Dormitory Authority of the State of New York (DASNY) ABO Annual Report Operations and Accomplishments Fiscal Year April 1, 2017 March 31, 2018

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1 MISSION STATEMENT We cmmit t deliver exceptinal service and prfessinal expertise n every financing and cnstructin prject fr ur clients and the public, in a cst-effective manner, while advancing the plicy gals f New Yrk State. OPERATIONS AND ACCOMPLISHMENTS DASNY is a public benefit crpratin riginally established in 1944 under the laws f the State f New Yrk (the State) t finance and build drmitries at State teachers clleges t huse an influx f sldiers returning frm Wrld War II and attending cllege under the GI Bill. DASNY successfully addressed this challenge and has been respnding t challenges ever since. As a result, the scpe f its respnsibilities has greatly expanded. Tday, DASNY is amng the natin s largest issuers f lw-cst, tax-exempt bnds and ne f its biggest public builders. DASNY is the premier financier, develper, and cnstructin manager, making New Yrk cmpetitive and inclusive by financing and building the health care, educatin and scientific facilities that are the fundatin f sustainable cmmunities. OPERATIONS OVERVIEW DASNY has tw main lines f business: public finance and cnstructin services. During FY , DASNY cmpleted 21 bnd financings fr a ttal f apprximately $8.5 billin. DASNY als cmpleted 11 lease transactins ttaling apprximately $148 millin under its Tax-Exempt Leasing Prgrams (TELP I and TELP II). The largest public, higher educatin and health care financings were: State Persnal Incme Tax, Series 2017A ($1,750,395,000); New Yrk University Revenue Bnds, Series 2017A&B ($678,005,000); and Memrial Slan-Kettering Cancer Center, Series 2017, Series 1 ($294,420,000). DASNY is authrized t prvide a brad range f cnstructin prject services t certain educatinal, gvernmental and nt-fr-prfit institutins. DASNY wrks primarily in planning, design and cnstructin, cnstructin mnitring, and purchasing f furnishings and equipment. During FY , DASNY cnstructin expenditures fr DASNY-managed prjects ttaled apprximately $857 millin. DASNY als awarded new prfessinal services cntracts, cnstructin cntracts and assciated purchase rders fr client prgrams, ttaling apprximately $309 millin. In additin, DASNY issued term cntract wrk authrizatins, jb rder cntract wrk rders and term purchase rders ttaling apprximately $128 millin. As such, new prcurement activity fr FY ttaled $437 millin. 1

2 Cnstructin-related accmplishments fr FY include: Delivering all 15 schedule-critical SUNY husing prjects by the ccupancy date, including the: State University Cllege at New Paltz, cmplete building renvatin f Bevier Hall ($19.1 millin); State University Cllege at Plattsburgh, cmplete building renvatin f Wilsn Hall ($16.0 millin); SUNY Cllege f Technlgy at Alfred, renvatin at MacKenzie Cmplex, Phase I ($18.4 millin) City Cllege f New Yrk, Shepard Hall Phase 11 and 12 Façade restratin is cmplete ($23.3 millin); NYC Cllege f Technlgy, cnstructin fr the first-flr renvatin and structural repairs in the Allied Health Center ($15.2 millin); LaGuardia Cmmunity Cllege, renvatin f the existing library n the first flr f the LGCC E Building and expansin f the library int part f the 2nd Flr ($14.6 millin); Rckland Psychiatric Center, design and cnstructin f a new campus pwer plant ($25.8 millin); Suth Beach Psychiatric Center, prject cntinued in cnstructin phase with substantial cmpletin f Building Packages 1, 2 and 3 (site preparatins, piles and fundatins, structural steel); Building Package 5 (base building) prgressed t 24 percent cmplete. Prgressed the new $24 millin SUNY Brckprt design build residence hall prject twards a summer 2018 cmpletin. Further infrmatin n these and ther significant DASNY public finance and cnstructin accmplishments can be fund belw. CHALLENGES DASNY challenges in the public finance sectr include cmpetitin frm ther issuers f tax-exempt debt and market cnditins. DASNY s business cntinues t be impacted by the prliferatin f lcal develpment crpratins issuing tax-exempt debt, withut having t cmply with State versight prcedures applicable t DASNY. In additin, the interest rate spread between taxable and tax-exempt financing has remained relatively cmpressed minimizing the impact f the tax-exemptin. In FY , 13 DASNY bnd issues were defeased as private clients cntinued t refinance their bnds elsewhere. These defeasances have resulted in an verall reductin in ttal amunt f DASNY bnds utstanding assciated with private client financings when cmpared t the prir fiscal year. This 2

