§ 1680-L — The special disability fund financing

New York § 1680-L

• Jurisdiction: New York
• Law PBA: Public Authorities
• Title 4: Dormitory Authority
• Art. 8: Miscellaneous Authorities

Text

§ 1680-l. The special disability fund financing. 1. As used in this\nsection the following terms shall have the following meanings:\n (a) "Ancillary bond facility" means any interest rate exchange or\nsimilar agreement or any bond insurance policy, letter of credit or\nother credit enhancement facility, liquidity facility, guaranteed\ninvestment or reinvestment agreement, or other similar agreement,\narrangement or contract.\n (b) "Benefited party" means any person, firm or corporation that\nenters into an ancillary bond facility with the authority according to\nthe provisions of this section.\n (c) "Bonds" means any bonds, notes, certificates of participation and\nother evidence of indebtedness issued by the authority pursuant to\nsubdivision five of this section.\n (d) "Bond owners or owners of bonds" means any registered owners of\nbonds.\n (e) "Chair" means the chair of the workers' compensation board.\n (f) "Code" means the United States Internal Revenue Code of 1986, as\namended.\n (g) "Costs of issuance" means any item of expense directly or\nindirectly payable or reimbursable by the authority and related to the\nauthorization, sale, or issuance of bonds, including, but not limited\nto, underwriting fees and fees and expenses of professional consultants\nand fiduciaries.\n (h) "Debt service" means actual debt service, comprised of principal,\ninterest and associated costs, as defined in subparagraph five of\nparagraph (h) of subdivision eight of section fifteen of the workers'\ncompensation law.\n (i) "Director of the budget" or "director" means the director of the\nbudget of the state of New York.\n (j) "Financing agreement" means any agreement authorized pursuant to\nsubdivision four of this section between the chair and the commissioner\nof taxation and finance, and the authority.\n (k) "Financing costs" means all costs of issuance, capitalized\ninterest, capitalized operating expenses of the authority and, pursuant\nto the financing agreement, the initial capitalized operating expenses\nof the waiver agreement management office and debt service reserves,\nfees, cost of any ancillary bond facility, and any other fees,\ndiscounts, expenses and costs related to issuing, securing and marketing\nthe bonds including, without limitation, any net original issue\ndiscount.\n (l) "Investment securities" means: (i) general obligations of, or\nobligations guaranteed by, any state of the United States of America or\npolitical subdivision thereof, or the District of Columbia or any agency\nor instrumentality of any of them, receiving one of the three highest\nlong-term unsecured debt rating categories available for such securities\nof at least one independent rating agency, or (ii) certificates of\ndeposit, savings accounts, time deposits or other obligations or\naccounts of banks or trust companies in the state, secured, if the\nauthority shall so require, in such manner as the authority may so\ndetermine, or (iii) obligations in which the comptroller is authorized\nto invest pursuant to either section ninety-eight or ninety-eight-a of\nthe state finance law, or (iv) investments which the commissioner of\ntaxation and finance is permitted to make with surplus or reserve moneys\nof the special disability fund under subparagraph seven of paragraph (h)\nof subdivision eight of section fifteen of the workers' compensation\nlaw.\n (m) "Interest rate exchange or similar agreement" means a written\ncontract entered into in connection with the issuance of bonds or with\nsuch bonds outstanding with a counterparty to provide for an exchange or\nswap of payments based upon fixed and/or variable interest rates, and\nshall be for exchanges in currency of the United States of America only.\n (n) "Net proceeds" means the amount of proceeds remaining following\neach sale of bonds which are not required by the authority for purposes\nof this section to pay or provide for debt service or financing costs,\nas provided in the financing agreement.\n (o) "Operating expenses" means the reasonable or necessary operating\nexpenses of the authority for purposes of this section, including,\nwithout limitation, the costs of: retention of auditors, preparation of\naccounting and other reports, maintenance of the ratings on the bonds,\nany operating expense reserve fund, insurance premiums, ancillary bond\nfacilities, rebate payments, annual meetings or other required\nactivities of the authority, and professional consultants and\nfiduciaries.\n (p) "Outstanding", when used with respect to bonds, shall exclude\nbonds that shall have been paid in full at maturity, or shall have\notherwise been refunded, redeemed, defeased or discharged, or that may\nbe deemed not outstanding pursuant to agreements with the holders\nthereof.