N.Y. Public Authorities Law § 2537: Reserve fund and appropriations

§ 2537. Reserve fund and appropriations. 1. (a) The corporation shall

create and establish a special fund (herein referred to as the capital

reserve fund) on or before December first, nineteen hundred seventy-five

and shall pay into such capital reserve fund (1) any monies appropriated

and made available by the city for the purpose of such fund, (2) any

proceeds of sale of notes or bonds, to the extent provided in the

resolution or resolutions of the corporation authorizing the issuance

thereof, and (3) any other monies which may be made available to the

corporation for the purpose of such fund from any other source. All

monies held in the capital reserve fund, except as hereinafter provided,

shall be used as required solely for the payment of the principal of

bonds as the same mature, sinking fund payments, the purchase or

redemption of bonds, the payment of interest on bonds or the payment of

any redemption premium required to be paid when such bonds are redeemed

prior to maturity; provided, however, that monies in such fund shall not

be withdrawn therefrom at any time in such amount as would reduce the

amount of such fund to less than the capital reserve fund requirement,

except for the purposes provided herein, for which other monies of the

corporation are not available. Any income or interest earned by, or

increment to, the capital reserve fund due to the investment thereof may

be transferred by the corporation to other funds or accounts of the

corporation to the extent it does not reduce the amount of the capital

reserve fund below the capital reserve fund requirement.

(b) In computing the amount of the capital reserve 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 or if purchased at less

than par at their cost to the corporation.

(c) To assure the continued operation and solvency of the corporation

for the carrying out of its corporate purpose, provision is made in

paragraph (a) of this subdivision for the accumulation in the capital

reserve fund of an amount equal to the capital reserve fund requirement.

In order further to assure such maintenance of the capital reserve fund,

there shall be paid by the city to the corporation for deposit in the

capital reserve fund on or before the first day of December, in each

year, such amount, if any, needed for the purpose of maintaining the

capital reserve fund at the capital reserve fund requirement as shall be

certified by the chairman of the corporation to the mayor and the

director of management and budget on or before the fifteenth day of

February next preceding; provided that any such amount shall have been

first appropriated by or on behalf of the city for such purpose or shall

have been otherwise made available.

2. The corporation may create and establish such other fund or funds

as may be necessary or desirable for its corporate purpose.