§ 1269 — Notes, bonds and other obligations of the authority

§ 1269. Notes, bonds and other obligations of the authority. 1. (a)\nThe authority shall have power and is hereby authorized from time to\ntime to issue its bonds, notes and other obligations in such principal\namount as, in the opinion of the authority, shall be necessary,\nconvenient or desirable to effectuate any of its powers and purposes,\nincluding to provide sufficient funds for achieving its purposes,\nincluding the acquisition, establishment, construction, effectuation,\noperation, maintenance, renovation, improvement, extension,\nrehabilitation or repair of any transportation facility, the payment of\nprincipal, redemption premium and interest on bonds, notes and other\nobligations of the authority, establishment of reserves to secure such\nbonds notes and other obligations, the provision of working capital and\nall other expenditures of the authority and its subsidiary corporations,\nand New York city transit authority and its subsidiary corporations\nincident to and necessary or convenient to carry out their purposes and\npowers. Such bonds, notes or other obligations may be issued for an\nindividual transportation facility or issued on a consolidated basis for\nsuch groups or classes of facilities and projects as the authority in\nits discretion deems appropriate and be payable from and secured\nseparately or on a consolidated basis by, among other things, all or any\nportion of such revenues and other monies and assets of the authority\nand its subsidiary corporations, and New York city transit authority and\nits subsidiary corporations as the authority determines in accordance\nwith the provisions of section twelve hundred seventy-d of this title;\n (b) The authority shall have power, from time to time, to issue\nrenewal notes, to issue bonds to refund, redeem or otherwise pay,\nincluding by purchase or tender, notes of the authority and its\nsubsidiary corporations, and New York city transit authority and its\nsubsidiary corporations and whenever it deems refunding, redemption or\npayment expedient, to refund, redeem or otherwise pay, including by\npurchase or tender, any bonds of the authority and its subsidiary\ncorporations, New York city transit authority and its subsidiary\ncorporations and Triborough bridge and tunnel authority by the issuance\nof new bonds, whether the bonds to be refunded, redeemed or otherwise\npaid have or have not matured, and to issue bonds partly for such\npurpose and partly for any other purpose and to otherwise refund,\nredeem, acquire by purchase or tender, or in any other way repay any\noutstanding notes, bonds or other obligations of the authority, any of\nits subsidiary corporations, New York city transit authority, any of its\nsubsidiary corporations and Triborough bridge and tunnel authority;\n (c) Every issue of its notes, bonds or other obligations shall be\ngeneral obligations or special obligations. Every issue of general\nobligations of the authority shall be payable out of any revenues or\nmonies of the authority, subject only to any agreements with the holders\nof particular notes or bonds pledging any particular receipts or\nrevenues. Every issue of special obligations shall be payable out of any\nrevenues, receipts, monies or other assets of the authority and its\nsubsidiary corporations, the New York city transit authority and its\nsubsidiary corporations and the Triborough bridge and tunnel authority\nidentified for such purposes in accordance with agreements with the\nholders of particular notes, bonds or other obligations. The authority\nmay issue transportation revenue special obligation bonds, notes or\nother obligations as provided in section twelve hundred seventy-d of\nthis title;\n 1-a. Pension obligation bonds. The authority may from time to time\nissue its bonds and notes in such principal amounts as, in the opinion\nof the authority, shall be necessary to finance the unfunded pension\nfund liabilities of the authority, its affiliates and subsidiaries,\nprovided, however, that in no event shall the cumulative amounts of\nbonds and notes issued pursuant to the authority of this subdivision\nexceed one billion two hundred million dollars or sixty percent of such\nunfunded pension fund liabilities, whichever is less, and provided,\nfurther, that no bonds shall be issued under this subdivision for a term\nlonger than twenty years. The authority may not issue bonds or notes in\nany twelve month period in a cumulative principal amount in excess of\nforty percent of the total amount permitted to be issued under this\nsubdivision. Prior to the issuance of any bonds or notes, the authority\nshall make a finding that such issue is expected to result, on a present\nvalue basis, in a lower effective cost to the authority than funding the\nunfunded pension fund liability solely through the payment of annual\namounts to the pension fund, assuming that the principal component of\nthe unfunded liability will be amortized over the same number of years\nas the term of the bonds or notes and that the interest payable thereon\nis the actuarial rate of interest determined by the actuary for the\npension fund at the time of the issuance of such bonds or notes. The\naggregate principal amount of bonds and notes issued for such purposes\nmay be increased to fund costs of issuance and may reasonably