3 lss f business has resulted in a decline in annual revenue frm private client bnd administratin fees frm apprximately $5.8 millin in FY t apprximately $5.2 millin in FY Additinally, during FY , DASNY experienced a decrease in private client transactins. Private client business decreased t 13 transactins valued at apprximately $1.4 billin, as cmpared t 22 transactins valued at apprximately $3.0 billin during the prir fiscal year. In late 2017, DASNY s public finance clients were als faced with the ptential changes t the federal tax law which wuld have severely limited their ability t access tax-exempt financing. In particular, the eliminatin f private activity bnds wuld have driven up brrwing csts fr nt-fr-prfit entities, restricting their ability t create infrastructure and curbing grwth f New Yrk s ecnmy. DASNY s challenge was t determine hw best t assist its clients with addressing this pssibility. Within the cnstructin sectr f DASNY s business, DASNY-managed cnstructin expenditures increased t $857 millin, as cmpared t apprximately $634 millin during FY , an increase f apprximately 35 percent. The prfile f this wrk, hwever, cntinues t shift t a high number f smaller-sized prjects. The challenge DASNY faces is t maintain a cmpetitive cst structure in managing these smaller prjects, which by their nature can incur similar administrative burdens as larger scale prjects, including csts assciated with cntract and payment management. T address these challenges, DASNY has undertaken a number f initiatives during FY t imprve efficiency and maintain grwth while als prperly managing risk. These initiatives are mre fully discussed in the Executive Leadership sectin in this reprt. EXECUTIVE LEADERSHIP DASNY s clients have an increasingly varied mix f prject types, sizes and cmplexity. In rder t meet its clients needs and effectively and efficiently manage risk, DASNY is cntinuusly evaluating its prcesses and prcedures t be mre nimble and practive, and cnduct its business efficiently. This apprach, knwn internally as One DASNY, includes: Evaluating financing plicies and prcesses t identify pprtunities fr DASNY clients t enhance access t the financial markets with speed, certainty, and flexibility; Refining cnstructin prject crdinatin and cmmunicatin by bringing key staff frm all cntributing units tgether in a team envirnment and integrating prject delivery; Respnding t the shift in cnstructin wrklad by streamlining prcurement prcesses fr small prjects and managing client budget, schedules, and pririties in yearly cycles; and Targeting the delivery prcess imprvements f small prjects t reduce the prject duratins by up t 50 percent. It is envisined that these cntinuus prcess imprvements will assist DASNY in addressing many f the challenges utlined abve. 3

4 In additin t the accmplishments previusly nted, management has als undertaken and cmpleted the fllwing initiatives: Driving Innvative Slutins t Accelerate Financings In December 2017, DASNY wrked hand in hand with its health and higher educatin partners t help them meet their financing needs as the ability f these nt-fr-prfit institutins t issue lw-cst, tax-exempt private activity bnds had been in questin as a result f varius federal tax refrm prpsals. The DASNY Bard met five times within a six-week perid t undertake actins t ensure that its clients maintained their ability t finance and refinance the infrastructure that drives New Yrk s ecnmy. Specifically, DASNY accelerated six issuances in December 2017: Frdham University: DASNY issued $78 millin f University Revenue Bnds, Series 2017 (refunding). St. Jhn s University: DASNY issued mre than $42 millin f 2017 Series Bnds (refunding). Tur Cllege: DASNY issued $64 millin fr the acquisitin and renvatin f a facility lcated in Manhattan t be used fr student husing. Cerebral Palsy Affiliates Prgram (Jawn, Inc.): DASNY issued mre than $20 millin t finance cnstructin f a new health center and headquarters. Brnx-Lebann Hspital: DASNY issued ver $32 millin f 2017 Series Bnds (refunding). Memrial Slan Kettering Cancer Center: DASNY issued $294 millin f Revenue Bnds, 2017 Series 1, t finance ambulatry care facilities and ther imprvements and t refund certain bnds. Investing in a Skilled Wrkfrce T increase knwledge and prperly manage risk, DASNY has increased fcus n training fr its prfessinal and ther staff, and unveiled a new learning management system. DASNY University (DASNY U) prvides emplyees with ne centralized training system and calendar, enabling staff t view learning events scheduled acrss divisins. With desktp and mbile accessibility DASNY U is empwering emplyees t participate in trainings frm anywhere at any time. It is streamlining emplyee training requests and eliminating paper-based request frms. It als prvides emplyees access t their wn training transcripts. 4

