§ 407-a. Authorization for dormitory authority financing of capital
facilities for special act school districts. 1. The legislature
declares that it is in the interest of the state, the school districts
and the children of the state to assure that special act school
districts educating children with handicapping conditions pursuant to
contracts with public school districts or social services districts have
sufficient facilities related to the education of such children. The
legislature finds that special act school districts providing such
education are in need of improved and additional facilities related to
the education of such children, and the means to finance the
construction of such improvements and additional facilities. The
legislature, therefore, enacts the following provisions.

2. This section shall apply to special act school districts listed in
chapter five hundred sixty-six of the laws of nineteen hundred
sixty-seven, as amended, which contract with public school districts or
social services districts for the education of children with
handicapping conditions pursuant to article eighty-one or eighty-nine of
this chapter.

3. Such special act school districts may enter into leases, subleases
or other agreements with the dormitory authority pursuant to title four
of article eight of the public authorities law for the financing of the
design, construction, reconstruction, rehabilitation, improvement,
renovation or otherwise providing for, furnishing or equipping of
capital facilities which are educational facilities where the total
estimated cost of such facilities exceeds ten thousand dollars. The
plans and specifications of such capital facilities shall be subject to
the approval of the commissioner with respect to educational facilities.
Such capital facilities may be constructed only on land owned by such
special act school district or, if the land is leased, where the lease
is for a period at least equal to the appropriate period of probable
usefulness for such facilities as listed in section 11.00 of the local
finance law, or the length of the lease, sublease or other agreement
with the dormitory authority, whichever is longer.

4. Each such special act school district shall, notwithstanding any
other provision of law, have the power to convey, lease, sublease or
otherwise make available to the dormitory authority without
consideration, title or any other rights in real property satisfactory
to the dormitory authority.

5. In addition to providing for all other matters deemed necessary and
proper, such leases, subleases and other agreements shall (a) require
such special act school district to pay to the dormitory authority
annual rentals which shall include the amount required to pay the
principal of and interest on obligations of the dormitory authority
issued in relation to providing such facilities and all incidental
expenses of the dormitory authority incurred in relation thereto, (b)
require the special act school district to include an amount sufficient
to meet its obligations under the lease, sublease or other agreement in
each proposed budget submitted during the term of the lease, sublease or
other agreement and (c) include a provision that such agreement shall
not be effective unless and until it is approved by the commissioner
with respect to educational facilities.

6. Title or other real property rights to the capital facilities
financed pursuant to this section shall remain with the dormitory
authority until the dormitory authority certifies to the commissioner
with respect to educational facilities and the comptroller the receipt
by it of the amount necessary to pay the total aggregate amount of
annual rentals to the dormitory authority. At such time, title or other
real property rights thereto shall be transferred by the dormitory
authority to such special act school district for use for educational
purposes. In order to avail itself of the provisions of this section,
each such special act school district must also agree to continue to
operate a program for the education of children pursuant to contract
with public school districts or social services districts, and such
lease, sublease or other agreement with the dormitory authority shall
provide that, if the special act school district shall cease to operate
such a program at any time during the term of the agreement, the state
will have the option to take title or other real property rights in
land, buildings, equipment and other properties which the special act
school district uses for its program upon, subject to appropriations,
payment by the state to the dormitory authority of the amount required
to pay the total aggregate amount of annual rentals to the dormitory
authority.

7. On or before November fifteenth of each year, the dormitory
authority shall submit, and thereafter may resubmit, to the director of
the budget, the state comptroller, the chairman of the senate finance
committee and the chairman of the assembly ways and means committee a
report setting forth the amounts, if any, of all annual rentals
estimated to become due in the succeeding state fiscal year to the
dormitory authority from the special act school districts pursuant to
any leases, subleases or other agreements between the dormitory
authority and such special act school districts to provide educational
facilities for such special act school district. The state comptroller
shall pay over to the dormitory authority pursuant to appropriations
therefor solely from moneys available in the school capital facilities
financing reserve fund the amount set forth in such report at the times
and in the amounts set forth in the certificate filed with the
comptroller by the dormitory authority pursuant to subparagraph (iv) of
paragraph (b) of subdivision eight of this section.

8. Method of payment; reserve fund. (a) Each special act school
district which elects to avail itself of the provisions of this section
shall have established with the state comptroller a school capital
facilities financing reserve account which shall be used to pay to the
dormitory authority the annual rentals payable to the dormitory
authority by special act school districts which have entered into
leases, subleases or other agreements with the dormitory authority to
provide educational facilities pursuant to the provisions of this
section. The dormitory authority shall identify to the state comptroller
and to the commissioner with respect to educational facilities, the
special act school districts with which it has leases, subleases or
other agreements pursuant to this section and shall annually certify the
amount of annual rentals required to be paid pursuant to such leases,
subleases or other agreements.