required\ndebt service of other reserve funds. Bonds and notes may be issued to\nrefund or otherwise repay bonds or notes theretofore issued for such\npurposes; provided, however, that upon any such refunding or repayment\n(including for purpose of such calculation the principal amount of the\nrefunding bonds or notes then to be issued and excluding the principal\namount of the bonds or notes so to be refunded or repaid and also\nexcluding any amounts used to pay costs of issuance and reasonably\nrequired debt service or other reserve funds) the present value of the\naggregate debt service of the refunding or repayment bonds or notes to\nbe issued shall not exceed the present value of the aggregate debt\nservice of the bonds or notes so to be refunded or repaid. For purposes\nof the preceding sentence, the present values of the aggregate debt\nservice of the refunding or repayment bonds or notes and of the\naggregate debt service of the bonds or notes so to be refunded or repaid\nshall be calculated by utilizing the effective interest rate of the\nrefunding or repayment bonds or notes, which shall be that rate arrived\nat by doubling the semi-annual interest rate (compounded semi-annually)\nnecessary to discount the debt service payments on the refunding or\nrepayment bonds or notes from the payment dates thereof to the date of\nissue of the refunding or repayment bonds or notes and to the price bid\nincluding estimated accrued interest or proceeds received by the\nauthority including estimated accrued interest from the sale thereof.\nDebt service on the bonds or notes shall be structured so that the\neconomic benefits thereof shall be relatively uniform for each full year\nthroughout the term of the bonds or notes. Beginning with the date of\nfirst issuance of bonds under this section, the authority and its\nsubsidiaries shall make annual payments into the pension fund in amounts\nat least equal to the current pension contribution liability applicable\nto such year. The net proceeds of the bonds or notes intended to be\ninvested in non-debt securities may be invested by the recipient pension\nfund in a fiscally prudent manner in securities consistent with any\ntrust indentures and all applicable state and federal law over a\nreasonable period of time not less than 30 days following the issuance\nof the bonds or notes. The operating budget savings associated with the\nissuance of pension obligation bonds during the period from April first,\ntwo thousand five, through March thirty-first, two thousand ten,\npursuant to this subdivision shall be dedicated to reducing service\neliminations projected to occur within that period.\n 2. The notes, bonds and other obligations shall be authorized by\nresolution approved by not less than a majority vote of the whole number\nof members of the authority then in office, except that in the event of\na tie vote the chairman shall cast one additional vote. Such notes,\nbonds and other obligations shall bear such date or dates, and shall\nmature at such time or times, in the case of any such note or any\nrenewals thereof not exceeding five years from the date of issue of such\noriginal note, and in the case of any such bond not exceeding fifty\nyears from the date of issue, as such resolution or resolutions may\nprovide. The notes, bonds and other obligations shall bear interest at\nsuch rate or rates, be in such denominations, be in such form, either\ncoupon or registered, carry such registration privileges, be executed in\nsuch manner, be payable in such medium of payment, at such place or\nplaces and be subject to such terms of redemption as such resolution or\nresolutions may provide. The notes, bonds and other obligations of the\nauthority may be sold by the authority, at public or private sale, at\nsuch price or prices as the authority shall determine. No notes or bonds\nof the authority may be sold by the authority at private sale, however,\nunless such sale and the terms thereof have been approved in writing by\n(a) the comptroller, where such sale is not to the comptroller, or (b)\nthe director of the budget, where such sale is to the comptroller.\n 3. Any resolution or resolutions authorizing any notes, bonds or any\nissue thereof, or any other obligations of the authority, may contain\nprovisions, which shall be a part of the contract with the holders\nthereof, as to:\n (a) pledging all or any part of the revenues of the authority or of\nany of its subsidiary corporations or New York city transit authority or\nany of its subsidiary corporations or Triborough bridge and tunnel\nauthority to secure the payment of the notes or bonds or of any issue\nthereof, or any other obligations of the authority, subject to such\napplicable agreements with bondholders, noteholders, or holders of other\nobligations of the authority, the New York city transit authority and\nits subsidiary corporations, and Triborough bridge and tunnel authority\nas may then exist;\n (b) pledging all or any part of the assets of the authority or of any\nof its subsidiary corporations or New York city transit authority or any\nof its subsidiary corporations or Triborough bridge and tunnel authority\nto secure the payment of the notes or bonds or of any issue of notes or\nbonds, or any other obligations of the authority, subject to such\nagreements with noteholders, bondholders, or holders of other\nobligations