Section 26. Conditions and security for loans

1. No loan shall be made by
  the state, the New York state housing finance agency, a municipality  or
  the   New   York   city   housing  development  corporation  unless  the
  commissioner, with respect to a project aided by a  state  loan  or  New
  York  state housing finance agency loan, or the supervisory agency, with
  respect to a municipally-aided project, finds that:
    (a)  The  municipality  has  approved  the  project  as  provided   in
  subdivision  five  of  this  section  and  has  enacted  or  will  enact
  regulations  or  appropriate  restrictions  adequately  protecting   the
  project  against  future  uses  likely to depreciate unduly the value of
  such project;
    (b) The estimated revenues of the project will be sufficient to  cover
  all  probable  costs  of operation and maintenance, of fixed charges and
  operating reserves and depreciation reserves if any;
    (c) The plans and specifications conform to the  requirements  of  all
  laws  applicable thereto, and assure adequate light, air, sanitation and
  fire protection;
    (d) If the project is aided by a state  loan,  or  a  New  York  state
  housing  finance  agency loan, the commissioner shall also find that the
  project is in conformity with a plan or undertaking  for  providing  low
  rent housing facilities for persons of low income and for the clearance,
  replanning,  reconstruction  or  rehabilitation  of  a  substandard  and
  insanitary area  or  areas,  and  for  other  facilities  incidental  or
  appurtenant thereto as may be approved by the commissioner.
    1-a.  No  company  may be aided pursuant to this article by a mortgage
  loan or tax exemption or both to finance the acquisition of  a  building
  by  residents thereof unless the commissioner or the supervising agency,
  as the case may be, finds that:
    (a) the condition of such building is deteriorating and  the  building
  is  located  in  a  deteriorating  area  or  in  an area threatened with
  deterioration  by  reason  of  economic,  social  or  physical   changes
  occurring therein or in nearby areas;
    (b) the building is not yielding sufficient revenues to cover costs of
  operation and maintenance, of fixed charges and of reserves, if any, and
  also a reasonable profit to the owner;
    (c)  the  making  of  such loan will prevent further deterioration and
  abandonment;
    (d) at least two-thirds of  the  present  residents  consent  to  such
  acquisition;
    (e) financing for such acquisition is otherwise unavailable because of
  the  neighborhood, the age of the buildings, or other factors indicating
  an inability of the private sector unaided to cause such acquisition  to
  be effected;
    (f)  the  proceeds of such loan will not be used to refinance existing
  debt in excess of a reasonable relationship to current value; and
    (g) the term for repayment of such loan does not exceed the  remaining
  useful life of the building.
    2.  The  principal  of a loan made by the state shall be repaid by the
  company over a period of not to exceed fifty years except in the case of
  a loan to rehabilitate an existing building, in which  case  the  period
  shall  not  exceed  thirty-five  years,  or  the  estimated  life of the
  project, whichever is shorter,  in  annual  installments  equal  to  the
  amount  payable  by  the  state  on the moneys borrowed for the project.
  Such annual installment of principal need not be uniform in amount,  but
  may  be so varied that the total payment of principal and interest shall
  be approximately equal and constant during the period of the loan.  Each
  payment of principal and interest shall be made to the state comptroller
  not  later  than five days before each payment by the state is required.

  The loan shall bear the same rate of interest paid or to be paid by  the
  state  for  the definitive housing bonds issued on account of such loan.
  The company shall pay to the state comptroller a proportionate share  of
  the  cost  of  borrowing  not  later  than  thirty  days after the state
  comptroller has certified the amount of such share.
    3. Any bonds or notes issued by the company and any mortgages relating
  thereto may authorize  the  company,  with  the  consent  of  the  state
  comptroller  in  the  case  of a state-aided project, or the supervising
  agency in the  case  of  a  municipally-aided  project,  to  prepay  the
  principal  of  the  loan.  Such bonds or notes and mortgages may contain
  such other clauses and provisions as the commissioner in the case  of  a
  state-aided  project  or  the  supervising  agency  in  the  case  of  a
  municipally-aided project, shall require. Notwithstanding the provisions
  of any general, special or local law, the principal of  any  loans  made
  pursuant  to  subdivision  one of section fifteen of this article or the
  principal of a loan made by a municipality pursuant to this article  and
  secured  by  a mortgage lien subordinate to the lien of a first mortgage
  made pursuant to paragraph (b) of subdivision one of section fifteen  of
  this  article  may be amortized at such time or times or at such rate as
  the supervising agency shall approve.
    4. With respect to a state-aided project the commissioner  may  charge
  the  company  reasonable fees for financing, regulation, supervision and
  audit. Fees collected for such services shall be paid into and disbursed
  from such fund or funds as may be provided by law.
    5. (a) In a municipality where there is  a  planning  commission,  the
  project  shall  first  be submitted to it for approval. Where changes in
  the city map and zoning amendments or variances are necessitated by such
  project, such amendments,  variances  and  changes  shall  be  submitted
  together  with  such  project  and  considered  as  a part thereof. Such
  planning commission, not later than ten  weeks  from  the  date  of  the
  referral  of  the  project  to  it,  after  a public hearing held on due
  notice, notice of which shall be  published  at  least  ten  days  prior
  thereto  in  the  official  publication  of the municipality, or if none
  exists, in a newspaper circulating in the municipality, shall submit its
  report  to  the  local  legislative  body  certifying  its   unqualified
  approval,    its   disapproval,   or   its   qualified   approval   with
  recommendations for modifications therein.
    After public hearing held on  due  notice  and  after  the  report  is
  received or due from the planning commission, the local legislative body
  may:
    (i)  if  the  planning commission shall have certified its unqualified
  approval, approve the project by a majority vote;
    (ii) if the planning commission shall have certified  its  disapproval
  or  shall  have failed to make its report within ten weeks from the date
  such project was submitted to it, nevertheless approve the project,  but
  only by a three-fourths vote;
    (iii)  if  the  planning commission shall have certified its qualified
  approval together with recommendations for  modifications,  approve  the
  project  together  with  the  modifications  recommended by the planning
  commission by a majority vote,  or  approve  the  project  without  such
  modifications but only by a three-fourths vote.
    (b)  In  a  municipality  where  there  is  no planning commission the
  project shall be submitted to the local legislative  body  which,  after
  public  hearing held on due notice, may either approve or disapprove the
  project.
    (c) Notwithstanding any other provision of law, changes  in  the  city
  map,  zoning  amendments,  or  variances  contained in the plan shall be
  deemed approved by the local  legislative  body  when  it  approves  the

  project.  Any  such  changes  in  the  city  map,  zoning amendments, or
  variances shall become effective on the date on  which  the  supervising
  agency  shall  file  a  resolution  with  the  local legislative body in
  implementation thereof.
    6.  The  provisions of subdivisions one and five of this section shall
  not apply to a state urban development corporation  project  or  to  any
  loan  made  by  the  state  or  the state housing finance agency to such
  project, notwithstanding anything to the contrary contained herein.
    7. Notwithstanding anything to the  contrary  contained  therein,  the
  provisions  of subdivisions one and five of this section shall not apply
  to a Battery Park city project or to any loan made by the state  or  the
  New York state housing finance agency to such project.