S T A T E O F N E W Y O R K
________________________________________________________________________
540
2011-2012 Regular Sessions
I N A S S E M B L Y
(PREFILED)
January 5, 2011
___________
Introduced by M. of A. MAGNARELLI, LUPARDO, KOLB -- Multi-Sponsored by
-- M. of A. WRIGHT -- read once and referred to the Committee on
Economic Development, Job Creation, Commerce and Industry
AN ACT to amend the New York state urban development corporation act, in
relation to establishing the empire revolving bridge loan fund, and
authorizing the New York state urban development corporation to issue
bonds or notes to provide monies for such fund; and to amend chapter
393 of the laws of 1994, amending the New York state urban development
corporation act relating to the powers of the New York state urban
development corporation to make loans, in relation to the effective-
ness thereof
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 1 of chapter 174 of the laws of 1968, constituting
the New York state urban development corporation act, is amended by
adding a new section 16-u to read as follows:
S 16-U. EMPIRE REVOLVING BRIDGE LOAN FUND. 1. IT IS HEREBY DECLARED
THAT IT IS A VITAL POLICY AND PUBLIC PURPOSE OF NEW YORK STATE TO
PROMOTE SIGNIFICANT ECONOMIC DEVELOPMENT IN NEW YORK. THE HISTORY OF NEW
YORK IS MARKED BY LARGE-SCALE ECONOMIC ENDEAVORS WHICH HARNESSED THE
CREATIVITY, SKILL AND VISION OF THE RESIDENTS OF NEW YORK. THE TRANS-
FORMING POWER OF THESE ACCOMPLISHMENTS IS BEST EMBODIED IN THE ERIE
CANAL, WHICH CREATED IN ITS WAKE A SURGE OF ECONOMIC AND POPULATION
GROWTH IN NEW YORK. IN CONTRAST, THE LEGISLATURE HEREBY FINDS THAT THE
CURRENT ECONOMIC CLIMATE OF NEW YORK AS A WHOLE IS MARKED BY PERSISTENT
DISINVESTMENT, BLIGHT AND AGING INFRASTRUCTURE, LOSS OF OPEN SPACE, AND
EMIGRATION OF EMPLOYMENT OPPORTUNITIES AND INVESTMENT DOLLARS, AND THAT
RECREATING THE ENVIRONMENT OF ENERGY AND RISK-TAKING THAT DROVE THE ERIE
CANAL IS ESSENTIAL TO NEW YORK'S FUTURE WELL-BEING. THE LEGISLATURE
FINDS THAT IN ORDER TO REVERSE THE TRENDS OF DECLINE, IT IS NECESSARY
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03271-01-1
A. 540 2
AND APPROPRIATE TO ESTABLISH A PUBLIC/PRIVATE FINANCING MODEL TO PROMOTE
ECONOMIC DEVELOPMENT IN NEW YORK WHILE MAXIMIZING LEVERAGE NEEDED TO
ASSIST IN FINANCING SUCH PROJECTS AND DO SO IN AN EXPEDITED MANNER. THE
LEGISLATURE HEREBY FINDS THAT CURRENT CONDITIONS IN CREDIT MARKETS HAVE
HAD A NEGATIVE EFFECT ON SIGNIFICANT ECONOMIC DEVELOPMENT PROJECTS IN
NEW YORK. IT IS THE OVERRIDING PUBLIC POLICY OF THIS STATE TO CREATE A
VEHICLE TO PROVIDE SHORT-TERM FINANCING FOR IMPORTANT PROJECTS IN NEW
YORK TO ENSURE THE HEALTH, WELFARE AND PROSPERITY OF ALL CITIZENS OF THE
STATE.
2. THERE IS HEREBY ESTABLISHED IN THE CUSTODY OF THE CORPORATION A
SPECIAL FUND TO BE KNOWN AS THE "EMPIRE REVOLVING BRIDGE LOAN FUND".
