§ 5. Powers of the agency.

Except as otherwise limited by this act and subject to the provisions
of any contract with noteholders or bondholders, the agency shall have
power:

1. To sue and be sued;

2. To have a seal and alter the same at pleasure;

3. To make and execute contracts and all other instruments necessary
or convenient for the exercise of its powers and functions under this
act;

4. To make and alter by-laws for its organization and internal
management;

5. To acquire, hold and dispose of real or personal property (whether
tangible or intangible) for its corporate purposes;

6. To appoint officers, agents and employees, prescribe their duties
and qualifications and fix their compensation;

7. To borrow money and issue negotiable or non-negotiable notes, bonds
or other obligations and to provide for the rights of the holders
thereof, and as security for the payment of the principal of and
interest on any notes or bonds so issued and any agreements made in
connection therewith, to assign or pledge any or all existing and future
assets or revenues owned by or assigned or pledged to the agency and the
receipts to be derived therefrom;

8. To accept appropriations made to it by the state and to apply the
proceeds of such appropriations, together with the proceeds of
borrowings by the agency and any other funds available to it, for the
purposes set forth in this act, and from time to time to enter into a
repayment agreement with the state in respect of such appropriations on
such terms and conditions as the director of the budget determines are
appropriate for the repayment of any and all outstanding sums then owed
in such respect by the agency and each such agreement shall supersede
all prior such agreements, provided that such repayment agreements shall
require payments thereunder in any fiscal year of the agency only to the
extent that the agency's revenues and receipts from operations
(excluding borrowings, proceeds of sales of assets and appropriations)
during its preceding fiscal year shall exceed the aggregate amount
payable by the agency during such preceding year for expenses (including
reasonable reserves for contingencies) and debt service (without regard
to any refunding of debt) plus the amount of any eligible purchases and
eligible loans made during either such year out of any balance of such
revenues and receipts from operations;

9. To invest any funds held in reserve or sinking funds, or any funds
not required for immediate use or disbursement, at the discretion of the
agency, in obligations of the state or federal government, obligations
the principal and interest of which are guaranteed by the state or
federal government, or obligations of agencies of the federal
government, or special time deposits in, or certificates of deposit
issued by, a bank or trust company authorized to do business in this
state and secured by a pledge of obligations of the United States of
America or obligations of the state or obligations the principal and
interest of which are guaranteed by the state or federal government or
obligations of agencies of the federal government, provided that any
such investment is one which may from time to time be legally purchased
by savings banks of the state as investments of funds belonging to them
or in their control;

10. To make eligible purchases at such purchase price as the
commissioner shall approve (including a purchase price at a premium over
the par value of the corporation first mortgage to be purchased) which
shall be determined on the basis that such purchase price is to be
amortized over the remaining term of the corporation first mortgage at
the corporation's estimated average cost of borrowing (as determined by
the commissioner in accordance with any accepted method) utilizing the
annual payments of principal and interest called for by such mortgage,
and otherwise on such terms and conditions, not inconsistent with this
act, as are satisfactory to the agency; provided that no eligible
purchase shall be made by the agency unless, except as otherwise
permitted by contract with bondholders or noteholders, the commissioner
finds that

(a) the mortgage purchased is (or in the case of a purchase not
involving the use of funds acquired through the issuance of bonds or
notes of the agency, can reasonably be anticipated to become) a valid
first mortgage lien on a corporation project free and clear of all other
liens and encumbrances which would materially affect the value or
usefulness of the property secured thereby (or that arrangements
satisfactory to the commissioner for the discharge of such liens and
encumbrances have been made) and that such first mortgage has been
executed and recorded in accordance with the requirements of existing
laws; and

(b) the estimated net revenues of such corporation project, after
provision has been made to cover all probable costs of operation and
maintenance, of fixed charges and operating reserves and depreciation
reserves, if any, including any subsidy payments attributable to such
corporation project, shall be sufficient to pay the estimated principal
of and interest on all bonds or notes of the agency issued or to be
issued which are allocated or re-allocated by the commissioner to the
financing of the purchase of such mortgage (after giving effect to such
estimated net revenues related to mortgages purchased or acquired as
security for eligible loans made with state appropriations or other
available funds which are concurrently allocated or re-allocated to such
financing) and any fees and charges of the agency applicable to such
eligible purchase.

