BILL NUMBER: S7068

SPONSOR: RYAN
 
TITLE OF BILL:

An act to amend chapter 307 of the laws of 2005 amending the public
authorities law relating to the special powers of the New York state
environmental facilities corporation, in relation to extending the
effectiveness thereof

 
PURPOSE OF THE BILL:

Section 1 of this bill would extend until September 30, 2026 the
"sunset" provision of Section 3 of Chapter 307 of the Laws of 2005,
thereby extending for an additional three years the provisions of Public
Authorities Law ("PAL") §§ 1285-j(6)(b) and 1285-m(6)(b), which author-
ize authority of EFC to invest Clean Water State Revolving Fund
("CWSRF") and Drinking Water State Revolving Fund ("DWSRF") monies in
security obligations available to municipalities under the General
Municipal Law ("GML").

 
SUMMARY OF PROVISIONS:
              

Section 1 of this bill would extend until September 30, 2026 the
"sunset" provision of Section 3 of Chapter 307 of the Laws of 2005,
thereby extending for an additional three years the provisions of PAL§§
1285- j(6)(b) and 1285-m(6)(b), which authorize authority of EFC to
invest CWSRF and DWSRF monies in security obligations available to muni-
cipalities under the GML.

Section 2 of the bill provides for an immediate effective date.

 
JUSTIFICATION:

EFC administers the CWSRF and the DWSRF. Under these SRF programs, EFC
provides low cost financial assistance to municipalities and other enti-
ties for water and wastewater infrastructure and other environmental
projects. As of September 30, 2022, EFC has issued approximately $21
billion in State Revolving Fund Bonds under the CWSRF program and the
DWSRF program for the purpose of providing financial assistance to local
governments and public benefit corporations. Under both the CWSRF and
the DWSRF, EFC is authorized to provide assistance in several forms to
recipients for the purpose of financing or refinancing their capital
projects.

Prior to enactment of PAL §§ 1285-j(6)(b) and 1285-m(6)(b), EFC only had
the authority to invest directly in obligations the interest on which is
excludable from gross income under the Internal Revenue Code. This
legislation would allow EFC to continue to invest in a limited array of
municipal taxable securities. By allowing CWSRF and DWSRF assets to
continue to be invested in taxable municipal obligations as well as
tax-exempt municipal obligations, these programs, including the partic-
ipating municipalities, will benefit from higher investment returns
without diminishing investment credit quality. Continued authorization
to invest CWSRF and DWSRF assets in taxable investments will also broad-
en the demand for taxable municipal bonds, including taxable bonds
issued by New York State municipalities.

 
PRIOR LEGISLATIVE HISTORY:
These provisions were extended until September 30, 2011 by Chapter 214
of the Laws of 2008; until September 30, 2014 by Chapter 70 of the Laws
of 2011; until September 30, 2017 by Chapter 159 of the Laws of 2014;
September 30, 2020 by Chapter 137 of the Laws of 2017; and until Septem-
ber 30, 2023 by Chapter 58 of the Laws of 2020.

 
FISCAL IMPLICATIONS:

The bill would have no budget implications to the State.

 
EFFECTIVE DATE:
The bill would take effect immediately.