3. THE FUND SHALL CONSIST OF THE NET PROCEEDS OF ONE OR MORE SERIES OF
BONDS OR NOTES ISSUED, AT ANY TIME AND FROM TIME TO TIME, BY THE CORPO-
RATION PURSUANT TO ARTICLE 5-C OF THE STATE FINANCE LAW AND SUBDIVISION
NINE OF THIS SECTION FOR THE PURPOSES OF THIS SECTION, ALL MONIES TRANS-
FERRED TO SUCH FUND PURSUANT TO LAW, ALL MONEYS DONATED TO IT, PAYMENTS
OF PRINCIPAL ON LOANS MADE FROM THE FUND, AND ANY INTEREST EARNINGS
WHICH MAY ACCRUE FROM THE INVESTMENT OR REINVESTMENT OF MONEYS FROM THE
FUND. THE MONIES HELD IN OR CREDITED TO THE FUND SHALL BE EXPENDED SOLE-
LY FOR THE PURPOSES SET FORTH IN THIS SECTION. THE CORPORATION SHALL NOT
COMMINGLE THE MONIES OF SUCH FUND WITH ANY OTHER MONIES OF THE CORPO-
RATION OR ANY MONIES HELD IN TRUST BY THE CORPORATION.
4. MONIES OF THE FUND, WHEN ALLOCATED, SHALL BE AVAILABLE TO THE
CORPORATION TO MAKE LOANS TO ELIGIBLE PROJECTS AS PROVIDED IN THIS
SECTION. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, FOR PURPOSES OF
THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE ACCOMPANYING MEANINGS:
(A) "APPLICANT" SHALL MEAN THAT INDIVIDUAL OR ENTITY, OR SUCH INDIVID-
UAL OR ENTITY'S AGENT, SUCCESSOR IN INTEREST, ASSIGNEE OR DESIGNEE,
WHICH FILES AN APPLICATION WITH THE CORPORATION FOR CONSIDERATION OF AN
ELIGIBLE PROJECT.
(B) "BROWNFIELD SITE" SHALL HAVE THE MEANING SET FORTH IN SECTION
27-1405 OF THE ENVIRONMENTAL CONSERVATION LAW.
(C) "ELIGIBLE PROJECT" SHALL MEAN ANY NEW EQUIPMENT, IMPROVEMENT OR
STRUCTURE, INCLUDING NEW CONSTRUCTION, ALTERATION OR IMPROVEMENT TO
EXISTING STRUCTURES, AND ALL REAL AND PERSONAL PROPERTY DEEMED NECESSARY
THEREWITH, WHICH IS PROJECTED TO (I) COST A MINIMUM OF TWENTY MILLION
DOLLARS, (II) RESULT IN THE CREATION, IN ONE OR MORE PHASES, OF AT LEAST
THREE HUNDRED NEW FULL TIME EQUIVALENT JOBS AT THE PROJECT SITE, AND
(III) ONE OR MORE OF THE FOLLOWING: (A) WILL BE DESIGNED AND CONSTRUCTED
TO ACHIEVE "GOLD" STATUS OR HIGHER PURSUANT TO THE LEADERSHIP IN ENERGY
AND ENVIRONMENTAL DESIGN ("LEED") GREEN BUILDING RATING SYSTEM CRITERIA
DEVELOPED BY THE UNITED STATES GREEN BUILDING COUNCIL OR (B) WILL BE
DESIGNED AND CONSTRUCTED TO ACHIEVE "3 GLOBES" OR HIGHER PURSUANT TO THE
GREEN GLOBES RATING SYSTEM DEVELOPED BY THE GREEN BUILDING INITIATIVE;
OR (C) WILL UTILIZE TECHNOLOGY-ENABLED DESIGN, CONSTRUCTION AND COOPER-
ATION INCLUDING, BUT NOT LIMITED TO, GENERALLY ACCEPTED UNIVERSAL DESIGN
PRINCIPLES THAT ENHANCE THE FULL CYCLE USE OF BUILDINGS WITHOUT REGARD
TO THE PHYSICAL ABILITIES OR DISABILITIES OF OCCUPANTS OR GUESTS IN
ORDER TO ACCOMMODATE A WIDE RANGE OF INDIVIDUAL PREFERENCES AND FUNC-
TIONAL ABILITIES. IF A PHASE OF THE ELIGIBLE PROJECT IS UNDER
CONSTRUCTION AS OF THE DATE OF THE APPLICATION, THEN ANY JOBS CREATED AS
OF SUCH DATE SHALL BE CONSIDERED JOBS CREATED FOR PURPOSES OF THIS DEFI-
NITION.
