Section 179-V. Interest payments

1. A not-for-profit organization shall be
  entitled to interest payments pursuant to this  section:  (a)  on  those
  moneys  that  would  be  due  under the terms of the contract or renewal
  contract  from  the  scheduled  commencement  date  or  the   date   the
  organization  begins  to provide services, whichever is later, until the
  date the payment is made under the contract or renewal contract; or  (b)
  if  a  not-for-profit  organization  borrows  funds  to provide services
  pursuant to a written directive by a state agency, provided however that
  a not-for-profit organization may only receive interest payments on such
  funds when such  not-for-profit  organization  has  received  a  written
  directive  but  has  been denied payment pursuant to section one hundred
  seventy-nine-u of this article  or  did  not  obtain  a  loan  from  the
  not-for-profit short-term revolving loan fund.
    2.  Such  organizations shall receive such interest payments at a rate
  equal to the rate set by the commissioner of taxation  and  finance  for
  corporate  taxes  pursuant to paragraph one of subsection (e) of section
  one thousand ninety-six of the tax law. In order for a state  agency  to
  approve  reimbursement  of a not-for-profit organization at a rate other
  than the  interest  rate  stated  in  this  section  the  not-for-profit
  organization  shall  submit  documentation  indicating the rate at which
  such funds were borrowed,  the  lender  of  such  funds  and  any  other
  information  requested  by  the  state  agency,  attorney general or the
  comptroller. The comptroller may disallow such portions of the  interest
  that the comptroller deems unreasonable.
    3.  Any interest payments made pursuant to subdivisions one and two of
  this section shall be made from appropriations for state operations that
  are available for the administrative programs of the state agency  which
  contracted  with  the  not-for-profit  organization.  In  no event shall
  interest  payments  be  made  from  amounts  appropriated  for   program
  purposes.
    4.  The  interest  payment  shall  not reduce the amount of money that
  otherwise will be payable to the not-for-profit organization  under  the
  terms of the relevant contract.
    5.   No   interest  payments  shall  be  made  if  the  not-for-profit
  organization receives an advance payment pursuant to section one hundred
  seventy-nine-u of this article; provided, however, that if the  contract
  is  not  fully executed at the end of the period covered by such advance
  payment, the not-for-profit organization may be  eligible  for  interest
  payments in respect of services performed after such period.
    6.  Should  the  attorney  general  or  the  comptroller  disapprove a
  contract or renewal contract, the provisions of this section  shall  not
  be applicable.
    7.  a.  If  the  timeframes  for processing a contract are met and the
  state agency is liable for interest due to a retroactive contract  start
  date,  the state agency and the not-for-profit organization may mutually
  agree to waive any interest  owed  to  the  not-for-profit  organization
  under  the provisions of this article. Waiver of interest shall not be a
  prerequisite to execution of such contract. If interest  is  so  waived,
  the  state  agency  shall  immediately  provide  the office of the state
  comptroller, division of the budget and the not-for-profit  organization
  with   the   written   waiver   of  interest  agreement  signed  by  the
  not-for-profit organization  and  documentation  (i)  showing  that  the
  applicable timeframes set forth in section one hundred seventy-nine-s or
  one  hundred  seventy-nine-t  of  this  article  have been met, and (ii)
  explaining the reason for a retroactive contract start date.
    b. Not more than twenty days after the receipt of such written  waiver
  of  interest agreement and required documentation, the comptroller shall
  determine whether the waiver of interest is warranted.  The  comptroller

  shall  thereupon  inform  such state agency, the division of the budget,
  and such not-for-profit organization  of  such  determination.  If  such
  determination  concludes  that a waiver of interest is unwarranted, such
  state  agency  shall  then  immediately  submit  for  the  comptroller's
  approval  a  voucher  requesting  the  payment  of  interest   to   such
  not-for-profit organization as required by this section. If such voucher
  is   not   received   within   thirty   days   after  the  comptroller's
  determination,  the  comptroller  shall  assess  the  amount  of  unpaid
  interest in the manner prescribed by this section.