5 CORPORATE GOVERNANCE The Public Authrities Refrm Act f 2009 requires each State authrity t adpt a missin statement and perfrmance measurements and t review them n an annual basis. At its March 7, 2018 meeting, the DASNY Gvernance Cmmittee undertk its annual review f DASNY s Missin Statement, Perfrmance Measures and Metrics t Quantify Perfrmance Gals. The Gvernance Cmmittee did nt recmmend any changes t the DASNY Missin Statement and Perfrmance Metrics, and made n substantive changes t the Metrics t Quantify Perfrmance Gals. LEGISLATION DASNY cntinues t mnitr legislative activity that wuld imprve its ability t respnd t client needs and advance sund plicy fr the State. In additin t matters referenced in the Operatins and Accmplishments, Executive Leadership and Finance sectins f this reprt, the fllwing are highlights f recent legislatin affecting DASNY: NYS Life Sciences Public Health Initiative: The FY State Budget authrized $150 millin in capital funding fr a new life sciences labratry public health initiative in the Capital District pursuant t a plan develped by Urban Develpment Crpratin (UDC) and the Department f Health (DOH). The FY enacted budget prvides fr Phase Tw f the prject by apprpriating anther $600 millin fr a ttal f $750 millin. DASNY and UDC are authrized by the Infrastructure Investment Act t cnstruct the prject using design-build prject delivery methd, and t finance the capital csts f the prject thrugh the issuance f DASNY r UDC bnds. DASNY Health Care Subsidiaries: The FY State Budget extends DASNY s authrizatin t frm subsidiaries in the health care sectr t July 1, This capability is critical t prtecting DASNY frm ptential liabilities in the event that it takes cntrl f the assets f a health care entity in default. This authrity was first used in cnnectin with the federal bankruptcy prceedings fr Nrth General Hspital (NGHP Hlding Crpratin) and, additinally fr Interfaith Medical Center (Atlantic Avenue Healthcare Prperty Hlding Crpratin). Raise The Age Facilities: The FY State Budget authrizes DASNY t prvide capital cnstructin services t the NYS Office f Children and Family Services (OCFS) and authrizes DASNY t prvide cnstructin and financing services fr certain detentin facilities certified by OCFS in cnjunctin with the Raise the Age legislatin enacted in the State Budget. Cerebral Palsy Assciatins f New Yrk State: The FY State Budget authrizes DASNY t finance and cnstruct prjects n behalf f the members and nt-fr-prfit affiliates f Cerebral Palsy Assciatins f New Yrk State. This new authrizatin supplements DASNY s existing authrizatin t the 25 individual Cerebral Palsy affiliates acrss the State, by allwing future members and affiliates t wrk with DASNY withut having t seek stand-alne legislatin. 5

6 FINANCE Bnd Financings DASNY delivered apprximately $8.5 billin par value f bnds during FY , ending with an utstanding bnd prtfli f apprximately $50.5 billin. Of the ttal bnds utstanding, apprximately 71 percent are n behalf f public prgrams (such as State-supprted debt and schl districts); apprximately 21 percent are n behalf f independent higher educatin institutins and ther nt-frprfits; and apprximately 8 percent are fr independent health care institutins. During FY , apprximately 83 percent f the $8.5 billin ttal par value f bnds delivered by DASNY were fr its public clients. DASNY delivered a ttal f apprximately $7.1 billin f bnds in FY fr its public clients: Public clients: Master BOCES Prgram Lease Refunding Revenue Bnds, (Nassau Cunty BOCES Issue), Series 2017 $10,530,000 Persnal Incme Tax Revenue Bnds (General Purpse), Series 2017A $1,750,395,000 Persnal Incme Tax Revenue Bnds (General Purpse), Series 2017B, Series 2017C and Series 2017D (Taxable) $1,667,125,000 Schl Districts Revenue Bnd Financing Prgram Revenue Bnds, Series 2017A-E $302,510,000 Schl Districts Revenue Bnd Financing Prgram Revenue Bnds, Series 2017F-J $299,180,000 State Sales Tax Revenue Bnds, Series 2017A (Bidding Grups A-C) and Series 2017B (Taxable) $1,380,550,000 State Sales Tax Revenue Bnds, Series 2018A (Bidding Grups 1-4) and Series 2018B (Taxable) $1,329,725,000 State University f New Yrk Drmitry Facilities Revenue Bnds, Series 2017A $344,665,000 Ttal public financings $7,084,680,000 6

7 DASNY als delivered apprximately $1.4 billin f bnds in FY fr its independent, private-sectr clients: Brnx-Lebann Hspital Center Private Placement Revenue Bnds, Series 2017 $32,911,000 Cerebral Palsy Affiliates Prgram (Jawni, Inc.) Private Placement Revenue Bnds, Series 2017A $20,720,000 Cerebral Palsy Affiliates Prgram (United Cerebral Palsy Assciatins f New Yrk State, Inc.) Private Placement Revenue Bnds, Series 2017A and Series 2017B (Taxable) $34,915,000 Cerebral Palsy Affiliates Prgram (United Cerebral Palsy Assciatins f Putnam and Suthern Dutchess Cunties, Inc.) Private Placement Revenue Bnds, Series 2017A and Series 2017B $12,035,000 Frdham University Revenue Bnds, Series 2017 $78,050,000 InterAgency Cuncil Pled Lan Prgram Revenue Bnds, Series 2017A (Subseries 2017A-1) and (Subseries 2017A-2) (Taxable) $17,145,000 Jewish Thelgical Seminary f America Private Placement Revenue Bnds, Series 2017 $51,000,000 Memrial Slan - Kettering Cancer Center Revenue Bnds, 2017 Series 1 $294,420,000 New Yrk University Revenue Bnds, Series 2017A and Series 2017B (Taxable) $678,005,000 Rckefeller University Private Placement Revenue Bnds, Series 2017A $100,445,000 Silvercrest Center fr Nursing and Rehabilitatin Private Placement Revenue Bnds, Series 2017 $15,766,981 St. Jhn's University Revenue Bnds, Series 2017A $42,580,000 Tur Cllege and University System Obligated Grup Revenue Bnds, Series 2017 $64,015,000 Ttal private-client financings $1,442,007,981 Ttal financings $8,526,687,981 Tax-Exempt Equipment Leasing Prgram (TELP) Financings Tax-Exempt Leasing Prgram I (Health Care) Episcpal Health Services, Inc. $3,256,969 Hspital fr Special Surgery $14,979,666 Maimnides Medical Center $19,408,390 Mntefire Medical Center $17,827,755 Mntefire Medical Center $9,990,258 Samaritan Medical Center, Watertwn $5,555,790 State University f New Yrk Stny Brk University Hspital $18,500,000 State University f New Yrk University Hspital at Syracuse $23,200,000 United Health Services Hspitals, Inc, $10,240,000 White Plains Hspital Medical Center $18,170,692 Ttal TELP I Leases $141,129,520 7

