§ 1977-b. Reserve funds and appropriations. 1. In addition to setting
aside of such other reserves or sinking funds as it shall deem advisable
and necessary, and the regulation and disposition thereof, the authority
shall create and establish a special fund to be known as and hereinafter
called the "Battery Park project area capital reserve fund" and shall
pay into such fund (a) any moneys appropriated and made available by the
state only for the purposes of such fund, (b) any proceeds of sale of
any bonds issued to finance the Battery Park project area to the extent
provided in the resolution of the authority authorizing the issuance
thereof, (c) any funds directed to be transferred by the authority to
such fund, and (d) any other moneys made available to the authority only
for the purposes of such fund from any other source or sources. The
moneys held in or credited to such capital reserve fund, except as
hereinafter provided, shall be used solely for the payment of the
principal of such bonds or of the sinking fund payments hereinafter
mentioned with respect to such bonds, the purchase or redemption of such
bonds, the payment of interest on such bonds, or the payment of any
redemption premium required to be paid when any of such bonds are
redeemed prior to maturity; provided, however, that moneys in 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shall not be withdrawn therefrom at any time in such amount as would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 amount of the Battery
Park project area capital reserve fund requirement hereinbelow referred
to, except for the purpose of making with respect to such bonds payment,
when due, of principal, interest and the sinking fund payments
hereinafter mentioned for the payment of which other moneys of the
authority are not available. Moneys in such capital reserve fund not
required for immediate use or disbursement may be invested in
obligations of the state or the United States of America or obligations
the principal and interest of which are guaranteed by the state or the
United States of America or obligations of agencies of the United States
of America which may from time to time be legally purchased by savings
banks of the state as investment of funds belonging to them or in their
control. In computing the amount of such capital reserve fund for the
purposes of this section, securities in which all or a portion of such
fund are invested shall be valued at par or, if purchased at less than
par, at their cost to the authority.

2. The authority shall not issue any of such bonds at any time secured
by such capital reserve fund if the amount in such capital reserve fund
at the time of issuance does not equal or exceed the amount of said
capital reserve fund requirement unless the authority at the time of
issuance of such bonds shall deposit in such fund from the proceeds of
such bonds or other sources an amount which together with the amount
then in such fund will not be less than the amount of said capital
reserve fund requirement.

3. In order to assure the continued operation and solvency of the
authority for the fulfillment of its corporate purposes with respect to
the Battery Park project area, the chairman of the authority shall
annually, on or before December first, make and deliver to the governor
and director of the budget his certificate stating the sum, if any,
required to restore such capital reserve fund to the amount as of the
particular date of computation equal to the greatest (herein sometimes
called the "Battery Park project area capital reserve fund requirement")
of the respective amounts for the then current or any future fiscal year
of the authority, of annual debt service with respect to such bonds,
such annual debt service for any fiscal year being the amount of money
equal to the aggregate of (a) all interest payable during such fiscal
year on all such bonds outstanding on said date of computation, plus (b)
the principal amount of all such bonds outstanding on said date of
computation which mature during such fiscal year, plus (c) all amounts
specified in any resolution of the authority authorizing any of such
bonds as payable during such fiscal year as a sinking fund payment with
respect to any of such bonds which mature after such fiscal year, all
calculated on the assumption that bonds will after said date of
computation cease to be outstanding by reason, but only by reason, of
the payment of bonds when due and the payment when due and application
in accordance with the resolution authorizing those bonds of all of such
sinking fund payments payable at or after said date of computation; and
there shall be annually apportioned and paid to the authority for
deposit in such capital reserve fund the sums so certified by the
chairman of the authority. All sums so apportioned and paid shall be
deposited by the authority in such capital reserve fund. The principal
amount of bonds secured by such capital reserve fund to which state
funds are apportionable pursuant to this subdivision shall be limited to
the total amount of bonds and notes outstanding on the effective date of
this act, plus the total amount of bonds and notes contracted after the
effective date of this act to finance projects in progress on the
effective date of this act as determined by the New York state public
authorities control board created pursuant to section fifty of this
chapter whose affirmative determination shall be conclusive as to all
matters of law and fact solely for the purposes of the limitations
contained in this subdivision, but in no event shall the total amount of
bonds so secured by such a capital reserve fund or funds exceed two
hundred million dollars, excluding bonds issued to refund such
outstanding bonds until the date of redemption of such outstanding
bonds. As outstanding bonds so secured are paid, the amount so secured
shall be reduced accordingly but the redemption of such outstanding
bonds from the proceeds of refunding bonds shall not reduce the amount
so secured.

4. All amounts paid over to the authority by the state pursuant to the
provisions of this section shall constitute and be accounted for as
advances by the state to the authority and, subject only to the rights
of the holders of any bonds or notes of the authority theretofore or
thereafter issued, shall be repaid to the state from all available
operating revenues of the authority in excess of the capital reserve
fund requirement and operating expenses.

5. As used in this section, (a) the term "operating expenses" for the
fiscal year shall mean ordinary expenditures for operation and
administration of the authority; and (b) the term "available operating
revenues" for the fiscal year shall mean all amounts received on account
of rentals and fees charged by the authority, if any, and income or
interest earned or added to funds of the authority due to the investment
thereof, and not required under the terms or provisions of any convenant
or agreement with holders of any bonds or notes of the authority to be
applied to any purposes other than payment of expenses of the authority.

6. This section is applicable only to the Battery Park project area
capital reserve fund.