Increases 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 $20 billion to $21.8 billion.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A11559
SPONSOR: Rules (Pretlow) 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
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 $20 billion to $21.8 billion.
SUMMARY OF PROVISIONS:
Section one of the bill would amend the MCFFA Act to increase DASNY's
authorization to issue hospital and nursing home project bonds and notes
from $20 billion to $21.8 billion.
Section two of the bill would make the bill effective immediately.
JUSTIFICATION:
Under current law, DASNY is authorized to issue hospital and nursing
home project bonds and notes under the MCFFA Act in the aggregate amount
of up to $20 billion. DASNY issues such bonds and notes to fund loans to
not-for-profit hospital and nursing home corporations. This authori-
zation was most recently increased by $1,800,000,000 by Ch 101 L 2025;
and, similarly, the then existing bond cap was increased by $800,000,000
in each of the following: Ch 183 L 2018; Ch 516 L 2011; Ch 238 L 2009;
and Ch 33 L 2008.
Over the past few years, DASNY has seen increased activity in the bond
market in terms of the number and dollar amount of healthcare
financings. After the bond cap was last increased by $1.8 billion in
March 2025, DASNY authorized two health care financings which totaled $1
billion. In early May 2026, another client notified DASNY that it will
be seeking authorization for a financing that could be as much as $800
million. This client is planning to be in the market in September or
October. DASNY is reserving $800 million in cap for this client and will
authorize this financing this summer. As such, as of May 2026, this
leaves DASNY with MCFFA bond capacity of approximately $146 million.
The requested $1.8 billion increase is necessary to ensure that DASNY
has sufficient capacity to support any new healthcare financings that
may arise given recent robust activity and the limited bond cap current-
ly available. Although DASNY cannot predict the timing and dollar amount
of future financings, DASNY is seeking this additional bond cap authori-
zation to ensure it may adequately respond to the needs of its private
not-for-profit health-care clients on a timely basis. It should be noted
that the bonds issued by DASNY pursuant to this authorization are not a
debt
STATE OF NEW YORK
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11559
IN ASSEMBLY
June 1, 2026
___________
Introduced by COMMITTEE ON RULES -- (at request of M. of A. Pretlow) --
(at request of the Dormitory Authority) -- read once and referred to
the Committee on Ways and Means
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 care facilities agency act, as amended by chapter 101 of the laws of
4 2025, 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 [twenty billion] twenty-one billion eight hundred
8 million dollars, excluding hospital and nursing home project bonds and
9 hospital and nursing home project notes issued to refund outstanding
10 hospital and nursing home projects bonds and hospital and nursing home
11 project notes; provided, however, that upon any such refunding or repay-
12 ment the total aggregate principal amount of outstanding bonds, notes or
13 other obligations may be greater than [twenty billion] twenty-one
14 billion eight hundred million dollars only if the present value of the
15 aggregate debt service of the refunding or repayment bonds, notes or
16 other obligations to be issued shall not exceed the present value of the
17 aggregate debt service of the bonds, notes or other obligations so to be
18 refunded or repaid. For purposes hereof, the present values of the
19 aggregate debt service of the refunding or repayment bonds, notes or
20 other obligations and of the aggregate debt service of the bonds, notes
21 or other obligations so refunded or repaid, shall be calculated by
22 utilizing the effective interest rate of the refunding or repayment
23 bonds, notes or other obligations, which shall be that rate arrived at
24 by doubling the semi-annual interest rate (compounded semi-annually)
25 necessary to discount the debt service payments on the refunding or
26 repayment bonds, notes or other obligations from the payment dates ther-
27 eof to the date of issue of the refunding or repayment bonds, notes or
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD16063-01-6
A. 11559 2
1 other obligations and to the price bid including estimated accrued
2 interest or proceeds received by the agency including estimated accrued
3 interest from the sale thereof. The agency shall not issue hospital and
4 nursing home project bonds at any time secured by the hospital and nurs-
5 ing home capital reserve fund if upon issuance, the amount in the hospi-
6 tal and nursing home capital reserve fund will be less than the hospital
7 and nursing home capital reserve fund requirement, unless the agency, at
8 the time of issuance of such bonds, shall deposit in such reserve fund
9 from the proceeds of the bonds so to be issued, or otherwise, an amount
10 which together with the amount then in such reserve fund, will be not
11 less than the hospital and nursing home capital reserve fund require-
12 ment.
13 § 2. This act shall take effect immediately.