of the authority, the New York city transit authority and\nits subsidiary corporations, and Triborough bridge and tunnel authority\nas may then exist;\n (c) the use and disposition of revenues, including fares, tolls,\nrentals, rates, charges and other fees, made or received by the\nauthority, any of its subsidiary corporations, New York city transit\nauthority or any of its subsidiary corporations, or Triborough bridge\nand tunnel authority;\n (d) the setting aside of reserves or sinking funds and the regulation\nand disposition thereof;\n (e) limitations on the purpose to which the proceeds of sale of notes,\nbonds or other obligations of the authority may be applied and pledging\nsuch proceeds to secure the payment of the notes or bonds or of any\nissue thereof or of other obligations;\n (f) limitations on the issuance of additional notes, bonds or other\nobligations of the authority; the terms upon which additional notes,\nbonds or other obligations of the authority may be issued and secured;\nthe refunding of outstanding or other notes, bonds or other obligations\nof the authority;\n (g) the procedure, if any, by which the terms of any contract with\nnoteholders, bondholders, or holders of other obligations of the\nauthority, may be amended or abrogated, the amount of notes, bonds or\nother obligations of the authority the holders of which must consent\nthereto, and the manner in which such consent may be given;\n (h) limitations on the amount of monies to be expended by the\nauthority or any of its subsidiary corporations or New York city transit\nauthority or any of its subsidiary corporations or Triborough bridge and\ntunnel authority for operating, administrative or other expenses of the\nauthority or any of its subsidiary corporations or New York city transit\nauthority or any of its subsidiary corporations or Triborough bridge and\ntunnel authority;\n (i) vesting in a trustee or trustees such property, rights, powers and\nduties in trust as the authority may determine, which may include any or\nall of the rights, powers and duties of the trustee appointed by the\nbondholders, noteholders or holders of other obligations of the\nauthority pursuant to this title, and limiting or abrogating the right\nof the bondholders, noteholders or holders of other obligations of the\nauthority to appoint a trustee under this article or limiting the\nrights, powers and duties of such trustee;\n (j) any other matters, of like or different character, which in any\nway affect the security or protection of the notes, bonds or other\nobligations of the authority.\n 4. In addition to the powers herein conferred upon the authority to\nsecure its notes, bonds and other obligations, the authority shall have\npower in connection with the issuance of notes, bonds and other\nobligations to enter into such agreements as the authority may deem\nnecessary, convenient or desirable concerning the use or disposition of\nthe monies or property of any of the authority, its subsidiary\ncorporations, New York city transit authority, or any of its subsidiary\ncorporations, or Triborough bridge and tunnel authority, including the\nmortgaging of any such property and the entrusting, pledging or creation\nof any other security interest in any such monies or property and the\ndoing of any act (including refraining from doing any act) which the\nauthority would have the right to do in the absence of such agreements.\nThe authority shall have power to enter into amendments of any such\nagreements within the powers granted to the authority by this title and\nto perform such agreements. The provisions of any such agreements may be\nmade a part of the contract with the holders of the notes, bonds and\nother obligations of the authority.\n 5. It is the intention hereof that any pledge, mortgage or security\ninstrument made by the authority shall be valid and binding from the\ntime when the pledge, mortgage or security instrument is made; that the\nmonies or property so pledged, mortgaged and entrusted and thereafter\nreceived by the authority, or any of its subsidiary corporations shall\nimmediately be subject to the lien of such pledge, mortgage or security\ninstrument without any physical delivery thereof or further act; and\nthat the lien of any such pledge, mortgage or security instrument shall\nbe valid and binding as against all parties having claims of any kind in\ntort, contract or otherwise against the authority, or any of its\nsubsidiary corporations, irrespective of whether such parties have\nnotice thereof. Neither the resolution nor any mortgage, security\ninstrument or other instrument by which a pledge, mortgage lien or other\nsecurity is created need be recorded or filed and neither the authority\nnor, any of its subsidiary corporations shall be required to comply with\nany of the provisions of the uniform commercial code.\n 6. Neither the members of the authority, the New York city transit\nauthority or the Triborough bridge and tunnel authority nor any person\nexecuting the notes, bonds or other obligations shall be liable\npersonally on the notes, bonds or other obligations or be subject to any\npersonal liability or accountability by reason of the issuance thereof.