New York Laws
Article 11 - Housing Development Fund Companies
575 - Advances; Conditions; Repayment.

§ 575. Advances; conditions; repayment. 1. The commissioner of housing
and community renewal is hereby authorized to use the moneys held in the
housing development fund to make non-interest bearing advances to
housing development fund companies, and housing corporations in
accordance with the provisions of this article. Such moneys shall be
paid out of such fund, after audit by and upon the warrant of the
comptroller, on vouchers approved by the commissioner.

1-a. The supervising agency is hereby authorized to use the moneys
held in the municipal housing development fund or other funds
appropriated by the municipality to make non-interest bearing advances
to housing development fund companies in accordance with the provisions
of this article and the applicable law of the municipality.

2. No such advances shall be made with respect to a housing project
unless the commissioner or the supervising agency, as the case may be,
(a) finds (1) that the housing development fund company, or housing
corporation proposes to finance the project in whole or in part by a
federally-aided, state-aided or municipally-aided mortgage or (2) that
the project, if otherwise financed, will provide housing for persons or
families of low income, as defined in this chapter, and is otherwise
consistent with the purposes of this article; (b) finds that the project
site is suitable, there is a need for this housing type proposed in the
area to be served and the project is feasible; and (c) reasonably
anticipates that financing will be obtained and makes a finding to that
effect.

3. No such advances may be made to a housing corporation unless it
enters into an agreement with the commissioner to be regulated with
respect to rents, profits, dividends and disposition of its property or
franchises. No such advances may be made to a housing development fund
company unless it enters into an agreement in accordance with the
provisions of section five hundred seventy-six of this article.

4. The proceeds of such advance may be used only to defray the
development costs of such project.

5. Each such advance shall either (i) be consolidated with the lien of
a municipally-aided mortgage, or (ii) be repaid in full by the housing
development fund company, or housing corporation to the division of
housing and community renewal or to the supervising agency as directed
in paragraph (b) of subdivision two of section five hundred
seventy-four-a of this article, as the case may be. Such repayment shall
be made concurrent with receipt by the housing development fund company
or its successor in interest, or housing corporation of the proceeds of
its mortgage or construction loan, unless the commissioner or the
supervising agency, as the case may be, shall extend the period for the
repayment of such advances. In no event shall the time of repayment be
extended later than the date of final advance of funds pursuant to such
mortgage financing.

6. If the commissioner or the supervising agency, as the case may be,
in his or its discretion shall, at any time, determine that permanent
financing for the housing project may not be obtained, then and in that
event all advances made to the housing development fund company, or
housing corporation pursuant to this article shall become due and
payable upon the demand of the commissioner or the supervising agency,
as the case may be.