Section 1689. Board of cooperative educational services school facilities

1.  For all the purposes of this section sixteen hundred eighty-nine the
  term "board of cooperative educational services school facilities" shall
  mean any interest in real property, any building,  library,  laboratory,
  classroom, or other building or structure essential, necessary or useful
  in  a  career  education  or  other  program of any board of cooperative
  educational services.
    2.  a.  The  authority  is  hereby  authorized  and   empowered   upon
  application  of  the board of cooperative educational services concerned
  to  construct,  acquire,  reconstruct,  rehabilitate  and  improve,  and
  furnish   and   equip  or  otherwise  provide  a  board  of  cooperative
  educational services school facility. The board for whose  students  any
  such  board  of  cooperative  educational  services  school  facility is
  intended to be provided shall approve plans and specifications  and  the
  location  of  such board of cooperative educational services facilities.
  The authority shall have the same power and authority in respect to such
  board of cooperative  educational  services  school  facilities  erected
  pursuant to this section that it has relative to dormitories.
    b.  The  authority  shall  have  power  to acquire, in the name of the
  authority, on terms necessary or convenient by  purchase,  condemnation,
  gift  or  devise,  real property, leasehold interest in real property or
  rights of easement in relation to the board of  cooperative  educational
  services school facilities erected pursuant to this section.
    c.  When  authorized  by  the  voters  of  the  board  of  cooperative
  educational services, any  board  of  cooperative  educational  services
  shall  have  power  to  convey to the authority real property, leasehold
  interest in real property or rights of easement, the title of  which  is
  vested in the board, in relation to the board of cooperative educational
  services  school facilities to be erected pursuant to this section, and,
  when so authorized, any board of cooperative educational services  shall
  have power to enter into any lease or other agreement with the authority
  in  connection  with the provision of a board of cooperative educational
  services school facility.
    d. The authority shall have power to accept gifts of real and personal
  property in the name of the authority for the purposes of this section.
    e. The authority may lease any such board of  cooperative  educational
  services  school  facilities  to  the  board  for  which  such  board of
  cooperative educational services school facilities are erected. At  such
  time  as the liabilities of the authority incurred for any such board of
  cooperative educational services school facilities have been  discharged
  and  the  bonds  of the authority issued therefor have been paid or such
  liabilities and bonds have  otherwise  been  discharged,  the  authority
  shall  transfer title to all real and personal property of such board of
  cooperative  educational  services  school  facilities  vested  in   the
  authority  to  the  board to which such board of cooperative educational
  services school facilities are then leased, provided, however,  that  if
  at  such  time  the  board  of  cooperative  educational services school
  facilities are not located in any board or any successor thereto in  the
  state of New York, then such title shall vest in the people of the state
  of New York.
    f.  Any  lease  of  a board of cooperative educational services school
  facility authorized by this section may contain provisions  which  shall
  be  a part of the contract with the holder of the bonds of the authority
  issued  for  such  board  of  cooperative  educational  services  school
  facility, as to
    (1)  pledging all or any part of the moneys, income or revenues of the
  lessee or other personal property of  the  lessee,  to  secure  payments
  required under the terms of such lease;

    (2)  the  setting  aside of reserves and the creation of special funds
  and the regulation and disposition thereof;
    (3)  the  procedure,  if  any, by which the terms of such lease may be
  amended, the amount of bonds the holders of which must consent  thereto,
  and the manner in which such consent may be given;
    (4)  vesting  in  a  trustee  or  trustees  such specified properties,
  rights, powers and duties as shall be deemed necessary or desirable  for
  the  security  of  the  holders of the bonds of the authority issued for
  such board of cooperative educational services school facilities;
    (5) the obligations of the lessee with  respect  to  the  replacement,
  reconstruction,  maintenance,  operations, repairs and insurance of such
  board of cooperative educational services school facilities;
    (6) defining the acts or omissions to act  which  shall  constitute  a
  default  in  the obligations and duties of the lessee, and providing for
  the rights and remedies of the authority and of its bondholders  in  the
  event of such default;
    (7)  any  other  matters, of like or different character, which may be
  deemed necessary or desirable for the  security  or  protection  of  the
  authority or the holders of its bonds.