\n (q) "Pledged assessments revenues", "pledged revenues" or "pledged\nassessments" means receipts of special disability fund assessments\nimposed pursuant to subparagraph four of paragraph (h) of subdivision\neight of section fifteen of the workers' compensation law and pledged\nfor the payment of debt service on the bonds or amounts due pursuant to\nan ancillary bond facility, including the right to receive same.\n (r) "State" means the state of New York.\n (s) "Special disability fund financing agreement" means an agreement\nauthorized and created pursuant to subparagraph five of paragraph (h) of\nsubdivision eight of section fifteen of the workers' compensation law,\nas same by its terms and bond proceedings, may be amended.\n (t) "Waiver agreement" means waiver agreements entered into pursuant\nto section thirty-two of the workers' compensation law.\n (u) "Waiver agreement management office" shall mean the office\ndescribed in paragraph (e) of section thirty-two of the workers'\ncompensation law.\n 2. The authority is hereby authorized to finance the special\ndisability fund established by paragraph (h) of subdivision eight of\nsection fifteen of the workers' compensation law and to enter into one\nor more special disability fund financing agreements described in such\nsubdivision. All of the provisions of the authority relating to bonds\nand notes which are not inconsistent with the provisions of this section\nshall apply to obligations authorized by this section, including but not\nlimited to the power to establish adequate reserves therefor and to\nissue renewal notes or refunding bonds thereof. The provisions of this\nsection shall apply solely to obligations authorized by this section and\nshall not include liabilities, assets or revenues other than\nliabilities, assets or revenues derived from the authority solely from\nthe special disability fund.\n 3. It is found and declared that the special disability fund no longer\nserves the purposes for which it was created, adds to the time and\nexpense of proceedings before the workers' compensation board and to\nemployers' costs for workers' compensation insurance; that the creation\nand operation of a waiver agreement management office of the workers'\ncompensation board, to manage, maintain and negotiate waiver agreements\non behalf of the special disability fund can reduce the special\ndisability fund's unfunded liability; that the reduction of such\nliability and the closing of the fund to new claims will over the long\nterm reduce assessments paid to the fund by insurance carriers,\nself-insurers and the state insurance fund, as well as the employers to\nwhom these costs are passed on; that in the absence of this section the\nannual cost of such assessments is expected to rise; that the settlement\nof claims and other actions undertaken by the waiver agreement\nmanagement office will lower the administrative costs of insurance\ncarriers, self-insurers and the state insurance fund; that revenue\nobligations issued by the authority and secured by a special assessment\nannually levied, imposed and collected on and from insurance carriers,\nself-insurers and the state insurance fund for the governmental purpose\nof funding waiver agreements amortized over a substantial period would\nallow the state to settle and otherwise manage claims as a means for\nreducing the fund's liabilities and the assessments needed to pay them,\nthereby furthering the policy of the state to reduce the costs of\nworkers' compensation and to improve the business climate in the state\nwhile compensating injured workers and honoring the obligations of the\nspecial disability fund; that all costs of the authority in relation to\nthis section shall be paid from assessments set forth in paragraph (h)\nof subdivision eight of section fifteen of the workers' compensation\nlaw; and that, therefore, the provisions of this section are for the\npublic benefit and good and the authorization as provided in this\nsection of the issuance of revenue obligations of the authority is\ndeclared to be for a public purpose and the exercise of an essential\ngovernmental function.\n 4. (a) The authority, the commissioner of taxation and finance and the\nchair, in consultation with the special disability fund advisory\ncommittee shall execute a financing agreement prior to the issuance of\nany bonds. Such agreement shall contain such terms and conditions as are\nnecessary to carry out and effectuate the purposes of this section,\nincluding covenants with respect to the assessment and enforcement of\nthe assessments, the application and use of the proceeds of the sale of\nbonds to preserve the tax-exemption on the bonds, the interest on which\nis intended to be exempt from taxation. The state shall not be\nauthorized to make any covenant, pledge, promise or agreement purporting\nto bind the state with respect to pledged revenues, except as otherwise\nspecifically authorized by this section.