New York Laws
Article 15 - New York City Public Housing Preservation Trust
637 - Borrowing by the Trust and for Its Benefit; Effects of Certain Defaults.

(a) pledging all or part of its revenues, including, but not limited
to, project-based or tenant-based assistance pursuant to section eight
of the United States housing act of nineteen hundred thirty-seven, as
amended, or any successor provision, and assistance provided to NYCHA
pursuant to section nine of the United States housing act of nineteen
hundred thirty-seven, as amended, or any successor provision, together
with any other moneys, securities or contracts, to secure the payment of
the bonds, notes or other obligations, subject to such agreements as may
then exist;
(b) the setting aside of reserves and the creation of sinking funds
and the regulation and disposition thereof;
(c) limitations on the purpose to which the proceeds from the sale of
bonds, notes or other obligations may be applied;
(d) limitations on the issuance of additional bonds, notes or other
obligations, the terms upon which additional bonds, notes or other
obligations may be issued and secured and the refunding of bonds, notes
or other obligations;
(e) the procedure, if any, by which the terms of any contract with
holders of bonds, notes or other obligations may be amended or
abrogated, including the proportion of holders of bonds, notes or other
obligations which are needed to consent thereto and the manner in which
such consent may be given;
(f) vesting in a bond trustee or trustees such properties, rights,
powers and duties in trust as the trust may determine; and
(g) defining the acts or omissions to act that may constitute a
default in the obligations and duties of the trust to the holders of
bonds, notes or other obligations and providing for the rights and
remedies of the holders of bonds, notes or other obligations in the
event of such default, including as a matter of right the appointment of
a receiver, provided, however, that such rights and remedies shall not
be inconsistent with the general laws of the state and other provisions
of this article.
7. In addition to the powers herein conferred upon the trust to secure
its bonds, notes or other obligations, the trust shall have power in
connection with the issuance of bonds, notes or other obligations to
enter into such agreements for the benefit of the holders of bonds,
notes or other obligations as the trust may deem necessary, convenient
or desirable concerning the use or disposition of its revenues or other
moneys, including the entrusting, pledging or creation of any other
security interest in any such revenues, moneys and the doing of any act,
including refraining from doing any act, which the trust would have the
right to do in the absence of such agreements. The trust shall have
power to enter into amendments of any such agreements within the powers
granted to the trust by this article and to perform such agreements. The
provisions of any such agreements may be made a part of the contract
with the holders of bonds, notes or other obligations of the trust.
8. Notwithstanding any provision of the uniform commercial code to the
contrary, any pledge of or other security interest in revenues, moneys,
accounts, contract rights, general intangible or other personal property
made or created by the trust shall be valid, binding and perfected from

the time when such pledge is made or other security interest attaches
without any physical delivery of the collateral or further act, and the
lien of any such pledge or other security interest shall be valid,
binding and perfected against all parties having claims of any kind in
tort, contract or otherwise against the trust irrespective of whether or
not such parties have notice thereof. No instrument by which such a
pledge or security interest is created nor any financing statement need
be recorded or filed.
9. Whether or not the bonds, notes or other obligations of the trust
are of such form and character as to be negotiable instruments under the
terms of the uniform commercial code, the bonds, notes or other
obligations are hereby made negotiable instruments within the meaning of
and for all the purposes of the uniform commercial code, subject only to
the provisions of the bonds, notes or other obligations for
registration.
10. Neither the members of the board nor any person executing bonds
shall be liable personally thereon or be subject to any personal
liability or accountability solely by reason of the issuance thereof.
The bonds, notes or other obligations of the trust shall not be a debt
of NYCHA, the city, or the state, and neither NYCHA, the city nor the
state shall be liable thereon, nor shall they be payable out of any
funds other than those of the trust, and such bonds, notes or other
obligations shall contain on the face thereof a statement to such
effect.
11. The trust, subject to such agreements with bondholders as then may
exist, shall have power to purchase bonds, notes or other obligations of
the trust out of any moneys available therefor, which shall thereupon be
cancelled.
12. Notwithstanding any provision of article twelve of the private
housing finance law, section twenty-nine hundred seventy-six of the
public authorities law or any other general, special or local law to the
contrary, (a) the purposes of the New York city housing development
corporation and its powers granted in article twelve of the private
housing finance law also shall include, subject to the provisions of any
contract with holders of its bonds, notes or other obligations, the
making of loans to the trust and entities referred to in subdivision
thirteen of section six hundred twenty-nine of this article, and (b)
bonds, notes or other obligations of the New York city housing
development corporation issued for, or to refund bonds, notes or other
obligations issued for, such purpose or the purposes of paying costs of
issuance thereof or funding reserves to secure such bonds, notes or
other obligations (i) may be sold without any consultation or approval
otherwise required by subdivision two of section six hundred fifty-five
of the private housing finance law, (ii) shall not be included in any
calculation of outstanding bonds, notes or other obligations for
purposes of section six hundred fifty-six of the private housing finance
law and shall not be secured by any capital reserve fund established
pursuant thereto, and (iii) shall not be included in any calculation of
bonds, notes or other obligations issued by the New York city housing
development corporation for purposes of section twenty-nine hundred
seventy-six of the public authorities law.
13. In the event that any default on any bond, note or other
obligation that is secured by an assignment of, mortgage on, pledge of
or other encumbrance on any interest of the trust, or any entity
referred to in subdivision thirteen of section six hundred twenty-nine
of this article, in any housing facilities, has occurred and is
continuing beyond the applicable cure period, if any, provided to the
trust or such entity in the instrument granting such assignment,

mortgage, pledge or other encumbrance, notwithstanding any provision in
such instrument, any right of the beneficiary of such instrument to
obtain such interest in such housing facilities as a remedy to any such
default shall, for a period ending thirty days after the end of such
cure period, be subject to:
(a) the right of the city of New York to remedy, or cause to be
remedied, such default; and
(b) the right of the state of New York to remedy, or cause to be
remedied, such default; provided, however, that nothing in this
subdivision shall be construed to impose any obligation on the city of
New York or on the state of New York to remedy, or cause to be remedied,
such default.
14. Notwithstanding any default on any obligation referred to in
subdivision thirteen of this section, and any remedies exercised as a
result of such default, provisions relating to the restricted use of the
housing facilities for the provision and operation of housing for
low-income families and current residents shall at all times continue to
be in effect in perpetuity, and the housing facilities shall remain
subject to the provisions of subdivision four of section six hundred
thirty of this article and section six hundred thirty-one of this
article. The trust shall not pledge the fee ownership of the housing
facilities as part of a financing arrangement.
15. At least quarterly, the trust shall provide financial reports to
the director of management and budget of the city of New York containing
such information as the director of management and budget of the city of
New York may request.