§ 66-h. Restriction on sale in the event of nonappropriation. 1. Any
agreement for the issuance of certificates of participation to fund
installment purchases or lease purchases by the state may provide that
the certificates are secured by the underlying property and that, in the
event that the legislature fails to appropriate funds sufficient for the
underlying installment payments, the financed property may be sold on
behalf of the holders of the certificates, provided that any excess
proceeds from such a sale, after deduction for and payment of fees,
expenses and any taxes levied on the sale, and distribution to the
holders of the certificates in the amount of the face value of the
certificates plus accrued interest, or in the case of a certificate
issued with an original issue discount, its accreted value, shall be
paid to the state.

2. Any security interest in personal property made or created by any
such agreement shall be valid, binding and perfected from the time when
such security interest attaches, without any physical delivery of the
collateral or further act. The lien of any such security interest shall
be valid, binding and perfected as against all parties having claims of
any kind in tort, contract or otherwise against the state irrespective
of whether or not such parties have notice hereof. No instrument by
which such security interest is created nor any financing statement or
other document need be recorded or filed. This section shall apply
notwithstanding the provisions of the uniform commercial code and the
vehicle and traffic law.