BILL NUMBER: S7497 Revised 4/30/25
SPONSOR: BORRELLO
 
TITLE OF BILL:
An act to amend the public authorities law, in relation to establishing
the city of Dunkirk interim finance authority
 
PURPOSE OR GENERAL IDEA OF BILL:
This bill would establish the city of Dunkirk Interim Finance Authority.
 
SUMMARY OF PROVISIONS:
Section 1: The bill would add a new Article 1-A of the public authori-
ties' law to create the City of Dunkirk Interim Finance Authority.
§ 3750: Short Title. This title shall be known and may be cited as the
"City of Dunkirk Finance Authority Act."
§ 3751: Definitions.
§ 3752: The authority shall be a corporate governmental agency and
instrumentality of the state, organized as a public benefit corporation.
It may issue bonds solely for the purpose of financing costs-including
the refunding of previously issued bonds-and for funding reserves to
secure such bonds. The authority shall remain in existence until all of
its oversight, control, responsibilities, and liabilities have been
fulfilled or otherwise discharged. Upon its dissolution, all rights,
assets, and property of the authority shall transfer to and vest in the
City.
§ 3753: The authority will be administered by nine directors appointed
by the Governor, with one director each appointed upon the written
recommendation of the Temporary President of the Senate, the Senate
Minority Leader, the Speaker of the Assembly, the Assembly Minority
Leader, and the State Comptroller. The remaining four directors are
appointed directly by the Governor. Of these nine directors, seven must
be residents of Chautauqua County. Directors are appointed for four-year
terms, though initial appointments will have staggered end dates in
2029, 2030, and 2031. Directors remain in office until their successors
are appointed and qualified. The Governor and legislative leaders will
designate a chairperson and vice-chairperson from among the directors.
While directors serve without a salary, they are reimbursed for neces-
sary expenses incurred during their official duties. Serving on the
authority does not conflict with holding other public offices or employ-
ment. A quorum requires five directors, and no action can be taken with-
out at least five affirmative votes. The authority must appoint a treas-
urer and may hire additional officers and agents as needed. Beginning
within one year of issuing bonds, the authority must report annually
to the mayor, the city legislature, the fiscal affairs officers, the
director of the budget, the speaker of the assembly, the temporary pres-
ident of the senate, the minority leader of the senate, the minority
leader of the assembly, and the state comptroller on the costs it has
financed and the amount of financing for each cost over the past year.
§ 3754: Except as otherwise limited by this title, the authority shall
have the following powers in addition to those specifically conferred
elsewhere in this title, subject only to agreements with bondholders.
1. To sue and be sued;
2. To have a seal and alter the same at pleasure;
3. To create and revise by-laws for its organization and operations,
and-subject to any agreements with bondholders-to establish and modify
rules and regulations for carrying out its powers and purposes under
this title;
4. To enter into contracts and execute any other instruments or agree-
ments needed or useful to carry out the powers and duties given under
this title;
5. To initiate legal action to protect or enforce any rights granted to
it by law, contract, or other agreement;
6. To borrow money and issue bonds, including the refunding of such
bonds, and to establish and protect the rights of bondholders;
7. To pledge all or part of its revenues or assets as security for the
payment of principal and interest on any bonds it issues under this
title, for any related agreements, and for its obligations under bond
facilities;
8. To obtain insurance, letters of credit, or other forms of credit
enhancement for its bonds, as well as facilities to cover bond tenders
or the payment of short-term notes at maturity if they are not renewed;
9. To enter into interest rate exchange agreements or similar financial
arrangements with any party, under such terms and conditions as the
authority may determine, provided they are consistent with the general
laws of the state and the provisions of this title. These agreements may
include, without limitation, terms related to default, early termi-
nation, and indemnification by the authority or any other party for any
resulting loss of benefits. However, the total value of such arrange-
ments shall not exceed fifty percent of the amount authorized in subdi-
vision one of section 3756 of this title to finance the costs described
in paragraph (a) of subdivision twelve of section 3751 of this title;
10. To obtain insurance, letters of credit, or other forms of credit
enhancement with respect to arrangements described in subdivision nine
of this section;
11. To accept gifts, grants, loans, or contributions of funds or other
forms of financial or in-kind assistance from the city, county, state,
federal government, or any of their agencies or instrumentalities, as
well as from any other source, and to use such proceeds for any of its
corporate purposes in accordance with the provisions of this title;
12. Subject to the terms of any contract with bondholders, the authority
may invest funds held in reserve or sinking funds, or any funds not
needed for immediate use or disbursement, at its discretion, in the
following:
(a) Obligations of the State of New York or the United States govern-
ment;
(b) Obligations whose principal and interest are guaranteed by the State
or the United States government;
(c) Certificates of deposit (negotiable or non-negotiable) and bankers'
