§ 72 — Bonds and security therefor

* § 72. Bonds and security therefor. 1. An authority may from time to\ntime issue bonds in such amounts and upon such terms as it may deem\nadvisable to carry out the provisions of this article. Bonds of an\nauthority shall be authorized by its resolution an may be issued singly\nor in one or more series, and shall bear such date or dates, mature at\nsuch time or times, bear interest at such rate or rates, not exceeding\nsix per centum per annum, be in such denomination or denominations,\ninterchangeable or otherwise, be in such form, either coupon or\nregistered, carry such registration privileges, be executed in such\nmanner, with or without authentication, be payable in such medium of\npayment, at such place or places, and be subject to such terms of\nredemption, with or without premium, as such resolution may provide. The\nauthority must obtain the approval as to the amount and terms of such\nbonds, of the board of estimate and apportionment in cities where such\nbody exists, and in other cities, of the local legislative body thereof\nas defined in the city home rule law, except that such approval shall\nnot be required for bonds issued in connection with a federal project.\nBonds issued for a non-federal project in a city of more than one\nmillion inhabitants may include terms providing that the amount\nnecessary to pay the interest thereon until maturity shall be paid to\nthe authority by such city without reimbursement or liability of the\nauthority to such city therefor. For the purpose of meeting such\npayments to the authority any such city shall be empowered to enact\nlocal laws imposing and collecting an occupation tax in addition to any\nand all other taxes which such city has the power to impose. Such tax\nshall be imposed upon any individual, copartnership or corporation\noccupying premises in any such city as an owner, tenant or\nconcessionaire for any gainful purpose. Such tax shall be in an amount\nof not less than one dollar nor more than six dollars per year for each\nseparate premises so occupied, the rate of tax to depend upon the size\nof such premises or upon such other reasonable standard as may be fixed\nin such local law. Revenues resulting from the imposition of taxes\nauthorized by this act shall be paid into the treasury of any such city\nand shall not be credited or deposited in the general fund of any such\ncity, but shall be deposited in a separate bank account or accounts and\nshall be available and used solely and exclusively for the purposes\naforesaid. In no event and under no circumstances shall the payment of\ninterest on such bonds by such city be deemed to modify in any way the\nprovisions of section seventy-three of this act. The bonds for a federal\nproject or non-federal project may be sold by the authority at public or\nprivate sale at such price or prices as the authority may determine.\n The authority may issue its interim certificates, or other temporary\nobligations, to the purchaser of bonds pending the authorization,\npreparation, execution or delivery of definitive bonds. Such interim\ncertificates, or other temporary obligations, shall be in such form,\ncontain such terms, conditions and provisions, bear such date or dates,\nand evidence such agreements relating to their discharge or payment or\nthe delivery of definitive bonds as the authority may by resolution\ndetermine.\n 2. Bonds may be issued for any purposes of the authority including the\npayment or reimbursement to the municipality for property, services or\nfacilities furnished by it pursuant to agreement with the authority.\n 3. The authority shall have power out of any funds available therefor\nto purchase any bonds issued by it at a price not more than the\nprincipal amount thereof and the accrued interest. All bonds so\npurchased shall be cancelled. This paragraph shall not apply to the\nredemption of bonds.\n 4. No personal liability or accountability shall attach to any member\nof the authority or any official of the municipality or to any person\nexecuting said bonds by reason of the execution or issuance thereof.\n 5. The bonds of an authority are securities in which the city or state\nmay invest. Such bonds, when they are (1) secured by a first mortgage\nlien not exceeding sixty-six and two-thirds per centum of the value of\nthe property covered thereby, or (2) issued in connection with a project\naided or financed in whole or in part by the federal government pursuant\nto the provisions of an act of the congress providing for capital grants\nfor low cost housing, or for the making of loans and for the payment of\nannual contributions for such purpose under a contract guaranteeing the\npayment of such annual contributions by the federal government to the\nauthority for a fixed period of years, are hereby declared to be\nsecurities in which all public officers and bodies of the state,\nmunicipalities, municipal subdivisions, all insurance companies and\nassociations, all savings banks and savings institutions, including\nsavings and loan associations, all executors, administrators, guardians,\ntrustees, and all other fiduciaries in the state may legally invest\nfunds within their control.\n 6. In connection with the issuance of bonds or the incurring of any\nobligation under a lease, and to secure the payment of such bonds or\nobligations, an authority in addition to its other powers may: (a)\nPledge all or any part of its rents, fees, or revenues to which its\nright then exists or may thereafter come into existence.\n (b) Mortgage all or any part of its property, real or personal, then\nowned or thereafter acquired.\n (c) Covenant against mortgaging all or any part of its property, real\nor personal, then owned or thereafter acquired, or against permitting or\nsuffering any lien thereon.\n (d) Covenant with respect to limitations on its right to sell, lease,\nor otherwise dispose of any project or any part thereof.\n (e) Covenant against pledging all or any part of its rents, fees and\nrevenues, to which its right then exists or may thereafter come into\nexistence, or against permitting or suffering any lien thereon.\n (f) Covenant as to the bonds to be issued and as to the issuance of\nsuch bonds in escrow or otherwise, and as to the use and disposition of\nthe proceeds thereof.\n (g) Covenant as to what other, or additional debts may be incurred by\nit.\n (h) Provide for the replacement of lost, destroyed or mutilated bonds.