Bill Text: NY A08082 | 2021-2022 | General Assembly | Introduced


Bill Title: Enacts the "New York electric corporation storm recovery securitization act"; allows electric corporations to petition the public service commission for authority to issue storm recovery bonds.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2021-06-11 - referred to corporations, authorities and commissions [A08082 Detail]

Download: New_York-2021-A08082-Introduced.html



                STATE OF NEW YORK
        ________________________________________________________________________

                                          8082

                               2021-2022 Regular Sessions

                   IN ASSEMBLY

                                      June 11, 2021
                                       ___________

        Introduced by M. of A. PAULIN -- read once and referred to the Committee
          on Corporations, Authorities and Commissions

        AN ACT to amend the public service law, in relation to enacting the "New
          York electric corporation storm recovery securitization act"

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Short title. This act shall be known and may  be  cited  as
     2  the "New York electric corporation storm recovery securitization act".
     3    §  2.  The public service law is amended by adding a new article 12 to
     4  read as follows:
     5                                  ARTICLE 12
     6       NEW YORK ELECTRIC CORPORATION STORM RECOVERY SECURITIZATION ACT
     7    Section 300. Short title.
     8            301. Definitions.
     9            302. Financing orders.
    10            303. Storm recovery property.
    11            304. Sale, assignment, or transfer of storm recovery property.
    12            305. Security interests.
    13            306. Choice of law; conflicts.
    14            307. Storm recovery bonds not public debt.
    15            308. State pledge.
    16            309. Assignee not an electric corporation.
    17            310. Effect of invalidity.
    18            311. Effect of a financing order.
    19    § 300. Short title. This article shall be known and may  be  cited  as
    20  the "New York electric corporation storm recovery securitization act".
    21    § 301. Definitions. As used in this article, the following terms shall
    22  have the following meanings:
    23    1.  "Ancillary  agreement" means any bond, insurance policy, letter of
    24  credit, reserve account, surety bond, swap arrangement, hedging arrange-
    25  ment, liquidity or credit support arrangement or other similar agreement

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD11729-01-1

        A. 8082                             2

     1  or arrangement entered into in connection with  the  issuance  of  storm
     2  recovery bonds under this article.
     3    2.  "Assignee"  means  any  individual, corporation, limited liability
     4  company, partnership or limited  partnership,  trust  or  other  legally
     5  recognized  entity  to  which  an interest in storm recovery property is
     6  created, recognized, assigned, sold or transferred, other than as  secu-
     7  rity, including any assignee of such property.
     8    3. "Consumer" means any individual, governmental body, trust, business
     9  entity,  nonprofit  organization or other legally recognized entity that
    10  takes electric delivery service within the  service  area  by  means  of
    11  electric transmission or distribution facilities, whether those electric
    12  transmission  or distribution facilities are owned by an electric corpo-
    13  ration or other entity.
    14    4. "Financing costs" means: (a) interest and acquisition,  defeasance,
    15  or redemption premiums that are payable on storm recovery bonds;
    16    (b)  any  payment required under an ancillary agreement and any amount
    17  required to fund or replenish  reserve  or  other  accounts  established
    18  under  the terms of any indenture, ancillary agreement, or other financ-
    19  ing documents pertaining to storm recovery bonds;
    20    (c) any other cost  related  to  issuing,  supporting,  repaying,  and
    21  servicing  storm  recovery bonds, including but not limited to servicing
    22  fees, accounting and auditing fees, trustee fees, legal fees, consulting
    23  fees, administrative fees, placement and underwriting fees,  capitalized
    24  interest,  rating  agency  fees,  stock  exchange listing and compliance
    25  fees, and filing fees, including costs related to obtaining a  financing
    26  order; or
    27    (d)  any  federal,  state  or  local taxes, payments in lieu of taxes,
    28  franchise fees or license fees imposed on storm recovery  charge  reven-
    29  ues.
    30    5.  "Financing  order"  means an order of the commission which author-
    31  izes:
    32    (a) the issuance of storm recovery bonds;
    33    (b) the imposition, collection,  and  periodic  adjustments  of  storm
    34  recovery charges;
    35    (c) the creation or recognition of storm recovery property; and/or
    36    (d) the sale, assignment, or transfer of storm recovery property to an
    37  assignee.
    38    6.  "Financing party" means any holder of storm recovery bonds and any
    39  trustee, collateral agent, or other person acting  for  the  benefit  of
    40  holders of storm recovery bonds.
    41    7.  "Financing statement" shall have the same meaning as that provided
    42  in paragraph (39) of subsection (a) of section 9-102 the uniform commer-
    43  cial code.  All financing statements under this article shall  be  filed
    44  in accordance with section 9-501 of the uniform commercial code.
    45    8.  "Lien  creditor"  shall  have the same meaning as that provided in
    46  paragraph (52) of subsection (a) of section 9-102 of the uniform commer-
    47  cial code.
    48    9. "Secured party" means a financing party in favor of which an  elec-
    49  tric  corporation  or  its  successors  or  assignees creates a security
    50  interest in all or any portion of its interest  in  or  right  to  storm
    51  recovery  property.   A secured party may be granted a security interest
    52  in storm recovery property under this article and a security interest in
    53  other collateral subject to the uniform  commercial  code  in  a  single
    54  security agreement.
    55    10. "Security interest" means a pledge, hypothecation, or other encum-
    56  brance  of  or  other  right over any portion of storm recovery property