acceptances issued by any of the fifty largest banks in the United
States, provided that at the time of investment, the bank has outstand-
ing unsecured, uninsured, and unguaranteed debt rated in one of the two
highest categories by two nationally recognized independent rating agen-
cies;
(d) Commercial paper issued by any bank or corporation organized under
U.S. or state laws, provided that at the time of investment, it has
received the highest rating from two nationally recognized independent
rating agencies;
(e) Bonds, debentures, or other debt instruments issued or guaranteed by
U.S. government-sponsored entities such as the Federal National Mortgage
Association, Federal Home Loan Mortgage Corporation, Student Loan
Marketing Association, or Federal Farm Credit System, provided that the
issuer or its obligations are rated in one of the three highest catego-
ries by two nationally recognized independent rating agencies at the
time of investment;
(f) Bonds or other obligations of any state, the United States, or any
political subdivision or agency thereof, provided that such obligations
have, at the time of investment, received one of the three highest
ratings from two nationally recognized independent rating agencies;
(g) Repurchase agreements with banks, trust companies, national banking
associations, or government bond dealers recognized as primary dealers
by the Federal Reserve Bank of New York, provided the agreement is
secured by securities described in (a), (b), or (e) above, and those
securities have a market value at all times of at least the full amount
of the agreement and are delivered to a custodian that is a New York
State-chartered or national bank domiciled in New York;
(h) Reverse repurchase agreements with the same institutions described
in (g), secured by securities listed in (a), (b), or (e), which must
also have a market value equal to or greater than the full amount of the
agreement and be delivered to a qualified custodian as described above;
13. To appoint the officers and employees necessary to carry out its
duties, and to establish their qualifications, responsibilities, and
compensation. The authority may also retain or hire legal counsel, audi-
tors, financial consultants, and other professional, technical, or busi-
ness service providers, whether by contract or otherwise. In doing so,
the authority shall take into account the financial impact on the city;
and
14. To take any actions necessary or helpful to carry out its purposes
and use the powers granted under this title. However, the authority is
not allowed to acquire, own, lease, manage, or control any real estate,
buildings, or interests in property-except for leasing or subleasing
office space that it considers necessary or desirable for its oper-
ations.
§ 3755: Declaration of need.
1. The city shall decide and formally state whether it is requesting the
authority to finance certain costs.
2. The mayor shall request that the authority provide financing in
accordance with the provisions of this title.
3. Upon approval by the authority, at its discretion and in accordance
with the provisions of this title, of a financing request, the authority
may enter into agreements with the city. The city, acting through the
mayor and with the approval of the legislature, may also enter into
agreements with the authority pursuant to this title. These agreements
may relate to the financing of costs by the authority, the allocation of
tax revenues to the authority to secure its bonds, and additional assur-
ances regarding the authority's receipt of such revenues and the city's
fiscal management. This may include, but is not limited to, the prepara-
tion of budget reports and financial plans as outlined in Sections 3766
and 3767 of this title, where applicable. Revenues received by the
authority shall not be considered city funds. Any such agreements may be
pledged by the authority as security for its bonds and may not be
amended except as permitted by the terms of the pledge.
4. Such agreements shall:
(a) specify the particular eligible costs to be financed in whole or in
part by the authority;
(b) outline the financing plan for those costs;
(c) detail the method, responsible parties, and terms and conditions
under which funds provided by the authority will be disbursed to the
city;
(d) where applicable, provide for the city's payment of such costs
through contracts awarded by the city, or for the city to make a capital
contribution of those proceeds as city funds to another entity for the
payment or reimbursement of such costs; and
(e) require that every contract entered into by the city, or by another
entity receiving funds from the city for costs financed in whole or in
part by the authority, comply with the city charter and all other appli-
cable laws governing such contracts. Nothing in this title shall exempt
or alter the city's or any city-affiliated entity's obligation to comply
with existing laws regarding:
(i) contracts for procurement, design, construction, services, and
materials;(ii) Section 220 of the Labor Law; or (iii) Article 5-A of the
General Municipal Law.
5. Beginning no later than one year after the initial issuance of
authority bonds, and at least once annually thereafter, the mayor shall
submit a report to the authority, the fiscal affairs officer, the city
legislature, the state comptroller, the chairs of the Senate Finance
Committee and the Assembly Ways and Means Committee, and the director of
the budget. This report shall detail the costs financed by the authority
and the total amount of such financing over the preceding year. It shall
also reference specific items in the city's budget or financial plan to
demonstrate compliance with those financial documents.
§ 3756: Bonds of the authority.
