Relates to the powers and duties of the dormitory authority for the financing and construction of certain not-for-profit corporations and entities

Summary of provisions

Sections 1 and 3 of the bill would amend Public Authorities Law ("PAL") § 1676 to define "dormitory" and "educational institution", respectively, to include several new categories of not- for-profit and public corporations for which the Dormitory Authority would be authorized to provide its financing and construction services. Specifically, the types of not-for-profit corporations that would be added areas follows:

1. Any entity that is: (i) qualified as an organization described in IRC § 501-(c)(3) as exempt from income tax; and (ii) authorized to conduct activities in this State for any of the purposes for which a not-for- profit corporation is authorized to be established pursuant to the not- for-profit corporation law. Any project undertaken by DASNY for an eligible entity pursuant to this paragraph is required to be located in the State of New York.

2. Any not-for-profit corporation, public corporation or education corporation having a charter from the board of regents of the University of the State of New York as a library, museum or other non-instructional entity.

3. Any corporation or other entity created under the laws of this State eligible for tax exempt financing under the United States internal revenue code and organized for the primary purpose of providing facili- ties, equipment, or other support to a not-for-profit corporation subject to the jurisdiction of, regulated by, or having an agreement with, an office of the department of mental hygiene relating to such facilities.

The proposed changes in these sections to PAL § 1680 also require that the consent of certain State agencies be obtained before DASNY may participate in a project. Such consents would be required for any project proposed to be undertaken for certain entities that would be required to obtain the approval of a State agency as a condition to their incorporation under Not-For-Profit Corporation Law § 404.

Section 2 of the bill amends PAL § 1676(2) to add a new paragraph (h) to expand the definition of "dormitory" to include intellectual or other intangible property, all or substantially all of which is eligible for tax-exempt financing under the IRC. This new provision will enable DASNY to issue bonds to assist its clients in financing the cost of acquiring intangible assets, such as copyrights.

Section 4 of the bill provides that it will take effect on the ninetieth day after it becomes law.

Existing law

DASNY is currently able to provide construction and financing services to the following: (1) any institution of higher education located in this state and authorized by law or the board of regents to confer degrees; (2) certain public libraries; (3) hospitals and nursing homes; (4) facilities for the aged; and (5) various other corporations specifically defined in the DASNY Act as an "educational institution."

Prior legislative history

None.

Statement in support

This bill would enable DASNY to improve the services it provides to eligible not-for-profit entities by eliminating the requirement that certain categories of not-for-profit and public corporations obtain the enactment of special legislation before being able to utilize DASNY's construction and financing services. Enactment of this bill would enhance the ability of DASNY to perform its mission as the state's primary health and education finance agency and would assist eligible not-for-profit entities in performing their very impor- tant functions.

Budget implications

None to the State. This bill would result in increased revenues for the State through the collection of the Bond Issuance Charges.

Effective date

This bill would take effect on the ninetieth day after it becomes law.