        A. 8082                             3

     1  created by contract to secure the payment or  performance  of  an  obli-
     2  gation.
     3    11.  "Service  area" means the geographical area within which an elec-
     4  tric corporation provides electric distribution services as of the  date
     5  of a financing order.
     6    12.  "Storm"  means,  individually  or  collectively, a named tropical
     7  storm or hurricane, a tornado, ice or snow storm, flood, an  earthquake,
     8  or other significant weather or natural disaster.
     9    13.  "Storm  recovery activity" means any activity or activities by or
    10  on behalf of an electric corporation in connection with the  restoration
    11  of  service  and  infrastructure  associated with electric power outages
    12  affecting consumers of an electric corporation as the result of a  storm
    13  or  storms,  including  but  not  limited  to mobilization, staging, and
    14  construction, reconstruction, replacement, or repair of electric  gener-
    15  ation, transmission, or distribution facilities.
    16    14.  "Storm  recovery  bonds"  means bonds, debentures, notes, certif-
    17  icates of participation, certificates of ownership, or  other  evidences
    18  of  indebtedness  or ownership that are issued pursuant to an indenture,
    19  contract, or other agreement of an electric corporation or  an  assignee
    20  pursuant  to  a financing order, the proceeds of which are used directly
    21  or indirectly to provide, recover, finance, or refinance  commission-ap-
    22  proved  storm recovery costs, financing costs, and costs to replenish or
    23  fund a storm recovery reserve  to  such  level  as  the  commission  may
    24  authorize in a financing order, and which are secured by or payable from
    25  storm  recovery property.  If certificates of participation or ownership
    26  are issued, references in this article to principal, interest, or premi-
    27  um shall be construed to refer to comparable amounts under those certif-
    28  icates.  Storm recovery bonds shall be nonrecourse to the credit or  any
    29  assets of the electric corporation other than the storm recovery proper-
    30  ty  as  specified in the financing order and any rights under any ancil-
    31  lary agreement.  Storm recovery bonds shall be legal investments for all
    32  governmental units, financial institutions, insurance companies, fiduci-
    33  aries, and other persons  that  require  statutory  authority  regarding
    34  legal investment.
    35    15.  "Storm  recovery  charge"  means  the  amounts  authorized by the
    36  commission to recover, finance, or refinance storm  recovery  costs  and
    37  financing  costs.    If  provided for in a financing order, such amounts
    38  shall be imposed on consumer bills and collected by an  electric  corpo-
    39  ration  or  its  successors or assignees, or a collection agent, in full
    40  through a charge paid by existing and future consumers receiving  trans-
    41  mission  or distribution service, or both, from the electric corporation
    42  or its successors or assignees under rate schedules or special contracts
    43  approved by the commission.  The storm recovery charge shall be  non-by-
    44  passable  and imposed on all consumers in the service area and collected
    45  by the electric corporation or any successor, its agent,  subcontractor,
    46  assignee,  collection  agent  or  any  other entity designated under the
    47  financing order.
    48    16. "Storm recovery costs" means, if requested by an  electric  corpo-
    49  ration  and approved by the commission, costs incurred or to be incurred
    50  by an electric corporation in undertaking  a  storm  recovery  activity.
    51  Such costs shall include the electric corporation's cost of capital from
    52  the  date  of  the applicable storm to the date the storm recovery bonds
    53  are issued calculated using the electric corporation's weighted  average
    54  cost  of capital as defined in its most recent base rate case proceeding
    55  before the commission net of all applicable income tax  savings  related
    56  to  the  interest component.  Such costs may be net of applicable insur-

        A. 8082                             4

     1  ance proceeds, tax benefits, and any other amounts intended to reimburse
     2  the electric corporation for storm recovery activities such  as  govern-
     3  mental  grants or aid of any kind and may include adjustments for normal
     4  capital  replacement  and operating costs, or other potential offsetting
     5  adjustments.  Storm recovery costs may include the  costs  to  fund  and
     6  finance  any storm recovery reserves and costs of repurchasing equity or
     7  retiring any existing indebtedness relating  to  storm  recovery  activ-
     8  ities.
     9    17.  "Storm recovery property" means the property rights and interests
    10  created pursuant to this article, including, but not limited to, any and
    11  all right, title and interest:
    12    (a) in and to storm recovery charges established pursuant to a financ-
    13  ing order, as adjusted from time to time in accordance with such financ-
    14  ing order;
    15    (b) in and to all revenues, collections, claims, payments,  money,  or
    16  proceeds  of  or arising from the storm recovery charges or constituting
    17  storm recovery charges that  are  the  subject  of  a  financing  order,
    18  regardless  of  whether  such  revenues,  collections, claims, payments,
    19  money or proceeds are imposed, billed, received, collected or maintained
    20  together with or commingled with other  revenues,  collections,  claims,
    21  payments, money or proceeds; and
    22    (c)  in  and to all rights to obtain periodic adjustments to the storm
    23  recovery charges pursuant to the terms of the financing  order.    Storm
    24  recovery property shall constitute a vested, presently existing property
    25  right.
    26    18.  "Storm  recovery  reserve"  means an electric corporation's storm
    27  reserve or such other similar reserve established pursuant to  order  or
    28  rule of the commission.
    29    §  302.  Financing orders. 1. No electric corporation or its affiliate
    30  or other assignee shall issue any storm recovery  bonds  unless  it  has
    31  been specifically authorized to do so by a financing order issued pursu-
    32  ant to this section. An electric corporation may petition the commission
    33  for  a  financing  order granting such authority. Such petition shall be
    34  made under oath and shall be signed and filed on behalf of the  electric
    35  corporation  or its affiliate or other assignee by the president or by a
    36  vice president, treasurer, or other executive officer  having  knowledge
    37  of  the matters set forth therein and shall be submitted in such form as
    38  the commission shall prescribe.
    39    2. Each petition filed under this section shall  include  all  of  the
    40  following:  (a)  A description of the storm recovery activities that the
    41  electric corporation has undertaken or proposes  to  undertake  and  the
    42  reasons for undertaking the activities.
    43    (b) The storm recovery costs and an estimate of the costs of any storm
    44  recovery activities that are being undertaken but not completed.
    45    (c)  The  level of the storm recovery reserve that the electric corpo-
    46  ration proposes to establish or replenish and has  determined  would  be
    47  appropriate  to  recovery through storm recovery bonds and is seeking to
    48  so recover and the level that the electric  corporation  is  funding  or
    49  will  seek  to  fund through other means, together with a description of
    50  the factors and calculations used in determining such amounts and  meth-
    51  ods of recovery.
    52    (d)  An  indication  of  whether  the electric corporation proposes to
    53  finance all or a portion of the storm recovery costs using storm  recov-
    54  ery bonds.  If the electric corporation proposes to finance a portion of
    55  such  costs, the electric corporation must identify the specific portion
    56  in the petition. An election not to  finance  a  portion  of  the  storm

