Section 1689-F. Public school districts; dormitory authority financing of payments made or to be made by the state on account of certain approved expenditures for capital outlays

1. (a) "Eligible school district projects" shall mean capital projects
  eligible  for  a  capital  outlay  transition  grant  aid  apportionment
  pursuant to subdivision twelve of section thirty-six  hundred  forty-one
  of  the  education  law for which payments are made, as reimbursement of
  approved expenditures, from a school district's  general  fund,  capital
  fund,  or  reserved  funds for capital outlays as defined in subdivision
  six of section thirty-six hundred two of the  education  law,  that  are
  incurred by the school district on or after July first, two thousand one
  and on or before June thirtieth, two thousand two, and are not otherwise
  reimbursable  in  the  two  thousand two--two thousand three school year
  pursuant to subdivision six of section thirty-six  hundred  two  of  the
  education law.
    (b)  Notwithstanding  the  provisions of any general or special law to
  the contrary, for purposes of this section, the term  "school  district"
  shall  mean  a common school district, a consolidated school district, a
  union free school district, a central school district,  a  central  high
  school district, or a city school district.
    2.  (a) Subject to chapter fifty-nine of the laws of two thousand, but
  notwithstanding any other provisions of any general or  special  law  to
  the  contrary,  and  subject  to  the  making  of  annual appropriations
  therefor by the legislature, the dormitory authority  is  authorized  to
  enter into one or more service contracts, none of which shall exceed ten
  years  in  duration, with the director of the budget, upon such terms as
  the director of the budget and the dormitory authority  agree,  for  the
  purpose of financing eligible school district projects.
    (b)  Any  service  contract  entered into pursuant to paragraph (a) of
  this subdivision or any payments made or to be made  thereunder  may  be
  assigned  and  pledged  by  the  dormitory authority as security for its
  bonds, notes, or other obligations; and may contain such other items and
  conditions as may be agreed upon by the parties thereto, including,  but
  not limited to, the establishment of reserve funds and indemnities.
    (c) Any such service contract shall provide that the obligation of the
  director  of  the  budget  or of the state to fund or to pay the amounts
  therein provided for shall not constitute a debt of the state within the
  meaning of any constitutional or statutory provision and shall be deemed
  executory only to the extent moneys are available and that no  liability
  shall  be  incurred  by  the  state  beyond the moneys available for the
  purpose, and that such obligation is subject to annual appropriation  by
  the legislature;
    (d)  Any  service  contract or contracts entered into pursuant to this
  subdivision shall provide for state commitments to provide  annually  to
  the dormitory authority a sum or sums, upon such terms and conditions as
  shall  be  deemed appropriate by the director of the budget, to fund the
  principal, interest, or related expenses required for any bonds,  notes,
  or  other  obligations, including bonds issued to fund any required debt
  service reserve fund  for  bonds,  of  the  dormitory  authority  issued
  pursuant to paragraph (b) of subdivision four of this section.
    3.  (a)  The  commissioner  of  education  shall certify, by September
  thirtieth, two  thousand  two,  to  the  dormitory  authority,  and  the
  director of the budget, each school district for which he has approved a
  capital  outlay  transition  grant  pursuant  to  subdivision  twelve of
  section thirty-six  hundred  forty-one  of  the  education  law  for  an
  eligible   school   district   project   as  reimbursement  of  approved
  expenditures for capital outlays  in  lieu  of  aid  previously  payable
  pursuant  to  subdivision  six  of section thirty-six hundred two of the

  education law,  (1)  a  description  of  the  eligible  school  district
  projects  for  which  such  aid  is  granted  for  each school district,
  including the cost of each project, and such other information regarding
  the   expenditures  for  capital  outlays  requested  by  the  dormitory
  authority as is necessary for the issuance of  bonds,  notes,  or  other
  obligations, pursuant to this section and (2) the amount of that grant.
    (b)  On  or before October first of each year, the dormitory authority
  shall submit, and thereafter may resubmit, to the director of the budget
  a report setting forth the amounts,  if  any,  of  all  annual  payments
  required  in  the  next  state fiscal year and for the four state fiscal
  years following such fiscal year estimated to  be  appropriated  to  the
  dormitory authority pursuant to such service contract agreements between
  the  dormitory authority and the director of the budget pursuant to this
  section. Such report may be incorporated into other reports required  to
  be  given by the dormitory authority to the director of the budget on or
  before those dates.
    4. (a) 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. All the provisions
  of this title not inconsistent with the provisions of this section shall
  be applicable with respect to any  bonds  of  the  authority  issued  to
  obtain funds for the purposes authorized under this section.
    (b)  The  dormitory authority shall not issue any bonds or notes in an
  amount in excess of one hundred forty million dollars for  the  purposes
  of this section, plus a principal amount of bonds or notes:
    (1) to fund any debt service reserve fund, and
    (2) to provide for the payment of fees and other charges and expenses,
  including  underwriters' discount, related to the issuance of such bonds
  or notes, or related to the provision of any  applicable  bond  or  note
  facilities.
    In  computing for the purposes of this paragraph, the aggregate amount
  of indebtedness evidenced by bonds and notes of the dormitory  authority
  issued  pursuant  to  this  title, there shall be excluded the amount of
  such indebtedness represented by such bonds or notes issued to refund or
  otherwise repay bonds or notes, provided that  the  amount  so  excluded
  under  the clause may exceed the principal amount of such bonds or notes
  that were issued to refund or otherwise repay only if the present  value
  of  the  aggregate  debt  service on the refunding or repayment bonds or
  notes shall not have at the time of their issuance exceeded the  present
  value  of  the  aggregate  debt  service of the bonds or notes they were
  issued to refund or  repay,  such  present  value  in  each  case  being
  calculated  by  using  the  effective  interest rate of the refunding or
  repayment bonds or notes,  which  shall  be  that  rate  arrived  at  by
  doubling   the  semi-annual  interest  rate  (compounded  semi-annually)
  necessary to discount the debt service  payments  on  the  refunding  or
  repayment  bonds  or  notes from the payment date thereof to the date of
  issue of the refunding or repayment bonds or notes from the payment date
  thereof to the date of issue of the  refunding  or  repayment  bonds  or
  notes  and to the price bid therefor, or to the proceeds received by the
  dormitory authority from  the  sale  thereof,  in  each  case  including
  estimated accrued interest.
    5.  The state hereby covenants with the purchasers, holders and owners
  from time to time of the bonds of the authority issued pursuant to  this
  section  that  it  will not repeal, revoke, rescind, modify or amend the
  provisions of this section which relate to the making of annual  service
  contract  payments  to  the  authority  with respect to such bonds as to

  limit, impair or impede the rights and remedies granted  to  bondholders
  under  this  title  or  otherwise  diminish the security pledged to such
  purchasers, holders and owners or significantly impair the  prospect  of
  payment of any such bond.