N.Y. Public Authorities Law § 1290: Notes and bonds of the corporation

§ 1290. Notes and bonds of the corporation. 1. (a) The corporation

shall have power and is hereby authorized from time to time to issue its

negotiable or non-negotiable bonds and notes in conformity with

applicable provisions of the uniform commercial code in such principal

amount, as, in the opinion of the corporation, shall be necessary to

provide sufficient funds for achieving its purposes, including the

acquisition and construction, operation and maintenance of sewage

treatment works, sewage collecting systems, solid waste disposal

facilities, storm water collecting systems, water management facilities,

air pollution control facilities, the removal, disposal and remediation

of petroleum storage tanks and the remediation of the sites thereof and

any other project or projects authorized pursuant to the provisions of

this title, and paying the cost thereof; the making of loans to persons

and, for purposes of sections twelve hundred eighty-five-j, twelve

hundred eighty-five-m and twelve hundred eighty-five-o of this title

only, to any municipality or recipient for such purposes; the making of

loans, providing of financing or extension of credit to or on behalf of

beginning farmers for purposes of section twelve hundred eighty-five-r

of this title only; the financing of the design, acquisition,

construction, improvement and installation of all or any portion of

Riverbank Park, provided however, that any such bonds or notes issued to

finance Riverbank Park shall only be issued in such principal amount as

shall be necessary to provide sufficient funds for the repayment of

amounts disbursed pursuant to appropriations or reappropriations under

chapter fifty-four of the laws of nineteen hundred ninety-one including

any subsequent reappropriation of the unexpended balance of such

appropriations or reappropriations for the purpose of Riverbank Park,

plus an amount sufficient to fund any debt service reserve fund

established by the corporation for the purpose of Riverbank Park and to

provide for the payment of fees and other charges and expenses of the

corporation in connection with such bonds and notes, which principal

amount shall constitute the statutory ceiling on the amount of bonds and

notes that can be issued for such purpose; the financing of all or any

portion of any state park infrastructure project or reimbursement of the

state for expenditures relating thereto, plus an amount to provide for

the payment of fees and other charges and expenses of the corporation in

connection with such bonds and notes; the provision of funds to the

state for any amounts contributed or to be contributed to the water

pollution control revolving fund, the pipeline for jobs fund or the

drinking water revolving fund provided, however, that any such bonds or

notes issued to provide funds to the water pollution control revolving

fund, the pipeline for jobs fund or the drinking water revolving fund

shall only be issued in such principal amount as shall be necessary to

provide sufficient funds for the repayment of amounts disbursed pursuant

to any appropriation or reappropriation enacted for the pipeline for

jobs fund or for the payment of the state match for federal

capitalization grants for the water pollution control revolving fund or

the drinking water revolving fund, plus an amount sufficient to fund any

debt service reserve fund and to provide for fees, charges and other

costs of issuance, which principal amount shall constitute the statutory

ceiling on the amount of bonds and notes that can be issued for such

purpose; the financing of any environmental infrastructure projects

authorized by section twelve hundred eighty-five-p of this title; the

purchase of municipal bonds and notes, and bonds and notes of a state

agency, the payment of the cost of any project, the payment of interest

on bonds and notes of the corporation, the establishment of reserves to

secure such bonds and notes; the provision of working capital and all

other expenditures of the corporation incident to and necessary or

convenient to carry out its purposes and powers;

(b) The corporation shall have power, from time to time, to issue

renewal notes, to issue bonds to pay notes and whenever it deems

refunding expedient, to refund any bonds by the issuance of new bonds,

whether the bonds to be refunded have or have not matured, and to issue

bonds partly to refund bonds then outstanding, and partly for any other

purpose. The refunding bonds shall be sold and the proceeds applied to

the purchase, redemption or payment of the bonds to be refunded.

Notwithstanding any statutory ceiling on outstanding bonds, any

refunding bonds shall be sold in the amount required to pay or redeem

outstanding bonds, to fund any reserve, escrow or payment fund, and to

provide for the payment of all fees and other charges and expenses,

including costs of issuance, incurred in connection with the issuance of

such refunding bonds, provided that the present value of the aggregate

debt service on the refunding bonds does not exceed the present value of

the aggregate debt service on the bonds refunded thereby.