THE CORPORATION SHALL GIVE PREFERENCE TO THOSE ELIGIBLE PROJECTS WHICH
MEET EITHER OR BOTH OF THE FOLLOWING CRITERIA: (I) THE SITE IS LOCATED
IN AN AREA OF A MUNICIPALITY OR REGION CHARACTERIZED BY HIGH UNEMPLOY-
A. 540 3
MENT, A HIGH POVERTY RATE AND/OR A HIGH COMMERCIAL VACANCY RATE; OR (II)
THE APPLICANT'S PROPOSED ELIGIBLE PROJECT WILL BE LOCATED, IN WHOLE OR
IN PART, ON A BROWNFIELD SITE AS DEFINED IN THIS SECTION.
(D) "ELIGIBLE PURPOSES" SHALL MEAN, NOTWITHSTANDING ARTICLE 5-B OF THE
STATE FINANCE LAW, ALL COSTS PAID OR INCURRED IN CONNECTION WITH THE
DESIGN AND CONSTRUCTION OF AN ELIGIBLE PROJECT, INCLUDING, WITHOUT LIMI-
TATION, THE COSTS OF LAND AND OTHER INTERESTS, BUILDINGS, FIXTURES,
FURNITURE, EQUIPMENT OR MACHINERY, RESEARCH AND DEVELOPMENT, PERMITTING,
PLANNING, ENGINEERING, FINANCING, REFINANCING, THE PROVISION OF WORKING
CAPITAL, INVENTORY, MARKETING, EXPENDITURES ASSOCIATED WITH THE OPENING
OF AN ELIGIBLE PROJECT, AND/OR OTHER AMOUNTS, INCLUDING RESERVES AND
INTEREST, REQUIRED TO BE PAID IN CONNECTION WITH FINANCING OR REFINANC-
ING OF THE ELIGIBLE PROJECT.
(E) "FUND" MEANS THE EMPIRE REVOLVING BRIDGE LOAN FUND ESTABLISHED BY
THIS SECTION.
(F) "SPONSOR" SHALL MEAN THE INDIVIDUAL OR ENTITY OR SUCH INDIVIDUAL
OR ENTITY'S AGENT, ASSIGNEE, DESIGNEE OR SUCCESSOR IN INTEREST WHOSE
APPLICATION FOR TREATMENT AS AN ELIGIBLE PROJECT HAS BEEN APPROVED BY
THE CORPORATION.
5. EVERY APPLICATION SHALL BE IN A FORM ACCEPTABLE TO THE CORPORATION.
THE APPLICANT SHALL PAY, UPON SUBMISSION OF THE APPLICATION, A FEE OF
ONE THOUSAND DOLLARS. THE CORPORATION SHALL APPROVE OR DISAPPROVE, IN
WHOLE OR IN PART, THE REQUESTED LOAN FOR THE ELIGIBLE PROJECT NO LATER
THAN THIRTY DAYS FROM THE DATE OF THE RECEIPT OF THE APPLICATION OR AT
THE NEXT BOARD MEETING OCCURRING WITHIN SIXTY DAYS OF THE DATE OF THE
RECEIPT OF THE APPLICATION IF SUCH MEETING IS SCHEDULED FOR A DATE LATER
THAN THIRTY DAYS FROM THE DATE OF RECEIPT OF SUCH APPLICATION. IN
CONSIDERING THE APPLICATION, THE CORPORATION SHALL CONSIDER FACTORS
AFFECTING THE CREDITWORTHINESS OF THE APPLICANT INCLUDING, BUT NOT
LIMITED TO, THE APPLICANT'S BUSINESS PLAN, BUSINESS EXPERIENCE AND
MANAGEMENT INFORMATION, CREDIT HISTORY AND FINANCIAL STATEMENTS, SUFFI-
CIENCY OF COLLATERAL TO SECURE REPAYMENT OF THE LOAN, OTHER PERSONAL AND
CORPORATE GUARANTEES ON THE PROJECT, CASH FLOW PROJECTIONS, AND THE
STRUCTURE AND TIMING OF ANY PROPOSED LONG-TERM FINANCING BY THE APPLI-
CANT, INCLUDING ANY FINANCING PURSUANT TO THE SELF-SUFFICIENCY PROGRAM
IN SECTION 16-V OF THIS ACT, AS ADDED BY A CHAPTER OF THE LAWS OF 2011.
