§ 179-v. Interest payments. 1. A not-for-profit organization shall be entitled to interest payments pursuant to this section: (a) on those moneys that would be due under the terms of the contract or renewal contract from the scheduled commencement date or the date the organization begins to provide services, whichever is later, until the date the payment is made under the contract or renewal contract; or (b) if a not-for-profit organization borrows funds to provide services pursuant to a written directive by a state agency, provided however that a not-for-profit organization may only receive interest payments on such funds when such not-for-profit organization has received a written directive but has been denied payment pursuant to section one hundred seventy-nine-u of this article or did not obtain a loan from the not-for-profit short-term revolving loan fund.

2. Such organizations shall receive such interest payments at a rate equal to the rate set by the commissioner of taxation and finance for corporate taxes pursuant to paragraph one of subsection (e) of section one thousand ninety-six of the tax law. In order for a state agency to approve reimbursement of a not-for-profit organization at a rate other than the interest rate stated in this section the not-for-profit organization shall submit documentation indicating the rate at which such funds were borrowed, the lender of such funds and any other information requested by the state agency, attorney general or the comptroller. The comptroller may disallow such portions of the interest that the comptroller deems unreasonable.

3. Any interest payments made pursuant to subdivisions one and two of this section shall be made from appropriations for state operations that are available for the administrative programs of the state agency which contracted with the not-for-profit organization. In no event shall interest payments be made from amounts appropriated for program purposes.

4. The interest payment shall not reduce the amount of money that otherwise will be payable to the not-for-profit organization under the terms of the relevant contract.

5. No interest payments shall be made if the not-for-profit organization receives an advance payment pursuant to section one hundred seventy-nine-u of this article; provided, however, that if the contract is not fully executed at the end of the period covered by such advance payment, the not-for-profit organization may be eligible for interest payments in respect of services performed after such period.

6. Should the attorney general or the comptroller disapprove a contract or renewal contract, the provisions of this section shall not be applicable.

7. a. If the timeframes for processing a contract are met and the state agency is liable for interest due to a retroactive contract start date, the state agency and the not-for-profit organization may mutually agree to waive any interest owed to the not-for-profit organization under the provisions of this article. Waiver of interest shall not be a prerequisite to execution of such contract. If interest is so waived, the state agency shall immediately provide the office of the state comptroller, division of the budget and the not-for-profit organization with the written waiver of interest agreement signed by the not-for-profit organization and documentation (i) showing that the applicable timeframes set forth in section one hundred seventy-nine-s or one hundred seventy-nine-t of this article have been met, and (ii) explaining the reason for a retroactive contract start date.

b. Not more than twenty days after the receipt of such written waiver of interest agreement and required documentation, the comptroller shall determine whether the waiver of interest is warranted. The comptroller shall thereupon inform such state agency, the division of the budget, and such not-for-profit organization of such determination. If such determination concludes that a waiver of interest is unwarranted, such state agency shall then immediately submit for the comptroller's approval a voucher requesting the payment of interest to such not-for-profit organization as required by this section. If such voucher is not received within thirty days after the comptroller's determination, the comptroller shall assess the amount of unpaid interest in the manner prescribed by this section.