RESOLUTION OF THE MEMBERS OF THE BOARD OF THE DORMITORY AUTHORITY OF THE STATE OF NEW YORK APPROVING GUIDELINES FOR THE USE OF INTEREST RATE EXCHANGE AGREEMENTS FOR MUNICIPAL COURT FACILITIES AND MUNCIPAL HEALTH FACILITIES

WHEREAS, the Authority is authorized pursuant to section 2926 of the Public Authorities Law to enter into interest rate exchange or similar agreements on behalf of municipalities in relation to outstanding debt for municipal court facilities and municipal health facilities in an amount not exceeding 20 percent of the outstanding debt for each municipality under each program;

WHEREAS, section 2926 of the Public Authorities Law requires the Authority to adopt Guidelines governing the use of interest rate exchange or similar agreements;

WHEREAS, pursuant to Article 5-D of the State Finance Law, the Authority has previously adopted guidelines for the use of interest rate exchange agreements;

WHEREAS, in accordance with Article 5-D of the State Finance Law, the Authority utilized a competitive process to solicit and review the qualifications of various proposed counterparties for interest rate exchange or similar agreements (including, but not limited to their experience and presence in the municipal swap market, their maintenance of a two-way swap book, their demonstrated capability to develop creative and innovative ideas and their relationship with and understanding of the needs of the Authority and the State) and as a result of that process, has established a list of qualified firms with which the Authority may enter into interest rate exchange or similar agreements;

WHEREAS, before the Board today is the form and content of the interest rate exchange agreements to be used by the Authority in connection with its interest rate exchange transactions for the municipal court facilities and municipal health facilities program;

WHEREAS, pursuant to the Guidelines the Authority is being asked by the City of New York to execute interest rate exchange agreements (the “Existing Agreements”) in connection with bonds issued or to be issued under the municipal courts program as set forth in the resolutions authorizing such bonds;

WHEREAS, the City of New York has advised the Authority it has determined that it is in the best interests of the City to reduce or mitigate counterparty exposure and risk on the Existing Agreements and that certain interest rate exchange agreements executed for the benefit of the City shall be “Excluded Agreements” as defined in the Guidelines;

WHEREAS, in accordance with the Guidelines the Authority will receive independent findings that the terms and conditions of the Existing Agreements and Excluded Agreements reflect a fair rate or value and that the Excluded Agreements are being entered into for the purpose of mitigating risks associated with the Existing Agreements;

WHEREAS, all payments to be made and risks associated with the Existing Agreements and Excluded Agreements are the responsibility of the City of New York;

NOW THEREFORE BE IT RESOLVED AS FOLLOWS:

1. The Guidelines are hereby approved.
2. The form and content of the interest rate exchange agreement is hereby approved for any such transactions as hereafter authorized by the Board in connection with the municipal court or municipal health facilities programs.
3. Staff of the Authority is authorized to execute either Existing Agreements or Excluded Agreements with one or more of the counterparties previously selected as qualified firms and to use the form of interest rate exchange agreement hereby approved.
4. Any subsequent resolution of the Board authorizing the execution and delivery of interest rate exchange agreements in connection with a specific bond issuance may also provide for such amendments, changes or deletions as the Board deems necessary or appropriate to the form of the interest rate exchange agreement hereby approved.
5. This Resolution shall take effect immediately.