§ 68-B — Issuance of bonds and notes

New York § 68-B

• Jurisdiction: New York
• Law STF: State Finance
• Art. 5-C: Revenue Bond Financing Program

Text

§ 68-b. Issuance of bonds and notes. 1. (a) Authorized issuers shall\nhave the power and are hereby authorized from time to time to issue\nrevenue bonds, in such principal amount or amounts, subject to\nsubdivision eight of this section and as the director of the budget\nshall determine to be necessary, to provide sufficient funds for\nauthorized purposes, the establishment of reserves to secure such\nrevenue bonds, the payment of amounts required under revenue bonds or\nagreements relating thereto, and the payment of all costs of issuance of\ntheir revenue bonds.\n (b) The authorized issuers shall have the power and are hereby\nauthorized from time to time to issue (i) revenue bonds to renew notes,\n(ii) revenue bonds to pay notes, and (iii) whenever it deems refunding\nexpedient, to refund any bonds, notes, or other obligations issued for\nan authorized purpose or purposes, by the issuance of new revenue bonds,\nincluding bonds, notes, or other obligations that were issued prior to\nthe enactment of this article, whether the bonds, notes, or other\nobligations to be refunded have or have not matured, and to issue\nrevenue bonds in part to refund bonds, notes, or other obligations then\noutstanding and in part for any of its other authorized purposes. The\nrefunding revenue bonds may be exchanged for bonds, notes, or other\nobligations to be refunded, or sold and the proceeds applied to the\npurchase, redemption or payment of such bonds, notes, or other\nobligations.\n (c) Except as may otherwise be expressly provided by an authorized\nissuer, every issue of revenue bonds of an authorized issuer pursuant to\nthis section shall be special obligations of the authorized issuer\npayable solely out of any revenues paid over to such authorized issuer\nfrom the revenue bond tax fund, established pursuant to section\nninety-two-z of this chapter.\n (d) All of the provisions of the enabling acts of the authorized\nissuers relating to bonds and notes, which are not inconsistent with the\nprovisions of this section, may, at the discretion of the authorized\nissuer, apply to revenue bonds authorized by this section.\n (e) The revenue bonds of the authorized issuers authorized by this\nsection shall not be a debt of the state and the state shall not be\nliable thereon, nor shall they be payable out of any funds other than\nthose of the authorized issuers pledged therefor; and such revenue bonds\nshall contain on the face thereof a statement to such effect. In\naddition, any agreements entered into by any entity pursuant to sections\nsixty-eight-c and ninety-two-z of this chapter on behalf of the state to\neffect the implementation of any of the activities financed in whole or\nin part with proceeds of the revenue bonds of the authorized issuers\nauthorized in this section do not constitute or create a debt of the\nstate, nor a contractual obligation in excess of the amounts\nappropriated therefor, and the state has no continuing legal or moral\nobligation to appropriate money for payments due under any such\nagreement.\n (f) (i) Revenue bonds shall be authorized by resolution of the\nauthorized issuers, be in such denominations, bear such date or dates\nand mature at such time or times, as such resolution or other agreement\nmay provide.\n (ii) Revenue bonds shall be subject to such terms of redemption, bear\ninterest at such rate or rates, be payable at such times, be in such\nform, either coupon, registered or book entry form, carry such\nregistration privileges, be executed in such manner, be payable in such\nmedium of payment at such place or places, and be subject to such terms\nand conditions as such resolution may provide.\n (g) Revenue bonds authorized hereunder shall be sold by authorized\nissuers, at public or private sale, at such price or prices as the\nauthorized issuers may determine. Revenue bonds of the authorized\nissuers shall not be sold by the authorized issuers at private sales\nunless such sale and the terms thereof have been approved by the state\ncomptroller.\n 2. Consistent with the provisions of this article, and subject to the\napproval of the director of the budget, any resolution or other\nagreement authorizing revenue bonds or any issue thereof 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 received by the\nauthorized issuers pursuant to section sixty-eight-c of this article to\nsecure the payment of the bonds or notes or of any issue thereof,\nsubject to such agreements with holders of revenue bonds as may then\nexist;\n (b) pledging all or any part of the assets of the authorized issuers\nto secure the payment of the revenue bonds or of any issue of revenue\nbonds subject to such agreements with holders of revenue bonds as may\nthen exist;\n (c) the setting aside of reserves or sinking funds and the regulation\nand disposition thereof;\n (d) limitations on the purposes to which the proceeds of sale of\nrevenue bonds, may be applied and pledging such proceeds to secure the\npayment of the revenue bonds or of any issue thereof;\n (e) limitations on the issuance of additional revenue bonds the terms\nupon which additional revenue bonds may be issued and secured and the\nrefunding of outstanding or other revenue bonds;\n (f) the procedure, if any, by which the terms of any contract with\nholders of revenue bonds may be amended or abrogated, the amount of\nrevenue bonds the holders of which must consent thereto and the manner\nin which such consent may be given;\n (g) vesting in a trustee, as described in subdivision six of this\nsection, such property, rights, powers and duties in trust as the\nauthorized issuers may determine, which may include any or all of the\nrights, powers and duties of the trustee appointed by the holders of\nrevenue bonds of the respective authorized issuers pursuant to this\narticle, and limiting or abrogating the right of such revenue bond\nholders to appoint a trustee under this title or limiting the rights,\npowers, and duties of such trustee;\n (h) the acts or omissions to act which shall constitute a default in\nthe obligations and duties of the authorized issuers to the holders of\nthe revenue bonds and providing for the rights and remedies of the\nholders of the revenue bonds in event of such default, including the\nright to appointment of a receiver; provided, however, that such rights\nand remedies shall not be inconsistent with the other provisions of this\narticle;\n (i) any other matters, of like or different character, which in any\nway affect the security or protection of the holders of the revenue\nbonds; and\n (j) the application of any of the foregoing provisions to any provider\nof any applicable bond, note or other financial facility.