8 Tax-Exempt Leasing Prgram II (Higher Educatin & Other Nt-fr-Prfits) NYSARC, Inc. $7,554,234 CONSTRUCTION Cnstructin Statistics Ttal TELP II Leases $7,554,234 Ttal TELP Leases $148,683,754 At the clse f FY , DASNY had a ttal cnstructin wrklad f 932 full and mdified services prjects valued at apprximately $6.16 billin. Expenditures n prjects fr which DASNY prvided full services during FY ttaled $857 millin. Prjects in the pipeline as f March 31, 2018 are summarized in the table belw: Type f DASNY Service Number f Prjects Ttal Value f Prjects Full and mdified (all phases) 932 $ 6,157,495,107 Preliminary phase 253 $ 1,473,365,469 Design phase 481 $ 2,166,162,564 Cnstructin phase 198 $ 2,517,967,074 Full Service Prjects >$5 millin 139 $ 2,975,730,243 DASNY-managed prjects cmpleted in FY include: State University Cllege at New Paltz, Bevier Hall ($18.8 millin) State University Cllege at Plattsburgh, Wilsn Hall renvatins ($15.3 millin) State University at Albany, Herkimer Hall renvatin ($9.0 millin) State University Cllege at Osweg, Scales Hall renvatin ($13.3 millin) State Office f Mental Health, Rckland PC, new pwer plant ($25.8 millin) NYC Curt Facilities, Brnx Family / Criminal Curt, interir renvatins ($53.6 millin) NYC Health + Hspitals, Guverneur Health, new cnstructin and renvatins ($252.6 millin) CUNY, City Cllege f New Yrk, Shepard Hall Façade Restratin, Phase 11 and 12 ($23.3 millin) CUNY Schl f Medicine s Sphie Davis Bimedical Prgram, interir renvatins ($12.6 millin) CUNY, New Yrk City Cllege f Technlgy, Allied Health, First Flr renvatins ($15.5 millin) CUNY, LaGuardia Cmmunity Cllege, library expansin ($14.6 millin) 8

9 CUNY, Cllege f Staten Island, rf replacement ($7.0 millin) CUNY, Hsts Cmmunity Cllege, furth flr renvatin ($9.2 millin) CUNY, Brugh f Manhattan Cmmunity Cllege, pl deck repairs ($10.9 millin) CUNY, Kingsbrugh Cmmunity Cllege, cling twer and chilled water system upgrades ($10.0 millin) Majr nging DASNY-managed prjects include: Suth Beach Psychiatric Center, new inpatient building ($265.0 millin) Hutchings Psychiatric Center, rehabilitatin f Building 1 ($25.0 millin) LaGuardia Cmmunity Cllege, Center 3 façade replacement ($122.7 millin) Queens Cllege, new chiller plant ($31.8 millin) Queensbrugh Cmmunity Cllege, electrical recnstructin ($42.0 millin) State University Cllege at Brckprt, new 250 bed residence hall ($24 millin) State University Cllege at Plattsburgh, Whiteface Hall renvatins ($19.0 millin) SUNY Cllege f Technlgy at Alfred, renvatin at MacKenzie Cmplex, Phase II ($18.4 millin) New prjects added t DASNY s cnstructin pipeline during FY include: Central New Yrk Psychiatric Center, Renvatins t Building 30 ($133.0 millin). Queensbrugh Cmmunity Cllege, Center fr Allied Health ($10.0 millin) Cllege f Staten Island, campus radway recnstructin ($9.0 millin) Cllege f Staten Island, Big Data Cnsrtium ($13.0 millin) Herbert H. Lehman Cllege, Shuster Hall façade renvatin ($5.9 millin) Brnx Cmmunity Cllege, Advanced Transprtatin and Technlgy Center ($8.4 millin) City Cllege f New Yrk, Schiff Huse Daycare Center renvatin ($8.0 millin) City Cllege f New Yrk, fire huse renvatin ($7.3 millin) Queens Cllege, Renvatin f Kiely Hall and Jeffersn Hall ($8.46 millin). NYS Cultural Educatin Center, new strage facility ($10.0 millin) State University f New Yrk at Purchase, Big Haus minr renvatins ($11.0 millin) SUNY Albany, Dutch Quad G & H renvatins ($26.5 millin) SUNY Buffal State Cllege, Renvatins t Twer 3 ($16.0 millin). State University Cllege at Plattsburgh, upgrades and site imprvements t Kent Hall ($12.0 millin). 9

