N.Y. State Finance Law § 66-b: Issuance of certificates of participation

§ 66-b. Issuance of certificates of participation. 1. The director of

the budget shall determine whether the use of certificates of

participation to finance and/or to refinance installment purchase or

lease purchase contracts entered into by state departments, agencies or

the city university of New York is financially desirable and in the best

interest of the state. Upon notice of such a determination the state

comptroller is authorized, pursuant to a request for proposals,

competitive bidding or negotiated placement, to cause to be issued

certificates of participation or similar instruments that represent

undivided proportionate interests in periodic payments due from the

state to fund installment purchase or lease purchase contracts entered

into, or expected to be entered into, by the state departments,

agencies, the city university of New York, or any combination thereof,

pursuant to the provisions of this article. The state comptroller shall

issue regulations to govern the procedure he shall follow in any sale

conducted pursuant to this section of such certificates. Such

regulations shall, in the case of all sales, require that notice be

published in a definitive trade publication of the municipal bond

industry published on each business day in the state of New York, which

is generally available to participants in the municipal bond industry,

which notice shall state the terms of the sale. The proceeds from the

issuance of such certificates may also be used for the establishment of

reserve funds to secure such certificates, the cost or premium of

letters of credit, insurance or other credit enhancements, the cost of

bond counsel, financial advisor, trustees and paying agent, and such

other related expenses as may be necessary for the issuance of such

certificates. The foregoing shall not be construed to authorize the use

of such proceeds for the payment of personal service expenses of state

departments, agencies or the city university of New York, other than

payments made to the department of law for legal services rendered.

2. The maximum term of certificates of participation issued to finance

personal property shall be ten years. The maximum term of certificates

of participation to finance the acquisition or improvement of real

property shall be twenty-five years. In no event, however, shall such

term exceed the expected useful life of the property being financed,

with such term calculated from the date of delivery, with respect to

personal property, and the date of occupancy, with respect to real

property.

3. Ten days prior to the issuance of certificates of participation

pursuant to this section, the director of the budget shall transmit to

the chairs of the senate finance committee and the assembly ways and

means committee a copy of the director of the budget's notice to the

state comptroller pursuant to this section. Such notice shall provide

the following information pertaining to the personal property to be

financed by the certificates:

1. The agency and program procuring the equipment.

2. A brief description of the equipment.

3. The estimated cost of the equipment if purchased outright.

4. The estimated terms of such financings.

5. The estimated total lease or installment purchase payments for the

equipment.

6. The estimated lease or installment purchase payments by fiscal year

for the current fiscal year and the next five fiscal years.

7. The anticipated source of funds to make lease or installment

purchase payments.

8. Those items of equipment not anticipated to be financed upon

enactment of the budget for such fiscal year.

Before the issuance of the certificates the director of the budget may

amend such notice and shall transmit a copy of the amended notice to the

chairs of the senate finance committee and assembly ways and means

committee. After the issuance of the certificates, the director of the

budget shall transmit to the chairs of the senate finance committee and

assembly ways and means committee and the state comptroller a copy of

the final official statement accompanying such issuance and thereafter

shall transmit quarterly reports which update such notices to such

individuals.

4. Subject to the provisions of chapter fifty-nine of the laws of two

thousand, but notwithstanding any other provisions of law to the

contrary, the maximum amount of certificates of participation or similar

instruments representing periodic payments due from the state of New

York, issued on behalf of state departments and agencies, the city

university of New York and any other state entity otherwise specified

after March thirty-first, two thousand three shall be seven hundred

eighty-four million two hundred eighty-five thousand dollars. Such

amount shall be exclusive of certificates of participation or similar

instruments issued to fund a reserve fund or funds, costs of issuance

and to refund outstanding certificates of participation.