N.Y. Public Authorities Law § 2925: Investments of funds by public authorities and public benefit corporations; general provisions

§ 2925. Investments of funds by public authorities and public benefit

corporations; general provisions. 1. Every public authority and every

public benefit corporation whether or not such corporation is otherwise

governed by this chapter, (such entities to be hereinafter in this title

referred to as "corporation") shall by resolution adopt comprehensive

investment guidelines which detail the corporation's operative policy

and instructions to officers and staff regarding the investing,

monitoring and reporting of funds of the corporation. The investment

guidelines approved by the corporation shall be annually reviewed and

approved by the corporation.

2. Funds of the corporation, for purposes of this title, shall consist

of all moneys and other financial resources available for investment by

the corporation on its own behalf or on behalf of any other entity or

individual.

3. The investment guidelines approved by the corporation shall

include, but not be limited to the following:

(a) A detailed list of the permitted investments of the corporation,

which shall be consistent with the appropriate provisions of law

relating to the corporation and any additional requirements pursuant to

any contract with bondholders and noteholders.

(b) Procedures and provisions to fully secure the corporation's

financial interest in investments; provided that the guidelines may

include a description of the circumstances under which the corporation's

financial interest in investments may be less than fully secured.

(c) A requirement that the corporation shall enter into written

contracts pursuant to which investments are made, unless the corporation

shall by resolution determine that a written contract is not practical

or that there is not a regular business practice of written contracts

with respect to a specific investment or transaction, in which case the

corporation shall adopt procedures covering such investment or

transaction. Such contracts and procedures shall include provisions:

(i) deemed necessary and sufficient to secure in a satisfactory manner

the corporation's financial interest in each investment;

(ii) covering the use, type and amount of collateral or insurance for

each investment;

(iii) establishing a method for valuation of collateral, and

procedures for monitoring the valuation of such collateral on a regular

basis;

(iv) for the monitoring, control, deposit and retention of investments

and collateral which shall include, in the case of a repurchase

agreement, a requirement that the obligations purchased be physically

delivered for retention to the corporation or its agent (which shall not

be an agent of the party with whom the corporation enters into such

repurchase agreement), unless such obligations are issued in book-entry

form, in which case the corporation shall take such other action as may

be necessary to obtain title to or a perfected security interest in such

obligations.

(d) Standards for the diversification of investments, including

diversification with respect to types of investments and firms with

which the corporation transacts business.

(e) Standards for the qualification of investment bankers, brokers,

agents, dealers and other investment advisers and agents which transact

business with the corporation, such as criteria covering quality,

reliability, experience, capitalization, size and any other factors

that, in the judgment of the corporation, make a firm qualified to

transact business with the corporation.

(f) Provisions for reporting on the investments of the corporation,

including provisions for an annual independent audit of all investments,

the results of which shall be available to the board at the time the

annual review and approval of investment guidelines is conducted by the

corporation.

4. Each corporation shall have the power from time to time to amend

such investment guidelines in accordance with the provisions of this

title.

5. Each corporation shall direct the preparation and filing with the

board of quarterly reports, or reports covering such other period as may

be approved by the corporation, from a designated officer or employee

regarding any new investments, the inventory of existing investments,

and the selection of investment bankers, brokers, agents, dealers or

auditors.

6. Each corporation shall annually prepare and approve an investment

report which shall include the investment guidelines, as specified in

subdivision three of this section, amendments to such guidelines since

the last investment report, an explanation of the investment guidelines

and amendments, the results of the annual independent audit, the

investment income record of the corporation and a list of the total

fees, commissions or other charges paid to each investment banker,

broker, agent, dealer and adviser rendering investment associated

services to the corporation since the last investment report. Such

investment report may be a part of any other annual report that the

corporation is required to make.

7. (a) Each corporation, a majority of the members of which consist of

persons appointed by the governor or who serve as members by virtue of

holding a civil office of the state, or a combination thereof, shall

annually submit its investment report to the division of the budget and

copies thereof to the department of audit and control, the senate

finance committee and the assembly ways and means committee.

(b) Each corporation, other than a corporation included under

paragraph (a) of this subdivision, shall annually submit its investment

report to the chief executive officer and chief fiscal officer of each

municipality for the benefit of which it was created and to the

department of audit and control.

(c) Each corporation shall make available to the public copies of its

investment report upon reasonable request therefor.

8. Nothing contained in this section shall be deemed to alter, affect

the validity of, modify the terms of or impair any contract, agreement

or investment of funds made or entered into in violation of, or without

compliance with, the provisions of this title.