    3.  Whenever  the  authority  under  the  provisions  of  this section
  undertakes to construct or otherwise  provide  a  board  of  cooperative
  educational services school facility and to lease the same to a board of
  cooperative  educational  services,  such  lease  shall  be  the general
  obligation of the board and any successor thereto. Such lessee shall  be
  responsible  for  the direct costs of operation, maintenance, repair and
  replacement of such board of  cooperative  educational  services  school
  facility,  and  in  addition  shall  be  responsible  for  the  over-all
  supervision of each board of  cooperative  educational  services  school
  facility,  for  the  overhead  and  general  administrative costs of the
  lessee  which  are  incurred  because  of  such  board  of   cooperative
  educational  services  school  facility  and  for the integration of the
  operation of each such board of cooperative educational services  school
  facility into the lessee's educational program.
    4.  All  the  provisions  of this title four not inconsistent with the
  provisions  of  this  section  sixteen  hundred  eighty-nine  shall   be
  applicable  with  respect to any bonds of the authority issued to obtain
  funds for any purpose authorized  under  this  section  sixteen  hundred
  eighty-nine and with respect to the powers of the authority hereunder.
    5.  To  obtain  funds  for the purposes of this section, the authority
  shall have power from time to time to issue negotiable bonds or notes of
  the authority. Unless  the  context  shall  clearly  indicate  otherwise
  whenever  the  words  "bond"  or  "bonds" are used in this section, such
  words shall include a note or notes of the authority.
    6. Any pledge of or  other  security  interest  in  moneys,  earnings,
  income,  revenues,  accounts,  contract  rights,  general intangibles or
  other personal property made or created by the authority shall be valid,
  binding and perfected from the time when such pledge or  other  security
  interest  attaches,  without  any physical delivery of the collateral or
  further act. The lien of any such  pledge  or  other  security  interest
  shall  be  valid,  binding  and  perfected as against all parties having
  claims of any kind in tort, contract or otherwise against the  authority
  irrespective  of  whether  or  not  such parties have notice thereof. No
  instrument by which such a pledge or other security interest is  created
  nor  any financing statement need be recorded or filed. This subdivision
  shall apply notwithstanding the provisions  of  the  uniform  commercial
  code.
    7.  Whenever  the  authority  undertakes  under the provisions of this
  section to construct, acquire, reconstruct,  rehabilitate  and  improve,

  and  furnish  and  equip  or  otherwise  provide  a board of cooperative
  educational  services  school  facility,  each  board   of   cooperative
  educational  services in connection with which such board of cooperative
  educational  services  school  facility is built is authorized to assign
  and pledge to the authority a sufficient portion of any and  all  public
  funds  to be apportioned or otherwise to be made payable by the state of
  New York to the board of cooperative educational services to  cover  the
  payments required under the lease between the authority and the board of
  cooperative   educational   services.  All  state  and  local  officials
  concerned are hereby authorized to apportion and pay all such  funds  so
  assigned and pledged to the authority. Such assignment and pledge by any
  board of cooperative educational services shall be irrevocable and shall
  continue  until  the  date on which the liabilities of the authority and
  any such board of cooperative  educational  services  school  facilities
  have been discharged and the bonds of the authority issued therefor have
  been paid or such bonds have otherwise been discharged.
    8.  No board of cooperative educational services school facility shall
  be  constructed  or  otherwise  provided  by  the  authority  under  the
  provisions of this section unless approved by the voters of the board of
  cooperative  educational  services  and  unless  any  and  all necessary
  approvals of the commissioner of education under  section  four  hundred
  eight of the education law have been obtained.
    9.  Any  payment  required  to  be  made  by  a  board  of cooperative
  educational services to the authority shall be deemed an  administrative
  or  capital expense within the meaning of section nineteen hundred fifty
  of the education law.