10 New prjects in prgrams where DASNY has varius levels f versight: Hmeless Husing and Assistance Prgram: 11 prjects fr hmeless husing lcated in Albany, Brnx, Erie, Kings, New Yrk, Niagara, Ontari, and Steuben Cunties ($361.9 millin). Office f Alchlism and Substance Abuse Services: Five renvatin and new cnstructin prjects in Brnx, Mnre, Niagara, and Tmpkins Cunties ($43.9 millin). Office f Parks, Recreatin, and Histric Preservatin: Tw prjects in Cattaraugus and Nassau Cunties ($24.7 millin). Cnstructin Develpments State University f New Yrk Residence Hall Prgram: DASNY cmpleted six capital prjects with an verall prject value exceeding $79 millin and 34 summer prjects with an verall prject value f apprximately $30 millin during the summer f In additin, the 2018 summer activity includes fur capital prjects with an verall prject value f apprximately $59.5 millin and 30 summer prjects with a value f mre than $30.5 millin. New Yrk City Husing Authrity (NYCHA): The FY State Budget authrized $100 millin fr public husing mdernizatin and imprvement prgram t imprve safety and quality f life fr NYCHA residents. DASNY was specified as the entity t execute the prgram by prviding cnstructin services fr all prjects within the prgram, which currently cnsists f three phases: (1) 77 security imprvement prjects; (2) 33 appliance replacement prjects; and (3) 56 quality f life prjects. Gvernr s Office f Strm Recvery (GOSR): DASNY s wrk fr GOSR includes apprximately 70 prjects ttaling ver $150 millin in NYC and n Lng Island alng with the 19 Upstate prjects ttaling nearly $24 millin. DASNY cntinues t wrk clsely with GOSR t advance the prjects int the cnstructin phase. NY Wrks: During FY , DASNY cntinued t perfrm cnstructin management services fr the NYS Department f Envirnmental Cnservatin (DEC) and the NYS Office f Parks, Recreatin, and Histric Preservatin (OPRHP) under the NY Wrks Prgram, including dams, fld cntrl and dredging prjects (DEC) and the Niagara Falls State Park prject (OPRHP). Department f Health Certificate f Need Reviews: DASNY cntinues t prvide dcument review services. As f March 31, 2018, DASNY has cntracted fr 282 reviews fr 114 hspitals and health care prviders with a ttal prject value f apprximately $10.5 billin. Prjects reviewed include hspitals, nursing hmes, ambulatry surgical centers, and diagnstic and treatment centers. Cnstructin Site Safety Initiatives: DASNY is cmmitted t maintaining a safe wrking envirnment at each f its cnstructin sites. T supprt this cmmitment, DASNY hlds cntracts with tw safety/lss cntrl firms. The cnsultants assist DASNY staff and cntractrs in identifying ways t cntrl hazards nrmally assciated with an active cnstructin site. In calendar year 2017, the safety/lss cntrl cnsultants cnducted 200 cnstructin site surveys. 10

11 NEW YORK STATE PROGRAMS Cnsistent with DASNY s missin statement and lng-standing histry f public service, DASNY s prfessinal staff supprted numerus State f New Yrk prgrams, plicies and ecnmic develpment initiatives during Fiscal Year : Health Care Transfrmatin (Department f Health) Upn taking ffice, Gvernr Andrew M. Cum created the Medicaid Redesign Team t craft a first-year Medicaid budget prpsal and develp a multiyear refrm plan fr the transfrmatin f health care in New Yrk State. In 2014, New Yrk finalized terms and cnditins with the federal gvernment fr a waiver amendment that allcates $6.42 billin t the Delivery System Refrm Incentive Payment (DSRIP) prgram. The purpse f the DSRIP prgram is t fundamentally restructure the health care delivery system in New Yrk using federal savings generated by the State s Medicaid refrms, creating a financially sustainable health care system. Althugh DASNY des nt have a direct rle in the DSRIP Prgram, DASNY has significant respnsibilities under several prgrams which are central t achieving the State s health care transfrmatin gals including financing prgrams thrugh issuance f bnds. Capital Restructuring Financing Prgram The Capital Restructuring Financing Prgram (CRFP) is a $1.2 billin capital grant prgram riginally included in the State Budget t prvide funds t health care prviders fr funding capital prjects. After prgram changes in 2015, a Request fr Applicatins was released by DOH and DASNY n April 10, 2015 and n March 4, 2016, DOH and DASNY annunced 135 grant awards ttaling apprximately $1.2 billin t qualifying institutins. Pst-award wrk n these grants cntinued thrughut 2017, and cntinues t date. Health Care Facility Transfrmatin Prgrams (HCFTP) The State Budgets beginning in FY and t date include $2.225 billin in apprpriatins and re-apprpriatins fr Health Care Facility Transfrmatin Prgram (HCFTP) capital grant funding, intended t strengthen and prtect cntinued access t health care services in New Yrk s cmmunities: The HCFTP Kings Cunty is a $700 millin capital grant prgram riginally included in the FY State Budget t prvide capital funding in supprt f prjects that replace inefficient and utdated facilities as part f a merger, cnslidatin, acquisitin r ther significant crprate restructuring activity intended t create a financially sustainable system f care. A Request fr Applicatins (RFA) was issued fr the prgram n March 9, 2017, and an award f up t $663,993,428 t One Brklyn Health (OBH) was annunced January 31, Pst-award wrk n the OBH grant cntinues t date. The HCFTP Oneida Cunty is a $300 millin capital grant prgram riginally included in the FY State Budget t prvide capital funding in supprt f prjects lcated in the largest ppulatin center f Oneida Cunty that cnslidate multiple licensed health care facilities int an integrated system f care. A Request fr Applicatins (RFA) was issued by DOH fr this prgram n Nvember 22, 2016, and an award f up t $300 11

