N.Y. Public Authorities Law § 1174-h: Bonds of the authority

§ 1174-h. Bonds of the authority. 1. The authority shall have the

power and is hereby authorized from time to time to issue bonds, in

conformity with applicable provisions of the uniform commercial code, in

such principal amounts as it may determine to be necessary to pay the

cost of any water project or projects or for any other corporate

purposes, including incidental expenses in connection therewith. The

authority shall have power from time to time to refund any bonds by the

issuance of new bonds whether the bonds to be refunded have or have not

matured, and may issue bonds partly to refund bonds then outstanding and

partly for any other corporate purpose. Bonds issued by the authority

may be general obligations secured by the faith and credit of the

authority or may be special obligations payable solely out of particular

revenues or other moneys of the authority as may be designated in the

proceedings of the authority under which the bonds shall be authorized

to be issued, subject to any agreements with the holders of outstanding

bonds pledging particular revenues or moneys.

2. The authority is authorized to obtain from any department or agency

of the United States of America or nongovernmental insurer any insurance

or guaranty, or any other credit enhancement arrangement with any bank

or other financial institution to the extent now or hereafter available,

as to, or for the payment or repayment of interest or principal, or

both, or any part thereof, on any bonds issued by the authority and to

enter into any agreement or contract with respect to any such insurance

or guaranty, except to the extent that the same would in any way impair

or interfere with the ability of the authority to perform and fulfill

the terms of any agreement made with the holders of the bonds of the

authority.

3. Bonds shall be authorized by resolution of the authority, and may

be in such denominations and bear such date or dates and mature at such

time or times as such resolution may provide except that bonds and any

renewal thereof shall mature within forty years of the date of their

original issuance and notes and any renewal thereof shall mature within

five years of the date of their original issuance. Such bonds shall be

subject to such terms of redemption, bear interest at such rate or

rates, which may vary from time to time, as may be necessary to effect

the sale thereof and shall be payable at such times, be in such form,

carry such registration privileges, be executed in such manner, be

payable in such medium of payment at such place or places, and be

subject to such terms and conditions as such resolution may provide.

Bonds may be sold at public sale or at private sale for such price or

prices as the authority shall determine, provided that no issue of bonds

may be sold at private sale unless the terms of such sale shall have

been approved in writing by:

(a) the comptroller, where such sale is not to the comptroller, or

(b) the director of the division of the budget of the state, where

such sale is to the comptroller.

4. Any resolution or resolutions authorizing bonds or any issue of

bonds by the authority may contain provisions which may be part of the

contract with the holders of the bonds thereby authorized as to:

(a) pledging all or part of its revenues, together with any other

moneys, securities, contracts or property, to secure the payment of the

bonds, subject to such agreements with bondholders as may then exist;

(b) the rates, rentals, fees and other charges to be fixed and

collected and the amounts to be raised in each year thereby, and the use

and disposition of the earnings and other revenues;

(c) the setting aside of reserves and the creation of sinking funds

and the regulation and disposition thereof;

(d) limitations on the purpose to which the proceeds from the sale of

bonds may be applied;

(e) limitations on the right of the authority to restrict and regulate

the use of any project or part thereof in connection with which bonds

are issued;

(f) limitations on the issuance of additional bonds, the terms upon

which additional bonds may be issued and the refunding of outstanding or

other bonds;

(g) the procedure, if any, by which the terms of any contract with

bondholders may be amended or abrogated, including the proportion of

bondholders which must consent thereto and the manner in which such

consent may be given;

(h) the creation of special funds into which any revenues or other

moneys may be deposited;

(i) the terms and provisions of any trust deed or indenture securing

the bonds under which the bonds may be issued;

(j) vesting in a trustee or trustees such properties, rights, powers

and duties in trust as the authority may determine, which may include

any or all of the rights, powers and duties of the trustee appointed by

the bondholders pursuant to section eleven hundred seventy-four-i of

this title and limiting or abrogating the rights of the bondholders to

appoint a trustee under such section or limiting the rights, duties and

powers of such trustee;