        A. 8082                             5

     1  recovery  costs  using  storm  recovery bonds by an electric corporation
     2  shall not be deemed to waive its right to recover such costs pursuant to
     3  a separate proceeding with the commission.
     4    (e)  An  estimate of the financing costs related to the storm recovery
     5  bonds.
     6    (f) An estimate of the storm recovery charges necessary to recover the
     7  storm recovery costs and financing costs and the period for recovery  of
     8  such costs.
     9    (g) A comparison between the net present value of the costs to consum-
    10  ers  that  are  estimated  to result from the issuance of storm recovery
    11  bonds and the result from the application of the traditional  method  of
    12  financing  and  recovering  storm  recovery  costs from consumers.   The
    13  comparison should demonstrate that the issuance of storm recovery  bonds
    14  and  the  imposition  of  storm recovery charges are expected to provide
    15  quantifiable benefits to consumers.
    16    3. The commission may grant a petition under subdivision one  of  this
    17  section  in  whole  or  in  part by issuing a financing order, with such
    18  modifications thereto and upon such terms and conditions as the  commis-
    19  sion  prescribes  and  that  are  consistent with this article.   If the
    20  commission issues a financing order approving the issue of storm  recov-
    21  ery  bonds under this article, the commission shall consider whether (a)
    22  the proposed issuance of storm recovery bonds  and  the  imposition  and
    23  collection  of a storm recovery charge are expected to provide quantifi-
    24  able benefits to consumers as compared to the costs that would have been
    25  incurred absent the  issuance  of  storm  recovery  bonds  and  (b)  the
    26  proposed structuring, expected pricing, and financing costs of the storm
    27  recovery  bonds  are  reasonably  expected to result in the lowest storm
    28  recovery charges consistent with market conditions at the time the storm
    29  recovery bonds are priced and the terms of the financing order or  would
    30  avoid or mitigate rate impacts to consumers as compared with traditional
    31  methods of financing or recovering storm recovery costs.  The commission
    32  may  determine  what  degree  of  flexibility  to afford to the electric
    33  corporation or assignees in establishing the terms and conditions of the
    34  storm recovery bonds, including but not limited to repayment  schedules,
    35  interest  rates,  and  other  financing costs.   A copy of any financing
    36  order issued under this article duly  certified  by  a  commissioner  or
    37  other  person  authorized  to  act  on behalf of the commission shall be
    38  sufficient evidence for all purposes of whole and complete compliance by
    39  the electric corporation with all procedural and other matters  required
    40  precedent to the issuance of the order.
    41    4.  Proceedings on a petition submitted pursuant to this section begin
    42  with the petition for a financing order filed by an electric corporation
    43  with the commission for review and approval within one  hundred  thirty-
    44  five  days  of  the  filing  of the petition and shall be disposed of in
    45  accordance with the requirements of this article and the  rules  of  the
    46  commission.   A party to such proceeding may petition the commission for
    47  rehearing of this financing order within five days after the date of its
    48  issuance.
    49    5.  A  financing  order issued by the commission to an electric corpo-
    50  ration shall:
    51    (a) Specify the amount of storm recovery costs including any level  of
    52  storm  recovery  reserves,  taking into consideration, to the extent the
    53  commission deems appropriate, any other methods used  to  recover  these
    54  costs  and  any  offsets  or  credits  to  those costs, and provide with
    55  respect to the amount of financing costs which may be recovered  through
    56  storm recovery charges;

        A. 8082                             6

     1    (b) Provide that the proposed issuance of storm recovery bonds and the
     2  imposition  and  collection  of  storm  recovery charges are expected to
     3  provide quantifiable benefits to consumers as compared to the costs that
     4  would have been incurred absent  the  issuance  of  the  storm  recovery
     5  bonds;
     6    (c)  Provide  that  the  structuring and pricing of the storm recovery
     7  bonds are expected to  result  in  the  lowest  storm  recovery  charges
     8  consistent  with  market conditions at the time the storm recovery bonds
     9  are priced and the terms set forth in such financing order;
    10    (d) Specify and create the storm  recovery  property  of  an  electric
    11  corporation  or  its  successors or assignees that may be used to pay or
    12  secure storm recovery bonds and financing costs;
    13    (e) Provide that such  storm  recovery  property  may  be:  (i)  sold,
    14  assigned, or transferred by the electric corporation to (A) a subsidiary
    15  which  is  wholly  owned, directly or indirectly, by the electric corpo-
    16  ration and which will be the issuer of the storm recovery bonds  or  (B)
    17  another  assignee  which will be the issuer of the storm recovery bonds;
    18  or
    19    (ii) created or recognized as property of an assignee  which  will  be
    20  the issuer of the storm recovery bonds;
    21    (f) Provide that the storm recovery charges shall be sufficient at all
    22  times  to  pay the principal of and interest on the storm recovery bonds
    23  as the same shall become due and payable and all other  financing  costs
    24  and  establish  a  true-up  mechanism  requiring that the storm recovery
    25  charges be reviewed and adjusted at least annually to correct any  over-
    26  collection  or  undercollection  during the period since the issuance or
    27  preceding adjustment and to ensure the  projected  recovery  of  amounts
    28  sufficient  to  provide  timely  payment  of all principal, interest and
    29  other financing costs. Each adjustment to the storm recovery charge,  in
    30  amounts  as  calculated  by  or on behalf of the owner of storm recovery
    31  property, shall automatically become effective sixty days following  the
    32  date  on  which  the  periodic  adjustment  is filed with the commission
    33  unless the commission approves an earlier effective  date  requested  by
    34  the issuer of storm recovery bonds;
    35    (g) Provide and pledge that after the earlier of the transfer of storm
    36  recovery property to an assignee or the issuance of storm recovery bonds
    37  authorized thereby, a financing order is irrevocable until the indefeas-
    38  ible payment in full of the storm recovery bonds and the financing costs
    39  and,  provided  that,  except  as  provided in subdivision eight of this
    40  section or to implement any true-up mechanism adopted by the  commission
    41  as  described  in  paragraph (f) of this subdivision, the commission may
    42  not amend, modify, or terminate the financing order  by  any  subsequent
    43  action or reduce, impair, postpone, terminate, or otherwise adjust storm
    44  recovery charges approved in the financing order, provided nothing shall
    45  preclude limitation or alteration if and when full compensation, includ-
    46  ing  full  cost  recovery,  is made for the full protection of the storm
    47  recovery charges collected pursuant to a financing order  and  the  full
    48  protection  of  the  holders of storm recovery bonds and any assignee or
    49  financing party;
    50    (h) Specify how amounts collected from consumers  shall  be  allocated
    51  between storm recovery charges and other charges;
    52    (i)  Provide  that a financing order remains in effect until the storm
    53  recovery bonds issued pursuant to the order have been indefeasibly  paid
    54  in  full  and  the  financing costs of such bonds have been recovered in
    55  full;