\n (b) The net proceeds of the bonds shall be deposited in accordance\nwith the financing agreement and this section. The financing agreement\nshall provide for the application of the net bond proceeds, and such\nbond proceeds shall be used, for any of the following purposes: (i)\nfunding of waiver agreements, (ii) payment of financing costs, (iii)\nfunding anticipated liabilities of the special disability fund, (iv)\nfunding contract awards pursuant to subparagraph two of paragraph (h) of\nsection thirty-two of the workers' compensation law and (v) such other\npurposes as are set forth in the financing agreement. Not inconsistent\nwith this section, the authority may provide restrictions on the use and\ninvestment of net proceeds of the bonds and other amounts in the\nfinancing agreement or otherwise in a tax regulatory agreement as\nnecessary or desirable to assure that they are exempt from taxation.\n 5. (a) (i) The authority shall have power and is hereby authorized to\nissue its bonds at such times and in an aggregate principal amount not\nto exceed an amount to be determined by the superintendent of financial\nservices as necessary to address all or a portion of the incurred\nunfunded liabilities of the special disability fund, but in no case\nexceeding twenty-five percent of the unfunded liability of the special\ndisability fund as of a date no later than July first, two thousand\nseven, as certified to the authority by a qualified third party. The\nbonds shall be issued for the following corporate purposes: (A) funding\nof waiver agreements, (B) payment of financing costs, (C) funding\nanticipated liabilities of the special disability fund, (D) funding\ncontract awards pursuant to paragraph two of subdivision (h) of section\nthirty-two of the workers' compensation law and (E) such other purposes\nas are set forth in the financing agreement. The foregoing limitation on\noutstanding aggregate principal shall not apply to prevent the issuance\nof bonds to refund bonds.\n (ii) Each issuance of bonds shall be authorized by a resolution of the\nauthority, provided, however, that any such resolution authorizing the\nissuance of bonds may delegate to an officer of the authority the power\nto issue such bonds from time to time and to fix the details of any such\nissues of bonds by an appropriate certificate of such authorized\nofficer. Every issue of the bonds of the authority for the special\ndisability fund shall be special revenue obligations payable from and\nsecured by a pledge of revenues and other assets, including those\nproceeds of such bonds deposited in a reserve fund for the benefit of\nbondholders, earnings on funds of the authority and such other funds and\nassets as may become available, upon such terms and conditions as\nspecified by the authority in the resolution under which the bonds are\nissued or in a related trust indenture.\n (iii) The authority shall have the power and is hereby authorized from\ntime to time to issue bonds, in consultation with the special disability\nfund advisory committee to refund any bonds issued under this section by\nthe issuance of new bonds, whether the bonds to be refunded have or have\nnot matured, and to issue bonds partly to refund bonds then outstanding\nand partly for any of its other corporate purposes under this section.\nThe refunding bonds may be exchanged for the bonds to be refunded or\nsold and the proceeds applied to the purchase, redemption or payment of\nsuch bonds.\n (b) The bonds of the authority of each issue shall be dated, shall\nbear interest (which, in the opinion of bond counsel to the authority,\nmay be includable in or excludable from the gross income of the owners\nfor federal income tax purposes) at such fixed or variable rates,\npayable at or prior to maturity, and shall mature at such time or times,\nas may be determined by the authority and may be made redeemable before\nmaturity, at the option of the authority, at such price or prices and\nunder such terms and conditions as may be fixed by the authority. The\nprincipal and interest of such bonds may be made payable in any lawful\nmedium. The resolution or the certificate of the authorized officer\nshall determine the form of the bonds, either registered or book-entry\nform, and the manner of execution of the bonds and shall fix the\ndenomination or denominations of the bonds and the place or places of\npayment of principal and interest thereof, which may be at any bank or\ntrust company within or outside the state. If any officer whose\nsignature or a facsimile thereof appears on any bonds shall cease to be\nsuch officer before the delivery of such bonds, such signature or\nfacsimile shall nevertheless be valid and sufficient for all purposes\nthe same as if such officer had remained in office until such delivery.