any interest earned or capital gain realized on the money so

deposited or invested shall accrue to and become part of such fund. The

separate identity of such fund shall be maintained whether its assets

consist of cash or investments or both.

4. Moneys in such fund may be invested (a) in special time deposit

accounts in, or certificates of deposit issued by, a bank, trust

company, savings bank or savings and loan association located and

authorized to do business in this state, provided, however, that such

time deposit account or certificate of deposit shall be payable within

such time as the proceeds may be needed to meet expenditures estimated

to be incurred by the agency and provided further that such time deposit

account or certificate of deposit be secured by a pledge of obligations

of the United States of America or obligations of the state, any city of

the state, or other municipal corporation, school district or district

corporation of the state or obligations of agencies of the federal

government; or (b) in obligations of the United States of America or the

state which may from time to time be legally purchased by savings banks

within the state as an investment of funds belonging to them or in their

control, or in obligations of the Federal National Mortgage Association,

or (c) in Government National Mortgage Association mortgage backed

securities, provided such obligations shall be payable or redeemable at

the option of the owner within such times as the proceeds may be needed

to meet expenditures estimated to be incurred by the agency.

5. In computing the amount of the mortgage insurance fund for the

purposes of this section, securities in which all or a portion of such

fund shall be invested shall be valued at par if purchased at par, or if

purchased at other than par, at amortized value. Amortized value, when

used with respect to securities purchased at a premium above or a

discount below par, shall mean the value as of any given date obtained

by dividing the total premiums or discount at which such securities were

purchased by the number of interest payments remaining to maturity on

such securities after such purchase and by multiplying the amount so

calculated by the number of interest payment dates having passed since

the date of such purchase; and (i) in the case of securities purchased

at a premium by deducting the product thus obtained from the purchase

price, and (ii) in the case of securities purchased at a discount by

adding the product thus obtained to the purchase price.

6. The agency may create and establish such other fund or funds as may

be necessary or desirable for the carrying out of its corporate

purposes.