(c) Except as may otherwise be expressly provided by the corporation,

every issue of its notes or bonds shall be (i) general obligations of

the corporation payable out of any revenues or monies of the

corporation, subject only to any agreements with the holders of

particular notes or bonds pledging any particular receipts or revenues,

(ii) special obligations of the corporation payable solely from the

revenues, service charges, rentals, proceeds or other payments to be

received on account of the mortgage, loan or other agreements and

payments, reserve and insurance funds or accounts issuance of special

obligations, and fees, charges or other monies to be received by the

corporation in respect to loans pursuant to section twelve hundred

eighty-five-b or twelve hundred eighty-five-j of this title, or from

amounts received by the corporation pursuant to any contract, lease,

easement, license or other instrument entered into by the corporation

pursuant to sections twelve hundred eighty-five-k and twelve hundred

eighty-five-l of this title or, (iii) special obligations of the

corporation payable solely from amounts received pursuant to an

agreement with the commissioner of environmental conservation pursuant

to subdivision twelve of section twelve hundred eighty-five-j of this

title, and may, but need not, be secured by mortgages, assignments or

pledges of such revenues, service charges, rentals, proceeds, other

payments, funds and accounts, fees, charges and other monies, and by

mortgages or assignments thereof in respect to projects, and may include

pooled financings subject only to any agreements with the holders of

particular special obligation notes or bonds issued to finance the cost

of, or loans for, a project or projects; no general obligations of the

corporation shall be issued to finance the cost of, or loans for, a

project or projects authorized to be constructed pursuant to section

twelve hundred eighty-five-b or twelve hundred eighty-five-j of this

title or to finance (A) the contribution of the state to the water

pollution control revolving fund, (B) the design, acquisition,

construction, improvement and installation of all or any portion of

Riverbank Park or (C) state park infrastructure projects and no funds,

monies, revenues or other assets of the corporation shall be used for

loans authorized pursuant to section twelve hundred eighty-five-b or

twelve hundred eighty-five-j of this title, except as may be available

with respect to a project and a contract with a person as aforesaid, or

for the payment to the state for amounts contributed by the state to the

water pollution control revolving fund, to finance the design,

acquisition, construction, improvement and installation of all or any

portion of Riverbank Park or state park infrastructure projects. Nor

shall any special obligation authorized pursuant hereto be payable from

or secured by any debt service reserve fund created pursuant to section

twelve hundred ninety-one of this title, and the state shall not be

entitled to require the redemption of such special obligations pursuant

to section twelve hundred ninety-three of this title; and such special

obligation and the security therefor shall not be subject to the

provisions of section twelve hundred ninety-four of this title but the

remedies of the holders thereof shall be set forth in the terms of such

special obligations and the instruments constituting such security; the

making of loans, providing of financial or extension of credit to or on

behalf of beginning farmers for purposes of section twelve hundred

eighty-five-r of this title only;

(d) Any bonds or notes issued for the purpose of financing amounts

deposited or to be deposited by the state in the water pollution control

revolving fund may be issued in an aggregate principal amount sufficient

to finance the amount to be paid or reimbursed to the state plus an

amount sufficient to fund any debt service reserve fund established by

the corporation and to provide for the payment of fees and other charges

and expenses of the corporation in connection with such bonds and notes.

(e) Notwithstanding any other law to the contrary, the corporation

shall not issue any notes or bonds on behalf of any state department or

agency to fund the removal, disposal and remediation of petroleum

storage tanks and the remediation of the sites thereof or on behalf of

the office of mental health to finance the pilgrim state sewage

treatment project, after the thirty-first day of March, nineteen hundred

ninety-six. This limitation shall not apply to bonds and notes issued to

refund bonds issued for such purposes.

2. The notes and bonds shall be authorized by resolution of the

directors of the corporation, shall bear such date or dates, and shall

mature at such time or times, in the case of any such note or any

renewals thereof not exceeding twelve years from the date of issue of

such original note, and in the case of any such bond not exceeding forty

years from the date of issue, as such resolution or resolutions may

provide; provided, however, that the final maturity of any bond issued

for the purpose of financing any amounts deposited or to be deposited by

the state in the water pollution control revolving fund shall not exceed

thirty years from the date of issue of such bond. The notes and bonds

shall bear interest at such rate or rates which may vary from time to

time, be in such denominations, be in such form, either coupon or

registered, 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 of redemption as such resolution or

resolutions may provide. The notes and bonds of the corporation may be

sold by the corporation, at public or private sale, at such price or

prices as the corporation shall determine. No notes or bonds of the

corporation may be sold by the corporation at private sale, however,

unless such sale and the terms thereof have been approved in writing by

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

the director of the budget, where such sale is to the comptroller.