        A. 8082                             7

     1    (j) Provide that a financing order shall remain in effect and unabated
     2  notwithstanding the  reorganization,  bankruptcy,  or  other  insolvency
     3  proceedings,  or  merger or sale, of the applicable electric corporation
     4  or its successors or assignees; and
     5    (k) Authorize and require the electric corporation, to the extent that
     6  any  interest  in  storm  recovery  property  is sold or assigned, shall
     7  contract with the assignee or any financing party to continue to operate
     8  its system to provide service  to  its  consumers,  collect  amounts  in
     9  respect  of  the  storm  recovery charges for the benefit and account of
    10  such assignee or financing party, and account for and remit such amounts
    11  to or for the account of such assignee  or  financing  party,  including
    12  pursuant  to  a  sequestration  order  authorized  by subdivision six of
    13  section three hundred  three  or  subdivision  seven  of  section  three
    14  hundred five of this article.
    15    6.  In  each  financing  order  issued  to or on behalf of an electric
    16  corporation, the commission shall:
    17    (a) Prescribe any limitations on potential assignees of storm recovery
    18  property;
    19    (b) Authorize an assignee which is a subsidiary of an electric  corpo-
    20  ration  and  which issues storm recovery bonds or another assignee which
    21  issues storm recovery bonds to provide and establish  in  its  organiza-
    22  tional  documents,  partnership  agreement,  or  operating agreement, as
    23  applicable, that in order for a person to file  a  voluntary  bankruptcy
    24  petition  on behalf of such assignee, the prior unanimous consent of the
    25  directors, partners, or managers, as applicable, shall be required.   If
    26  so  authorized in a financing order, any such provision set forth in the
    27  organizational documents, partnership agreement, or operating  agreement
    28  of  such an assignee shall constitute a legal, valid, and binding agree-
    29  ment of the shareholders, partners, or members, as applicable,  of  such
    30  assignee  and  shall be enforceable against such shareholders, partners,
    31  or members; and
    32    (c) Provide that the creation of the storm recovery property  pursuant
    33  to  paragraph  (d)  of  subdivision five of this section shall be condi-
    34  tioned upon, and shall  be  simultaneous  with  either:  (i)  the  sale,
    35  assignment,  or  other  transfer  of  the  storm recovery property to an
    36  assignee; or (ii) the issuance of the storm recovery bonds and the secu-
    37  rity interest created in the storm recovery  property  to  secure  storm
    38  recovery bonds.
    39    7.  After  the issuance of a financing order, and within such time and
    40  subject to any other limitations set forth in the financing  order,  the
    41  electric  corporation  retains  discretion  regarding  whether  to sell,
    42  assign, or otherwise transfer storm recovery property or  to  cause  the
    43  storm recovery bonds to be issued, including the right to defer or post-
    44  pone such sale, assignment, transfer, or issuance.
    45    8.  At  the  request  of  an  electric corporation, the commission may
    46  commence a proceeding  and  issue  a  subsequent  financing  order  that
    47  provides  for  the refinancing, retiring, or refunding of storm recovery
    48  bonds issued by an affiliate of the electrical corporation  pursuant  to
    49  the original financing order if the commission finds that the subsequent
    50  financing  order  satisfies all of the criteria specified in subdivision
    51  three of this section or that provides for an accounting, refunding,  or
    52  crediting  to consumers of the proceeds of any true-up mechanism adopted
    53  by the commission in accordance with paragraph (f) of  subdivision  five
    54  of this section.  Effective on retirement of the refunded storm recovery
    55  bonds  and  the issuance of new storm recovery bonds, the commission may

        A. 8082                             8

     1  adjust the related  storm  recovery  charges  accordingly  or  establish
     2  substitute storm recovery charges.
     3    9. (a) The commission shall not, in exercising its powers and carrying
     4  out  its  duties  regarding  any matter within its authority pursuant to
     5  this article, consider the storm recovery bonds  issued  pursuant  to  a
     6  financing  order  to  be the debt of the electric corporation other than
     7  for federal income tax purposes, consider  the  storm  recovery  charges
     8  paid  under the financing order to be the revenue of the electric corpo-
     9  ration for any purpose, or consider the storm recovery costs or  financ-
    10  ing  costs specified in the financing order to be the costs of the elec-
    11  tric corporation, nor may the commission determine any action  taken  by
    12  an electric corporation which is not consistent with the financing order
    13  to be unjust or unreasonable.
    14    (b)  The  commission may not order or otherwise directly or indirectly
    15  require an electric corporation to use storm recovery bonds  to  finance
    16  any  project, addition, plant, facility, extension, capital improvement,
    17  equipment, or any other expenditure.  After the issuance of a  financing
    18  order, the electric corporation retains sole discretion whether to cause
    19  the  storm  recovery bonds to be issued, including the right to defer or
    20  postpone such sale, assignment, transfer or  issuance.    Nothing  shall
    21  prevent  the  electric corporation from abandoning the issuance of storm
    22  recovery bonds under the financing order by filing with the commission a
    23  statement of abandonment and the reasons therefor.  The commission shall
    24  not refuse to allow an electric corporation to  recover  storm  recovery
    25  costs in an otherwise permissible fashion or refuse or condition author-
    26  ization  or approval of the issuance and sale by an electric corporation
    27  of securities or the assumption by the electric corporation  of  liabil-
    28  ities  or  obligations,  solely because of the potential availability of
    29  storm recovery bond financing.
    30    10. All financing orders issued by the commission shall  be  operative
    31  and in full force and effect on the date of the issuance of such order.
    32    11. Notwithstanding any other law to the contrary, any action, suit or
    33  proceeding to which the commission or the storm recovery bond issuer may
    34  be  a  party,  in  which  any question arises as to the validity of this
    35  article or any financing order, shall be preferred over all other  civil
    36  causes in all courts of the state, except election matters, and shall be
    37  heard  and  determined in preference to all other civil business pending
    38  therein, except election matters, irrespective of position on the calen-
    39  dar. Such preference shall also be granted upon petition of  counsel  to
    40  the  commission  in any action or proceeding questioning the validity of
    41  any financing order or other decision made by the commission under  this
    42  article  in  which  such  counsel may be allowed to intervene.  Notwith-
    43  standing any other provision of law to the contrary, the validity of any
    44  financing order or other decision may only be challenged by an aggrieved
    45  party pursuant to an action, suit or proceeding filed within thirty days
    46  after such financing order becomes final; provided,  however,  that  any
    47  such  action,  suit  or  proceeding  and  all supporting papers shall be
    48  commenced directly in the supreme court, appellate division, third judi-
    49  cial department.
    50    § 303.  Storm recovery property. 1. All storm recovery property speci-
    51  fied in a financing order shall constitute an existing, present property
    52  right. Such property shall exist whether or not the revenues or proceeds
    53  arising from the property have been billed, have accrued, or  have  been
    54  collected.
    55    2.  Storm  recovery  property  specified  in  a  financing order shall
    56  continue to exist until the storm recovery bonds issued pursuant to such