\nThe authority may also provide for temporary bonds and for the\nreplacement of any bond that shall become mutilated or shall be\ndestroyed or lost.\n (c) The authority may sell such bonds in such manner, either at a\npublic or private sale and either on a competitive or negotiated basis,\nprovided no such bonds may be sold by the authority at private sale\nunless such sale and the terms thereof have been approved in writing by\nthe comptroller of the state of New York. The proceeds of such bonds\nshall be disbursed for the purposes for which such bonds were issued\nunder such restrictions as the financing agreement and the resolution\nauthorizing the issuance of such bonds or the related trust indenture\nmay provide. Such bonds shall be issued upon approval of the authority\nand without any other approvals, filings, proceedings or the happening\nof any other conditions or things other than the approvals, findings,\nproceedings, conditions, and things that are specified and required by\nthis section. Provided, however, that any issuance of bonds under the\nauthority of this section shall be considered a project for the purposes\nof section fifty-one of this chapter, and subject to approval under such\nsection.\n (d) Any pledge made by the authority shall be valid and binding at the\ntime the pledge is made. The assets, property, revenues, reserves or\nearnings so pledged shall immediately be subject to the lien of such\npledge without any physical delivery thereof or further act and the lien\nof any such pledge shall be valid and binding as against all parties\nhaving claims of any kind against the authority, irrespective of whether\nsuch parties have notice thereof. Notwithstanding any other provision of\nlaw to the contrary, neither the bond resolution nor any indenture or\nother instrument, including the financing agreement, by which a pledge\nis created or by which the authority's interest in pledged assets,\nproperty, revenues, reserves or earnings thereon is assigned need be\nfiled, perfected or recorded in any public records in order to protect\nthe pledge thereof or perfect the lien thereof as against third parties,\nexcept that a copy thereof shall be filed in the records of the\nauthority.\n (e) Whether or not the bonds of the authority are of such form and\ncharacter as to be negotiable instruments under the terms of the uniform\ncommercial code, the bonds are hereby made negotiable instruments for\nall purposes, subject only to the provisions of the bonds for\nregistration.\n (f) At the sole discretion of the authority, any bonds issued by the\nauthority and any ancillary bond facility made under the provisions of\nthis subdivision may be secured by a resolution or trust indenture by\nand between the authority and the trust indenture trustee, which may be\nany trust company or bank having the powers of a trust company, whether\nlocated within or outside the state, provided it is carried out in\naccordance with section sixty-nine-d of the state finance law. Such\ntrust indenture or resolution providing for the issuance of such bonds\nmay provide for the creation and maintenance of such reserves as the\nauthority shall determine to be proper and may include covenants setting\nforth the duties of the authority in relation to the bonds, the income\nof the authority, or the financing agreement. Such trust indenture or\nresolution may contain provisions: (i) respecting the custody,\nsafeguarding and application of all moneys and securities; (ii)\nprotecting and enforcing the rights and remedies (pursuant to the trust\nindenture and the financing agreement) of the owners of the bonds and\nany other benefited party as may be reasonable and proper and not in\nviolation of law; (iii) concerning the rights, powers and duties of the\ntrustee appointed by bondholders pursuant to paragraph (g) of this\nsubdivision; or (iv) limiting or abrogating the right of the bondholders\nto appoint a trustee. It shall be lawful for any bank or trust company\nwhich may act as depository of the proceeds of bonds or of any other\nfunds or obligations received on behalf of the authority to furnish such\nindemnifying bonds or to pledge such securities as may be required by\nthe authority. Any such trust indenture or resolution may contain such\nother provisions as the authority may deem reasonable and proper for\npriorities and subordination among the owners of the bonds and other\nbeneficiaries. For purposes of this section, a "resolution" of the\nauthority shall include any trust indenture authorized thereby.