Section 99-O. Arts institutions revolving loan fund

1. There is hereby
  established within the custody of the state comptroller a new fund to be
  known as the "arts institutions revolving loan fund".
    2. The fund shall consist of all moneys appropriated for its  purpose,
  all  moneys  transferred  to  such  fund pursuant to law, and all moneys
  required by this section or any other law to be paid into or credited to
  this fund, including all moneys received by the fund or donated  to  it,
  and payments of principal on loans made from the fund.
    3.  Moneys  of  the  fund,  when  allocated, shall be available to the
  chairperson of the council on the arts to make loans as provided in this
  section. Up to five percent of the moneys of the fund or fifty  thousand
  dollars,  whichever  is less, may be used to pay the expenses, including
  personal service and maintenance and operation, in connection  with  the
  administration of such loans.
    4.  (a)  The chairperson of the council on the arts, on recommendation
  of the members of the council may make, upon application duly  made,  up
  to  the amounts available by appropriation, loans for project support at
  arts institutions.
    (b) No loan authorized by this section shall  have  an  interest  rate
  greater  than  two  and one-half percent. The minimum amount of any loan
  shall be five thousand dollars. The period of any loan shall not  exceed
  the  period  of one year. The chairperson of the council on the arts may
  make loans under this section subject to such other terms and conditions
  the council board deems proper.
    (c) The council board shall have the power  to  make  such  rules  and
  regulations as may be necessary and proper to effectuate the purposes of
  this section.
    (d)  The council board shall annually report by March fifteenth to the
  governor and the legislature describing the activities and operation  of
  the loan program authorized by this section. Such report shall set forth
  the  number of loan applications received and approved; the names of the
  arts institutions receiving loans together with the amount  and  purpose
  of  the  loan, and the outstanding balance; and the balance remaining in
  the arts institutions revolving loan fund.
    5. (a) Application for loans may  be  made  by  an  arts  institution,
  including  but  not  limited to museums, orchestras, dance companies and
  theatre groups.
    (b) Every application shall be in the form acceptable to the  chairman
  of  the  council on the arts. Every application shall accurately reflect
  the  conditions  which  give  rise  to  the  proposed  expenditure   and
  accurately  reflect  the  ability  of  the  applicant  to  make  such an
  expenditure without the proceeds of a loan under this section.
    (c)(i) The council board shall give preference to  those  applications
  which  demonstrate  the  greatest need and benefit to the arts community
  and public at large.
    (ii) In making determinations on loan applications, the council  board
  shall  assure  that loan fund moneys are equitably distributed among all
  sectors of the arts community and all geographical areas of the state.
    (d) An application shall be referred by the chairperson of the council
  on the arts to the council board as defined by article three of the arts
  and cultural affairs law.
    (e) An application shall not be approved:
    (i) if the applicant is in  arrears  on  any  prior  loan  under  this
  section,
    (ii) if it shall be shown that at any time in the prior ten years, the
  applicant  used  state funds to repay all or part of any loan made under
  this section.

    (f) The council board shall,  to  the  maximum  extent  feasible,  and
  consistent  with  the  other provisions of this section, seek to provide
  that loans authorized by this section reflect an appropriate  geographic
  distribution and are distributed equitably.