Current through Register Vol. 46, No. 12, March 20, 2024
(a) Definitions. For the purpose of this
section, the following definitions shall apply:
(1) Obligation shall mean any amortized debt
incurred by the City of New York for the funding of capital expenditures for
school purposes of the city and its departments, agencies or subdivisions,
including but not limited to the city school district of the City of New York
and the School Construction Authority of the City of New York. In the event
that no amortized debt is incurred by the City of New York for the funding of
capital expenditures for school purposes, obligation shall mean any amortized
debt incurred by the New York City transitional finance authority for the
funding of capital expenditures for school purposes of the city and its
departments, agencies or subdivisions, including but not limited to the City
School District of the City of New York and the School Construction Authority
of the City of New York.
(2) Total
principal for school purposes shall mean that portion of the original proceeds
received by the City of New York from the sale of an obligation that is
expended for school purposes.
(3)
Term shall mean the number of years represented by the amortization of an
obligation, expressed to the nearest whole number of years.
(4) Total net proceeds shall mean the sum of
the total principal for school purposes less costs of issuance (including
underwriters discount and bond insurance), less original issue discount, plus
original issue premium attributable to such total principal for school
purposes. Bond insurance, original issue discount and original issue premium
shall be allocated to such principal on the basis of actual cost for that
portion of principal. Costs of issuance, including underwriters discount, but
not bond insurance, shall be allocated pro rata on the basis of the ratio of
proceeds (adjusted for original issue discount and premium only) attributable
to school purposes to total proceeds (adjusted for original issue discount and
premium only) in the bond series.
(5) Average interest rate shall be determined
by doubling the semi-annual interest rate, compounded semi-annually, necessary
to discount the debt service payments (including interest, principal and
mandatory redemptions) from the payment dates to the dated date such that the
sum of such discounted payments equal the total net proceeds.
(i) When a particular maturity of bonds has
more than one interest rate, the principal amount allocated to school purposes
shall be allocated pro rata based on the ratio of principal amount of an
interest rate in a maturity to the total principal amount of the
maturity.
(ii) When there are
proceeds of more than one series of bonds in a calculation period, then the
average interest rate shall be determined by doubling the semi-annual interest,
compounded semi-annually, necessary to discount the debt service payments
(including interest, principal and mandatory redemptions) from the payment
dates to the dated date of the series of bonds with the earliest dated date
such that the sum of such discounted payments equals the sum of the net
proceeds discounted to the dated date of the series of bonds with the earliest
dated date.
(iii) The interest rate
for adjustable rate bonds shall be determined by taking the municipal swap
index selected by the commissioner (or if such index is no longer available,
using comparable data) averaged over the last 10 years, plus the costs of
credit facilities, remarketing fees, broker-dealers fees and auction agent
fees, as applicable, that are in effect at the time of the issuance of the
bonds.
(iv) If there is an interest
rate swap associated with the adjustable rate bonds that creates a synthetic
fixed rate, then the interest rate shall be determined by the sum of the fixed
swap rate plus the cost of credit facilities, remarketing fees, broker-dealers
fees and auction agent fees, as applicable, that are in effect at the time of
the issuance of the bonds.
(b) The analysis of the actual average
interest rate and of the estimated average interest rate which must be
submitted by the Comptroller of the City of New York to the commissioner by
September 1st of the current year pursuant to section
3602(6)(e)(1)(c) and
(2)(a)(ii) of the Education Law shall include
such data as is prescribed by the commissioner, including but not limited to
the following:
(1) A listing of all
obligations incurred by the City of New York for the period from July 1st of
the prior calendar year to June 30th of the current calendar year. Such listing
shall include for each obligation listed and for that portion of each
obligation listed that is for school purposes:
(i) the total principal;
(ii) the term;
(iii) the total net proceeds;
(iv) the average interest rate;
(v) the total interest;
(vi) if the bonds are floating-rate bonds or
attached to swap(s), include the swap rate, the cost of credit facilities,
remarketing fees, broker-dealers fees and auction agent fees, as
applicable;
(vii) costs of
issuance, including breakout of underwriters discount and bond insurance;
and
(viii) original issues premiums
and discounts.
(2) A
statement certifying that the data provided pursuant to paragraph (1) of this
subdivision reasonably reflects anticipated obligations to be incurred by the
City of New York for the period from July 1st of the current calendar year to
June 30th of the next calendar year, or, in the alternative, a listing of all
anticipated obligations to be incurred by the City of New York for such period
that shall include for each obligation listed and for that portion of each
obligation listed that is for school purposes:
(i) the total principal;
(ii) the term;
(iii) the total net proceeds;
(iv) the average interest rate;
(v) the total interest;
(vi) if the bonds are floating-rate bonds or
attached to swap(s), include the swap rate, the cost of credit facilities,
remarketing fees, broker-dealers fees and auction agent fees, as
applicable;
(vii) costs of
issuance, including breakout of underwriters discount and bond insurance;
and
(viii) original issue premiums
and discounts.
(c) Upon review and approval of the listing
provided by the Comptroller of the City of New York pursuant to paragraph
(b)(1) of this section, the commissioner shall determine the actual average
interest rate applied to all obligations incurred by the City of New York
during the base year, as required by section
3602(6)(e)(2) of the
Education Law. The actual average interest shall be determined using the
methodology described in paragraph (a)(5) of this section. Such actual average
interest rate shall be expressed as a decimal rounded to the nearest eighth of
one percent.
(d) Upon review and
approval of the statement of the Comptroller of the City of New York certifying
that the data provided pursuant to paragraph (b)(1) of this section reasonably
reflects anticipated obligations to be incurred by the City of New York for the
period from July 1st of the current calendar year to June 30th of the next
calendar year, the commissioner shall certify that the actual average interest
rate applied to all obligations incurred by the City of New York during the
base year shall be the estimated average interest rate applied to all
obligations to be incurred by the City of New York during the current year, or,
in the alternative, upon review and approval of the listing provided by the
Comptroller of the City of New York pursuant to paragraph (b)(2) of this
section, the commissioner shall determine the estimated average interest rate
applied to all obligations to be incurred by the City of New York during the
current year. The estimated average interest shall be determined using the
methodology described in paragraph (a)(5) of this section. Such estimated
average interest rate shall be expressed as a decimal rounded to the nearest
eighth of one percent.