\n (g) The authority may enter into, amend or terminate, as it determines\nto be necessary or appropriate, any ancillary bond facility in\nconsultation with the special disability fund advisory committee (i) to\nfacilitate the issuance, sale, resale, purchase, repurchase or payment\nof bonds, interest rate savings or market diversification or the making\nor performance of interest rate exchange or similar agreements,\nincluding without limitation bond insurance, letters of credit and\nliquidity facilities, (ii) to attempt to manage or hedge risk or achieve\na desirable effective interest rate or cash flow, or (iii) to place the\nobligations or investments of the authority, as represented by the bonds\nor the investment of reserved bond proceeds or other pledged revenues or\nother assets, in whole or in part, on the interest rate, cash flow or\nother basis decided in consultation with the special disability fund\nadvisory committee, which facility may include without limitation\ncontracts commonly known as interest rate exchange or similar\nagreements, forward purchase contracts or guaranteed investment\ncontracts and futures or contracts providing for payments based on\nlevels of, or changes in, interest rates. These contracts or\narrangements may be entered into by the authority in connection with, or\nincidental to, entering into, or maintaining any (i) agreement which\nsecures bonds of the authority or (ii) investment, or contract providing\nfor investment of reserves or similar facility guaranteeing an\ninvestment rate for a period of years not to exceed the underlying term\nof the bonds. The determination by the authority that an ancillary bond\nfacility or the amendment or termination thereof is necessary or\nappropriate as aforesaid shall be conclusive. Any ancillary bond\nfacility may contain such payment, security, default, remedy, and\ntermination provisions and payments and other terms and conditions as\ndetermined by the authority, after giving due consideration to the\ncreditworthiness of the counterparty or other obligated party, including\nany rating by any nationally recognized rating agency, and any other\ncriteria as may be appropriate.\n (h) The authority, subject to such agreements with bondholders as may\nthen exist (including provisions which restrict the power of the\nauthority to purchase bonds), or with the providers of any applicable\nancillary bond facility, shall have the power out of any funds available\ntherefor to purchase bonds of the authority, which may or may not\nthereupon be cancelled, at a price not substantially exceeding:\n (i) if the bonds are then redeemable, the redemption price then\napplicable, including any accrued interest; or\n (ii) if the bonds are not then redeemable, the redemption price and\naccrued interest applicable on the first date after such purchase upon\nwhich the bonds become subject to redemption.\n (i) Neither the members of the authority nor any other person\nexecuting the bonds or an ancillary bond facility of the authority shall\nbe subject to any personal liability by reason of the issuance or\nexecution and delivery thereof.\n (j) The maturities of the bonds shall not exceed thirty years from\ntheir respective issuance dates.\n 6. Neither any bond issued pursuant to this section nor any ancillary\nbond facility of the authority shall constitute a debt or moral\nobligation of the state or a state supported obligation within the\nmeaning of any constitutional or statutory provision or a pledge of the\nfaith and credit of the state or of the taxing power of the state, and\nthe state shall not be liable to make any payments thereon nor shall any\nbond or any ancillary bond facility be payable out of any funds or\nassets other than pledged revenues and other assets of the authority and\nother funds and assets of or available to the authority pledged\ntherefor, and the bonds and any ancillary bond facility of the authority\nshall contain on the face thereof or other prominent place thereon a\nstatement to the foregoing effect.\n 7. (a) Subject to the provisions of subdivision five of this section\nin the event that the authority shall default in the payment of\nprincipal of, or interest on, or sinking fund payment on, any issue of\nbonds after the same shall become due, whether at maturity or upon call\nfor redemption, or in the event that the authority or the state shall\nfail to comply with any agreement made with the holders of any issue of\nbonds, the holders of twenty-five percent in aggregate principal amount\nof the bonds of such issue then outstanding, by instrument or\ninstruments filed in the office of the clerk of the county of Albany and\nproved or acknowledged in the same manner as a deed to be recorded, may\nappoint a trustee to represent the holders of such bonds for the\npurposes herein provided.