(b) (i) There is hereby established in the custody of the state
comptroller a special fund to be known as the school capital facilities
financing reserve fund. Within such fund, there is hereby established a
special account for each special act school district which enters into a
lease, sublease or other agreement with the dormitory authority pursuant
to this section.

(ii) Notwithstanding the provisions of any other law, such fund shall
consist of part of the tuition payments from public school districts and
social services districts as determined by the commissioner, and state
aid to special act school districts pursuant to subdivision six of
section thirty-six hundred two of this chapter as determined by the
commissioner. The comptroller shall maintain sufficient amounts in the
fund in order to pay when due the annual rentals due to the dormitory
authority from each such special act school district pursuant to any
lease, sublease or other agreement entered into pursuant to the
provisions of this section. The dormitory authority shall certify to
the state comptroller the dates and amount of such annual payments as
scheduled in its leases, subleases or other agreements with such special
act school districts. The commissioner with respect to educational
facilities shall certify the amount of payments due the fund from public
school districts and social services districts, respectively and such
public school districts and social services districts shall make such
payments to the fund at such times as shall be prescribed by the
commissioner with respect to educational facilities, subject to the
approval of the director of the budget, and after consultation with the
dormitory authority.

(iii) Revenues in any special account in the school capital facilities
financing reserve fund may be commingled with any other moneys in such
fund. All deposits of such revenues with banks and trust companies shall
be secured by obligations of the United States or of the state of New
York or its political subdivisions. Such obligations shall have a
market value at least equal at all times to, but not less than, one
hundred five percent of the amount of such deposits. All banks and trust
companies are authorized to give security for such deposits. Any such
revenues in such fund may, in the discretion of the comptroller, be
invested in obligations of the United States or the state or obligations
the principal of and interest on which are guaranteed by the United
States or by the state. Any interest earned shall be credited to such
fund.

(iv) Upon receipt by the comptroller of a certificate or certificates
from the dormitory authority that it requires a payment or payments from
the appropriate special account established for a special act school
district in order for such special act school district to comply with
any lease, sublease or other agreement pursuant to this section, each of
which certificates shall specify the required payment or payments and
the date when the payment or payments is required, the comptroller shall
pay from such special account on or before the specified date or within
thirty days after receipt of such certificate or certificates, whichever
is later, to the paying agent designated by the dormitory authority in
any such certificate, the amount or amounts so certified.

(v) All payments of money from the school capital facilities financing
reserve fund shall be made on the audit and warrant of the state
comptroller.

9. Notwithstanding the provisions of any contract pursuant to article
eighty-one or eighty-nine of this chapter between a social services
district or a public school district and a special act school district,
if the special act school district enters into a lease, sublease or
other agreement with the dormitory authority pursuant to this section,
payments due from the public school district or social services district
shall be made in accordance with the provisions of this section.

10. All state and local officials are authorized and required to take
whatever actions are necessary to carry out the provisions of this
section and the provisions of any leases, subleases or other agreements
entered into pursuant to this section, including making the required
payments to the dormitory authority.

11. Any contract undertaken or financed by the dormitory authority for
any construction, reconstruction, rehabilitation or improvement for any
special act school district shall comply with the provisions of sections
one hundred one and one hundred three of the general municipal law.

12. Notwithstanding any other provision of law to the contrary, the
dormitory authority may execute leases, subleases, or other agreements
with special act school districts for financing of the design,
construction, rehabilitation, improvement, renovation, acquisition or
provision, furnishing or equipping of capital facilities; provided,
however, that during the two year period commencing July first, nineteen
hundred ninety-five, the amount of bonds inclusive of principal,
interest and issuance costs to be issued for each individual lease,
sublease, or other agreement shall not exceed fifteen million dollars
annually; and provided further that the total amount of such bonds for
all such leases, subleases, or agreements with special act school
districts during such period shall not exceed twenty million dollars.
On or before September first of each year, the commissioner shall submit
to the chairs of the assembly ways and means committee, the senate
finance committee and the director of the budget, a capital plan for
those projects expected to be bonded for special act school districts
pursuant to this section, within such twenty million dollar allowance.
After application of the principles of the capital assets preservation
program, such plan shall accord priority to health and safety
considerations and shall specify the name, location, estimated total
cost of the project at the time the project is to be bid, the
anticipated bid date and the anticipated completion date and may contain
any further recommendations the commissioner may deem appropriate.