Section 2049-NN. Exemption from taxes, assessments and certain fees

1. It
  is hereby determined that the creation of the authority and the carrying
  out of its corporate purposes is in all respects for the benefit of  the
  people  of  the  counties  and the state and is a public purpose and the
  authority shall be regarded as performing a governmental function in the
  exercise of the powers conferred upon it by this title and shall not  be
  required  to  pay any taxes or assessments upon any property owned by it
  or  under  its  jurisdiction,  control  or  supervision  or   upon   its
  activities,  income and operations, or any filing, recording or transfer
  fees or taxes in relation to instruments filed, recorded or  transferred
  by  it  or  on  its  behalf  provided, however, that the authority shall
  annually pay a sum in lieu of taxes to each  of  the  municipalities  in
  which  any  real property owned by or under its jurisdiction, control or
  supervision of the authority are located in an amount equal to the taxes
  and assessments which would have been levied upon such real property  in
  an  unimproved state had such real property been owned by a person whose
  real property is subject to taxation. The construction, use,  occupation
  or  possession  of  any property owned by the authority or the counties,
  including improvements thereon, by  any  person  or  public  corporation
  under  a  lease,  lease  and  sublease  or any other agreement shall not
  operate to abrogate or limit the  foregoing  exemption,  notwithstanding
  that  the  lessee,  user,  occupant  or person in possession shall claim
  ownership for federal income tax purposes. Mortgages made  or  financed,
  directly  or  indirectly,  by  the  authority  shall  be exempt from the
  mortgage recording taxes imposed by article eleven of the tax law.
    2. Any bonds issued pursuant to this title together  with  the  income
  therefrom  as well as the property of the authority shall be exempt from
  taxes, except for transfer, and estate and gift taxes. The state  hereby
  covenants  with  the  purchasers  and  with  all  subsequent holders and
  transferees of bonds issued by the authority pursuant to this title,  in
  consideration  of  the acceptance of any payment for the bonds, that the
  bonds of the authority issued pursuant to  this  title  and  the  income
  therefrom and all revenues, moneys, and other property pledged to secure
  the  payment  of  such  bonds  shall at all times be free from taxation,
  except for transfer, and estate and gift taxes.