\n (b) Such trustee, may, and upon written request of the holders of\ntwenty-five percent in principal amount of such bonds then outstanding\nshall, in his or its own name:\n (i) by suit, action or proceeding in accordance with the civil\npractice law and rules, enforce all rights of the bondholders, including\nthe right to require the authority to carry out any agreement with such\nholders and to perform its duties under this section;\n (ii) bring suit upon such bonds;\n (iii) by action or suit, require the authority to account as if it\nwere the trustee of an express trust for the holders of such bonds;\n (iv) by action or suit, enjoin any acts or things which may be\nunlawful or in violation of the rights of the holders of such bonds; and\n (v) declare all such bonds due and payable, and if all defaults shall\nbe made good, then, with the consent of the holders of twenty-five\npercent of the principal amount of such bonds then outstanding, annul\nsuch declaration and its consequences, provided, however, that nothing\nin this subdivision shall preclude the authority from agreeing that\nconsent of the provider of an ancillary bond facility is required for an\nacceleration of related bonds in the event of a default other than a\nfailure to pay principal of or interest on the bonds when due.\n (c) The supreme court shall have jurisdiction of any suit, action or\nproceeding by the trustee on behalf of such bondholders. The venue of\nany such suit, action or proceeding shall be laid in the county of\nAlbany.\n (d) Before declaring the principal of bonds due and payable, the\ntrustee shall first give thirty days notice in writing to the authority.\n 8. All monies of the authority from whatever source derived shall be\npaid to the treasurer of the authority and shall be deposited forthwith\nin a bank or banks designated by the authority. The monies in such\naccounts shall be paid out or withdrawn on the order of such person or\npersons as the authority may authorize to make such requisitions. All\ndeposits of such monies shall either be secured by obligations of the\nUnited States or of the state or of any municipality of a market value\nequal at all times to the amount on deposit, or monies of the authority\nmay be deposited in money market funds rated in the highest short-term\nor long-term rating category by at least one nationally recognized\nrating agency. To the extent practicable, and consistent with the\nrequirements of the authority, all such monies shall be deposited in\ninterest bearing accounts. The authority shall have power,\nnotwithstanding the provisions of this section, to contract with the\nholders of any bonds as to the custody, collection, security, investment\nand payment of any monies of the authority or any monies held in trust\nor otherwise for the payment of bonds or any way to secure bonds, and\ncarry out any such contract notwithstanding that such contract may be\ninconsistent with the provisions of this section. Monies held in trust\nor otherwise for the payment of bonds or in any way to secure bonds and\ndeposits of such moneys may be secured in the same manner as monies of\nthe authority and all banks and trust companies are authorized to give\nsuch security for such deposits. Any monies of the authority not\nrequired for immediate use or disbursement may, at the discretion of the\nauthority, be invested in accordance with law and such guidelines as are\napproved by the authority.\n 9. (a) It is hereby determined that the carrying out by the authority\nof its corporate purposes under this section are in all respects for the\nbenefit of the people of the state of New York and are public purposes.\nAccordingly, the authority shall be regarded as performing an essential\ngovernmental function in the exercise of the powers conferred upon it by\nthis section. The property of the authority, its income and its\noperations shall be exempt from taxation, assessments, special\nassessments and ad valorem levies. The authority shall not be required\nto pay any fees, taxes, special ad valorem levies or assessments of any\nkind, whether state or local, including, but not limited to, real\nproperty taxes, franchise taxes, sales taxes or other taxes, upon or\nwith respect to any property owned by it or under its jurisdiction,\ncontrol or supervision, or upon the uses thereof, or upon or with\nrespect to its activities or operations in furtherance of the powers\nconferred upon it by this section, or upon or with respect to any\nassessments, rates, charges, fees, revenues or other income received by\nthe authority.\n (b) Any bonds issued pursuant to this section, their transfer and the\nincome therefrom shall, at all times, be exempt from taxation except for\nestate or gift taxes and taxes on transfers.\n (c) The state hereby covenants with the purchasers and with all\nsubsequent holders and transferees of bonds issued by the authority\npursuant to this section, in consideration of the acceptance of and\npayment for the bonds, that the bonds of the authority issued pursuant\nto this section and the income therefrom and all assessments, revenues,\nmoneys, and other property received by the authority and pledged to pay\nor to secure the payment of such bonds shall at all times be exempt from\ntaxation.