(k) defining the acts or omissions to act which may constitute a

default in the obligations and duties of the authority to the

bondholders and providing for the rights and remedies of the bondholders

in the event of such default, including as a matter of right the

appointment of a receiver, provided, however, that such rights and

remedies shall not be inconsistent with the general laws of the state

and other provisions of this title;

(1) limitations on the power of the authority to sell or otherwise

dispose of any system or any part thereof or other property;

(m) limitations on the amount of revenues and other moneys to be

expended for operating, administrative or other expenses of the

authority;

(n) the protection and enforcement of the rights and remedies of the

bondholders;

(o) the obligations of the authority in relation to the construction,

maintenance, operation, repairs and insurance of the properties, the

safeguarding and application of all moneys and as to the requirements

for the supervision and approval of consulting engineers in connection

with construction, reconstruction and operation;

(p) the payment of the proceeds of bonds, revenues and other moneys to

a trustee or other depository, and for the method of disbursement

thereof with such safeguards and restrictions as the authority may

determine; and

(q) any other matters of like or different character which in any way

affect the security or protection of the bonds or the rights and

remedies of bondholders.

5. In addition to the powers herein conferred upon the authority to

secure its bonds, the authority shall have power in connection with the

issuance of bonds to enter into such agreements as the authority may

deem necessary, consistent or desirable concerning the use or

disposition of its revenues or other moneys or property, including

remarketing agreements or other similar agreements for the bonds, the

mortgaging of any property and the entrusting, pledging or creation of

any other security interest in any such revenues, moneys, or property

and the doing of any act, including refraining from doing any act, which

the authority would have the right to do in the absence of such

agreements. The authority shall have power to enter into amendments of

any such agreements within the powers granted to the authority by this

title and to perform such agreements. The provisions of any such

agreements may be made a part of the contract with the holders of bonds

of the authority.

6. Any provision of the uniform commercial code to the contrary

notwithstanding, any pledge of or other security interest in revenues,

moneys, accounts, contract rights, general intangibles or other personal

property made or created by the authority shall be valid, binding and

perfected from the time when such pledge is made or other security

interest attaches without any physical delivery of the collateral or

further act, and the lien of any such pledge or other security interest

shall be valid, binding and perfected against all parties having claims

of any kind in tort, contract or otherwise against the authority

irrespective of whether or not such parties have notice thereof. No

instrument by which such a pledge or security interest is created nor

any financing statement need be recorded or filed.

7. Whether or not the bonds of the authority are of such form and

character as to be negotiable instruments under the terms of the uniform

commercial code, the bonds are hereby made negotiable instruments within

the meaning of and for all purposes of the uniform commercial code,

subject only to the provisions of the bonds for registration.

8. Neither the members of the board of directors nor the officers of

the authority nor any person executing bonds shall be liable personally

thereon or be subject to any personal liability or accountability solely

by reason of the issuance thereof.

9. The authority, subject to such agreements with bondholders as then

may exist, shall have power out of any moneys available therefor to

purchase bonds of the authority in lieu of redemption, at a price not

exceeding:

(a) if the bonds are then redeemable, the redemption price then

applicable, plus accrued interest to the next interest payment date,

(b) if the bonds are not then redeemable, the redemption price then

applicable on the first date after such purchase upon which the bonds

become subject to redemption plus accrued interest to the next interest

payment date.

10. The authority shall have power and is hereby authorized to issue

negotiable bond anticipation notes in conformity with applicable

provisions of the uniform commercial code and may renew the same from

time to time but the maximum maturity of any such note, including

renewals thereof, shall not exceed five years from the date of issue of

such original note. Such notes shall be paid from any moneys of the

authority available therefor and not otherwise pledged or from the

proceeds of sale of the bonds of the authority in anticipation of which

they were issued. The notes shall be issued in the same manner as the

bonds and such notes and the resolution or resolutions authorizing the

same may contain any provisions, conditions or limitations which the

bonds or bond resolution of the authority may contain. Such notes may be

sold at public sale or, upon the approval of the comptroller of the

terms thereof, at private sale. Such notes shall be as fully negotiable

as the bonds of the authority.