\n (i) Covenant that the authority warrants the title to the premises.\n (j) Covenant as to the rents and fees to be charged, the amount to be\nraised each year or other period of time by rents, fees, and other\nrevenues, and as to the use and disposition to be made thereof.\n (k) Covenant as to the use of any or all of its property, real or\npersonal.\n (l) Create or authorize the creation of special funds segregating (a)\nthe proceeds of any loans or grant; (b) all of the rents, fees and\nrevenues of any project or projects; (c) any monies held for the payment\nof the costs of operation and maintenance of projects, or as a reserve\nfor the meeting of contingencies in the operation and maintenance\nthereof; (d) any monies held for the payment of the principal and\ninterest on its bonds or the sums due under its leases and/or as a\nreserve for such payments; and (e) any monies held for any other\nreserves or contingencies; and covenant as to the use and disposal of\nthe monies held in such funds.\n (m) Redeem the bonds, and covenant for their redemption, and provide\nthe terms and conditions thereof.\n (n) Covenant against extending the time for the payment of its bonds\nor interest thereon.\n (o) Prescribe the procedure, if any, by which the terms of any\ncontract with bond holders may be amended or abrogated, the amount of\nbonds the holders of which must consent thereto, and the manner in which\nsuch consent may be given.\n (p) Covenant as to the maintenance of its property, the replacement\nthereof, the insurance to be carried thereon, and the use and\ndisposition of insurance moneys.\n (q) Vest in an obligee, in the event of a default by an authority, the\nright to cure any such default and to advance any monies necessary for\nsuch purpose, and covenant that the monies so advanced be an additional\nobligation of such authority with such interest, security and priority\nas may be provided in any trust indenture, mortgage, lease or contract.\n (r) Covenant and prescribe as to the events of default and terms and\nconditions upon which any or all of its bonds shall become or may be\ndeclared due before maturity, and as to the terms and conditions upon\nwhich such declaration and its consequences may be waived.\n (s) Covenant as to the rights, liabilities, powers and duties arising\nupon the breach by it of any covenant, condition, or obligation.\n (t) Covenant to surrender possession of a project or projects or parts\nthereof upon the happening of an event of default; and vest in an\nobligee the right, upon such default, without judicial proceedings to\ntake possession and use, operate, manage and control such projects or\nany part thereof, and to collect and receive rents, fees and revenues\narising therefrom in the same manner as such authority itself might do,\nand to dispose of the monies collected in accordance with the agreement\nof such obligee with the authority.\n (u) Vest in a trustee or trustees the right to enforce any covenant to\nsecure, or pay the bonds, or otherwise relating to such bonds; provide\nfor the powers and duties of such trustee or trustees, limit the\nliabilities thereof, and provide the terms and conditions upon which the\ntrustee or trustees, or the holders of bonds, or any proportion of them,\nmay enforce any such covenant.\n (v) Vest in a government or in a trustee the right, upon any happening\nof an event of default, to foreclose the mortgage securing any bonds\nheld by such government, through judicial proceedings or through the\nexercise of a power of sale without judicial proceedings.\n (w) Vest in a trustee or trustees or in other obligees the right, upon\nthe happening of an event of default, to foreclose any mortgage through\njudicial proceedings.\n (x) Vest in an obligee, including a government, the right to foreclose\nany such mortgage as to all or such part or parts of the property\ncovered thereby as such obligee shall elect; the institution,\nprosecution and conclusion of any such foreclosure proceedings or the\nsale of any such parts of the mortgaged property shall not affect in any\nmanner or to any extent the lien of the mortgage on the parts of the\nmortgaged property not included in such proceedings or not sold as\naforesaid.\n (y) Make covenants other than, and in addition to, the covenants\nherein expressly authorized, of like or different character; and execute\nall instruments necessary or convenient in the exercise of the powers\nherein granted, or in the performance of its covenants or duties, which\nmay contain such covenants and provisions, in addition to those above\nspecified, as the government or any purchaser of the bonds of an\nauthority may require.\n (z) Make such covenants and do any and all such acts and things as may\nbe necessary or convenient or desirable in order to secure its bonds, or\nin the absolute discretion of an authority tend to make the bonds more\nmarketable; notwithstanding that such covenants, acts or things may not\nbe enumerated herein.\n 7. In addition to powers conferred upon an authority by other\nprovisions of this act, an authority is empowered to borrow money or\naccept grants from the federal government for or in aid of any project,\nto take over any land acquired by the federal government or any housing\nplan of the federal government, to take over, manage or lease any\nhousing undertaking of the federal government, and to these ends, to\nenter into such contracts, mortgages, trust indentures, leases or other\nagreements as the federal government may require, including agreements\nthat the federal government shall have the right to supervise and\napprove the construction, maintenance and operation of any project. It\nis the purpose and intent of this subdivision to authorize an authority\nto do any and all things necessary or desirable to secure the financial\naid and co-operation of the federal government in the undertaking,\nconstruction, maintenance, lease, operation or assistance of any project\nby the authority, or in connection with any housing plan or undertaking\nof the federal government.\n * NB The text of Article 5 of the former State Housing Law (cited\nherein as the "Municipal Housing Authorities Law"), as such article\nexisted immediately prior to its repeal pursuant to section 227 of\nChapter 808 of the Laws of 1939, is provided here for ease of reference\nand historical purposes as such text continues to be applicable for the\nNew York City Housing Authority pursuant to the provisions of section\n401 of the current Public Housing Law.\n