TO THE EXTENT PERMITTED BY LAW, ALL INFORMATION REGARDING THE FINANCIAL
CONDITION, MARKETING PLANS, MANUFACTURING PROCESSES, PRODUCTION COSTS,
CUSTOMER LISTS, OR OTHER TRADE SECRETS OR PROPRIETARY INFORMATION DEEMED
AS SUCH BY THE APPLICANT IN CONNECTION WITH THE APPLICATION SUBMITTED
PURSUANT TO THIS SECTION, SHALL BE CONFIDENTIAL AND EXEMPT FROM PUBLIC
DISCLOSURE.
6. (A) THE FUNDS OF THE CORPORATION DERIVED PURSUANT TO THIS SECTION
MAY BE USED TO PROVIDE LOANS TO ELIGIBLE PROJECTS FOR ELIGIBLE PURPOSES.
THE INTEREST RATE ON ANY SUCH LOAN FOR THE TERM OF SUCH LOAN SHALL BE
NOT MORE THAN THE ALL-IN TRUE INTEREST COST TO THE CORPORATION, AS
DETERMINED BY THE CORPORATION, FOR THE BONDS ISSUED PURSUANT TO SUBDIVI-
SION NINE OF THIS SECTION. THE TERM OF ANY LOAN MADE PURSUANT TO THIS
SECTION SHALL NOT EXCEED THREE YEARS. ALL LOANS SHALL BE SECURED BY A
LIEN POSITION ON COLLATERAL AT THE HIGHEST LEVEL OF PRIORITY THAT CAN
ACCOMMODATE THE BORROWER'S ABILITY TO RAISE SUFFICIENT DEBT AND EQUITY
CAPITAL FOR THE PROJECT.
(B) THE SPONSOR, UPON NOTICE TO THE CORPORATION WITHIN THIRTY DAYS OF
THE EXPIRATION OF THE TERM OF THE LOAN, MAY EXTEND AT ITS OPTION THE
LOAN FOR A ONE-YEAR PERIOD IF THE SPONSOR IS IN COMPLIANCE WITH THE
TERMS OF THE LOAN. THE SPONSOR SHALL BE LIMITED TO THREE ONE-YEAR EXTEN-
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SIONS. ANY SUCH EXTENSION SHALL CONTINUE TO BE SECURED IN ACCORDANCE
WITH THE PROVISIONS OF PARAGRAPH (A) OF THIS SUBDIVISION, AND THE INTER-
EST RATE ON SUCH EXTENSION SHALL BE CALCULATED IN THE SAME WAY AS THE
ORIGINAL LOAN.
