N.Y. Energy Law 5-127 – New York state business energy conservation loan program
§ 5-127. New York state business energy conservation loan program. 1. As used in this section, unless a different meaning clearly appears from the context, the term:
Terms Used In N.Y. Energy Law 5-127
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
- Interest rate: The amount paid by a borrower to a lender in exchange for the use of the lender's money for a certain period of time. Interest is paid on loans or on debt instruments, such as notes or bonds, either at regular intervals or as part of a lump sum payment when the issue matures. Source: OCC
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
a. "Agri-business" shall mean (i) an individual, partnership or corporation involved in farm production which (1) has had twenty thousand dollars or more in gross farm production related sales in the twelve-month period prior to the submission of a program application, or from which at least fifty percent of the applicant's income was derived during such period, or (2) if the applicant has not been in operation for the prior twelve-month period, certifies that sales are projected in excess of twenty thousand dollars, or at least fifty percent of the applicant's income is projected to be derived, from farm production during the next twelve-month period; or (ii) a business involved in food processing.
b. "Financing institution" shall mean and include all banks, trust companies, savings banks, savings and loan associations and credit unions, whether incorporated, chartered, organized or licensed under the laws of this state, any other state of the United States or the federal government.
This term may also include public authorities, public benefit corporations, units of local government, domestic insurance companies and not-for-profit corporations, which make loans for improvements for the benefit of eligible applicants.
c. "Eligible applicant" or "applicant" shall mean (i) a small to medium size business or a not-for-profit corporation that is a veteran's organization which employs less than five hundred workers or has gross annual sales of less than ten million dollars, or (ii) an agri-business, and which is the owner or which has a lease or management agreement extending beyond the loan term of a building located within the state for which an eligible energy conservation improvement is made, provided that the commissioner may qualify this definition by rule and regulation.
d. "Eligible energy conservation improvement" or "improvement" shall mean the construction, alteration, repair or improvement to a building or equipment affixed to, contained in or on the grounds of the building which reduces energy consumption provided that: (i) the cost of such improvement will be returned in savings in energy costs within a period of not less than one year nor more than ten years as identified in an energy audit, (ii) work on such improvement commenced after submittal of an application under the program, and (iii) such construction, alteration, repair or improvement is permissible under federal requirements and court decisions applicable to overcharge funds appropriated to this program.
e. "Energy audit" shall mean a process which identifies and specifies the energy and cost savings which are likely to be realized by an eligible energy conservation improvement.
f. "Loan" or "program loan" shall mean a loan from a financing institution pursuant to an agreement with the office as part of the New York state business energy conservation loan program.
g. "Program" shall mean the New York state business energy conservation loan program.
h. "Region" shall mean one or more of the following named areas comprised of the counties indicated:
(1) Buffalo-Rochester: Cattaraugus, Chautauqua, Erie, Genesee, Livingston, Monroe, Niagara, Ontario, Orleans, Seneca, Wayne, Wyoming and Yates counties;
(2) Syracuse-Southern Tier: Allegany, Broome, Cayuga, Chemung, Chenango, Cortland, Delaware, Madison, Onondaga, Oswego, Otsego, Schuyler, Steuben, Tioga and Tompkins counties;
(3) Central-Northern: Albany, Clinton, Essex, Franklin, Fulton, Hamilton, Herkimer, Jefferson, Lewis, Montgomery, Oneida, Rensselaer, Saratoga, Schenectady, Schoharie, St. Lawrence, Warren and Washington counties;
(4) Westchester-Mid-Hudson: Columbia, Dutchess, Greene, Orange, Putnam, Rockland, Sullivan, Ulster and Westchester counties;
(5) Long Island: Nassau and Suffolk counties;
(6) New York City: the five counties comprising the city of New York.
2. The commissioner is hereby authorized and directed to establish the New York state business energy conservation loan program. The program shall facilitate below market interest rate loans by financing institutions within the state for eligible energy conservation improvements made to eligible applicants as hereinafter provided.
3. The commissioner may enter into cooperative agreements with financing institutions within the state for the financing with the institution's own assets of eligible energy conservation improvements by eligible applicants at a rate that is at least twenty-five percent below the prime interest rate. Such interest rate shall initially be five percent. The commissioner shall agree to utilize such funds as are appropriated to this program and the earnings produced on such funds to underwrite interest subsidies on loans made to eligible applicants, if not inconsistent with federal requirements and court decisions directing the payment of petroleum overcharge funds to the state. Such agreements shall provide that: (i) the maximum loan per applicant shall be five hundred thousand dollars, except that the commissioner may increase the maximum loan amount up to one million dollars for specific types of improvements by rule and regulation, (ii) the duration of the loan shall not to exceed ten years, (iii) program loans shall be made only after an application has been made to the office, the office has approved the technical merits of the proposed improvement and the office has notified the financing institution of its approval and the amount of interest reduction upon the loan to be funded pursuant to such agreement, and (iv) loan agreements with program applicants shall provide for a post installation inspection, as deemed necessary by the office.
4. The commissioner shall apportion the moneys appropriated for this program for the purpose of providing interest subsidies to applicants within each of the six regions of the state identified in paragraph g of subdivision one of this section based on the ratio, calculated by the commissioner, which reflects:
a. the volume of refined petroleum products consumed within that region during the period beginning September first, nineteen hundred seventy-three, and ending January twenty-eighth, nineteen hundred eighty-one, compared to
b. the volume of refined petroleum products consumed within the six regions during such period.
Such calculation shall be made by the commissioner upon estimates determined by him in reliance upon reasonably available information.
The commissioner may reapportion the funds available for interest subsidies for applicants within any region under this subdivision for use in one or more of the other regions upon finding that participation in the program within the former region would not be adversely affected, and that there exists in the latter region or regions inadequate funds to satisfy the demand for program participation. In any fiscal year of the state, the amount of funds available to applicants within any region may be reduced by not more than twenty-five percent of the total amount apportioned for such region. A copy of the commissioner's finding shall be given to the chairman of the senate finance committee and the chairman of the assembly ways and means committee.
5. In addition to the authority granted under subdivision three of this section, the commissioner shall be authorized to utilize monies appropriated to this program for the purpose of providing loan guaranties and principal reductions for eligible applicants, if such uses are permissible under the conditions applicable to the appropriated overcharge funds. Principal reductions shall be limited to the amount of the interest subsidy which would otherwise be available to an eligible applicant under subdivision three of this section.
6. In implementing the program, the commissioner is authorized to take such action as he deems necessary and appropriate which may include but not be limited to the promulgation of rules and regulations formulated after consultation with the energy research and development authority, the department of commerce and the department of financial services. Such rules and regulations may include but not be limited to requirements for applications and supporting materials and criteria for the selection of cooperating financing institutions.