12 millin was made t Mhawk Valley Health System (MVHS) n April 3, Pst-award wrk n the MVHS grant cntinues t date. The FY State Budget included a new $200 millin HCFTP Statewide prgram, with up t $195 millin t prvide capital grant funding in supprt f prjects that replace inefficient and utdated facilities as part f a merger, cnslidatin, acquisitin r ther significant crprate restructuring activity that is part f an verall transfrmatin plan intended t create a financially sustainable system f care, and up t $5 millin fr the purchase f mammgraphy equipped vehicles. A Request fr Applicatins (RFA) was issued fr the prgram n July 20, 2016 Due t significant RFA respnse, State fficials determined t seek additinal funding fr the applicants under this RFA during the State Budget prcess. Effective April 1, 2017, a new Statewide II prgram (als discussed belw) included a feature allwing up t $300 millin frm the new HCFTP Statewide II prgram authrizatin f $500 millin t be awarded t unfunded capital grant applicatins. On April 20, 2018, DOH fficials determined t award grants t 92 prjects ttaling apprximately $491 millin fr the HCFTP Statewide RFA. Pst-award wrk n these grants cntinues t date, with apprximately $28 millin (45 prjects) awarded t cmmunity-based health care prviders. A Request fr Applicatins (RFA) fr the remaining balance in the HCFTP Statewide II prgram was issued n January 8, 2018, and the RFA remains in prcess. Finally, the FY State Budget includes a new $525 millin HCFTP Statewide III prgram t prvide grant funding in supprt f capital prjects, debt retirement, wrking capital r ther nn-capital prjects that facilitate health care transfrmatin activities. Cmmunity Health Care Revlving Lan Capital Fund DASNY and DOH have established the $19.5 millin Cmmunity Health Care Revlving Capital Fund t imprve access t capital fr clinics and ther rganizatins that have limited resurces and are seeking t braden access t primary care services. In February 2017, DASNY, in cnsultatin with the Department f Health (DOH), selected the Primary Care Develpment Crpratin t administer the fund. Brrwers will be chsen by Primary Care Develpment Crpratin (PCDC) thrugh an applicatin prcess that is apprved by DASNY and DOH. The funds will be used t prvide lans fr prjects at eligible facilities. This new lan prgram was placed int peratin during April New Yrk Rising Strm Recvery Prgram (GOSR/HTFC) In FY , DASNY cntinued t wrk with the Gvernr s Office fr Strm Recvery (GOSR) and Husing Trust Fund Crpratin (HTFC) t prvide services fr the New Yrk Rising Strm Recvery Prgram. Further details n this prgram are included in the Cnstructin sectin f this reprt. Public Husing Supprt (NYCHA) In FY , DASNY cntinued t wrk with the New Yrk State Divisin f Husing and Cmmunity Renewal (DHCR) and New Yrk City Husing Authrity 12