Subject to the provisions of any contract of the agency or the
corporation with their respective noteholders or bondholders, (i) the
corporation shall have authority to make an additional mortgage loan,
pursuant to the private housing finance law and the New York state urban
development corporation act, for any corporation project the corporation
first mortgage on which has been purchased by the agency, such loan to
be made on an additional mortgage junior and subordinate only to the
mortgage that was purchased by the agency but otherwise equivalent to a
corporation first mortgage, (ii) the agency shall have authority to make
an eligible purchase, pursuant to this act, of such additional mortgage
notwithstanding that it is not a corporation first mortgage, at any time
at or after the making of the first advance on such additional mortgage
by the corporation, with the purchase price (including any applicable
premium) to be payable at such times and in such amounts as shall be
agreed by the agency and the corporation, and (iii) upon such a purchase
by the agency such additional mortgage may be consolidated with the
corporation first mortgage previously purchased by the agency;

11. To make eligible loans on such terms and conditions, not
inconsistent with this act, as are satisfactory to the agency; provided
that no eligible loan shall be made by the agency unless, except as
otherwise permitted by contract with bondholders or noteholders, the
commissioner finds that

(a) the mortgage securing the eligible loan is (or in the case of a
loan not involving the use of funds acquired through the issuance of
bonds or notes of the agency, can reasonably be anticipated to become) a
valid first mortgage lien on a corporation project free and clear of all
other liens and encumbrances which would materially affect the value or
usefulness of the property secured thereby (or that arrangements
satisfactory to the commissioner for the discharge of such liens and
encumbrances have been made) and that such first mortgage has been
executed and recorded in accordance with the requirements of existing
laws; and

(b) the estimated net revenues of such corporation project, after
provision has been made to cover all probable costs of operation and
maintenance, of fixed charges and operating reserves and depreciation
reserves, if any, including any subsidy payments attributable to such
corporation project, shall be sufficient to pay the estimated principal
of and interest on all bonds or notes of the agency issued or to be
issued which are allocated or re-allocated by the commissioner to the
financing of such eligible loan (after giving effect to such estimated
net revenues related to mortgages purchased or acquired as security for
eligible loans made with state appropriations or other available funds
which are concurrently allocated or re-allocated to such financing) and
any fees and charges of the agency applicable to such eligible loan;

12. To use and apply all monies received by the agency on account of
the corporation first mortgages purchased by the agency or on account of
the corporation first mortgages and other assets or revenues assigned or
pledged to it as security for eligible loans:

(a) In the case of such corporation first mortgages and other assets
or revenues assigned or pledged by the agency as security for
outstanding bonds of the agency, to meet payments of principal and
interest on such outstanding bonds and any fees and charges of the
agency related to the respective corporation first mortgages, and any
excess shall be applied in accordance with paragraph (d) of this
subdivision;

(b) In the case of such corporation first mortgages and other assets
or revenues assigned or pledged by the agency as security for
outstanding notes of the agency, to meet payments of principal and
interest on such outstanding notes (including the redemption of any note
payment certificates delivered pursuant to subdivision three of section
seven of this act) and any fees and charges of the agency related to the
respective corporation first mortgages, and any excess shall be applied
in accordance with paragraph (d) of this subdivision;

(c) In the case of any such corporation first mortgages and other
assets or revenues assigned or pledged by the agency as security for its
guaranty of obligations of the corporation, pursuant to subdivision
twenty-one of this section, to be applied in accordance with the
provisions of such guaranty, and any excess shall be applied in
accordance with paragraph (d) of this subdivision; and