    10. a. The total amount payable annually to the authority by  a  board
  shall be certified by the authority to the commissioner of education and
  the  authority shall annually prepare and certify to the commissioner of
  education a statement of the total amount necessary to be  paid  by  all
  boards of cooperative educational services for the ensuing school year.
    b.  The  commissioner  of  education  shall include in the certificate
  which he files with the state comptroller showing the  amount  of  state
  funds  apportioned  to  the  board of cooperative educational services a
  statement showing the amount to be owed by the board  to  the  authority
  for the ensuing school year.
    c.  The comptroller shall deduct from any state funds to become due to
  any such board of cooperative educational services an  amount  equal  to
  the  amount  required to be paid by such board to the authority as shown
  by the certificate of the  commissioner  of  education  filed  with  the
  comptroller as required by paragraph b of this subdivision.
    d. The state of New York hereby covenants with the purchasers, holders
  and  owners from time to time of the bonds of the authority that it will
  not repeal, revoke, rescind, modify or  amend  the  provisions  of  this
  subdivision ten so as to limit, impair or impede the rights and remedies
  granted  hereby  or  otherwise  diminish  the  security  pledged to such
  purchasers, holders and owners or significantly impair the  prospect  of
  payment  of  any  such  bond, nor shall any lien or charge on or pledge,
  assignment, diversion, withholding, payment or other use of or deduction
  from any state funds due or to become due or appropriated to  or  to  be
  appropriated  to  or  to  be  apportioned  and  paid  to  any  board  of
  cooperative educational services be created which is prior  in  time  or
  superior  in  right  to  the  deduction  required by paragraph c of this
  subdivision; provided, however, that nothing herein contained  shall  be
  deemed  or  construed  as requiring the state to continue the payment of
  the state aid or assistance to  any  board  of  cooperative  educational
  services  or  as  limiting  or  prohibiting  the state from repealing or
  amending any law theretofore or  hereafter  enacted  providing  for  the

  payment  or  apportionment  of  state  aid  to  a  board  of cooperative
  educational services or the manner, time or amount thereof.
    11. In the event that the amount paid to the authority pursuant to the
  provisions  of  subdivision  ten of this section is insufficient to meet
  any payment required by the board of cooperative educational services to
  the authority any such amount still due and owing shall be paid directly
  to the authority by the board.
    12. (a) After: (i) a proposition has been approved by the voters of  a
  board  of  cooperative  educational  services  for  the  construction or
  providing by  the  authority  of  a  board  of  cooperative  educational
  services  school  facility  or  facilities  and  any  and  all necessary
  approvals of the commissioner of education have been  obtained,  all  as
  provided  by  subdivision eight of this section; (ii) an agreement and a
  lease have been executed  by  and  between  such  board  of  cooperative
  educational  services  and  the  dormitory  authority  relating  to  the
  construction  or  otherwise  providing  of  such  board  of  cooperative
  educational  services school facility or facilities, the leasing thereof
  by the dormitory authority to  such  board  of  cooperative  educational
  services  and  the  financing  thereof by the dormitory authority by the
  issuance of its obligations;  and  (iii)  the  dormitory  authority  has
  adopted   its   resolution  authorizing  obligations  of  the  dormitory
  authority for such purpose, the dormitory  authority  may  determine  to
  provide  that  the  validity of such agreement, lease, resolution of the
  authority authorizing the issuance of obligations  and  the  obligations
  authorized and issued pursuant thereto may be contested only if:
    1.  Such agreement, lease, resolution and the obligations to be issued
  pursuant to such resolution are authorized for a  board  of  cooperative
  educational  services  school facility or facilities for which the board
  of cooperative educational services and the dormitory authority are  not
  authorized  to  execute  an  agreement  and  a  lease  or  for which the
  dormitory authority is not authorized to issue obligations, or
    2. The provisions of law which should be complied with at the date  of
  the  publication  of  the  notice  hereinafter  provided  for,  are  not
  substantially  complied  with,  and  an  action,  suit   or   proceeding
  contesting  such validity is commenced within twenty days after the date
  of such publication, or
    3. Such obligations are authorized in violation of the  provisions  of
  the constitution.
