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A10673 Summary:

BILL NOA10673
 
SAME ASSAME AS S08648
 
SPONSORPaulin
 
COSPNSR
 
MLTSPNSR
 
Amd 7, Chap 392 of 1973
 
Increases to the ability of the New York state medical care facilities finance agency to issue certain bonds and notes.
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A10673 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A10673
 
SPONSOR: Paulin
  TITLE OF BILL: An act to amend the New York state medical care facilities finance agen- cy act, in relation to the ability to issue certain bonds and notes 1.   PURPOSE OF THE BILL: This bill would increase the authorization of the Dormitory Authority of the State of New York ("DASNY"), as successor to the New York State Medical Care Facilities Finance Agency ("MCFFA") pursuant to the Health Care Financing Consolidation Act of 1995, to issue hospital and nursing home project bonds and notes from $15.8 billion to $16.6 billion. 2.   SUMMARY OF PROVISIONS: Section one of this bill would amend the MCFFA Act to increase DASNY's authorization to issue hospital and nursing home project bonds and notes from $15.8 billion to $16.6 billion. Section two of the bill would make it effective immediately. 3.   JUSTIFICATION: DASNY issues bonds for purposes including funding mortgage loans or project loans to not-for-profit hospital and nursing home corporations. Some of the bonds issued for DASNY's hospital and nursing home clients are issued under the MCFFA Act. Bonds issued pursuant to the MCFFA Act are subject to the current hospital and nursing home project bond authorization cap in the MCFFA Act of $15.8 billion. This authorization was most recently increased by $800,000,000 in 2011. It was also increased by $800,000,000 in 2009. As of December 21, 2017, DASNY has sold and closed bond transactions pursuant to this authorization in the amount of $14,833,767,602. Thus, $966,232,398 of capacity under the existing statutory limitation is available for other transactions. The federal tax reform legislature caused increased activity in the bond market and as a result there are currently several hospital financings in DASNY's "pipeline" totaling approximately $840 million. This bill is necessary to ensure that DASNY has sufficient capacity to support additional healthcare projects as they seek financing. Although DASNY cannot predict the timing of the proposed financings, DASNY is seeking additional bond authorization at this time to ensure that it will be able to meet the needs of additional private not-for- profit health-care clients on a timely basis. 4.   PRIOR LEGISLATIVE HISTORY: The MCFFA bond cap was increased from $15 billion to $15.8 billion in 2011 (Chapter 516 of the laws of 2011). In 2009, the MCFFA bond cap was increased from $14.2 billion to $15 billion (Chapter 238 of the laws of 2009). 5.   FISCAL IMPLICATIONS: The bill has no implications for the state budget. 6.   EFFECTIVE DATE: The bill shall take effect immediately.
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A10673 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          10673
 
                   IN ASSEMBLY
 
                                      May 10, 2018
                                       ___________
 
        Introduced by M. of A. PAULIN -- (at request of the Dormitory Authority)
          --  read  once and referred to the Committee on Corporations, Authori-
          ties and Commissions
 
        AN ACT to amend the New York state medical care facilities finance agen-
          cy act, in relation to the ability to issue certain bonds and notes
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section 1. Paragraph (b) of subdivision 1 of section 7 of section 1 of
     2  chapter 392 of the laws of 1973, constituting the New York state medical
     3  facilities  finance agency act, as amended by chapter 516 of the laws of
     4  2011, is amended to read as follows:
     5    (b) The agency shall not issue hospital and nursing home project bonds
     6  and hospital and nursing home project notes in  an  aggregate  principal
     7  amount  exceeding  [fifteen] sixteen billion [eight] six hundred million
     8  dollars, excluding hospital and nursing home project bonds and  hospital
     9  and nursing home project notes issued to refund outstanding hospital and
    10  nursing home projects bonds and hospital and nursing home project notes;
    11  provided,  however,  that upon any such refunding or repayment the total
    12  aggregate principal amount of outstanding bonds, notes  or  other  obli-
    13  gations  may  be  greater  than  [fifteen]  sixteen  billion [eight] six
    14  hundred million dollars only if the present value of the aggregate  debt
    15  service  of the refunding or repayment bonds, notes or other obligations
    16  to be issued shall not exceed the present value of  the  aggregate  debt
    17  service  of  the  bonds, notes or other obligations so to be refunded or
    18  repaid. For purposes hereof, the present values of  the  aggregate  debt
    19  service  of the refunding or repayment bonds, notes or other obligations
    20  and of the aggregate debt service of the bonds,  notes  or  other  obli-
    21  gations  so  refunded  or  repaid,  shall be calculated by utilizing the
    22  effective interest rate of the refunding or repayment  bonds,  notes  or
    23  other  obligations,  which shall be that rate arrived at by doubling the
    24  semi-annual  interest  rate  (compounded  semi-annually)  necessary   to
    25  discount  the debt service payments on the refunding or repayment bonds,
    26  notes or other obligations from the payment dates thereof to the date of
    27  issue of the refunding or repayment bonds, notes  or  other  obligations
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD14331-01-8

        A. 10673                            2
 
     1  and  to  the  price bid including estimated accrued interest or proceeds
     2  received by the agency including estimated  accrued  interest  from  the
     3  sale  thereof.  The  agency  shall  not  issue hospital and nursing home
     4  project bonds at any time secured by the hospital and nursing home capi-
     5  tal  reserve fund if upon issuance, the amount in the hospital and nurs-
     6  ing home capital reserve fund will be less than the hospital and nursing
     7  home capital reserve fund requirement, unless the agency, at the time of
     8  issuance of such bonds, shall deposit in  such  reserve  fund  from  the
     9  proceeds  of  the  bonds  so to be issued, or otherwise, an amount which
    10  together with the amount then in such reserve fund,  will  be  not  less
    11  than the hospital and nursing home capital reserve fund requirement.
    12    § 2. This act shall take effect immediately.
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