§ 1823. Further restrictions on loans and loan guarantees. In addition to other provisions of this title limiting the power of the authority to make loans to local development corporations in respect of a particular project, and to guarantee loans made by banking organizations, the following restrictions shall also apply:

Terms Used In N.Y. Public Authorities Law 1823

  • Assisted project: shall mean any project in respect of which the authority has granted a loan or guaranteed a loan. See N.Y. Public Authorities Law 1801
  • Authority: shall mean the New York job development authority created by subdivision one of section eighteen hundred two of this title. See N.Y. Public Authorities Law 1801
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Eligible business facility: shall mean any type of business facility to be used or occupied by any person in an enterprise deemed to offer a reasonable likelihood for promoting the creation or retention of job opportunities in the state, and includes, but is not limited to, industrial or manufacturing plants, facilities for research and development purposes, facilities for conducting wholesale, receiving and distributing operations, facilities for conducting office operations, warehousing operations, or any other operation dealing in the exchange of goods, wares, services or other types of property of any type or description. See N.Y. Public Authorities Law 1801
  • Foreclosure: A legal process in which property that is collateral or security for a loan may be sold to help repay the loan when the loan is in default. Source: OCC
  • Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
  • Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
  • Loan: shall mean (i) a mortgage loan evidenced by a bond, note or other obligation of a local development corporation secured by a mortgage on a project, defined in subdivision fourteen (i) and (ii) of this section, made by a local development corporation, a project occupant or other person, firm or corporation; (ii) a loan evidenced by a bond, note or other obligation of a local development corporation, a project occupant, or other person, firm or corporation secured by a loan agreement, contract or such other instrument deemed necessary or convenient on a project defined in subdivision fourteen (iii) of this section; (iii) a loan evidenced by a bond, note or other obligation of a local development corporation, a project occupant, or other person, firm or corporation secured by a security interest in machinery and equipment as provided in section eighteen hundred fourteen; and (iv) an employee ownership assistance loan made pursuant to paragraph (v) of subdivision fourteen of this section. See N.Y. Public Authorities Law 1801
  • Manufacturing plant: shall include a plant used in connection with making, creating, working, preparing, processing, milling, manufacturing, finishing, fashioning, fabricating, or producing in any manner, goods, wares, merchandise, metals, fabrics, materials, products or substances of any kind or nature. See N.Y. Public Authorities Law 1801
  • Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
  • Municipality: shall mean any county, city, town or village in the state. See N.Y. Public Authorities Law 1801
  • Plant: shall mean real property, the buildings, improvements and structures thereon and the fixtures thereon other than machinery or equipment used by a project occupant in its operations. See N.Y. Public Authorities Law 1801
  • Project: shall mean (i) the construction of a new industrial or manufacturing plant, a new research and development building or other new eligible business facility, (ii) the acquisition, rehabilitation or improvement of a former or existing industrial or manufacturing plant, of a former or existing building to be used for research and development, of a former or existing other eligible business facility, (iii) the construction, acquisition, rehabilitation or improvement of pollution control facilities, (iv) the purchase of machinery and equipment, for which financial assistance from the authority is sought, or (v) assistance to employees under an employee ownership assistance loan agreement made pursuant to subtitle six of this title; provided, however, that any such plant, building, facility or machinery and equipment therefore shall not be primarily used in making retail sales of goods or services to customers who personally visit such facilities to obtain such goods or services, or used primarily as a hotel, apartment house or other place of business which furnishes dwelling space or accommodations to either residents or transients. See N.Y. Public Authorities Law 1801
  • Project occupant: shall mean the business enterprise which proposes to use a project after construction, acquisition, rehabilitation or improvement. See N.Y. Public Authorities Law 1801
  • State: shall mean the state of New York. See N.Y. Public Authorities Law 1801

1. No funds of the authority shall be used in respect of any project if the completion thereof would result in the removal of an industrial or manufacturing plant or research and development facility or other eligible business facility of the project occupant from one area of the state to another area of the state or in the abandonment of one or more plants or facilities of the project occupant located within the state, provided, however, that neither restriction shall apply if the authority shall determine on the basis of the application before it that the project is reasonably necessary to discourage the project occupant from removing such other plant or facility to a location outside the state or is reasonably necessary to preserve the competitive position of the project occupant in its respective industry.