13 (NYCHA) n a public husing mdernizatin and imprvement prgram benefitting husing develpments wned r perated by NYCHA. Further details n this prgram are included in the Cnstructin sectin f this reprt. NY Wrks (OPRHP and DEC) In FY , DASNY cntinued t prvide design and cnstructin management services t the New Yrk State Office f Parks, Recreatin and Histric Preservatin (OPRHP) and Department f Envirnmental Cnservatin (DEC) under the NY Wrks Prgram and further details n this prgram are included in the Cnstructin sectin f this reprt. State Transfrmatinal Ecnmic Develpment Infrastructure and Revitalizatin Prjects Jacb K. Javits Cnventin Center Expansin Prject Part G f Chapter 73 f the Laws f 2016 authrized the New Yrk Cnventin Center Develpment Crpratin (CCDC) t request that DASNY act as the cnstructin-permitting agency, pursuant t Article 18 f the Executive Law and the regulatins prmulgated thereunder, fr the Jacb K. Javits Cnventin Center prject. Wrk n this prject is cntinuing. Mynihan Statin/James A. Farley Building Replacement Pursuant t Article 18 f the Executive Law and the regulatins prmulgated thereunder, in FY DASNY tk n the respnsibility t act as the cnstructin-permitting agency fr the Urban Develpment Crpratin s (UDC) adaptive reuse f the James A. Farley Pst Office Building and Annex as part f UDC s Mynihan Statin Civic and Land Use Imprvement Prject. This wrk includes the creatin f Mynihan Train Hall cnnected t Penn Statin. Wrk n this prject is cntinuing. NYS Life Sciences Public Health Initiative Pursuant t certain apprpriatins enacted in the State Budget and re-apprpriatins enacted in the State Budget, DASNY is authrized t prvide design and cnstructin services fr a new (cmbined) Life Sciences Public Health Initiative in the Capital District that wuld prvide pprtunities t evlve the DOH Wadswrth Labratry s basic research; attract and retain sustainable partners in its current state withut key enhancements; and serve as a fcal pint fr the Capital Regin s life sciences industry cluster. The new facility will be in accrdance with a plan develped and apprved by the Chief Executive Officer f the New Yrk State Urban Develpment Crpratin jintly with the Cmmissiner f the New Yrk State Department f Health. The New Yrk State Infrastructure Develpment Act was amended t authrize DASNY and Urban Develpment Crpratin t utilize the alternative delivery methd knw as design-build fr the new life sciences labratry. A ttal f $750 millin is apprpriated fr the capital prtin f this prject fr which UDC and DASNY are authrized t issue bnds. DASNY and its State partners are evaluating ptential alternative sites, and a 2018 Request fr Qualificatins (RFQ) pursuant t the New Yrk State Infrastructure Develpment Act is anticipated. 13

14 State Capital Grant Prgrams DASNY administers 18 capital grant prgrams n behalf f New Yrk State that supprt cmmunity and ecnmic develpment, including newer prgrams described belw with recent legislative amendments: Nnprfit Infrastructure Capital Investment Prgram (NICIP) The FY State Budget created a $50 millin capital grant prgram t make targeted investments in capital prjects that will imprve the quality, efficiency, accessibility, and reach f nt-fr-prfit human services rganizatins that serve New Yrkers. In the State Budget, funding fr NICIP was increased by $50 millin, Pursuant t a cmpetitive RFA prcess, n January 3, 2017, 237 applicants were awarded grants ttaling apprximately $100 millin. Due t significant respnse t the RFA, the FY State Budget authrized an additinal $20 millin fr the NICIP prgram t be awarded t unfunded capital grant applicatins submitted in respnse t the RFA. On January 23, 2018, an additinal 31 grants were awarded, ttaling apprximately $20 millin. DASNY and/r UDC are authrized t issue bnds t supprt this prgram. Pst-award wrk n all NICIP grants cntinues t date. Higher Educatin Capital Matching Grant Prgram (HECap) In FY , DASNY, as staff t the HECap Bard, cntinued t administer grants under the prgram s $240 millin bnding authrizatin. A Request fr Applicatins (RFA) was released n Nvember 21, 2017, and awards t successful applicants are expected t be made in Summer The FY State Budget includes an additinal $30 millin in supprt f the HECap prgram, and DASNY is currently develping an RFA fr this new grant funding. The State and Municipal Facilities Capital Prgram (SAM) DASNY administers SAM Grants awarded by the Senate Finance Cmmittee, the Assembly Ways and Means Cmmittee, and the Executive. The FY State Budget expanded the entities eligible fr SAM funding t include certain schls fr students with disabilities. The legislatin was further expanded t authrize a prtin f SAM grant funds t be utilized fr certain strm recvery effrts. The State Budget increased the aggregate amunt f bnds that may be issued by DASNY and/r UDC under the SAM prgram frm $1.54 billin t $2.32 billin, and expands the list f eligible SAM grantees t ther entities including nt-fr-prfit rganizatins, reginal transprtatin authrities, special districts, and certain public authrities. MINORITY AND WOMEN-OWNED BUSINESS ENTERPRISE (MWBE) INITIATIVES MWBE 15-A Cntract Gals and Expenditure Results fr FY 2018: DASNY s MWBE Article 15-A aspiratinal gal fr cntracts executed in FY 2018 was 30 percent (18 percent MBE and 12 percent WBE). DASNY s cumulative MWBE expenditures fr FY 2018 were $174,391,411, which is percent (18.51 percent MBE and percent WBE) f DASNY s ttal cntract expenditures fr FY This represents an increase f apprximately $35 millin when cmpared t MWBE expenditures in the previus fiscal year. DASNY s FY 2018 MWBE participatin cmpares favrably with the 20 percent gal that was in place when many f the applicable cntracts were awarded. Taken tgether, these accmplishments psitin DASNY t better serve its clients and prmte inclusin in New Yrk State cntracting pprtunities. 14