(C) THE CORPORATION SHALL, UPON THE REQUEST OF THE SPONSOR, ESTABLISH
A SPECIAL ACCOUNT FOR SUCH SPONSOR WITHIN THE FUND. SUCH ACCOUNT SHALL
CONSIST OF THAT PORTION, AS REQUESTED BY THE SPONSOR, OF ANY PROCEEDS OF
BONDS ISSUED PURSUANT TO SUBDIVISION THREE OF THIS SECTION, ALL PAYMENTS
OF PRINCIPAL ON LOANS MADE FROM THE FUND OR SPECIAL ACCOUNT BY THE
APPLICABLE SPONSOR, AND ANY INTEREST EARNINGS THAT MAY ACCRUE FROM THE
INVESTMENT OR REINVESTMENT OF MONEYS FROM THE SPECIAL ACCOUNT. NOTWITH-
STANDING PARAGRAPHS (A) AND (B) OF THIS SUBDIVISION, THE CORPORATION
SHALL PROVIDE ONE-YEAR EXTENSIONS ON THE ORIGINAL LOAN TO THE APPLICABLE
SPONSOR, PROVIDED THAT THE SPONSOR IS IN COMPLIANCE WITH THE TERMS OF
THE LOAN, FROM THE SPECIAL ACCOUNT UNTIL TEN YEARS FROM THE DATE OF
COMMENCEMENT OF THE INITIAL LOAN, AT THE INTEREST RATE OF SUCH INITIAL
LOAN, PROVIDED THAT SUFFICIENT MONEYS ARE ON DEPOSIT IN SUCH SPECIAL
ACCOUNT. ALL LOANS SHALL BE SECURED BY A LIEN POSITION ON COLLATERAL AT
THE HIGHEST LEVEL OF PRIORITY THAT CAN ACCOMMODATE THE BORROWER'S ABILI-
TY TO RAISE SUFFICIENT DEBT AND EQUITY CAPITAL FOR THE PROJECT. THE
AMOUNTS DEPOSITED IN SUCH SPECIAL ACCOUNT MAY NOT BE INTERCHANGED OR
COMMINGLED WITH ANY OTHER ACCOUNT IN THE FUND. ANY REMAINING MONIES IN A
SPECIAL ACCOUNT AT THE END OF THE TERM OF THE FINAL LOAN MADE HEREUNDER
SHALL BE TRANSFERRED TO THE GENERAL ACCOUNTS OF THE CORPORATION CONSIST-
ENT WITH APPLICABLE LAW.
7. IN CONNECTION WITH THE UNDERTAKING OF AN ELIGIBLE PROJECT BY THE
CORPORATION, THE SPONSOR SHALL PAY TO THE CORPORATION, AT THE CLOSING OF
EACH LOAN FINANCING BY THE CORPORATION, A CLOSING FEE EQUAL TO THE SPON-
SOR'S ALLOCABLE SHARE OF THE COSTS OF ISSUANCE OF THE BONDS ISSUED
PURSUANT TO SUBDIVISION NINE OF THIS SECTION, PROVIDED HOWEVER THAT SUCH
FEE SHALL NOT EXCEED ONE PERCENT OF THE LOAN AMOUNT. THE ALLOCABLE SHARE
SHALL BE A RATIO, THE NUMERATOR OF WHICH SHALL BE THE PRINCIPAL AMOUNT
OF THE SPONSOR'S LOAN, AND THE DENOMINATOR OF WHICH SHALL BE THE NET
PROCEEDS OF BONDS ISSUED PURSUANT TO SUBDIVISION NINE OF THIS SECTION.
THE APPLICATION FEE PAID PURSUANT TO SUBDIVISION FIVE OF THIS SECTION
SHALL BE CREDITED AGAINST SUCH CLOSING FEE.
8. THE CORPORATION SHALL ANNUALLY REPORT, BEGINNING ON OR BEFORE MARCH
15, 2012 AND ON OR BEFORE EACH SUBSEQUENT MARCH 15, TO THE GOVERNOR, THE
CHAIR OF THE SENATE FINANCE COMMITTEE AND THE CHAIR OF THE ASSEMBLY WAYS
AND MEANS COMMITTEE, DESCRIBING THE ACTIVITIES AND OPERATION OF THE LOAN
PROGRAM AUTHORIZED BY THIS SECTION. SUCH REPORTS SHALL SET FORTH THE
NUMBER OF LOAN APPLICATIONS RECEIVED AND APPROVED; THE NAMES OF SPONSORS
RECEIVING LOANS TOGETHER WITH THE AMOUNT AND PURPOSE OF THE LOAN AND THE
OUTSTANDING BALANCE; THE NUMBER OF JOBS CREATED AND/OR RETAINED; AND THE
BALANCE REMAINING IN THE EMPIRE REVOLVING BRIDGE LOAN FUND, ALONG WITH
FUND REVENUES AND EXPENDITURES FOR THE PREVIOUS FISCAL YEAR, AND
PROJECTED REVENUES AND EXPENDITURES FOR THE CURRENT AND FOLLOWING FISCAL
YEARS.
