1. No loan shall be made by the state, the New York state housing finance agency, a municipality or the New York city housing development corporation unless the commissioner, with respect to a project aided by a state loan or New York state housing finance agency loan, or the supervisory agency, with respect to a municipally-aided project, finds that:

1. (a) The municipality has approved the project as provided in subdivision five of this section and has enacted or will enact regulations or appropriate restrictions adequately protecting the project against future uses likely to depreciate unduly the value of such project;
2. (b) The estimated revenues of the project will be sufficient to cover all probable costs of operation and maintenance, of fixed charges and operating reserves and depreciation reserves if any;
3. (c) The plans and specifications conform to the requirements of all laws applicable thereto, and assure adequate light, air, sanitation and fire protection;
4. (d) If the project is aided by a state loan, or a New York state housing finance agency loan, the commissioner shall also find that the project is in conformity with a plan or undertaking for providing low rent housing facilities for persons of low income and for the clearance, replanning, reconstruction or rehabilitation of a substandard and insanitary area or areas, and for other facilities incidental or appurtenant thereto as may be approved by the commissioner.

5. 1-a. No company may be aided pursuant to this article by a mortgage loan or tax exemption or both to finance the acquisition of a building by residents thereof unless the commissioner or the supervising agency, as the case may be, finds that:

   1. (a) the condition of such building is deteriorating and the building is located in a deteriorating area or in an area threatened with deterioration by reason of economic, social or physical changes occurring therein or in nearby areas;
   2. (b) the building is not yielding sufficient revenues to cover costs of operation and maintenance, of fixed charges and of reserves, if any, and also a reasonable profit to the owner;
   3. (c) the making of such loan will prevent further deterioration and abandonment;
   4. (d) at least two-thirds of the present residents consent to such acquisition;
   5. (e) financing for such acquisition is otherwise unavailable because of the neighborhood, the age of the buildings, or other factors indicating an inability of the private sector unaided to cause such acquisition to be effected;
   6. (f) the proceeds of such loan will not be used to refinance existing debt in excess of a reasonable relationship to current value; and
   7. (g) the term for repayment of such loan does not exceed the remaining useful life of the building.
6. 2. The principal of a loan made by the state shall be repaid by the company over a period of not to exceed fifty years except in the case of a loan to rehabilitate an existing building, in which case the period shall not exceed thirty-five years, or the estimated life of the project, whichever is shorter, in annual installments equal to the amount payable by the state on the moneys borrowed for the project. Such annual installment of principal need not be uniform in amount, but may be so varied that the total payment of principal and interest shall be approximately equal and constant during the period of the loan. Each payment of principal and interest shall be made to the state comptroller not later than five days before each payment by the state is required. The loan shall bear the same rate of interest paid or to be paid by the state for the definitive housing bonds issued on account of such loan. The company shall pay to the state comptroller a proportionate share of the cost of borrowing not later than thirty days after the state comptroller has certified the amount of such share.
7. 3. Any bonds or notes issued by the company and any mortgages relating thereto may authorize the company, with the consent of the state comptroller in the case of a state-aided project, or the supervising agency in the case of a municipally-aided project, to prepay the principal of the loan. Such bonds or notes and mortgages may contain such other clauses and provisions as the commissioner in the case of a state-aided project or the supervising agency in the case of a municipally-aided project, shall require. Notwithstanding the provisions of any general, special or local law, the principal of any loans made pursuant to subdivision one of section fifteen of this article or the principal of a loan made by a municipality pursuant to this article and secured by a mortgage lien subordinate to the lien of a first mortgage made pursuant to paragraph (b) of subdivision one of section fifteen of this article may be amortized at such time or times or at such rate as the supervising agency shall approve.
8. 4. With respect to a state-aided project the commissioner may charge the company reasonable fees for financing, regulation, supervision and audit. Fees collected for such services shall be paid into and disbursed from such fund or funds as may be provided by law.

9. 5.

   1. (a) In a municipality where there is a planning commission, the project shall first be submitted to it for approval. Where changes in the city map and zoning amendments or variances are necessitated by such project, such amendments, variances and changes shall be submitted together with such project and considered as a part thereof. Such planning commission, not later than ten weeks from the date of the referral of the project to it, after a public hearing held on due notice, notice of which shall be published at least ten days prior thereto in the official publication of the municipality, or if none exists, in a newspaper circulating in the municipality, shall submit its report to the local legislative body certifying its unqualified approval, its disapproval, or its qualified approval with recommendations for modifications therein. After public hearing held on due notice and after the report is received or due from the planning commission, the local legislative body may:

      1. (i) if the planning commission shall have certified its unqualified approval, approve the project by a majority vote;
      2. (ii) if the planning commission shall have certified its disapproval or shall have failed to make its report within ten weeks from the date such project was submitted to it, nevertheless approve the project, but only by a three-fourths vote;
      3. (iii) if the planning commission shall have certified its qualified approval together with recommendations for modifications, approve the project together with the modifications recommended by the planning commission by a majority vote, or approve the project without such modifications but only by a three-fourths vote.
   2. (b) In a municipality where there is no planning commission the project shall be submitted to the local legislative body which, after public hearing held on due notice, may either approve or disapprove the project.
   3. (c) Notwithstanding any other provision of law, changes in the city map, zoning amendments, or variances contained in the plan shall be deemed approved by the local legislative body when it approves the project. Any such changes in the city map, zoning amendments, or variances shall become effective on the date on which the supervising agency shall file a resolution with the local legislative body in implementation thereof.
10. 6. The provisions of subdivisions one and five of this section shall not apply to a state urban development corporation project or to any loan made by the state or the state housing finance agency to such project, notwithstanding anything to the contrary contained herein.
11. 7. Notwithstanding anything to the contrary contained therein, the provisions of subdivisions one and five of this section shall not apply to a Battery Park city project or to any loan made by the state or the New York state housing finance agency to such project.