N.Y. Public Authorities Law § 1310: Notes and bonds of the authority

§ 1310. Notes and bonds of the authority. 1. (a) The authority shall

have power and is hereby authorized from time to time to borrow money

and issue its negotiable bonds and notes in such principal amount, as,

in the opinion of the authority, shall be necessary to provide

sufficient funds for achieving its purposes, including the acquisition,

establishment, construction, effectuation, operation, maintenance,

renovation, improvement, extension or repair of any transportation

facility, the payment of interest on bonds and notes of the authority,

establishment of reserves to secure such bonds and notes, the provision

of working capital and all other expenditures of the authority and its

subsidiary corporations incident to and necessary or convenient to carry

out their purposes and powers;

(b) The authority 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

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

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

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

every issue of its notes or bonds shall be general obligations of the

authority payable out of any revenues or moneys of the authority,

subject only to any agreements with the holders of particular notes or

bonds pledging any particular receipts or revenues;

(d) Whether or not the notes or bonds are of such form and character

as to be negotiable instruments under article eight of the uniform

commercial code, the notes or bonds shall be and hereby are made

negotiable instruments within the meaning of and for all the purposes of

article eight of the uniform commercial code, subject only to the

provisions of the notes or bonds for registration.

2. The notes and bonds shall be authorized by resolution approved by

not less than a majority of the whole number of members of the authority

then in office, shall bear such date or dates, and shall mature at such

time or times, as specified therein and in the case of any such bond not

exceeding fifty years from the date of issue, as such resolution or

resolutions may provide. The notes and bonds shall bear interest at such

rate or rates, 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 authority may be

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

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

authority may be sold by the authority 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 fares, tolls, rentals, rates,

charges and other fees made or received by the authority or any of its

subsidiary corporations, and other moneys received or to be received, 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 authority or of any

of its subsidiary corporations to secure the payment of the notes or

bonds or of any issue of notes or bonds, subject to such agreements with

noteholders or bondholders as may then exist;

(c) the use, and disposition of fares, tolls, rentals, rates, charges

and other fees made or received by the authority or any of its

subsidiary corporations;

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

and disposition thereof;

(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 moneys to be expended by the

authority or any of its subsidiary corporations for operating,

administrative or other expenses of the authority or any of its

subsidiary corporations;

(i) vesting in a trustee or trustees such property, 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 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 authority to

secure its notes and bonds, the authority shall have power in connection

with the issuance of notes and bonds to enter into such agreements as

the authority may deem necessary, convenient or desirable concerning the

use or disposition of its moneys or property or the moneys or property

of any of its subsidiary corporations, including the mortgaging of any

such property and the entrusting, pledging or creation of any other

security interest in any such 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 the notes and bonds of the authority.

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

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

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

moneys or property so pledged, mortgaged and entrusted and thereafter

received by the authority 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 authority, 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 authority shall not be

required to comply with any of the provisions of the uniform commercial

code.

6. Neither the members of the authority 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 authority, 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 authority, 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 date 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. The state shall not be liable on notes or bonds of the authority

and such notes and bonds shall not be a debt of the state, and such

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

effect.