(d) In the case of any such corporation first mortgages and other
assets or revenues not assigned or pledged by the agency as security,
and in the case of excess amounts to be applied in accordance with this
paragraph as provided above, first, to meet payments of principal and
interest on any outstanding bonds or notes of the agency (including the
redemption of any note payment certificates delivered pursuant to
subdivision three of section seven of this act) and the fees and charges
of the agency, irrespective of the corporation project or projects from
which such monies are derived, and, second, any balance shall be applied
as follows: (i) in the case of any such monies received on account of
such corporation first mortgages and other assets or revenues that had
been assigned or pledged to the agency as security for eligible loans,
to pay over such balance to the corporation in accordance with the terms
and conditions of such eligible loans; and (ii) in the case of any such
monies received on account of such corporation first mortgages that had
been purchased by the agency, to make further eligible purchases or
eligible loans to the extent deemed appropriate by the commissioner, to
pay any remaining balance to the corporation in reduction of the
agency's obligations for repayment of appropriations theretofore
transferred by the state to the corporation pursuant to a chapter of the
laws of nineteen hundred seventy-five, and, in the event of payment in
full by the agency of such obligations, to apply any remaining balance
as the members of the agency, in their discretion, with the approval of
the commissioner, shall determine to be in the best interests of the
agency and the corporation and their respective bondholders and
noteholders.

13. To sell, at public or private sale, any obligations, property or
rights representing, embodying or securing an eligible loan made by the
agency or acquired in an eligible purchase;

14. In connection with the making of eligible purchases, eligible
loans and commitments therefor, to make and collect such fees and
charges, including but not limited to reimbursements of all costs of
financing by the agency, service charges and insurance premiums, as the
agency shall determine to be reasonable;

15. To consent to the modification, with respect to rate of interest,
time of payment of any installment of principal or interest, security,
or any other term, of any eligible loan, eligible loan commitment,
eligible purchase, eligible purchase commitment, contract or agreement
of any kind to which the agency is a party;

16. To exercise exclusively all rights of the mortgagee under any
corporation first mortgage purchased by the agency or assigned to secure
any eligible loan, to foreclose on any property subject to such mortgage
or commence any action to protect or enforce any right conferred upon it
by any law, mortgage, contract or other agreement, and to bid for and
purchase such property at any foreclosure or at any other sale, or
acquire or take possession of any such property; and in such event the
agency may complete, administer, pay the principal of and interest on
any obligations incurred in connection with such property, dispose of,
and otherwise deal with, such property, in such manner as may be
necessary or desirable to protect the interests of the agency therein;

17. To procure insurance against any loss in connection with its
property and other assets (including mortgages and mortgage loans) in
such amounts, and from such insurers, as it deems desirable;

18. To accept any gifts or grants or loans of funds or property or
financial or other aid in any form, including but not limited to
mortgage insurance, from the federal government or any agency or
instrumentality thereof or from the state or from any other source and
to comply, subject to the provisions of this act, with the terms and
conditions thereof;

19. To engage the services of private consultants on a contract basis
for rendering professional and technical assistance and advice;

20. To enter into a contract with the New York state housing finance
agency to market and service any agency bonds and notes approved by the
agency and to contract with the New York state housing finance agency to
render such other services as the agency may request, including but not
limited to the use of the premises, personnel and personal property of
the New York state housing finance agency, and to provide for
reimbursement to the New York state housing finance agency from the
agency for any expenses necessarily incurred by the New York state
housing finance agency in carrying out the terms of any such contract.
Any such contract shall be subject to the separate approval of the
director of the budget;

21. To guarantee obligations of the corporation and to assign or
pledge as security for any such guaranty any or all of the obligations,
property or rights representing, embodying or securing an eligible loan
made by the agency or acquired in an eligible purchase;

22. To do any and all things necessary or convenient to carry out its
purposes and exercise the powers expressly given and granted in this
act.