BILL NUMBER: S2459

SPONSOR: AKSHAR
 
TITLE OF BILL:

An act making certain findings and determinations with respect to
certain bond anticipation notes issued by the city school district of
the city of Binghamton, and authorizing the issuance of obligations of
such school district with respect thereto

 
PURPOSE OR GENERAL IDEA OF BILL:

The purpose of this bill is to authorize the issuance of certain bond
anticipation renewal notes of the City School District of the City of
Binghamton issued in connection with the construction of a new Mac
Arthur Elementary School, after destruction of the existing elementary
school by flooding caused by Tropical Storm Lee. In order to permit the
issuance of such further bond anticipation renewal notes of said School
District for a period in excess of the current statutory' limit of five
years, the proceeds of which, together with available current funds of
said School District in amounts as shall be consistent with the require-
ment of the local finance law, shall be used to refinance the latest
              

outstanding bond anticipation renewal note issued for the aforesaid
purpose.

 
SUMMARY OF PROVISIONS:

Section 1 of the bill describes the obligations for which continued
renewal as bond anticipation notes is being authorized by the bill and
makes findings and determinations with respect to such obligations,
including the amounts, dates of issuance, maturity dates, and purposes
for which such obligations were issued.

Section 2 of the bill authorizes certain other bond anticipation renewal
notes described in section one of the bill to be renewed and the maturi-
ty thereof including the maturity of renewals thereof, to be extended
for a period not to exceed ten years beyond the original date of issue
of such bond anticipation notes, notwithstanding certain provisions of
paragraph b of section 23.00 of the local finance law, to-wit: paragraph
b of section 23.00 of the local finance law provides that bond antic-
ipation notes shall mature within one year from the date of issue and
may be renewed from time to time, with each renewal not exceeding one
year. In no event shall such notes or the renewals thereof extend more
than five years beyond the original date of issue thereof unless a
portion of such notes or the renewals thereof shall be redeemed from a
source other than the proceeds of bonds within two years from the
original date of issue.

Section three of the bill provides that the act shall take effect imme-
diately.

 
JUSTIFICATION:

The obligations authorized to be refinanced by the bill were issued in
accordance with the provisions of paragraph b of section 23.00 of the
local finance law. Due to a delay in the processing and receipt of
federal aid from the Federal Emergency Management Agency, the School
District does not expect to receive, by the time that the currently
outstanding obligation becomes due, such aid to pay off a significant,
and yet to be determined, portion of the outstanding obligation. The
renewal of such obligation May not extend more than five years beyond
the original date of issue pursuant to paragraph b of section 23.00 of
the Local Finance Law. (The first obligation, issued in 2013. has been
paid in full prior to its fifth anniversary date in accordance with said
requirement). Therefore, in accordance with existing law, before Novem-
ber 21, 2019, the remaining outstanding obligation must be refinanced
with serial bonds, after the annual principal pay down amount for 2019
is made, consistent with the amortization requirements provided in
Section 21.00 of the Local Finance Law.

By passing this bill, the School District will be enabled to temporarily
delay issuing long term serial bonds and await the determination of the
amount of the project to be paid with federal aid, before issuing such
bonds. Thereafter, such bonds would be issued in the remaining local
share cost of the project.

The acts being legalized by the provisions of the bill cannot be accom-
plished pursuant to the provisions of section two hundred twenty-seven
of the county law or by enactment of local law.  Accordingly, this
special legislation, which would take effect immediately, is necessary.

A similar extension of bond anticipation renewal notes to permit them to
mature beyond five years was granted to all issuers of such obligations
originally issued during calendar years 2004 and 2005 by Chapter 386 of
the Laws of 2010.

 
PRIOR LEGISLATIVE HISTORY:

New Bill.

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
Immediately.