        A. 8082                             9

     1  order are paid in full and all financing costs of the  bonds  have  been
     2  recovered in full.
     3    3.  All  or  any  portion  of  storm  recovery property specified in a
     4  financing order issued to an electric corporation may be sold, assigned,
     5  or transferred to a successor or an assignee, including an affiliate  or
     6  affiliates of the electric corporation or any other assignee created for
     7  the  limited purpose of acquiring, owning, or administering storm recov-
     8  ery property or issuing storm recovery bonds under the financing  order.
     9  All  or  any  portion  of storm recovery property may be encumbered by a
    10  security interest to secure storm recovery bonds issued pursuant to  the
    11  order  and other financing costs.  Each such sale, assignment, transfer,
    12  or security interest granted by an electric corporation or affiliate  of
    13  an  electric  corporation or assignee shall be considered to be a trans-
    14  action in the ordinary course of business.
    15    4. The description of storm recovery property being sold, assigned, or
    16  transferred to an assignee in any sale agreement, purchase agreement, or
    17  other transfer agreement or created and recognized  as  property  of  an
    18  assignee  in  accordance  with  subdivision  nine of this section, being
    19  encumbered to a secured party in any security agreement,  pledge  agree-
    20  ment,  or  other security document, or indicated in any financing state-
    21  ment is only sufficient if such description or indication refers to  the
    22  specific  financing  order  that created the storm recovery property and
    23  states that such agreement or financing statement covers all or part  of
    24  such  storm  recovery  property  described  in such financing order.   A
    25  description of storm recovery property in a financing statement shall be
    26  sufficient if it refers to the financing order creating the storm recov-
    27  ery property.   This subdivision shall apply  to  all  purported  sales,
    28  assignments, or transfers of, and all purported liens or security inter-
    29  ests in, storm recovery property, regardless of whether the related sale
    30  agreement, purchase agreement, other transfer agreement, security agree-
    31  ment,  pledge agreement, or other security document was entered into, or
    32  any financing statement was filed, before or after the effective date of
    33  this article.
    34    5. Every electric bill issued by  an  electric  corporation  that  has
    35  obtained  a financing order and caused storm recovery bonds to be issued
    36  shall comply with the provisions of this subdivision; provided, however,
    37  that the failure of an electric corporation to comply with this subdivi-
    38  sion shall not invalidate, impair, or affect any financing order,  storm
    39  recovery  property,  storm  recovery  charge,  or  storm recovery bonds.
    40  Every such bill shall:
    41    (a) Explicitly reflect that a portion of  the  charges  on  such  bill
    42  represents  storm  recovery charges approved in a financing order issued
    43  to the electric corporation and, if the storm recovery property has been
    44  transferred to, or created at, an assignee, must include a statement  to
    45  the  effect that the assignee is the owner of the rights to storm recov-
    46  ery charges and that the electric corporation or other entity, if appli-
    47  cable, is acting as a collection agent or servicer  for  that  assignee.
    48  The  tariff  applicable  to  consumers  must indicate the storm recovery
    49  charge and the ownership of the charge.
    50    (b) Include the storm recovery charge on each  consumer's  bill  as  a
    51  separate  line  item  and  include  either the rate or the amount of the
    52  charge on each bill.
    53    6. If an electric corporation defaults  on  any  required  payment  of
    54  charges  arising  from  storm recovery property specified in a financing
    55  order, the supreme court, Albany county, upon petition by an  interested
    56  party, and without limiting any other remedies available to the applying

        A. 8082                            10

     1  party, shall order the sequestration and payment of the revenues arising
     2  from  the  storm  recovery  property  to  the financing parties or their
     3  representatives.  Any such order shall remain in full force  and  effect
     4  notwithstanding  any  reorganization,  bankruptcy,  or  other insolvency
     5  proceedings with respect to the electric corporation or  its  successors
     6  or assignees.
     7    7.  The  interest  of  an  assignee or secured party in storm recovery
     8  property specified in a financing order shall not be subject to  setoff,
     9  counterclaim,  surcharge,  or defense by the electric corporation or any
    10  other person, or in connection with the reorganization,  bankruptcy,  or
    11  other insolvency of the electric corporation or any other entity.
    12    8.  Any  successor to an electric corporation, whether pursuant to any
    13  reorganization, bankruptcy, or other insolvency  proceeding  or  whether
    14  pursuant  to any merger or acquisition, sale, or other business combina-
    15  tion, or transfer by operation of law, as a result  of  electric  corpo-
    16  ration  restructuring  or otherwise, shall perform and satisfy all obli-
    17  gations of, and have the same rights under  a  financing  order  as  the
    18  electric corporation under the financing order in the same manner and to
    19  the  same  extent  as the electric corporation, including collection and
    20  payment of any revenues and proceeds of the storm recovery  property  to
    21  any person entitled thereto.
    22    9.  Upon petition by the electric corporation, storm recovery property
    23  may be immediately created by operation of law  on  the  latter  of  the
    24  issuance  of  a  financing  order, or the issuance of the storm recovery
    25  bonds by an assignee.   Storm recovery property  created  in  accordance
    26  with  this  subdivision shall, upon creation, belong to the assignee and
    27  such assignee will have the same rights to and benefits arising from the
    28  storm recovery property as it would  have  if  it  acquired  such  storm
    29  recovery property as a result of a purchase, acquisition or other trans-
    30  fer from the electrical corporation.
    31    §  304.  Sale, assignment, or transfer of storm recovery property.  1.
    32  The sale, assignment, or other transfer of storm recovery property by an
    33  electric corporation to an assignee that the parties have in the govern-
    34  ing contract expressly stated to be a sale or  other  absolute  transfer
    35  shall  constitute an absolute transfer and true sale of, and not a secu-
    36  rity interest in, the transferor's right, title, and  interest  in,  to,
    37  and under such storm recovery property, other than for federal and state
    38  income  tax purposes.  The parties' characterization of such transaction
    39  as a sale of an interest in storm recovery property shall be  conclusive
    40  that the transaction is a true sale and that ownership has passed to the
    41  party characterized as the purchaser, regardless of whether the purchas-
    42  er  has  possession  of  any  documents  evidencing or pertaining to the
    43  interest.  After any such transaction, the storm recovery property shall
    44  not be subject to any claims of the transferor or the transferor's cred-
    45  itors, other than creditors holding a prior  security  interest  in  the
    46  storm  recovery  property perfected under section three hundred seven of
    47  this article.
    48    2. Notwithstanding any provision of law to the contrary,  the  charac-
    49  terization  of any sale, assignment, or other transfer as a true sale or
    50  other absolute transfer pursuant to subdivision one of this section  and
    51  the  corresponding  characterization of the assignee's property interest
    52  shall be determinative and conclusive irrespective of, and not  affected
    53  or  impaired  by,  the  existence of any or all of the following circum-
    54  stances:
    55    (a) Commingling of amounts arising with respect to the storm  recovery
    56  property with other amounts;