9. PURSUANT TO ARTICLE 5-C OF THE STATE FINANCE LAW, BUT NOTWITHSTAND-
ING ANY PROVISIONS OF LAW TO THE CONTRARY, THE NEW YORK STATE URBAN
DEVELOPMENT CORPORATION IS HEREBY AUTHORIZED TO ISSUE BONDS, NOTES AND
OTHER OBLIGATIONS IN ONE OR MORE SERIES, AT ANY TIME AND FROM TIME TO
TIME, IN AN AGGREGATE PRINCIPAL AMOUNT NOT TO EXCEED THE AMOUNT NECES-
SARY TO PROVIDE NET PROCEEDS OF NO GREATER THAN FIVE HUNDRED MILLION
DOLLARS FOR THE PURPOSE OF ESTABLISHING THE FUND CREATED PURSUANT TO
THIS SECTION. THE AGGREGATE AMOUNT OF BONDS, NOTES OR OTHER OBLIGATIONS
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AUTHORIZED TO BE ISSUED PURSUANT TO THIS SECTION SHALL EXCLUDE BONDS,
NOTES OR OTHER OBLIGATIONS ISSUED TO REFUND OR OTHERWISE REPAY BONDS,
NOTES OR OTHER OBLIGATIONS THERETOFORE ISSUED; PROVIDED, HOWEVER, THAT
UPON ANY SUCH REFUNDING OR REPAYMENT THE TOTAL AGGREGATE PRINCIPAL
AMOUNT OF OUTSTANDING BONDS, NOTES OR OTHER OBLIGATIONS MAY BE GREATER
THAN FIVE HUNDRED MILLION DOLLARS, ONLY IF THE PRESENT VALUE OF THE
AGGREGATE DEBT SERVICE OF THE REFUNDING OR REPAYMENT BONDS, NOTES OR
OTHER OBLIGATIONS SHALL NOT EXCEED THE PRESENT VALUE OF THE AGGREGATE
DEBT SERVICE OF THE BONDS, NOTES OR OTHER OBLIGATIONS SO REFUNDED OR
REPAID. FOR THE PURPOSES HEREOF, THE PRESENT VALUE OF THE AGGREGATE DEBT
SERVICE OF THE REFUNDING OR REPAYMENT BONDS, NOTES OR OTHER OBLIGATIONS
SO REFUNDED OR REPAID, SHALL BE CALCULATED BY UTILIZING THE EFFECTIVE
INTEREST RATE OF THE REFUNDING OR REPAYMENT BONDS, NOTES OR OTHER OBLI-
GATIONS, WHICH SHALL BE THAT RATE ARRIVED AT BY DOUBLING THE SEMI-ANNUAL
INTEREST RATE (COMPOUNDED SEMI-ANNUALLY) NECESSARY TO DISCOUNT THE DEBT
SERVICE PAYMENTS ON THE REFUNDING OR REPAYMENT BONDS, NOTES OR OTHER
OBLIGATIONS FROM THE PAYMENT DATES THEREOF TO THE DATE OF ISSUE OF THE
REFUNDING OR REPAYMENT BONDS, NOTES OR OTHER OBLIGATIONS AND TO THE
PRICE BID INCLUDING ESTIMATED ACCRUED INTEREST OR PROCEEDS RECEIVED BY
THE CORPORATION INCLUDING ESTIMATED ACCRUED INTEREST FROM THE SALE THER-
EOF.
S 2. Section 2 of chapter 393 of the laws of 1994, amending the New
York state urban development corporation act relating to the powers of
the New York state urban development corporation to make loans, as
amended by section 1 of part P of chapter 59 of the laws of 2010, is
amended to read as follows:
S 2. This act shall take effect immediately provided, however, that
section one of this act shall expire on July 1, [2011] 2012, at which
time the provisions of subdivision 26 of section 5 of the New York state
urban development corporation act shall be deemed repealed; provided,
however, that neither the expiration nor the repeal of such subdivision
as provided for herein shall be deemed to affect or impair in any manner
any loan made pursuant to the authority of such subdivision prior to
such expiration and repeal.
S 3. This act shall take effect immediately.