3. Any resolution or resolutions authorizing any notes or bonds or any

issue thereof may contain provisions, which shall be a part of the

contract with the holders thereof, as to:

(a) pledging all or any part of the rentals, rates, charges and other

fees made or received by the corporation and other monies received or to

be received from the ownership or operation or otherwise in connection

with any project or projects and all or any part of the monies received

in payment of principal or interest on bonds or notes of any state

agency and municipal bonds or notes acquired by the corporation, to

secure the payment of the notes or bonds or of any issue thereof,

subject to such agreements with bondholders or noteholders as may then

exist;

(b) pledging all or any part of the assets of the corporation

including municipal bonds and notes acquired by the corporation in the

issuance of general obligations, and in the issuance of special

obligations, notes or other evidences of indebtedness of any person

acquired by the corporation, and assigning and pledging any mortgages or

other security interests acquired by the corporation or any interests of

the corporation in properties or revenues or other sums payable to the

corporation and any reserve and insurance funds or accounts or other

funds and accounts established in connection with the issuance of

special obligations to secure the payment of the notes or bonds or of

any issue of notes or bonds of general obligations or special

obligations, as the case may be, subject to such agreements with

noteholders or bondholders as may then exist;

(c) the use and disposition of rentals, rates, charges and other fees

made or received by the corporation;

(d) the setting aside of reserves or sinking funds and the regulation

and disposition thereof from the ownership or operation or otherwise in

connection with any project or projects and of the gross income from

municipal bonds and notes and bonds and notes of any state agency owned

by the corporation;

(e) limitations on the purpose to which the proceeds of sale of notes

or bonds may be applied and pledging such proceeds to secure the payment

of the notes or bonds or of any issue thereof;

(f) limitations on the issuance of additional notes or bonds; the

terms upon which additional notes or bonds may be issued and secured;

the refunding of outstanding or other notes or bonds;

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

noteholders or bondholders may be amended or abrogated, the amount of

notes or bonds the holders of which must consent thereto, and the manner

in which such consent may be given;

(h) limitations on the amount of monies to be expended by the

corporation for operating, administrative or other expenses of the

corporation;

(i) vesting in a trustee or trustees such property, rights, powers and

duties in trust as the corporation may determine, which may include any

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

bondholders pursuant to this title, and limiting or abrogating the right

of the bondholders to appoint a trustee under this article or limiting

the rights, powers and duties of such trustee;

(j) any other matters, of like or different character, which in any

way affect the security or protection of the notes or bonds.

4. In addition to the powers herein conferred upon the corporation to

secure its notes and bonds, the corporation shall have power in

connection with the issuance of notes and bonds to enter into such

agreements as the corporation may deem necessary, convenient or

desirable concerning the use or disposition of its monies or property

including the mortgaging of any such property and the entrusting,

pledging or creation of any other security interest in any such monies

or property and the doing of any act (including refraining from doing

any act) which the corporation would have the right to do in the absence

of such agreements. The corporation shall have power to enter into

amendments of any such agreements within the powers granted to the

corporation 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 the notes and bonds of the corporation.

5. It is the intention hereof that any pledge, mortgage or security

instrument made by the corporation shall be valid and binding from the

time when the pledge, mortgage or security instrument is made; that the

monies or property so pledged, mortgaged and entrusted and thereafter

received by the corporation shall immediately be subject to the lien of

such pledge, mortgage or security instrument without any physical

delivery thereof or further act; and that the lien of any such pledge,

mortgage or security instrument shall be valid and binding as against

all parties having claims of any kind in tort, contract or otherwise

against the corporation, irrespective of whether such parties have

notice thereof. Neither the resolution nor any mortgage, security

instrument or other instrument by which a pledge, mortgage lien or other

security is created need be recorded or filed and the corporation shall

not be required to comply with any of the provisions of the uniform

commercial code.

6. Neither the directors of the corporation nor any person executing

the notes or bonds shall be liable personally on the notes or bonds or

be subject to any personal liability or accountability by reason of the

issuance thereof.

7. The corporation, subject to such agreements with noteholders or

bondholders as may then exist, shall have power out of any funds

available therefor to purchase notes or bonds of the corporation, which

shall thereupon be cancelled, at a price not exceeding (a) if the notes

or bonds are then redeemable, the redemption price then applicable plus

accrued interest to the next interest payment thereon, or (b) if the

notes or bonds are not then redeemable, the redemption price applicable

on the first date after such purchase upon which the notes or bonds

become subject to redemption plus accrued interest to such date.

8. Neither the state nor any municipality shall be liable on notes or

bonds issued as general obligations of the corporation and such notes

and bonds shall not be a debt of the state or any municipality, and such

notes and bonds shall contain on the face thereof a statement to such

effect. The state shall not be liable on notes or bonds issued as

special obligations of the corporation, and such notes and bonds shall

not be a debt of the state and shall be payable solely from the

revenues, service charges, rentals, proceeds or other payments to be

derived from the extension of credit or the loan for the project for

which such notes and bonds were issued, and such notes and bonds shall

contain on the face thereof a statement to such effect.