        A. 8082                            11

     1    (b) The retention by the transferor of a partial or residual interest,
     2  including an equity interest or entitlement to any surplus, in the storm
     3  recovery property, whether direct or indirect, or whether subordinate or
     4  otherwise;
     5    (c)  Any  recourse  that the assignee may have against the transferor,
     6  except that any such recourse shall not be created, contingent upon,  or
     7  otherwise occurring or resulting from the inability or failure of one or
     8  more of the transferor's consumers to timely pay all or a portion of the
     9  storm recovery charge;
    10    (d)  Any  indemnifications,  obligations, or repurchase rights made or
    11  provided by the transferor, except that  such  indemnity  or  repurchase
    12  rights  shall  not  be  based  solely upon the inability or failure of a
    13  transferor's consumers to timely pay all  or  a  portion  of  the  storm
    14  recovery charge;
    15    (e)  The  transferor  acting  as  the  collector of the storm recovery
    16  charges or the existence of any contract described in paragraph  (k)  of
    17  subdivision five of section three hundred two of this article;
    18    (f)  The contrary or other treatment of the sale, assignment, or other
    19  transfer for tax, financial reporting, or other purposes;
    20    (g) The granting or providing to holders of the storm  recovery  bonds
    21  of  a  preferred right to the storm recovery property or credit enhance-
    22  ment by the electric corporation or its affiliates with respect  to  the
    23  storm recovery bonds; or
    24    (h)  The  status  of the assignee as a direct or indirect wholly owned
    25  subsidiary or other affiliate of the electric corporation.  The separate
    26  juridical personality of any assignee of storm recovery  property  which
    27  is  a  subsidiary  or affiliate of the electric corporation shall not be
    28  disregarded due to the fact that the assignee and  the  electric  corpo-
    29  ration  share  any  one  or  more incidents of control, including common
    30  managers, officers, directors,  members,  accounting  or  administrative
    31  systems,  consolidated  tax  returns, or office space, that the assignee
    32  may be a disregarded entity for tax purposes, that the  electric  corpo-
    33  ration  caused  the  formation  of  the assignee, that a contract by the
    34  electric corporation and the assignee  described  in  paragraph  (k)  of
    35  subdivision  five  of  section three hundred two of this article exists,
    36  that the assignee has no other business other  than  pertaining  to  the
    37  storm  recovery  property,  that  the  capitalization of the assignee is
    38  limited to amounts  required  for  compliance  with  certain  applicable
    39  federal  income  tax  laws and revenue procedures, or that other factors
    40  used in applying a single business enterprise test to juridical  persons
    41  are present.
    42    3.  Any  right  that an electric corporation has in the storm recovery
    43  property prior to its sale, assignment, or transfer shall be in the form
    44  of a contractual right or chose in action notwithstanding  any  contrary
    45  treatment  thereof  for accounting or tax purposes.  The ownership of an
    46  interest in storm recovery property  is  voluntarily  transferred  by  a
    47  contract  between  the  owner and the assignee that purports to transfer
    48  the ownership of that interest.  Unless otherwise provided, the transfer
    49  of ownership between the parties shall be effective as soon as there  is
    50  written  agreement on the interest, the purchase price is fixed, and the
    51  financing order has been issued.  Such transfer shall be  perfected  and
    52  take  effect  against  all  third parties including, but not limited to,
    53  subsequent lien creditors when the transfer has become effective between
    54  the parties and when a financing statement giving notice  of  the  sale,
    55  assignment,  or transfer is filed in accordance with subdivision four of
    56  this section.  Delivery of such an interest in storm  recovery  property

        A. 8082                            12

     1  shall  take  place  by operation of law upon the filing of the financing
     2  statement.
     3    4.  Financing statements required to be filed under this section shall
     4  be filed, indexed, maintained, and continued in the same manner  and  in
     5  the same system of records maintained for the filing of financing state-
     6  ments  under article nine of the uniform commercial code.  The filing of
     7  such financing statement shall be the only method of perfecting a  sale,
     8  assignment,  or  transfer of storm recovery property.  The sale, assign-
     9  ment, or transfer of an interest in storm recovery property perfected by
    10  filing a financing statement shall be effective  against  any  consumers
    11  owing  payment  of the storm recovery charges, creditors of the transfe-
    12  ror, subsequent transferees, and all other third persons notwithstanding
    13  the absence of actual knowledge of or notice to such consumers  of  such
    14  sale, assignment, or transfer.
    15    5. The priority of the conflicting ownership interests of assignees in
    16  the  same  interest  or  rights  in any storm recovery property shall be
    17  determined as follows:
    18    (a) Conflicting  perfected  interests  or  rights  of  assignees  rank
    19  according to priority in time of perfection.
    20    (b)  A  perfected interest or right of an assignee has priority over a
    21  conflicting unperfected interest or right of an assignee.
    22    (c) A perfected interest or right of an assignee has priority  over  a
    23  person  who  becomes  a  lien  creditor  after  the  perfection  of such
    24  assignee's interest or right.
    25    6. The priority of a sale, assignment,  or  transfer  perfected  under
    26  this  section  shall  not  be  impaired by any later modification of the
    27  financing order or storm recovery property  or  by  the  commingling  of
    28  funds  arising from storm recovery property with other funds.  Any other
    29  security interest that may apply to such funds, other  than  a  security
    30  interest  perfected  under  section  three hundred five of this article,
    31  shall be terminated when those funds are  transferred  to  a  segregated
    32  account  for the assignee or a financing party.  If storm recovery prop-
    33  erty has been  transferred  to  an  assignee  or  financing  party,  any
    34  proceeds  of such property shall be held for and delivered to the assig-
    35  nee or financing party by any collector under any contract described  in
    36  paragraph  (k)  of subdivision five of section three hundred two of this
    37  article as a mandatary and fiduciary.
    38    § 305. Security interests. 1. The provisions of article  nine  of  the
    39  uniform commercial code relating to secured transactions shall not apply
    40  to  storm recovery property or any right, title, or interest of a corpo-
    41  ration or assignee therein, whether before or after the  issuance  of  a
    42  financing  order, except as provided in subdivision one of section three
    43  hundred six of this article.  In addition, such right, title, or  inter-
    44  est  pertaining  to a financing order, including but not limited to, the
    45  associated storm  recovery  property,  and  any  revenues,  collections,
    46  claims,  rights  to  payment, payments, money, or proceeds of or arising
    47  from storm recovery charges pursuant to such order, shall not be  deemed
    48  proceeds  of any right or interest other than of the financing order and
    49  the storm recovery property arising  from  the  financing  order.    All
    50  revenues  and  collections  resulting from storm recovery property shall
    51  constitute proceeds only of the storm recovery property arising from the
    52  financing order.
    53    2. Except to the extent provided  in  this  article  with  respect  to
    54  filings  of  financing  statements  or  control  of  deposit accounts or
    55  investment property as original collateral,  the  creation,  attachment,
    56  granting, perfection, and priority of security interests in storm recov-

