§ 16-18-9 — Lease by Educational Institutions of Ancillary Improvements

(a) Any one or more educational institutions in the state, except those educational institutions to which subsection (b) of this section applies, are hereby authorized at any time and from time to time to enter into one or more lease agreements with the authority whereunder any one or more ancillary improvements or part thereof shall be leased by the authority to such educational institution for a term not exceeding 50 years; provided, that the rentals under such lease agreement shall not be payable from any sources other than those specified in the lease agreement; and provided, further, that the rentals shall not be payable by educational institutions out of funds appropriated by the state to or for the benefit of such educational institutions.
(b) The State Board of Education and each city and county board of education (including each public body having jurisdiction over schools in a municipality or county) are each hereby authorized at any time and from time to time to enter into one or more lease agreements with the authority whereunder any one or more ancillary improvements or any part thereof shall be leased by the authority to such board of education for a term not longer than the then current fiscal year of the said board of education, but any such lease agreement may contain a grant to the said board of education of successive options of renewing the said lease agreement on the terms specified therein for any subsequent fiscal year or years of the said board of education; the said lease agreement may contain appropriate provisions as to the method by which such board of education may, at its election, exercise the said options, or any of them, as it may elect on the terms provided therein, and such other covenants and provisions as shall not be inconsistent with this chapter and as the authority and the said board of education may agree. The rental for each fiscal year during which any lease agreement between the authority and the said board of education shall be in effect shall be due in advance on the first day of the fiscal year, and the said rental for said fiscal year shall be payable, and any such covenant on the part of the said board of education shall be performed, solely out of the current revenues of the said board of education for such fiscal year; provided, that the rentals shall be payable solely out of all or any portion (as may be specified in the said lease agreement) of the revenues of the particular educational institution for the benefit of which the ancillary improvements were leased; and provided, further, that the rentals shall not be payable out of funds appropriated by the state to or for the benefit of any of the said educational institutions.
(c) Neither the state, county nor any municipality shall in any manner be liable for the performance of any obligation or agreement contained in any lease agreement between the authority and any one or more educational institutions. The rental payable and the covenants to be performed by an educational institution under the provisions of any such lease agreement shall never create a debt of the state or of any county or municipality in the state within the meaning of Sections 213, 224 and 225 of the Constitution of Alabama. The securing of adequate ancillary improvements by educational institutions for use by them is hereby declared to constitute an essential function of educational institutions, and the rentals payable by such educational institutions for that purpose under any such lease agreement are and shall constitute necessary operating expenses of such educational institutions.

Legislative History

(Acts 1966, Ex. Sess., No. 221, p. 308, §9.)