N.Y. Public Health Law § 2815-a: Community health care revolving capital fund

§ 2815-a. Community health care revolving capital fund. 1.

Definitions. As used in this section, the following words and phrases

shall have the following meanings unless a different meaning is plainly

required by the context:

a. "Administrator" shall mean a not for profit Community Development

Financial Institution CDFI that is certified by the U.S. Treasury

community development financial fund, has experience financing projects

in the New York state healthcare sector and otherwise meets the

requirements of this section.

b. "Dormitory authority" or "authority" shall mean the dormitory

authority of the state of New York created by title four of article

eight of the public authorities law which has succeeded to the powers,

functions and duties of the medical care facilities finance agency

pursuant to chapter eighty-three of the laws of nineteen hundred

ninety-five.

c. "Participating borrower" shall mean a community-based health care

provider, which for the purposes of this section, shall be defined as

diagnostic and treatment center licensed or granted an operating

certificate under article twenty-eight of this chapter, a mental health

clinic licensed or granted an operating certificate under article

thirty-one of the mental health law; or an alcohol and substance abuse

treatment clinic licensed or granted an operating certificate under

article thirty-two of the mental hygiene law, each organized under the

laws of this state.

d. "Revolving capital fund" shall mean community health care revolving

capital fund authorized to be established by the dormitory authority and

administered pursuant to this section.

2. Revolving capital fund. The dormitory authority shall, within

amounts appropriated, establish the community health care revolving

capital fund. Monies in the revolving capital fund shall be utilized for

the purpose of making loans to qualifying participating borrowers to

improve access to affordable capital financing to expand and improve

capacity to provide health care in the State. Funds shall be transferred

by the commissioner to the dormitory authority for deposit in the

revolving capital fund in an amount as authorized by appropriation.

Monies in the fund shall be: (a) held by the authority pursuant to this

section as custodian pursuant to an agreement with the commissioner

until transferred to the administrator pursuant to this section, and (b)

invested by the authority in accordance with the investment guidelines

of the authority during said custodial period. All investment income

shall be credited to, and shall be deposited in, the revolving capital

fund.

3. Administration agreement. The commissioner and the authority shall

enter into an agreement, subject to the approval of the director of the

budget, for the purpose of administering the funds in the revolving

capital fund through an administrator. A copy of such agreement, and any

amendments thereto, shall be provided to the chair of the senate finance

committee, the director of the division of budget, and the chair of the

assembly ways and means committee. The agreement shall specify that the

administrator shall administer the community health care revolving

capital fund in a manner that will benefit the public health by

encouraging improvements in the community health care delivery system in

the state, in compliance with all applicable laws, rules, regulations

and other requirements.

4. Agreement with the administrator. The dormitory authority shall, in

consultation with the commissioner, enter into an agreement with the

administrator. Such agreement shall provide for the administration of

the revolving capital fund administrator, in accordance with the

requirements of this section, the commissioner and dormitory authority

and all applicable laws, rules, regulations and other requirements. Upon

the effective date of the agreement, custody of, and responsibility for,

the revolving capital fund shall be transferred from the dormitory

authority to the administrator, subject to the requirements of the

agreement. Such agreement shall include, but not be limited to, the

following provisions:

a. That the administrator shall be responsible for the receipt,

management and expenditure of monies held in the revolving capital fund;

b. That the administrator shall maintain books and records pertaining

to all monies received and disbursed pursuant to this section and the

agreement;

c. That monies in such revolving capital fund shall be utilized for

the purpose of making loans to qualifying participating borrowers, to

provide participating borrowers with improved access to affordable

capital to expand and improve preventive or primary care capacity;

d. That participating borrowers shall be chosen by the administrator

through an application process approved by the authority and the

commissioner;

e. That eligible uses of funds so loaned to participating borrowers

shall include but not be limited to: (i) eligible costs as described in

paragraph (f) of this subdivision, attributable to the proposed

construction, reconstruction, renovation, rehabilitation, refurbishing,

expansion, upgrading and equipping of a participating borrower's

community-based health care facility; (ii) reserves for credit

enhancement including loan guarantees; (iii) loan loss and debt service

reserves and subordinated loans; and (iv) facility financing, including

loans for predevelopment, acquisition and construction, permanent

financing and bridge loans;

f. That eligible costs under this section shall include, but not be

limited to, all hard construction costs and associated professional and

other costs, furniture, fixtures and equipment, including health

information technology, acquisition, predevelopment due diligence,

initial operating expenses and working capital;

g. That the administrator administering the revolving capital fund

shall report quarterly on the transactions in the revolving capital fund

in a form and manner specified by the authority in consultation with the

commissioner, including but not limited to: receipts or deposits to the

fund, disbursements, loans or credit enhancement made from the fund,

investment income, and the balance on hand as of the end of the month

for each such quarter;

h. That the administrator shall be required to invest monies on

deposit in the fund in accordance with investment guidelines meeting the

requirements of the department and dormitory authority, and all

investment income shall be credited to, and any repayment of loans as

hereinafter provided shall be deposited in, the revolving capital fund,

and spent therefrom only for the purposes set forth in this section;

i. That only the reasonable expenses of the administrator, as

determined by the commissioner and president of the authority, incurred

in the establishment and administration of the revolving capital loan

program (including the retention of professionals and consultants, if

any) may be paid or reimbursed from the revolving capital fund;

j. That revolving capital fund monies shall be held in trust and used

for the benefit of eligible community-based health care facility capital

projects; and

k. Any other term or condition as determined by the authority, in

consultation with the commissioner.

5. Loan documentation. Loans from the revolving capital fund shall be

made pursuant to a written loan agreement between the administrator and

the participating borrower, specifying the terms thereof including

repayment terms. The loan agreement shall be in such form and content as

shall be acceptable to the commissioner and dormitory authority, and may

include such other any further written documentation and/or agreements

as shall be required in the judgment of the commissioner and dormitory

authority, including but not limited to all required filings under the

Uniform Commercial Code.