        A. 8082                            13

     1  ery  property to secure storm recovery bonds shall be governed solely by
     2  this article and not by the uniform commercial code.
     3    3.  (a)  A  security  interest in storm recovery property is valid and
     4  enforceable against the electric corporation and  its  successor  or  an
     5  assignee  and third parties and attaches to storm recovery property only
     6  after all of the following conditions are met:
     7    (i) The issuance of a financing order;
     8    (ii) The execution and delivery of a security agreement with a financ-
     9  ing party in connection with the issuance of storm recovery bonds; and
    10    (iii) The receipt of value for the storm recovery bonds.
    11    (b) A security interest attaches to storm  recovery  property  without
    12  physical  delivery  of collateral or other act when all of the foregoing
    13  conditions have been met, unless the security agreement expressly  post-
    14  pones the time of attachment.
    15    4. A security interest in storm recovery property is perfected only if
    16  it  has attached and a financing statement indicating the storm recovery
    17  property collateral covered thereby has been filed.  A financing  state-
    18  ment  must be filed to perfect all security interests and liens in storm
    19  recovery property under this article.   A  security  interest  in  storm
    20  recovery  property is perfected when it has attached and when the appli-
    21  cable financing statement has been filed.   The interest  of  a  secured
    22  party  is  not  perfected  unless a financing statement sufficient under
    23  this article and otherwise in accordance  with  the  uniform  commercial
    24  code is filed, and after perfection the secured party's interest contin-
    25  ues in the storm recovery property and all proceeds of such storm recov-
    26  ery  property, whether or not billed, accrued, or collected, and whether
    27  or not deposited into a deposit account and however evidenced.  A  secu-
    28  rity  interest  in  proceeds  of  storm recovery property is a perfected
    29  security interest if the security interest in the storm recovery proper-
    30  ty was perfected under this article.  Financing statements  required  to
    31  be  filed  pursuant to this article shall be filed, indexed, maintained,
    32  and continued in the same manner and in the same system of records main-
    33  tained for the filing of financing statements under the uniform  commer-
    34  cial  code,  except  that  the requirement as to continuation statements
    35  does not apply.  The filing of such a financing statement shall  be  the
    36  only  method of perfecting a lien or security interest on storm recovery
    37  property.  The financing statement shall be filed as if the debtor named
    38  therein were located in this state.
    39    5. The priority of  the  conflicting  security  interests  of  secured
    40  parties in the same interest or rights in any storm recovery property is
    41  determined as follows:
    42    (a)  Conflicting  perfected security interests of secured parties rank
    43  according to priority in time of perfection;
    44    (b) A perfected security interest of a secured party has priority over
    45  a conflicting unperfected security interest of a secured party; and
    46    (c) A perfected security interest of a secured party has priority over
    47  a person who becomes a  lien  creditor  after  the  perfection  of  such
    48  secured party's security interest.
    49    6.  A  perfected  security interest in storm recovery property and all
    50  proceeds of  such  storm  recovery  property,  whether  or  not  billed,
    51  accrued,  or  collected,  and  whether  or  not deposited into a deposit
    52  account and however evidenced, shall have priority  over  a  conflicting
    53  lien  or privilege of any nature in the same collateral property, except
    54  a security interest is subordinate  to  the  rights  of  a  person  that
    55  becomes a lien creditor before the perfection of such security interest.
    56  A  security  interest  in  storm  recovery  property which qualifies for

        A. 8082                            14

     1  priority over a conflicting security interest, lien, or  privilege  also
     2  has  priority over the conflicting security interest, lien, or privilege
     3  in proceeds of the storm recovery property.  The relative priority of  a
     4  perfected security interest of a secured party is not adversely affected
     5  by any lien, privilege, or security interest in a deposit account of the
     6  electric  corporation  that is a collector as described in paragraph (k)
     7  of subdivision five of section three hundred two  of  this  article  and
     8  into which the revenues are deposited. The priority of a security inter-
     9  est  perfected  under  this section shall not be defeated or impaired by
    10  any later modification of the financing order or storm recovery property
    11  or by the commingling of funds arising from storm recovery property with
    12  other funds.  Any other security interest that may apply to those  funds
    13  shall  be terminated as to all funds transferred to a segregated account
    14  for the benefit of an assignee or a financing party or to an assignee or
    15  financing party directly. The  perfection  by  control,  the  effect  of
    16  perfection  by  control, and the priority of a security interest granted
    17  by the issuer of and securing storm recovery bonds  held  by  a  secured
    18  party  having  control  of  a  segregated  deposit account or securities
    19  account as original collateral  into  which  revenues,  collections,  or
    20  proceeds  of  storm recovery property are deposited or credited shall be
    21  governed by section 1-301 of uniform commercial code.
    22    7. If a default occurs under the terms of any storm recovery bond, the
    23  secured party may foreclose on or otherwise enforce the security  inter-
    24  est  in  any  storm recovery property as if it was a secured party under
    25  the uniform commercial code. A secured party holding a security interest
    26  in storm recovery property shall be entitled to exercise all of the same
    27  rights and remedies available to  a  secured  party  under  the  uniform
    28  commercial code, to the same extent as if those rights and remedies were
    29  set  forth  in  this article.   The court may order that amounts arising
    30  from storm recovery property be transferred to a separate account of the
    31  secured party for the financing parties' benefit, to which their securi-
    32  ty interest shall apply.   On petition by or  on  behalf  of  a  secured
    33  party,  the  court  shall  order  the  sequestration  and payment to the
    34  financing parties of revenues arising from the storm recovery property.
    35    8. A security interest created under this section may  provide  for  a
    36  security  interest in after-acquired collateral.  Such security interest
    37  shall not be invalid or fraudulent against creditors solely because  the
    38  grantor  or  the  electric  corporation as collector or servicer has the
    39  right or ability to commingle the collateral or  proceeds,  or  collect,
    40  compromise, enforce, and otherwise deal with collateral.
    41    9.  Any action arising under the provisions of this article to enforce
    42  a security interest in  storm  recovery  property,  or  which  otherwise
    43  asserts  an interest in, or a right in, to or against any storm recovery
    44  property, wherever located or deemed located, or any  security  interest
    45  governed  by this article, shall be brought in the supreme court, Albany
    46  county. Such actions shall be governed by the applicable  provisions  of
    47  the  civil  practice law and rules and other law applicable to executory
    48  proceedings, including provisional remedies, but only to the extent such
    49  laws are consistent with the language and purposes of this article.
    50    § 306. Choice of law; conflicts. 1. The law  governing  the  validity,
    51  enforceability,  attachment, perfection, priority, exercise of remedies,
    52  and venue with respect to the creation, recognition,  sale,  assignment,
    53  or transfer of an interest or right or the creation of a security inter-
    54  est in any storm recovery property shall be exclusively the laws of this
    55  state,  without  applying  this  state's  law  on  conflict  of laws and
    56  notwithstanding any contrary contractual provision, except  as  provided

