* § 4662. Entrance fee escrow account. As a condition for approval to
advertise and collect refundable entry fees/deposits:

1. The operator shall establish an interest-bearing account with a New
York state bank, New York state savings and loan association, or New
York state trust company for any entrance fees received by the operator,
which escrow funds shall be subject to release as provided by section
forty-six hundred sixty-three of this article.

2. An escrow agreement shall be entered into between the bank, savings
and loan association, or trust company and the operator of the
community. The agreement shall state that its purpose is to protect the
resident or the prospective resident and that, upon presentation of
evidence of compliance with applicable portions of this article, or upon
order of a court of competent jurisdiction, the escrow agent shall
release and pay over the funds, or portions thereof, together with any
interest accrued thereon or earned from investment of the funds, to the
operator or resident as directed.

3. Checks, drafts and money orders for deposit from prospective
residents shall be made payable to the escrow agent only.

4. All funds deposited in the escrow account shall remain the property
of the resident until released to the operator in accordance with
section forty-six hundred sixty-three of this article, and the funds
shall not be subject to any liens or charges by the escrow agent or
judgments, garnishments, or creditor's claims against the operator or
community.

5. At the request of the operator or the commissioner, the escrow
agent shall issue a statement indicating the status of the escrow
account.

6. If the funds in an escrow account under this section and any
interest thereon are not released to the operator within such time as
provided by rules and regulations adopted by the council, then such
funds shall be returned by the escrow agent to the persons who had made
payment to the operator.

7. An entrance fee held in escrow may be returned by the escrow agent
to the person who paid the fee upon receipt by the escrow agent of
notice from the operator that such person is entitled to a refund of the
entrance fee.

8. Nothing in this section shall be interpreted as requiring the
escrow of any nonrefundable application fee, designated as such in the
contract, received by the operator from a prospective resident.

9. Occupancy of housing or other facilities shall not begin until:

a. the operator has executed contracts accompanied by a deposit of at
least ten percent of the entry fee payment for fifty percent of all
units or an approved phase of a community; and

b. all permits and approvals necessary for operation of the community,
or an approved phase of a community, have been granted except those
depending upon construction; provided, nothing in this subdivision shall
prohibit an operator, upon the approval of the council, or an applicant
or prospective applicant upon the approval of the commissioner pursuant
to section forty-six hundred seventy-four of this article, from
constructing model units and a sales office.

10. Any entry fee deposit required by an operator shall be fully
refundable if the contract is canceled within seventy-two hours of its
execution. In the event of cancellation, the entry fee deposit shall be
refunded within three business days of receipt of cancellation.

* NB There are 2 § 4662's