1. (a) The authority shall have the power and is hereby authorized, from
time to time, to issue bonds in such principal amounts as it deems
necessary under Section 3755 of this title, to cover any financeable
costs and to fund reserves securing such bonds, including related inci-
dental expenses. However, the total principal amount of bonds issued to
cover the financeable city costs described in paragraph (c) of subdivi-
sion twelve of Section 3751 of this title-specifically those resulting
from certiorari proceedings initiated on or after June 1, 2025-shall not
exceed $800 million in total. This limit excludes bonds, notes, or other
obligations issued to refund or repay previously issued obligations for
the same purposes. Beginning in the year 2031, upon request by the city,
the authority shall issue bonds in the requested amount, not exceeding
$15 million, to pay tax certiorari settlements or judgments of any kind
involving the city. Similarly, beginning in the year 2032, upon request
by the city, the authority shall issue bonds in the requested amount,
not exceeding $10 million, for the same purpose. When this title estab-
lishes a limit on the principal amount of bonds the authority may issue,
the following shall not be counted toward that limit:(i) amounts the
authority deems reasonable for bond issuance costs, (ii) portions of
bonds considered interest under the Internal Revenue Code of 1986, as
amended, and (iii) amounts the authority determines necessary to estab-
lish reserves. (b) The authority shall have the power, from time to
time, to refund any of its bonds by issuing new bonds, regardless of
whether the bonds to be refunded have matured. The authority may also
issue bonds partly to refund outstanding bonds and partly to cover
financeable costs as specified under Section 3755 of this title.(b)Bonds
issued by the authority shall be payable solely from designated revenues
or other funds of the authority, as specified in the authority's
proceedings authorizing the bonds, subject to any agreements made
between the authority and the city, as well as any agreements with hold-
ers of outstanding bonds that pledge particular revenues or funds.
However, under no circumstances shall transitional
state aid be pledged as security for or used to pay the bonds.
2. The authority is authorized to issue its bonds for a period that ends
no later than December 31, 2046. The authority may issue bonds to refund
previously issued bonds without being subject to the limitation stated
in the first sentence of this subdivision. However, in no case shall any
bonds of the authority mature later than January 31, 2076. Notwithstand-
ing any other provision of law, no bond issued by the authority shall
have a maturity date more than 30 years from the date of issuance.
3. The authority may issue, amortize, redeem, and refund its bonds with-
out being subject to the provisions of the Local Finance Law. However,
for the purpose of determining the amount of debt the city is permitted
to incur under the Local Finance Law and the State Constitution, the
principal amount of outstanding bonds issued by the authority shall be
considered indebtedness of the city. The authority shall not exceed this
debt limitation.
4. The directors may delegate to the chairperson or other director or
officer of the authority the power to set the final terms of bonds.
5. The authority shall have sole discretion to determine whether the
issuance of its bonds is appropriate. Bonds shall be authorized by a
resolution of the authority. They may bear interest at fixed or variable
rates and shall be issued in such denominations and forms-whether coupon
or registered-as the authority specifies. Bonds may be sold through
public or private sale, executed in a manner determined by the authori-
ty, denominated in U.S. currency, and made payable in such form, at such
place, and under such terms of redemption as set forth in the authoriz-
ing resolution. No bonds of the authority may be sold through a private
sale unless the sale and its terms are approved in writing by:(a) the
State Comptroller, if the sale is not to the State Comptroller; or (b)
the Director of the Budget, if the sale is to the State Comptroller.
6. As a condition precedent to authorizing the issuance of any bonds
under this title, the authority may include in any agreement with the
city such provisions as it deems necessary and appropriate. These may
include explicit requirements for compliance with Sections 3766 and 3767
of this title, as applicable.
7. Any resolution or resolutions authorizing bonds, or a particular
issuance of bonds, may include provisions that form part of the contract
with the bondholders, including but not limited to:(a) the pledge of all
or a portion of the authority's revenues-along with any other funds,
securities, or contracts-to secure payment of the bonds, subject to any
existing agreements with bondholders;
(b) the establishment of reserves and sinking funds, and the regulation
and management of those funds. (c) restrictions on how the proceeds from
the sale of bonds may be used;
(d) limitations on the issuance of additional bonds, the conditions
under which such bonds may be issued and secured, and provisions for the
refunding of existing bonds;
(e) procedures, if any, for amending or terminating any contract with
bondholders, including the percentage of bondholders required to consent
and the method by which such consent must be given;
(f) the granting to one or more trustees such properties, rights,
powers, and duties in trust as the authority may determine. This may
include any or all of the rights, powers, and duties of a trustee
appointed by bondholders under Section 3764 of this title and may also
limit or eliminate the bondholders' rights to appoint a trustee under
that section, or restrict the rights, duties, and powers of any such
trustee. (g) defining the acts or failures to act that may constitute a
default by the authority in its obligations and duties to bondholders
and outlining the rights and remedies available to bondholders in the
event of such a default-including, as a matter of right, the appointment
of a receiver. However, any such defined defaults and related rights or
remedies must not conflict with the general laws of the state or other
provisions of this title.
8. In addition to the powers granted elsewhere in this title for secur-
ing its bonds, the authority is also empowered, in connection with the
issuance of bonds, to enter into agreements for the benefit of bondhold-
ers as it deems necessary, convenient, or desirable. These agreements
may relate to th