        A. 8082                            15

     1  in  subdivision  six  of section three hundred five of this article. The
     2  validity, enforceability, attachment, perfection, priority, and exercise
     3  of remedies with respect to the creation, recognition, sale, assignment,
     4  or transfer of an interest or right or the creation of a security inter-
     5  est  in  any  storm recovery property shall be governed by this article,
     6  and solely to the extent not addressed by this article, by  the  uniform
     7  commercial  code  and  other  laws  of  this  state. Notwithstanding the
     8  preceding sentence, this article provides that  the  uniform  commercial
     9  code  applies  to the filings of financing statements referenced in this
    10  article, to perfection, the effect of perfection or  nonperfection,  and
    11  the  priority  of  security  interests  held  by  a secured party having
    12  control of deposit accounts or securities accounts as  original  collat-
    13  eral  securing  storm  recovery  bonds, notwithstanding that proceeds of
    14  storm recovery charges are deposited therein, and to the enforcement  of
    15  security  interests  in storm recovery property, in each case subject to
    16  subdivision two of this section.
    17    2. Insofar as the provisions of this article are inconsistent with the
    18  provisions of any other law or part thereof  regarding  the  attachment,
    19  creation,  perfection,  the  effect  of  perfection, or priority of, and
    20  sale, assignment, or transfer of, or security interest in, storm  recov-
    21  ery  property,  or  the  exercise  of remedies with respect thereto, the
    22  provisions of this article shall be controlling.
    23    3. Nothing in this section shall be construed so as to  conflict  with
    24  the  provisions of subdivision six of section three hundred five of this
    25  article.
    26    § 307. Storm recovery bonds not public debt. Storm recovery bonds  are
    27  not  a debt or a general obligation of the state or any of its political
    28  subdivisions, agencies, or instrumentalities and are  not  a  charge  on
    29  their  full  faith  and credit.   An issue of storm recovery bonds shall
    30  not, directly or indirectly or contingently, obligate the state  or  any
    31  agency,  political  subdivision, or instrumentality of the state to levy
    32  any tax or make any appropriation for payment of the bonds,  other  than
    33  for  paying  storm  recovery  charges  in their capacity as consumers of
    34  electricity.  All storm recovery bonds authorized by a  financing  order
    35  by  the  commission  must contain on the face thereof a statement to the
    36  following effect: "Neither the full faith  and  credit  nor  the  taxing
    37  power  of the State of New York is pledged to the payment of the princi-
    38  pal of, or interest on, this bond."
    39    § 308. State pledge. 1. The state pledges to and agrees with the hold-
    40  ers of storm recovery bonds, any assignee and all financing parties that
    41  the state will not in any way take or permit  any  action  that  limits,
    42  alters  or  impairs  the  value of storm recovery property or, except as
    43  required by a  true-up  mechanism  described  in  the  financing  order,
    44  reduce,  alter  or  impair  storm  recovery  charges  that  are imposed,
    45  collected and remitted for the benefit of the owners of  storm  recovery
    46  bonds,  any  assignee,  and  all financing parties, until all principal,
    47  interest and redemption premium in respect of storm recovery bonds,  all
    48  other  financing  costs  and  all  amounts  to be paid to an assignee or
    49  financing party under an ancillary agreement are paid  or  performed  in
    50  full.
    51    2.  Any  person that issues storm recovery bonds shall be permitted to
    52  include the pledge specified in subdivision one of this section  on  the
    53  face  of  such bonds and in any ancillary agreements or other documenta-
    54  tion related to the issuance and marketing of such bonds.
    55    § 309. Assignee not an electric corporation. An assignee or  financing
    56  party  shall  not  be  considered  an electric corporation as defined in

        A. 8082                            16

     1  subdivision thirteen of section two of this chapter solely by virtue  of
     2  engaging in any of the transactions described in this article.
     3    §  310. Effect of invalidity. If any provision of this article is held
     4  invalid or is invalidated, superseded, replaced repealed, or expires for
     5  any reason, such occurrence shall not affect the validity of any  action
     6  allowed  under  this  article  taken  by  an electric corporation, or an
     7  assignee, a financing party, a collection agent, or a party to an ancil-
     8  lary agreement. Any such action shall remain in full  force  and  effect
     9  with  respect  to  all  storm  recovery  bonds issued or authorized in a
    10  financing order issued pursuant to this article on or  before  the  date
    11  that  such  provision  is  held  invalid  or is invalidated, superseded,
    12  replaced, or repealed, or expires for any reason.
    13    § 311. Effect of a financing order. Section seventy  of  this  chapter
    14  shall  not apply to: 1. Any sale, assignment or transfer of storm recov-
    15  ery property or any equity position held by the  electrical  corporation
    16  in an assignee; or
    17    2.  Any  other  transaction contemplated by or approved in a financing
    18  order issued by the commission pursuant to this article.
    19    § 3. This act shall take effect immediately.
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