15 MWBE Financial and Prfessinal Services: The chart belw utlines the MWBE participatin fr nn-cnstructin related prfessinal services fr FY Fur categries, Legal, Accunting, Official Statement Printing and Risk Management are reprted t Empire State Develpment (ESD). Financial Advisry, Swap Advisry, Underwriters fr Public Transactins, Brker Dealer and Private Client Transactins with Multiple Underwriters are tracked by DASNY, but nt reprted t ESD. Summary Fiscal Year April 1, March 31, 2018 Nn-Cnstructin Prfessinal Service Ttal MWBE Participatin % Participatin Legal $ 12,085,094 $ 2,242, % Accunting $ 375,682 $ 96, % Financial Advisry $ 25,500 $ 0 0% (1) Official Statement Printing $ 79,505 $ 79, % Swap Advisry $ N/A $ N/A N/A Risk Management $ 669,621 $ 186, % (2) Underwriters fr Public Transactins $ 5,990,253 $ 1,897, % (1) $25,000 engagement related t bnd financing with an MWBE financial advisry firm which merged with a majrity firm. This wuld have resulted in 98% MWBE Financial Advisry participatin. (2) Values include fees paid by DASNY and cmmissins paid by insurance carriers in assciatin with plicies placed fr DASNY. Values d nt include insurance premiums, which ttal $11.9 millin. Brkers d nt retain any part f thse funds, which are paid directly t insurance carriers n DASNY s behalf. Nn-Cnstructin Prfessinal Service Ttal MWBE Participatin % Participatin Brker-Dealer (3) $ 5,158,338,000 $ 1,412,443, % Nn-Cnstructin Prfessinal Service Number f Transactins Transactins with MWBE Participatin % Participatin Private Client Transactins with Multiple Underwriters % (3) Blended rate including vluntary private client MWBE participatin nt required under Executive Law Article 15-A. 15

16 SERVICE-DISABLED VETERAN-OWNED BUSINESS (SDVOB) INITIATIVES DASNY is dedicated t assisting SDVOBs t cmpete successfully in its building services and prcurement prgrams. DASNY cntinues t emply numerus strategies/prgrams designed t identify, ntify, educate and supprt SDVOB enterprises in DASNY s cmplete platfrm f services. Based n the Divisin f Service-Disabled Veterans Business Develpment Annual Reprt, as f December 31, 2017, DASNY ranked seventh (7 th ) amng ninety-eight (98) State Agencies and Authrities in disbursements t SDVOB firms. SUSTAINABILITY PROGRAMS DASNY Green Prjects in Design and Cnstructin All DASNY prjects that are new cnstructin, additins r significant renvatins must include a gal f LEED Silver r higher and be fully submitted t the United States Green Building Cuncil (USGBC) fr a rating review. As f March 31, 2018, 42 prjects have received a rating f Certified r better, including three Platinum, 14 Gld, 22 Silver and three Certified. LEED Accredited Prfessinals at DASNY DASNY has 25 LEED-Accredited Prfessinals (AP) and ne Green Assciate n staff t assist DASNY and its clients with the LEED certificatin prcess. DASNY encurages all emplyees invlved with design and cnstructin t prepare fr and take the test t achieve LEED-AP status. DASNY Wrks t Advance New Yrk State Sustainability Plicy Gals DASNY cntinues t wrk cllabratively with ther State entities t further State Plicy Gals, including Executive Orders N. 88 (relating t energy efficiency, cmmissining and metering), N.18 (striving t eliminate single-use water bttles), N. 4 (pertaining t green prcurement and waste reductin) and Executive Order N. 166 (with gals f statewide greenhuse gas (GHG) emissins reductins f 40 percent by 2030 and 80 percent by 2050). Where pssible, DASNY incrprates these plicy gals int its cnstructin prjects by striving fr extremely high efficiency in every prject and discussing the ptential benefits f net zer designs with clients, cnsultants, and cntractrs. DASNY incrprates the State s plicy gals int its purchasing practices. The gals include: prcurement frm MWBE vendrs; increase in energy efficiency and use f renewable energy strategies; use f State cntracts fr ptimal pricing; and increases in percentages f green prcurement. 16

17 SUBSIDIARIES REPORTS DASNY has tw subsidiaries which hld real prperty acquired as a cnsequence f security agreement defaults by private nt-fr-prfit health care institutins in DASNY s prtfli: NGHP Hlding Crpratin (frmer Nrth General Hspital real prperty); and Atlantic Avenue Healthcare Prperty Hlding Crpratin (frmer Interfaith Medical Center real prperty). The annual reprt fr each subsidiary is annexed heret fr reference. The FY State Budget established the New Yrk State Design and Cnstructin Crpratin (DCC) as a statutry DASNY subsidiary. The purpses f the DCC are t prvide: (i) additinal prject management expertise, mnitring, and versight n significant public wrks prjects undertaken by any state entity; and (ii) a means t implement and recmmend imprvements and ther prject changes n significant public wrks prjects, in a mre timely fashin, t ensure that such prjects can be accmplished, t the extent practicable, n time, within budget, and at an acceptable verall quality and cst t the State f New Yrk. 17

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