1. (1) A not-for-profit organization that provides services to a State agency pursuant to a written directive prior to the date that the contract for such services has been fully executed, shall, once such contract has been approved and become fully executed, be entitled to interest in accordance with, and to the extent authorized by, this section on those moneys that would be due under the terms of a contract or a renewal contract prior to the date on which the contract became fully executed.

2. (2) For purposes of this section, a State agency shall be deemed to have issued a written directive where:

   1. (i) with respect to a renewal contract it has provided notice to the not-for-profit organization of its intent to renew the contract which shall include the transmission of a proposed renewal agreement to the not-for-profit organization; or
   2. (ii) with respect to new contracts, it has provided the not-for-profit organization with a proposed contract containing a start date, in which case such start date shall be deemed the date of the written directive.

3. (b) A not-for-profit organization that has borrowed funds to provide services pursuant to a written directive may receive interest under this section where the not-for-profit organization has:

   1. (1) been denied an advance payment pursuant to section 22.6 of this Part; and
   2. (2) did not obtain a loan from the Not-For-Profit Short Term Revolving Loan Fund.

4. (c) A not-for-profit organization may not receive interest payments pursuant to this section where the not-for-profit organization received an advance payment pursuant to section 22.6 of this Part, provided however that if the contract has not been fully executed at the end of the period covered by such advance payment, the not-for-profit organization shall be eligible for interest payments pursuant to this section in respect to services performed after such period; or

   1. (1) Except as provided in paragraph (2) of this subdivision, any not-for-profit organization eligible to receive an interest payment pursuant to subdivision (a) or (b) of this section shall receive such interest payments at a rate equal to the rate set by the Commissioner of Taxation and Finance for corporation taxes pursuant to paragraph l of subsection (e) of section 1096 of the Tax Law.

   2. (2) A not-for-profit organization eligible to receive interest pursuant to subdivision (b) of this section shall submit to the State agency the interest rate at which it borrowed funds and such other documentation as prescribed under subdivision 2 of 179-v of the State Finance Law. Such not-for-profit organization shall receive interest pursuant to this section at a rate of interest equal to the rate it is paying on such borrowed funds, provided the State agency has approved of such rate and the comptroller determines such rate is reasonable.

      (e)

   3. (1) Interest shall be due a not-for-profit organization for each payment that would have been due if the contract had been fully executed before the scheduled commencement date. Interest shall be calculated for the period commencing 30 days after the end of each billing period as specified in the contract and ending on the date payment is actually made, except where under the terms of the contract the not-for-profit organization is entitled to a payment or payments on specified dates without the submission of an invoice or voucher, in which case interest shall run from each such specified date or dates. Interest shall be calculated separately with respect to each payment due under the contract. For purposes of this section, if a contract does not specify billing periods or a payment schedule, it shall be presumed that the not-for-profit is authorized to submit invoices or vouchers at the end of each month for a pro rata portion of the total contract amount. The State agency is responsible for calculating interest due and preparing a separate voucher to pay such interest consistent with this section. A State agency may not deny interest to a not-for-profit organization on the basis that it failed to submit invoices or vouchers during the period prior to final execution of the contract. However, where the not-for-profit fails to submit an invoice or voucher for such payment by the 30th day after the date the contract became fully executed, no additional interest shall accrue after such 30th day.
   4. (2) Once a late contract is fully executed, interest on any late payments due subsequent to the date the contract is fully executed shall be made in accordance with the requirements of the article XI-A of the State Finance Law which relates to the prompt payment of contracts.

   (d)

5. (f) Any interest payments made pursuant to subdivision (a) or (b) of this section shall be made from appropriations for State operations that are available for the administrative programs for the State agency which contracted with the not-for-profit organization. Interest payments shall not be made from amounts appropriated for program purposes. Any interest payments made to a not-for-profit organization shall not reduce the amount of money that otherwise would be payable to the not-for-profit organization under the terms of the contract.
6. (g) No interest shall be payable pursuant to the provisions of this section with respect to any contract or renewal contract where such contract is required to be approved by the attorney general and the comptroller, but is never approved.

7. (h) No interest shall be payable under this section where a State agency and a not-for-profit organization have entered into an agreement under section 179-v subdivision (7) waiving interest, and the comptroller has determined that the waiver of interest is warranted. If the comptroller determines the waiver of interest is unwarranted the State agency shall immediately submit for the comptroller’s approval a voucher requesting payment of interest to such not-for-profit organization. If such voucher is not received within 30 days after the date of the comptroller’s written determination, the comptroller will calculate the amount of unpaid interest due to the not-for-profit organization pursuant to section 179-v of the State Finance Law and this Part, and pay such amount to the not-for-profit organization as a charge against the agency’s appropriations.

   1. (1) Interest payable pursuant to the provisions of this section shall be suspended where the State agency has, in accordance with section 179-w of the State Finance Law, determined that significant and substantive differences exist between the State agency and the not-for-profit organization in the negotiation of a contract or renewal contract or that the not-for-profit organization is not negotiating in good faith; and the State agency has provided written notice of such determination to the not-for-profit organization and the comptroller, as required by section 179-w.
   2. (2) Interest shall be suspended only for the period during which the State agency has determined that the significant and substantive differences existed or the not-for-profit was not negotiating in good faith. Any State agency that has made a determination under paragraph (1) of this subdivision shall, when it submits the contract to the comptroller for approval, provide notice to the comptroller and the not-for-profit organization of the date on which the conditions that justified the suspension of interest, ceased to exist.

   (i)

8. (j) A determination that extenuating circumstances exist pursuant to section 179-w shall not suspend the accrual of interest unless the State agency also determines, and such determination is approved by the comptroller, that the circumstances are unusual which warrant the denial of interest as prescribed by section 22.4 of this Part.
9. (k) No State agency shall be liable for interest payments under this section on contracts executed pursuant to appropriations made in whole or in part for liabilities incurred in a prior fiscal year that were awarded without the use of competitive process.

(a)