N.Y. Public Authorities Law § 3632: Transfer of property; relationship with county; certain gifts, loans, and guarantees by the county

§ 3632. Transfer of property; relationship with county; certain gifts,

loans, and guarantees by the county. 1. (a) The county may give, grant,

sell, convey, lend, license the use of, or lease to the corporation, and

the corporation may accept any property (except monies appropriated by

the county and payable to the corporation pursuant to subdivision three

of this section) which are useful in connection with the exercise by the

corporation of any of its powers under this title in order to transfer

the facilities and operations of the Erie County Medical Center

healthcare network to the corporation by agreement between the county

and the corporation and any subsequent renewal or amendment thereof, by

local law adopted by a majority vote of the Erie county legislature,

notwithstanding any general, special, or local law, ordinance,

resolution, or charter.

(b) Any such gift, grant, sale, conveyance, loan, license, or lease

shall be upon such terms and conditions, for such consideration, if any,

and for such term or terms of years, subject to the rights of the

holders of any bonds, as the corporation and the county may agree. No

real property of the county consisting of any health facility operated

on the effective date of this title by the Erie County Medical Center

healthcare network shall be transferred to the corporation in fee,

except under such restrictions regarding rights of first refusal in

favor of the county and subject to a right of reverter in the event that

the corporation should cease to use such property for the provision of

research, education, and health care, or other rights, to repurchase the

property as the Erie county legislature shall approve by act, and

subject to a restrictive covenant prohibiting the corporation from

pledging or mortgaging the fee interest in the property. In the event

that the county gives, grants, sells, conveys, lends, licenses, or

leases any facilities to the corporation, the county may contract with

the corporation to lease, borrow, license, operate, maintain, manage,

and provide services for such facilities upon such terms and conditions

and for such term or terms of years, subject to the rights of holders of

bonds, as the corporation and the county may agree. The corporation, in

furtherance of any purchase, conveyance, or lease of any property or

facility from the county, may assume the primary responsibility for the

payment of the principal and interest on any bonds or notes issued by

the county for such property or facility.

2. The county may acquire by purchase, grant, lease, gift, or

condemnation, pursuant to the eminent domain procedure law, real

property in the name of the county for any corporate purpose of the

corporation.

3. In addition to any other powers granted to it by law and consistent

with the constitution and other provisions of law, the county shall

appropriate sums of money to defray project costs or any other costs or

expenses of the corporation, including operating expenses.

4. On the effective date of the transfer of the facilities and

operations of the Erie County Medical Center healthcare network pursuant

to an agreement between the corporation and the county, the Erie County

Medical Center board of managers shall cease to be responsible for

operation of the network; provided, however, that the county shall

continue the existence of the board of managers in the event that the

contract between the corporation and the county requires the operation

of the network to revert to the county in the event that the corporation

should cease to use such property for the provision of health care or

the corporation otherwise fails to meet its obligations under any

agreement between the county and the corporation.

5. The county shall maintain its efforts to provide annual operating

funding to the corporation to permit it to serve all uninsured and

under-insured patients, foster its role as a teaching hospital, and

provide tertiary care services that are unavailable at other health care

facilities in the western New York region. The county shall maintain and

provide an operating contribution to the corporation in an annual amount

that is the difference between the corporation's total revenues minus

total expenses. For purposes of this section, total revenue and total

expenses shall include amounts attributable to the corporation, any

subsidiary of the corporation, and any entity providing health care

services thereto. The manner of calculating the county's annual

maintenance of effort of the corporation shall be the process followed

by the county in determining the maintenance of effort for the network.

The county shall have the right of audit at any time and from time to

time to confirm the details of corporate operations. The corporation

shall provide monthly financial reports to the county that provide

details concerning all business operations for the corporation on a

consistent basis.

6. (a) Notwithstanding any general, special, or local law or charter

provisions to the contrary, the county of Erie shall have the power and

is hereby authorized, pursuant to section seven of article seventeen of

the state constitution, to lend its money or credit to or in aid of the

corporation or any subsidiary thereof for the purpose of providing

health related facilities or hospital facilities for the prevention,

diagnosis, or treatment of human disease, pain, injury, disability,

deformity, or physical condition, and for facilities incidental or

appurtenant thereto, as may be prescribed by law. The county is hereby

authorized to prescribe such facilities by local law. The corporation or

any such subsidiary thereof, as a condition to any such loan of money or

credit, shall enter into a regulatory agreement with the county as to

its charges, profits, dividends, and disposition of its property or

franchises, which agreement shall be binding and enforceable by the

county insofar as such agreement regulates such charges, profits,

dividends, and disposition of property. The county may elect in such

regulatory agreement to refrain from exercising all or any portion of

its authority to so regulate such charges, profits, dividends, and

disposition of property to the extent such charges, profits, dividends,

and disposition of property are regulated by the state or any agency

thereof. The county shall authorize such regulatory agreement by local

law.

(b) In pursuance of the authority granted in this title, the county of

Erie shall have the power and is hereby authorized, from time to time,

to issue its bonds, notes, or other obligations in such principal

amounts as it shall deem necessary, after taking into account other

monies which may be available for the purposes set forth in this title.

Such bonds, notes, or obligations shall be issued for the purpose of

making loans to the corporation or any subsidiary thereof, paying

interest on such bonds, notes, or other obligations, establishment of

reserves to secure such notes, bonds, or other obligations, and paying

all other obligations and expenditures incidental to and necessary or

convenient for the making of such loans. Such bonds, notes, or

obligations shall be issued in accordance with the applicable provisions

of this chapter, the local finance law, and applicable local laws.

(c) Any guarantee by the county made pursuant to the authority granted

in this section shall be authorized by act or acts of the county in the

same manner as such act or acts authorizing the issuance of bonds of the

county for the purposes for which such guarantee is undertaken.

(d) The county is also authorized to enact laws governing the

conditions under which such loans, commitments, and guarantees shall be

made.

7. For purposes of subdivision four of paragraph a of section 25.00 of

the local finance law, amounts to be derived by the county of Erie from

the corporation, or any subsidiary thereof, shall be included in the

term "other income".

8. (a) Notwithstanding the provisions of any other state or local law

to the contrary, including, but not limited to, sections six-n and six-j

of the general municipal law, with the approval of the Erie county

legislature, amounts deposited for or on behalf of the Erie County

Medical Center healthcare network in the liability and casualty and

workers' compensation reserve funds established by the county pursuant

to such sections of the general municipal law, and investment earnings

thereof, may be withdrawn by the county from such funds and transferred

to the corporation and shall be used by the corporation for the purposes

for which such funds were established.

(b) No amounts shall be withdrawn and transferred to the corporation

pursuant to this subdivision unless, prior to such withdrawal or

transfer, the corporation has agreed in writing to indemnify and hold

harmless the county, and provide defense, for all claims, cases,

proceedings, actions, or other matters against the county arising out of

the properties, facilities, operations, or employees of the corporation,

whether commenced before or after the date of transfer of such amounts,

and to provide such other security for such obligation as the county may

reasonably require.

9. The county shall be responsible for the payment of all outstanding

bonded indebtedness of the Erie County Medical Center healthcare network

that was accumulated prior to the creation of the public benefit

corporation.