Legalizes, validates, ratifies and confirms certain actions taken by the town of Schodack, in the county of Rensselaer, with respect to certain bond anticipation notes

Title of bill

An act to legalize, validate, ratify and confirm certain actions taken by the town of Schodack, in the county of Rensselaer, with respect to certain bond anticipation notes

Purpose

The legislation is to provide legislative relief by validating and ratifying the town's actions with respect to the Subject BAN notwithstanding the Town of Schodack not making an additional principal payment in 2006 or 2007.

Summary of provisions

Section one- On September 16, 2005, the Town of Schodack (the "Town") adopted two bond resolutions (respectively, the "$160,000 Resolution" and the "$268,000 Resolution," and, collectively, the "Resolutions") in anticipation of financing the costs of two related purposes that would both eventually be within the scope of a project (a "Project") for which proceeds from the New York State Environmental Facilities Corporation ("EFC") would be used. On October 14, 2005, pursuant to the Resolutions, the Town issued a bond anticipation note in the amount of $428,000 (the "Subject BAN"), the proceeds of which were used for costs associated with the Project.

On October 13, 2006, the Town renewed the Subject BAN in the reduced amount of $419,960, reflecting a payment of principal of $8,040 from sources other than proceeds of the Subject BAN renewal. All of the $8,040 was allocated to the part of the BAN authorized by the $268,000 Resolution, leaving a balance under that part of the BAN of$259,960.

In September 2006, the Town had issued a note to EFC (the "EFC Note") in the amount of $1,098,647 in anticipation of obtaining permanent financing from EFC (the "Permanent EFC Financing"). In September 2007, proceeds from the EFC Note in the amount of $419,960 were used to refund the Subject BAN. Neither at that time nor at any time during 2006 or 2007 (other than as described above) was an additional payment of principal made either towards the Subject BAN, as renewed, or towards the EFC Note. In September 2008, the Town paid, from funds not borrowed, $38,000 toward the outstanding principal of the EFC Note, then $1,098,647.

The Town violated the provisions of subdivisions b-1 and d of Section 21.00 of the Local Finance Law and subdivision b of the Section 23.00 of the Local Finance Law by not making an additional principal payment towards the Subject BAN in 2006 or 2007.

Section two-The 2006 BAN and the EFC Note are validated and ratified.

Section three- states bonds, bond anticipation notes issued under authority of the bond resolutions shall be issued in accordance with the provisions of the local finance law.

Section four- contains the separability clause.

Section five- effective date.

Justification

The Town violated the provisions of subdivisions b-l and d of Section 21.00 of the Local Finance Law and subdivision b of the Section 23.00 of the Local Finance Law by not making an additional principal payment towards the Subject BAN in 2006 or 2007. The purpose of the Legislation is to provide legislative relief by validating and ratifying the Town's actions with respect to the Subject BAN

notwithstanding the Town's not making such an additional principal payment in 2006 or 2007.

Legislative history

New Bill.

Fiscal implications

None to the state.

Effective date

This act shall take effect immediately.