Relates to increasing the bond and note authorization of the state of New York mortgage agency from one billion dollars to one billion five hundred million dollars.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A10223
SPONSOR: Rules (Tapia) TITLE OF BILL:
An act to amend the public authorities law, in relation to increasing
the bond and note authorization of the state of New York mortgage agency
PURPOSE OR GENERAL IDEA OF BILL:
This bill also increases the taxable bonding authority of SONYMA by $500
million.
SUMMARY OF PROVISIONS:
Section 1 of the bill increases the taxable bonding authority by $500
million to a maximum aggregate of $1.5 billion.
Section 2 of the bill provides for an immediate effective date.
JUSTIFICATION:
SONYMA's taxable bonding authority limit was last increased in 2016, and
prior to that in 2007. Currently, only approximately $225 million of the
authority remains unused.
SONYMA is seeking to increase the authority by $500 million in order to
allow it to continue to use taxable bonds to purchase loans that do not
qualify under its tax-exempt program due to limitations that restrict
that program for use primarily to first time homebuyers. SONYMA uses
its taxable bonds to purchase mortgage loans for eligible non first time
him buyers under its low and moderate income programs as well as for
special programs such as its mobile and manufactured home programs and
its neighborhood revitalization programs. In addition, SONYMA is seeking
alternative ways of funding its program by among other things entering
into a line of credit with the Federal Home Loan Bank. The draws on the
line of credit, if done on a taxable basis, would count against the
taxable bond limit.
Getting this limit increased now, for the first time since 2016, would
allow flexibility to SONYMA in conducting its program over the coming
years.
PRIOR LEGISLATIVE HISTORY:
Chapter 163 of the Laws of 2016 increased the taxable bond limit from
$800 million to $1 billion.
FISCAL IMPLICATIONS:
None.
EFFECTIVE DATE:
Immediately.
STATE OF NEW YORK
________________________________________________________________________
10223
IN ASSEMBLY
May 6, 2022
___________
Introduced by COMMITTEE ON RULES -- (at request of M. of A. Tapia) --
read once and referred to the Committee on Housing
AN ACT to amend the public authorities law, in relation to increasing
the bond and note authorization of the state of New York mortgage
agency
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivision 2 of section 2407 of the public authorities
2 law, as amended by chapter 232 of the laws of 2021, is amended to read
3 as follows:
4 (2) In connection with the issuance of bonds for the purpose of
5 furthering programs described in this title, the agency is authorized to
6 covenant and consent that the interest on any of its bonds, notes or
7 other obligations shall be includable, under the United States Internal
8 Revenue Code of 1986, as amended or any subsequent corresponding inter-
9 nal revenue law of the United States, in the gross income of the holders
10 of the bonds to the same extent and in the same manner that the interest
11 on bills, bonds, notes or other obligations of the United States is
12 includable in the gross income of the holders thereof under said Inter-
13 nal Revenue Code or any such subsequent law. Pursuant to this subdivi-
14 sion, the agency shall not issue bonds, notes or other obligations in an
15 aggregate principal amount exceeding one billion five hundred million
16 dollars, excluding from such limitation bonds, notes or other obli-
17 gations issued to refund outstanding bonds, notes or other obligations.
18 No such bond, note or other obligation shall be issued by the agency on
19 or after July twenty-third, two thousand twenty-three, excluding bonds,
20 notes or other obligations issued to refund outstanding bonds, notes or
21 other obligations and no mortgages shall be purchased with the proceeds
22 of such bonds, notes or other obligations after such date. The board of
23 directors of the agency shall establish program guidelines for purposes
24 of bonds, notes or other obligations issued pursuant to this subdivi-
25 sion. The board of directors shall establish from time to time maximum
26 income limits of persons eligible to receive mortgages financed by
27 bonds, notes or other obligations issued pursuant to this subdivision,
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD15706-01-2
A. 10223 2
1 which income limits with respect to one-third of the total principal
2 amount of mortgages authorized to be so financed shall not exceed one
3 hundred twenty-five percent of the latest maximum income limits permit-
4 ted under the Internal Revenue Code of 1986, as amended, for mortgagors
5 financed by mortgage revenue bonds, with respect to one-third of such
6 principal amount authorized to be so financed, shall not exceed one
7 hundred thirty-five percent of such income limits, and with respect to
8 one-third of such principal amount authorized to be so financed, shall
9 not exceed one hundred fifty percent of such limits, provided that
10 notwithstanding the foregoing, the maximum income limits of persons
11 eligible to receive mortgages financed by the agency under its neighbor-
12 hood revitalization program (and any successor program) shall not exceed
13 one hundred fifty percent of the latest maximum income limits permitted
14 under the Internal Revenue Code of 1986, as amended, for mortgagors
15 financed by mortgage revenue bonds.
16 § 2. This act shall take effect immediately.
