Title 9 Part 1728

Projections for each category of expense shall be made by applying adjustments for inflation to current expenditures, as revised pursuant to section 1728-1.2(a)(2) of this Subpart. The inflation adjustment factors, which shall be applied to each applicable individual category of expense, are derived from the United States Department of Labor Statistics New York-Northern New Jersey Consumer Price Index for all Urban Consumers, unless otherwise specified in this section or as determined by a supply or service contract, for the period of said contract.

Projected costs of fuel oil will be calculated and revised monthly by the division based on an analysis of oil prices and/or oil price futures.

Costs for these utilities shall be based on actual current expenses, adjusted by amounts to cover any rate adjustments which have been granted or are reasonably expected to be granted by the New York State Public Service Commission.

Payments into the contingency reserve shall be computed according to the following schedule:

If a company has no vacancies for the last two years and currently has a waiting list for all size apartments, the above requirements will be reduced by one half of one percent in each category. Funding of the contingency reserve shall not be required if there are debt service arrears.

Debt service arrears shall be funded in the budget projections at the lesser of: the total debt service arrears or an amount equal to the current debt service requirement, unless otherwise provided in an agreement restructuring the mortgage loan and approved by the division.

The division shall periodically establish guidelines for charges for the use of various classes of appliances based upon rate and consumption data.

A bank account shall be opened in a local bank insured by the Federal Deposit Insurance Corporation entitled “Name of company Administration Fund.” Into this account shall be deposited all rent receipts and other miscellaneous operating income. From this account shall be disbursed all expenses for current operations.

No housing company shall pay any dividends on stock, interest on income debentures or return on equity without the prior written approval of the division. In no event shall approval be granted by the division for an amount greater than the total of two years on any of the following in any one fiscal year: dividends on stock; interest on income debentures; or return on equity.

Except as otherwise permitted by this Chapter, funds of the housing company shall not be used for any purpose other than the ordinary operation of the project, without the prior written approval of the division. Corporate funds shall not be loaned or invested without the written approval of the division; no loans or advances shall be made at any time to officers, stockholders or employees.

No housing company shall pay any salaries or fees to any officer or director, without the prior written approval of the division.

All surcharges imposed after June 30, 1981 shall be applied to the expenses of operation and management.

Any purchases, commitments, and contracts for occasional and continuing requirements which, based on the projections for the period of the most recently approved budget would result in an average annual expenditure of $100,000 or more, must comply with section 1728-4.3 of this Subpart unless otherwise approved by the division.

Notwithstanding the value of the purchase or contract, where any work involves the integrity of the building structure, building system, or site component, contract documents including plans or specifications for such work must be prepared by a licensed and currently registered engineer, architect, and landscape architect specializing in the field for such work. Such contract documents must be reviewed by the division prior to the execution of any purchase or contract by the housing company.

Notwithstanding any other provision of this Chapter, any contract, purchase, or commitment which involves an identity of interest under sections 1725-6.1 or 1725-1.4 of Title requires prior division approval of the contract and solicitation of bidders.

Where the division determines that a specific contract, purchase, or commitment, or category of purchase, contract, progress payment, or commitment requires additional supervision, the division may order that a housing company follow alternative procedures for review and approval than otherwise required by this Subpart.

Where a housing company refinances pursuant to Part 1760 of this Title with a private lender that has its own procedures and safeguards to assure appropriate use of its funds with respect to any improvements it is funding, the division may upon written agreement with the lender modify the applicability of procedures pursuant to the Subpart in light of such supervision. Where a housing company participates in a preservation transaction pursuant to Part 1760 of this Title involving supervision of contracts, commitments, purchases, or other matters through another set of governmental procedures, the division may by written agreement modify the applicability of its procedures pursuant to the requirements of this Chapter in light of such supervision.

Where a contract, purchase or commitment is funded in whole or in part by a grant administered by the division, notwithstanding any provision of this Chapter, it must be bid, approved and reviewed by the division in accordance with any requirements set forth in the grant documents.

Inventory records will be maintained for appliances, office and maintenance equipment, tools and similar project property of a nonexpendable nature having a unit cost of $500 or more.

Equipment and supplies which are no longer needed or useful to the housing company should be disposed of as quickly as possible.