N.Y. State Finance Law § 179-v: Interest payments

§ 179-v. Interest payments. 1. A not-for-profit organization shall be

entitled to interest payments pursuant to this section: (a) on those

moneys that would be due under the terms of the contract or renewal

contract from the scheduled commencement date or the date the

organization begins to provide services, whichever is later, until the

date the payment is made under the contract or renewal contract; or (b)

if a not-for-profit organization borrows funds to provide services

pursuant to a written directive by a state agency, provided however that

a not-for-profit organization may only receive interest payments on such

funds when such not-for-profit organization has received a written

directive but has been denied payment pursuant to section one hundred

seventy-nine-u of this article or did not obtain a loan from the

not-for-profit short-term revolving loan fund.

2. Such organizations shall receive such interest payments at a rate

equal to the rate set by the commissioner of taxation and finance for

corporate taxes pursuant to paragraph one of subsection (e) of section

one thousand ninety-six of the tax law. In order for a state agency to

approve reimbursement of a not-for-profit organization at a rate other

than the interest rate stated in this section the not-for-profit

organization shall submit documentation indicating the rate at which

such funds were borrowed, the lender of such funds and any other

information requested by the state agency, attorney general or the

comptroller. The comptroller may disallow such portions of the interest

that the comptroller deems unreasonable.

3. Any interest payments made pursuant to subdivisions one and two of

this section shall be made from appropriations for state operations that

are available for the administrative programs of the state agency which

contracted with the not-for-profit organization. In no event shall

interest payments be made from amounts appropriated for program

purposes.

4. The interest payment shall not reduce the amount of money that

otherwise will be payable to the not-for-profit organization under the

terms of the relevant contract.

5. No interest payments shall be made if the not-for-profit

organization receives an advance payment pursuant to section one hundred

seventy-nine-u of this article; provided, however, that if the contract

is not fully executed at the end of the period covered by such advance

payment, the not-for-profit organization may be eligible for interest

payments in respect of services performed after such period.

6. Should the attorney general or the comptroller disapprove a

contract or renewal contract, the provisions of this section shall not

be applicable.

7. a. If the timeframes for processing a contract are met and the

state agency is liable for interest due to a retroactive contract start

date, the state agency and the not-for-profit organization may mutually

agree to waive any interest owed to the not-for-profit organization

under the provisions of this article. Waiver of interest shall not be a

prerequisite to execution of such contract. If interest is so waived,

the state agency shall immediately provide the office of the state

comptroller, division of the budget and the not-for-profit organization

with the written waiver of interest agreement signed by the

not-for-profit organization and documentation (i) showing that the

applicable timeframes set forth in section one hundred seventy-nine-s or

one hundred seventy-nine-t of this article have been met, and (ii)

explaining the reason for a retroactive contract start date.

b. Not more than twenty days after the receipt of such written waiver

of interest agreement and required documentation, the comptroller shall

determine whether the waiver of interest is warranted. The comptroller

shall thereupon inform such state agency, the division of the budget,

and such not-for-profit organization of such determination. If such

determination concludes that a waiver of interest is unwarranted, such

state agency shall then immediately submit for the comptroller's

approval a voucher requesting the payment of interest to such

not-for-profit organization as required by this section. If such voucher

is not received within thirty days after the comptroller's

determination, the comptroller shall assess the amount of unpaid

interest in the manner prescribed by this section.