\n (d) In the case of any bonds of the authority, interest on which is\nintended to be exempt from federal income tax, the authority shall\nprescribe restrictions on the use of the proceeds thereof and related\nmatters only as are necessary or desirable to assure such exemption, and\nthe recipients of such proceeds shall be bound thereby to the extent\nsuch restrictions shall be made applicable to them. Any such recipient,\nincluding, but not limited to, the state, the state insurance fund, a\npublic benefit corporation, and a school district or municipality is\nauthorized to execute a tax regulatory agreement with the authority or\nthe state, as the case may be, and the execution of such an agreement\nmay be treated by the authority or the state as a condition to receiving\nany such proceeds.\n 10. (a) The state, solely with respect to the resources of the special\ndisability fund and as set forth in the special disability fund\nfinancing agreement, covenants with the purchasers and all subsequent\nowners and transferees of bonds issued by the authority pursuant to this\nsection in consideration of the acceptance of the payment of the bonds,\nuntil the bonds, together with the interest thereon, with interest on\nany unpaid installment of interest and all costs and expenses in\nconnection with any action or proceeding on behalf of the owners, are\nfully met and discharged or unless expressly permitted or otherwise\nauthorized by the terms of each special disability fund financing\nagreement and any contract made or entered into by the authority with or\nfor the benefit of such owners, (i) that in the event bonds of the\nauthority are sold as federally tax-exempt bonds, the state shall not\ntake any action or fail to take action that would result in the loss of\nsuch federal tax exemption on said bonds, (ii) that the state will cause\nthe workers' compensation board to impose, charge, raise, levy, collect\nand apply the pledged assessments and other revenues, receipts, funds or\nmoneys pledged for the payment of debt service requirements in each year\nin which bonds are outstanding, and (iii) further, that the state (A)\nwill not materially limit or alter the duties imposed on the workers'\ncompensation board, the authority and other officers of the state by the\nspecial disability fund financing agreement and the bond proceedings\nauthorizing the issuance of bonds with respect to application of pledged\nassessments or other revenues, receipts, funds or moneys pledged for the\npayment of debt service requirements, (B) will not issue any bonds,\nnotes or other evidences of indebtedness, other than the bonds, having\nany rights arising out of paragraph (h) of subdivision eight of section\nfifteen of the workers' compensation law or this section or secured by\nany pledge of or other lien or charge on the pledged revenues or other\nreceipts, funds or moneys pledged for the payment of debt service\nrequirements, (C) will not create or cause to be created any lien or\ncharge on the pledged revenues, other than a lien or pledge created\nthereon pursuant to said sections, (D) will carry out and perform, or\ncause to be carried out and performed, each and every promise, covenant,\nagreement or contract made or entered into by the special disability\nfund financing agreement, by the authority or on its behalf with the\nbond owners of any bonds, (E) will not in any way impair the rights,\nexemptions or remedies of the bond owners, and (F) will not limit,\nmodify, rescind, repeal or otherwise alter the rights or obligations of\nthe appropriate officers of the state to impose, maintain, charge or\ncollect the assessments and other revenues or receipts constituting the\npledged revenues as may be necessary to produce sufficient revenues to\nfulfill the terms of the proceedings authorizing the issuance of the\nbonds, including pledged revenue coverage requirements, provided,\nhowever, (i) the remedies available to the authority and the bondholders\nfor any breach of the pledges and agreements of the state set forth in\nthis subclause shall be limited to injunctive relief, (ii) nothing in\nthis subdivision shall prevent the authority from issuing evidences of\nindebtedness (A) which are secured by a pledge or lien which is, and\nshall on the face thereof, be expressly subordinate and junior in all\nrespects to every lien and pledge created by or pursuant to said\nsections, or (B) which are secured by a pledge of or lien on moneys or\nfunds derived on or after the date every pledge or lien thereon created\nby or pursuant to said sections shall be discharged and satisfied, and\n(iii) nothing in this subdivision shall preclude the state from\nexercising its power, through a change in law, to limit, modify,\nrescind, repeal or otherwise alter the character of the pledged\nassessments or revenues or to substitute like or different sources of\nassessments, taxes, fees, charges or other receipts as pledged revenues\nif and when adequate provision shall be made by law for the protection\nof the holders of outstanding bonds pursuant to the proceedings under\nwhich the bonds are issued, including changing or altering the method of\nestablishing the special assessments.