    (b)  If  the  dormitory  authority  shall  determine  to  utilize  the
  provisions of this subdivision, the dormitory authority shall publish or
  shall cause a notice to be published in the manner hereinafter provided,
  which notice shall be in substantially the following form:
    The (here insert the name of  the  board  of  cooperative  educational
  services)  and  the  dormitory  authority  of the state of New York have
  entered into an agreement dated as of the ----- day of -----, 19---, and
  a lease dated as of the ----- day of -----,  19---,  and  the  dormitory
  authority has adopted a resolution on the ----- day of -----, 19---, and
  the  validity  of  such agreement, lease, resolution and the obligations
  issued  pursuant  thereto  may  be  hereafter  contested  only  if  such
  agreement, lease, resolution and the obligations issued pursuant thereto
  were  authorized  for a board of cooperative educational services school
  facility or facilities for which such board of  cooperative  educational
  services and the dormitory authority are not authorized to enter into an
  agreement, lease and for which the dormitory authority is not authorized
  to  issue such obligations or if the provisions of law which should have
  been complied with as of the date of publication of this notice were not
  substantially  complied  with,  and  an  action,  suit   or   proceeding
  contesting  such validity is commenced within twenty days after the date

  of publication of this notice, or such obligations  were  authorized  in
  violation of the provisions of the constitution.
    By  such  agreement  and  lease  such board of cooperative educational
  services and the dormitory authority  have  agreed  that  the  dormitory
  authority  shall  provide  the board of cooperative educational services
  school facility or facilities  described  therein,  that  the  dormitory
  authority  shall lease the same to such board of cooperative educational
  services, which board of  cooperative  educational  services  shall  pay
  annual  rentals  as  agreed  upon  in  such  lease sufficient to pay the
  principal of and interest on the obligations of the authority issued  to
  finance  such  facility  or  facilities,  the  amounts  required by such
  resolution to establish and maintain the reserve funds, if any, required
  by such resolution, any expenditures of  the  authority  for  insurance,
  fees  and expenses of auditing and fees and expenses of the trustee, all
  as required by the resolution, all  other  expenditures  reasonably  and
  necessarily  incurred  by  the  authority  by  reason  of its ownership,
  financing and leasing of the project and the annual  administrative  fee
  payable  to the authority. Such resolution authorizes an issue of $-----
  obligations of the authority, which amount is equal to the sum  of:  (i)
  the  estimated  cost  of  construction  and  equipment  of such board of
  cooperative educational services school  facility  or  facilities  after
  first  deducting  federal  grants-in-aid to be received; (ii) the amount
  required by the authority, if any, to be paid to reserve  funds  created
  by  the resolution of the authority authorizing the bonds; and (iii) the
  amounts required to make payments for legal,  financing,  administrative
  and  other  costs  and expenses of the authority in connection with such
  board of cooperative educational  services  school  facilities  and  the
  financing thereof.
    Executed counterparts of such agreement and lease and a certified copy
  of   the   resolution   of  the  dormitory  authority  authorizing  such
  obligations are on file in the office of the  clerk  of  such  board  of
  cooperative  educational  services  at  (here  insert the address of the
  office of such clerk) and at the office of the dormitory authority (here
  insert the address of such office) and such documents may  be  inspected
  at either of said offices during regular business hours.
                     DORMITORY AUTHORITY OF THE STATE OF
                  NEW YORK and (here insert the name of the
                  board of cooperative educational services)
    (c) The notice described in subparagraph (b) of this subdivision shall
  be  published  once in each of two newspapers, if there shall be two, or
  in one newspaper, if there shall be but one, having general  circulation
  within  the  board  of  cooperative  educational  services,  but  if  no
  newspaper shall then have general circulation therein, such notice shall
  be posted in at least twenty of the most public places in said board  of
  cooperative educational services.
    (d)  After  the  publication  of  such  notice,  the  validity  of the
  obligations authorized thereby may be contested only if:
    1. Such  agreement,  lease,  resolution  of  the  dormitory  authority
  authorizing  the  obligations,  and  the  obligations  of  the dormitory
  authority  were  authorized  for  a  board  of  cooperative  educational
  services   school  facility  or  facilities  for  which  such  board  of
  cooperative educational services and the dormitory  authority  were  not
  authorized  to  execute  an  agreement  and  a  lease  or  for which the
  dormitory authority is not authorized to issue obligations, or
    2. The provisions of law which should be complied with at the date  of
  publication   of   the   notice   hereinabove   provided  for,  are  not
  substantially  complied  with,  and  an  action,  suit   or   proceeding

  contesting  such validity is commenced within twenty days after the date
  of such publication, or
    3.  Such  obligations are authorized in violation of the provisions of
  the constitution.