2. No funds of the authority shall be used in respect of any project if the authority would be required to operate, service or maintain the project pursuant to any lease or other agreement except upon foreclosure or except upon the occurrence of a default in the payment or terms of any loan guaranteed by the authority, provided, however, notwithstanding any other provision of this subtitle, the authority may take title to a project under a financing lease which does not require the authority to operate, service or maintain the project itself, and which provides for payments in lieu of property taxes as approved by the local taxing jurisdiction which are equal to or less than any property taxes which would have been due had the authority not taken title to the property. Nothing shall prevent the authority from transferring such property to the project occupant or its designee at the end of the term of such financing.

3. No funds of the authority shall be used for a project unless the applicant shows to the satisfaction of the authority that funds equal to the amount of the proposed loan from the authority are not reasonably available from other sources at a comparable cost of borrowing.

4. No funds of the authority shall be used in violation of any further restrictions imposed by general rule or regulation of the authority in relation to assisted projects and the authority is hereby authorized to adopt rules and regulations containing such restrictions as it may deem necessary or appropriate to effectuate its corporate purposes.

5. No provision of this title shall prevent the inclusion in a mortgage, lease or other agreement relating to an assisted project of a provision granting the project occupant the right to purchase such project upon such terms and conditions as the authority may approve.

6. No funds of the authority shall be loaned or used for any project unless the applicant demonstrates to the authority that such project has a valid permit or permits for the following, when such permits are required pursuant to applicable federal, state or local law: the generation, treatment, storage and disposal of hazardous wastes; the discharge of pollutants into the waters of the state, or, if such a plant or facility is in violation thereof, that the project contemplated includes the elimination of any such violation or violations.

7. Loans in economically distressed areas and to companies in need of special assistance. (a) Loans by the authority pursuant to paragraphs (a) and (b) of subdivision two of section eighteen hundred three of this chapter may exceed forty percent but shall not exceed sixty percent of the cost of the project for:

(i) projects which are or will be located in empire zones designated pursuant to Article 18-b of the general municipal law or in areas that meet, in accordance with the most recent census data available, the following criteria:

(A) the area must have a poverty rate of at least twenty percent for the year to which the data relate; and

(B) the area must have an unemployment rate of at least one hundred twenty-five percent of the statewide unemployment rate for the year to which the data relate;

(ii) projects involving companies in need of special assistance as determined by the findings of the members of the authority that such companies are unable to obtain a sufficient amount of financing at prevailing market rates of interest for businesses of similar size in the same industry in New York state.

(b) In determining eligibility for loans involving companies in need of special assistance pursuant to subparagraph (ii) of paragraph (a) of this subdivision, the members of the authority shall consider:

(i) the applicant's potential for creating jobs in New York state;

(ii) the benefits derived from the project in the community in which the project is or will be located;

(iii) the interaction of a project with economic development programs administered by the department of economic development, the New York state urban development corporation and the New York state science and technology foundation;

(iv) the meaningful participation of minority and women-owned business enterprises and minority group members and women in a project;

(v) the degree to which the project will support apprenticeship training;

(vi) compliance with the provisions of section eighteen hundred twenty-six of this chapter with regard to the project occupant; and

(vii) in consultation with the department of economic development, the eligibility of the applicant for assistance under the industrial effectiveness program pursuant to Article 7 of the economic development law.

(c) In addition to the rules and regulations promulgated with regard to loans made by the authority under other provisions of this title, the members of the authority shall also promulgate rules and regulations pertaining to the loans made under subparagraphs (i) and (ii) of paragraph (a) of this subdivision by December first, nineteen hundred ninety-two.

(d) On an annual basis, the authority shall compile and publish:

(i) in consultation with the department of economic development, a listing of economically distressed areas as defined in subparagraph (i) of paragraph (a) of this subdivision.

(ii) the criteria for determining the eligibility of a project that is in need of special assistance under subparagraph (ii) of paragraph (a) of this subdivision.

(e) All otherwise applicable requirements and restrictions of this title shall apply to projects that are described in paragraph (a) of this subdivision, provided, however, that in the case of projects which involve the relocation of economic activity from another municipality within New York state, the authority shall also find that the project occupant has made reasonable efforts to carry out the project within the municipality from which the project occupant intends to move an industrial, or manufacturing plant, or research and development facility, or other eligible business facility.

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