\n The authority is authorized to include this covenant of the state, as\na contract of the state, in any agreement with the owner of any bonds\nissued pursuant to this section and in any credit facility or\nreimbursement agreement with respect to such bonds. Notwithstanding\nthese pledges and agreements by the state, the attorney general may in\nhis or her discretion enforce any and all provisions related to the\nspecial disability fund, without limitation.\n (b) Prior to the date which is one year and one day after the\nauthority no longer has any bonds issued pursuant to this section\noutstanding, the authority shall have no authority to file a voluntary\npetition under chapter nine of the federal bankruptcy code or such\ncorresponding chapter or sections as may, from time to time, be in\neffect, and neither any public officer nor any organization, entity or\nother person shall authorize the authority to be or become a debtor\nunder chapter nine or any successor or corresponding chapter or sections\nduring such period. The state hereby covenants with the owners of the\nbonds of the authority that the state will not limit or alter the denial\nof authority under this subdivision during the period referred to in the\npreceding sentence. The authority is authorized to include this covenant\nof the state, as a contract of the state, in any agreement with the\nowner of any bonds issued pursuant to this section.\n (c) To the extent deemed appropriate by the authority any pledge and\nagreement of the state with respect to the bonds as provided in this\nsection may be extended to, and included in, any ancillary bond facility\nas a pledge and agreement of the state with the authority and the\nbenefited party.\n 11. The bonds of the authority are hereby made securities in which all\npublic officers and bodies of this state and all municipalities and\npolitical subdivisions, all insurance companies and associations and\nother persons carrying on an insurance business, all banks, bankers,\ntrust companies, savings banks and savings associations, including\nsavings and loan associations, building and loan associations,\ninvestment companies and other persons carrying on a banking business,\nall administrators, guardians, executors, trustees and other\nfiduciaries, and all other persons whatsoever who are now or may\nhereafter be authorized to invest in bonds or in other obligations of\nthe state, may properly and legally invest funds, including capital, in\ntheir control or belonging to them. The bonds are also hereby made\nsecurities which may be deposited with and may be received by all public\nofficers and bodies of the state and all municipalities, political\nsubdivisions and public corporations for any purpose for which the\ndeposit of bonds or other obligations of the state is now or may\nhereafter be authorized.\n 12. (a) An action against the authority for death, personal injury or\nproperty damage or founded on tort shall not be commenced more than one\nyear and ninety days after the cause of action thereof shall have\naccrued nor unless a notice of claim shall have been served on a member\nof the authority or officer or employee thereof designated by the\nauthority for such purpose, within the time limited by, and in\ncompliance with the requirements of section fifty-e of the general\nmunicipal law.\n (b) The venue of every action, suit or special proceeding brought\nagainst the authority or concerning the validity of this section shall\nbe laid in the county of Albany.\n (c) The bonds, and any obligation of the authority under any ancillary\nbond facility, may contain a recital that they are issued or executed,\nrespectively, pursuant to this section, which recital shall be\nconclusive evidence of the validity of the bonds and any such\nobligation, respectively, and the regularity of the proceedings of the\nauthority relating thereto.\n 13. Any action or proceeding to which the authority or the people of\nthe state may be parties, in which any question arises as to the\nvalidity of this section, shall be preferred over all other civil causes\nof action or cases, except election causes of action or cases, in all\ncourts of the state and shall be heard and determined in preference to\nall other civil business pending therein, except election causes,\nirrespective of position on the calendar. The same preference shall be\ngranted upon application of the authority or its counsel in any action\nor proceeding questioning the validity of this section in which the\nauthority may be allowed to intervene.\n