§ 8. Health facilities reserve funds and appropriations. 1. (a) For
the purposes of the issuance by the agency of health facilities bonds,
the term "health facilities reserve fund requirement" shall mean, as of
any particular date of computation, an amount of money equal to the
greatest of the respective amounts, for the then current or any
succeeding calendar year, of annual debt service payments of the agency,
such annual debt service payments for any calendar year being an amount
of money equal to the aggregate of (i) all interest payable during such
calendar year on all health facilities bonds of the agency then
outstanding on said date of computation, plus (ii) the prinicipal amount
of all health facilities bonds of the agency then outstanding on said
date of computation which mature during such calendar year, plus (iii)
the amount of all sinking fund payments payable during such calendar
year with respect to all health facilities bonds of the agency
outstanding on said date of computation; and the term "sinking fund
payment" shall mean the amount of money specified in the resolution
authorizing term bonds as payable into a sinking fund for the
amortization of such term bonds. The agency may create and establish one
or more additional reserve funds to be known as health facilities
reserve funds and may pay into such reserve funds (1) any monies
appropriated and made available by the state for the purposes of such
funds, (2) any proceeds of sale of health facilities notes or health
facilities bonds, to the extent provided in the resolution of the agency
authorizing the issuance thereof, and (3) any other monies which may be
made available to the agency for the purposes of such funds from any
other source or sources. The monies held in or credited to any health
facilitiss reserve fund established under this subdivision, except as
hereinafter provided, shall be used solely for the payment of the
prinicipal of health facilities bonds of the agency secured by such
reserve fund, as the same mature, sinking fund payments, the purchase of
such health facilities bonds of the agency, and the payment of any
redemption premium required to be paid when such bonds are redeemed
prior to maturity; provided, however, that monies in any such fund shall
not be withdrawn therefrom at any time in such amount as would reduce
the amount of such fund to less than the health facilities reserve fund
requirement, except for the purpose of paying principal and interest on
the health facilities bonds of the agency secured by such reserve fund
maturing and becoming due and any sinking fund payments and for the
payment of which other monies of the agency are not available. Any
income or interest earned by, or increment to, any such health
facilities reserve fund due to the investment thereof may be transferred
to any other fund or account of the agency to the extent it does not
reduce the amount of such health facilities reserve fund below the
health facilities reserve fund requirement.

(b) The agency shall not issue health facilities bonds and health
facilities notes, municipal hospital bonds, municipal hospital notes,
municipal nursing home bonds and municipal nursing home notes in an
aggregate principal amount exceeding two billion dollars, excluding
health facilities bonds and health facilities notes issued to refund
outstanding health facilities bonds or health facilities notes. The
agency shall not issue health facilities bonds at any time secured by a
health facilities reserve fund if upon issuance, the amount in the
health facilities reserve fund will be less than the health facilities
reserve fund requirement, unless the agency, at the time of issuance of
such bonds, shall deposit in such reserve fund from the proceeds of the
bonds so to be issued, or otherwise, an amount which together with the
amount then in such reserve fund, will be not less than the health
facilities reserve fund requirement.

(c) In computing any health facilities reserve fund for the purposes
of this section, securities in which all or a portion of such reserve
fund shall be invested shall be valued at par if purchased at par, or if
purchased at other than par, at amortized value.

2. (a) The agency shall create and establish one or more special
accounts (herein referred to as health facilities income account) and
shall pay into such accounts any monies which the agency shall receive
in payment of rentals due under one or more leases or subleases entered
into with a municipality pursuant to section five and any other monies
which the agency shall receive from a municipality as security for or in
payment of such rentals. Such monies and any other monies paid into such
health facilities income accounts, may, in the discretion of the agency,
but subject to agreements with the holders of health facilities bonds
and health facilities notes, be used by the agency (1) for the repayment
of advances, if any, from the state to the agency in connection with
health facilities, and any real property required therefor, in
accordance with the provisions of repayment agreements related thereto
which have been entered into with the director of the budget, (2) to pay
all costs, expenses and charges of financing the health facil-
applicable to such account or accounts including fees and expenses of
trustees and paying agents, (3) to pay the administrative and other
expenses of the agency allocable to the services performed by the agency
in the financing of the construction, acquisition, reconstruction,
rehabilitation or improvement of health facilities and matters relating
thereto, (4) for the payment of the principal of and interest on health
facilities bonds or health facilities notes isued by the agency when the
same shall become due whether at maturity or by call for redemption and
for the payment of any redemption premium required to be paid where such
bonds or notes are redeemed prior to their stated maturities, and any
sinking fund payments, and to purchase health facilities bonds or health
facilities notes isued by the agency, or (5) for such other corporate
purposes of the agency relating to the carrying out of its functions,
powers and duties with respect to the financing of the construction,
acquisition, reconstruction, rehabilitation or improvement of health
facilities as the agency in its discretion shall determine and provide.

(b) To assure the continued payment of rentals due under one or more
leases or subleases entered into with a municipality pursuant to section
five, the agency shall make and deliver to the appropriate chief fiscal
officer of the municipality a certificate setting forth the amount, if
any, due and not paid to the agency under such lease or sublease with
such municipality within five days of the due date. In the event of the
failure or inability of the municipality to pay over the stated amount
to the agency within ten days of receipt of such certificate, the agency
shall forthwith make and deliver to the comptroller of the state of New
York, the director of the budget of the state of New York and the
commissioner of health of the state of New York a further certificate
restating the amount due and not paid, and such amount shall be paid
over to the agency, upon the warrant of the comptroller on vouchers
certified as correct by the commissioner of health, out of the next
payment of state aid to such municipality pursuant to section 368-a of
the social services law or funds appropriated for the purpose of making
payment on behalf of such municipality pursuant to section 367-b of such
law. To the extent any such payments to the agency are made from state
aid payments pursuant to section 368-a of such law, the amount of such
payments shall be deducted from the corresponding apportionment of state
aid otherwise credited to such municipality, and the state shall not be
obligated to pay, nor shall such municipality be entitled to receive, by
virtue of such deduction, any additional or increased apportionment or
payment of state aid pursuant to section 368-a of the social services
law. To the extent any such payments to the agency are made from funds
appropriated for the purpose of making payments on behalf of such
municipality pursuant to section 367-b of such law, the amount of such
payments may be deducted from any other payments of state assistance to
such municipality under the social services law and the state shall not
be obligated to pay, nor shall the municipality be entitled to receive,
by virtue of such deduction, any additional or increased apportionment
or payment of such state assistance, provided, however, that nothing
contained in this sentence shall be construed to limit, impair, impede,
or otherwise adversely affect in any manner the rights or remedies of
the purchasers and holders and owners of any bonds or notes of the state
or any agency or instrumentality, public benefit corporation or
political subdivision thereof under which such purchasers and holders
and owners have any right of payment of such bonds or notes by recourse
to such state assistance monies.