\n 7. The authority, subject to such agreements with the holders of\nnotes, bonds or other obligations as may then exist, shall have power\nout of any funds available therefor to purchase notes, bonds or other\nobligations of the authority. The authority may hold, cancel or sell\nsuch bonds, notes and other obligations, subject to and in accordance\nwith agreements with such holders.\n 8. Neither the state nor the city of New York shall be liable on\nnotes, bonds or other obligations of the authority and such notes, bonds\nand other obligations shall not be a debt of the state or the city of\nNew York, and such notes, bonds and other obligations shall contain on\nthe face thereof, or in an equally prominent place, a statement to such\neffect.\n 9. So long as the authority has outstanding any bonds, notes or other\nobligations issued pursuant to this section or any bonds, notes or other\nobligations issued or incurred pursuant to section twelve hundred\nsixty-six-c of this title, none of the authority or any of its\nsubsidiary corporations, New York city transit authority or any of its\nsubsidiary corporations, or Triborough bridge and tunnel authority shall\nhave the authority to file a voluntary petition under chapter nine of\nthe federal bankruptcy code or such corresponding chapter, chapters or\nsections as may, from time to time, be in effect, and neither any public\nofficer nor any organization, entity or other person shall authorize the\nauthority or any of its subsidiary corporations, New York city transit\nauthority or any of its subsidiary corporations, or Triborough bridge\nand tunnel authority to be or become a debtor under chapter nine or said\ncorresponding chapter, chapters or sections during any such period.\n 10. The term "monies" as used in this section shall include, but not\nbe limited to, all operating subsidies provided by (i) any public\nbenefit corporation, including without limitation transfers of operating\nsurplus by Triborough bridge and tunnel authority pursuant to section\ntwelve hundred nineteen-a of this article, or (ii) any governmental\nentity, federal, state or local.\n 11. Any resolution or agreement authorizing the issuance of bonds,\nnotes or other obligations pursuant to this section may, in addition,\nauthorize and provide for the issuance of lease obligations of the\nauthority which may be issued for the purposes and on the terms and\nconditions under which the bonds, notes and other obligations authorized\nunder this section may be issued, and may be secured in the same manner\nas such bonds, notes and other obligations, and which resolution with\nrespect to such lease obligations, may contain such other provisions\napplicable to bonds, notes and other obligations not inconsistent with\nthe provisions of this section, as the authority may determine.\n 12. The aggregate principal amount of bonds, notes or other\nobligations issued after the first day of January, nineteen hundred\nninety-three by the authority, the Triborough bridge and tunnel\nauthority and the New York city transit authority to fund projects\ncontained in capital program plans approved pursuant to section twelve\nhundred sixty-nine-b of this title for the period nineteen hundred\nninety-two through two thousand twenty-nine shall not exceed one hundred\nfifteen billion five hundred million dollars. Such aggregate principal\namount of bonds, notes or other obligations or the expenditure thereof\nshall not be subject to any limitation contained in any other provision\nof law on the principal amount of bonds, notes or other obligations or\nthe expenditure thereof applicable to the authority, the Triborough\nbridge and tunnel authority or the New York city transit authority. The\naggregate limitation established by this subdivision shall not include\n(i) obligations issued to refund, redeem or otherwise repay, including\nby purchase or tender, obligations theretofore issued either by the\nissuer of such refunding obligations or by the authority, the New York\ncity transit authority or the Triborough bridge and tunnel authority,\n(ii) obligations issued to fund any debt service or other reserve funds\nfor such obligations, (iii) obligations issued or incurred to fund the\ncosts of issuance, the payment of amounts required under bond and note\nfacilities, federal or other governmental loans, security or credit\narrangements or other agreements related thereto and the payment of\nother financing, original issue premiums and related costs associated\nwith such obligations, (iv) an amount equal to any original issue\ndiscount from the principal amount of such obligations or to fund\ncapitalized interest, (v) obligations incurred pursuant to section\ntwelve hundred seven-m of this article, (vi) obligations incurred to\nfund the acquisition of certain buses for the New York city transit\nauthority as identified in a capital program plan approved pursuant to\nchapter fifty-three of the laws of nineteen hundred ninety-two, (vii)\nobligations incurred in connection with the leasing, selling or\ntransferring of equipment, and (viii) bond anticipation notes or other\nobligations payable solely from the proceeds of other bonds, notes or\nother obligations which would be included in the aggregate principal\namount specified in the first sentence of this subdivision, whether or\nnot additionally secured by revenues of the authority, or any of its\nsubsidiary corporations, New York city transit authority, or any of its\nsubsidiary corporations, or Triborough bridge and tunnel authority.\n