    (e) If an action, suit or proceeding contesting the validity  of  such
  agreement,   lease,   resolution  authorizing  the  obligations  or  the
  obligations authorized thereby is commenced within twenty days from  the
  date of publication of such notice, the court in which such action, suit
  or   proceeding  is  commenced  shall  determine  whether  or  not  such
  agreement, lease, resolution and obligations were authorized for a board
  of cooperative educational services school facility  or  facilities  for
  which  the  board  of cooperative educational services and the dormitory
  authority were authorized to enter into an agreement and a lease and for
  which  the  authority  was  authorized  to  issue  obligations  or   the
  provisions   of   law   which   should  have  been  complied  with  were
  substantially complied with. The court may determine that the provisions
  of law which should have been complied with were substantially  complied
  with if:
    1.  The  aggregate amount of obligations authorized does not exceed an
  amount equal to the sum of; (i) the estimated cost of  construction  and
  equipment  of  such  a  board of cooperative educational services school
  facility or facilities after first deducting federal grants-in-aid to be
  received; (ii) the amount, if any, required  by  the  authority  by  the
  resolution  to be paid to reserve funds created by the resolution of the
  authority authorizing the obligations; and (iii) the  amounts  estimated
  by  the  authority to be required to make payments for legal, financing,
  administrative  and  other  costs  and  expenses  of  the  authority  in
  connection  with  the  providing  of  the  facilities  and the financing
  thereof.
    2.  Such  agreement  and  lease  were  executed  after  a  proposition
  authorizing the same had been submitted to and approved by a majority of
  the  duly  qualified  voters  of  such  board of cooperative educational
  services.
    (f) Such determination of the court as described in  subparagraph  (e)
  hereof  may be arrived at notwithstanding any irregularity or failure to
  observe a technicality in:
    1. The form of such proposition approved by the duly qualified  voters
  of such board of cooperative educational services.
    2. The notice of the meeting at which such proposition was submitted.
    3. The time or manner of the publication of such notice.
    4. The conduct of the meeting at which such proposition was adopted.
    5. Like matters in such proceedings.
    (g)  If  the dormitory authority shall have utilized the provisions of
  this subdivision, the obligations of the authority  issued  pursuant  to
  the   resolution   authorizing   the   same   shall  contain  a  recital
  substantially to the effect that the procedure  for  the  validation  of
  such  bonds  set  forth in this section have been complied with and such
  recital shall bind the board of cooperative educational services and the
  dormitory authority, and twenty days after such notice shall  have  been
  published  and  after such obligations have been purchased in good faith
  and for fair value by any person, the validity of such agreement, lease,
  resolution and of the obligations issued  pursuant  to  such  resolution
  shall  not  be  questioned  by  such  board  of  cooperative educational
  services or by any taxpayer thereof in any court.
    (h)  If  the  dormitory  authority  and  such  board  of   cooperative
  educational  services  shall deem it necessary to increase the amount of
  obligations of the  authority  to  be  issued  in  connection  with  the
  construction or providing of a board of cooperative educational services

  school  facility or facilities and shall have authorized the issuance of
  such additional obligations by the execution of a supplemental agreement
  and a supplemental lease between the dormitory authority and such  board
  of  cooperative  educational  services  and  the authority has adopted a
  supplemental resolution authorizing  such  additional  obligations,  the
  provisions  of  this  subdivision  also  shall  be  applicable  to  such
  supplemental agreement, supplemental lease, supplemental resolution  and
  additional obligations authorized and issued pursuant thereto.
    13.  No  authorization  given  by the voters of a board of cooperative
  educational services prior to April first, nineteen hundred  seventy-six
  of  a lease or other agreement with the authority in connection with the
  provision of a board of cooperative educational services school facility
  shall be held invalid by  reason  of  any  irregularity  or  failure  to
  observe a technicality in:
    a.  The form of such proposition approved by the duly qualified voters
  of such board of cooperative educational services,
    b. The notice of the meeting at which such proposition was submitted,
    c. The time or manner of the publication of such notice,
    d. The conduct of the meeting at which such proposition was adopted,
    e. Like matters in such  proceedings,  in  any  action  or  proceeding
  commenced  more than two years after the date of approval by such voters
  of the proposition  authorizing  such  lease  or  other  agreement.  The
  foregoing  limitation shall not be construed as extending any limitation
  period  otherwise  provided  by  law  or  authorizing  any   action   or
  proceeding.