\n Notwithstanding the foregoing, the authorized issuers shall not be\nauthorized to make any covenant, pledge, promise, or agreement\npurporting to bind the state except as otherwise specifically authorized\nby this article.\n 3. Any pledge made by the respective authorized issuers shall be valid\nand binding from the time when the pledge is made. The revenues or\nproperty so pledged and thereafter received by the respective authorized\nissuers shall immediately be subject to the lien of such pledge without\nany physical delivery thereof or further act, and the lien of any such\npledge shall be valid and binding as against all parties having claims\nof any kind in tort, contract or otherwise against the respective\nauthorized issuers, irrespective of whether such parties have notice\nthereof. Neither the resolution nor any other instrument by which a\npledge is created need be recorded or filed to protect such pledge.\n 4. Neither the directors or members of the authorized issuers nor any\nother person executing the revenue bonds of the authorized issuers shall\nbe liable personally thereon or be subject to any personal liability or\naccountability solely by reason of the issuance thereof.\n 5. The authorized issuers, subject to such agreements with holders of\nrevenue bonds as may then exist, or with the providers of any applicable\nbond or note or other financial or agreement facility, shall have power\nout of any funds available therefor to purchase revenue bonds of the\nauthorized issuers, which may or may not thereupon be canceled, at a\nprice not exceeding:\n (a) if the revenue bonds are then redeemable, the redemption price\nthen applicable, including any accrued interest; or\n (b) if the revenue bonds are not then redeemable, the redemption price\nand accrued interest applicable on the first date after such purchase\nupon which the revenue bonds become subject to redemption; or\n (c) whether or not the revenue bonds are then redeemable, at a\nredemption price that provides present value savings to the state, as\ncertified in writing by an independent financial advisor.\n No later than seven days after a redemption pursuant to paragraph (c)\nof this subdivision, the director of the budget shall provide such\nwritten certification to the chair of the senate finance committee and\nthe chair of the assembly ways and means committee.\n 6. In the discretion of the authorized issuers, the revenue bonds may\nbe secured by a trust indenture by and between the authorized issuers\nand a corporate trustee, or a corporate trustee may be appointed under\nthe resolution as provided in subdivision two of this section.\n 7. Whether or not the revenue bonds are of such form and character as\nto be negotiable instruments under the terms of the uniform commercial\ncode, the revenue bonds are hereby made negotiable instruments within\nthe meaning of and for all the purposes of the uniform commercial code,\nsubject only to the provisions of the revenue bonds for registration or\nany book-entry-only system.\n 8. Revenue bonds may only be issued for authorized purposes, as\ndefined in section sixty-eight-a of this article. Notwithstanding the\nforegoing, the dormitory authority of the state of New York, the urban\ndevelopment corporation and the New York state thruway authority may\nissue revenue bonds for any authorized purpose of any other such\nauthorized issuer through March thirty-first, two thousand thirty. Any\nsuch revenue bonds issued by the New York state thruway authority shall\nbe subject to the approval of the New York state public authorities\ncontrol board, pursuant to section fifty-one of the public authorities\nlaw. The authorized issuers shall not issue any revenue bonds in an\namount in excess of statutory authorizations for such authorized\npurposes. Authorizations for such authorized purposes shall be reduced\nin an amount equal to the amount of revenue bonds issued for such\nauthorized purposes under this article. Such reduction shall not be made\nin relation to revenue bonds issued to fund reserve funds, if any, and\ncosts of issuance, nor shall revenue bonds issued to refund bonds issued\nunder existing authorizations reduce the amount of such authorizations.\n 9. Except upon the amendment of the New York state constitution\nallowing the issuance or assumption of bonds, notes or other obligations\nsecured by revenues, which may include the revenues securing revenue\nbonds of authorized issuers, and the affirmative assumption of such\nbonds, notes or other obligations by the state, the revenue bonds of the\nauthorized issuers authorized by this section shall not be a debt of the\nstate and the state shall not be liable thereon, nor shall they be\npayable out of any funds other than those of the authorized issuers\npledged therefor; and such revenue bonds shall contain on the face\nthereof a statement to such effect. In addition, any agreements entered\ninto by any entity pursuant to sections sixty-eight-c and ninety-two-z\nof this chapter on behalf of the state to effect the implementation of\nany of the activities financed in whole or in part with proceeds of the\nobligations of the authorized issuers authorized in this section do not\nconstitute or create a debt of the state, nor a contractual obligation\nin excess of the amounts appropriated therefor and the state has no\ncontinuing legal or moral obligation to appropriate money for payments\ndue under any such agreement.\n 10. Nothing in this article shall affect the authority of each of the\nauthorized issuers to issue or incur indebtedness for any purposes\notherwise authorized by law and nothing in this article shall be deemed\nto alter or affect the rights of outstanding bondholders or noteholders\nof any authorized issuer.\n 11. The authorization, sale and issuance of revenue bonds pursuant to\nthis section shall not be deemed an action as such term is defined in\narticle eight of the environmental conservation law for the purposes of\nsuch article. Such exemption shall be strictly limited in its\napplication to such financing activities of the authorized issuers\nhereunder and does not exempt any other entity from compliance with such\narticle.\n 12. The comptroller is hereby authorized to receive from the\nauthorized issuers any portion of bond proceeds paid to provide funds\nfor or reimburse the state for its costs associated with such authorized\npurposes and to credit such amounts to the capital projects fund or any\nother appropriate fund.\n