N.Y. Public Authorities Law § 2020: Bonds of the authority

§ 2020. Bonds of the authority. 1. The authority shall have the power

and is hereby authorized from time to time to issue its negotiable bonds

for any of its corporate purposes, including incidental expenses in

connection therewith, and to secure the payment of the same by a lien or

pledge covering all or part of its contract, earnings or revenues. The

authority shall have power from time to time 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 may issue bonds

partly to refund bonds then outstanding and partly for any of its

corporate purposes. Except as may be otherwise expressly provided by the

authority, every issue of bonds by the authority shall be general

obligations payable out of any moneys, earnings or revenues of the

authority, subject only to any agreements with the holders of particular

bonds pledging any particular moneys, earnings or revenues.

Notwithstanding the fact that the bonds may be payable from a special

fund, if they are otherwise of such form and character as to be

negotiable instruments under the terms of negotiable instruments law

(constituting chapter thirty-eight of the consolidated laws) the bonds

shall be and are hereby made negotiable instruments within the meaning

of and for all the purposes of the negotiable instruments law, subject

only to the provisions of the bonds for registration.

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

shall bear such date or dates, mature at such time or times not

exceeding forty years from their respective dates, bear interest at the

best possible interest rate per annum as may be obtainable, be in such

denominations, be in such form either coupon or registered, carry such

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

lawful money of the United States of America, at such place or places

and be subject to such terms of redemption, as such resolution or

resolutions may provide.

All bonds of the authority shall be sold at public or private sale as

the authority shall determine. No bonds of the authority may be sold at

private sale, however, unless such sale and the terms thereof have been

approved by the county legislature. If such bonds are sold at public

sale, such sale shall be upon sealed bids to the bidder who shall offer

the lowest interest cost to the authority to be determined by the

authority. Notice of any public sale shall be published at least once,

not less than ten nor more than forty days before the date of sale, in a

financial newspaper published and circulated in the city of New York and

designated by the authority. The notice shall call for the receipt of

sealed bids and shall fix the date, time and place of sale.

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

bonds may contain provisions, which shall be a part of the contract with

the holders of the bonds thereby authorized, as to

(a) pledging all or any part of the moneys, earnings, income and

revenues derived from all or any part of the properties of the authority

to secure the payment of the bonds or of any issue 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 right of the authority to restrict and regulate

the use of the properties in connection with which such bonds are

issued;

(e) limitations in the purposes to which and the manner in which the

proceeds of sale of any issue of bonds may be applied;

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

which additional bonds may be issued and secured; 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, the amount of bonds the holders

of which must consent thereto, and the manner in which such consent may

be given;

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

of the authority may be deposited;

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

indenture securing the bonds or under which 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 forty-three hereof, and

limiting or abrogating the right 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 shall constitute a

default in the obligations and duties of the authority to the

bondholders and providing 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 this state

and other provisions of this title;

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

dispose of its properties;

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

affect the security or protection of the bonds;

(n) limitations on the amount of moneys derived from the properties to

be expended for operating, administrative or other expenses of the

authority;

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

bondholders;

(p) 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;

(q) the payment of the proceeds of bonds and revenues of the the

properties to a trustee or other depositary, and for the method of

disbursement thereof with such safeguards and restrictions as the

authority may determine.

4. It is in the intention of the legislature that any pledge of

earnings, revenues or other moneys made by the authority shall be valid

and binding from the time when the pledge is made; that the earnings,

revenues or other moneys so pledged and thereafter received by the

authority shall immediately be subject to the lien of such pledge

without any physical delivery thereof or further act, and that the lien

of any such pledge 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 other instrument by which a pledge is

created need be recorded.

5. Neither the members of the authority nor any person executing the

bonds or other obligations shall be liable personally on the bonds or

other obligations or be subject to any personal liability or

accountability by reason of the issuance thereof.

6. The authority shall have power out of any funds available therefor

to purchase (as distinguished from the power of redemption hereinabove

provided) any bonds issued by it or which may be assumed by such

authority at a price of not more than the principal amount thereof and

accrued interest, and all such bonds shall be cancelled.

7. In the discretion of the authority, the bonds may be secured by a

trust indenture by and between the authority and a corporate trustee,

which may be any trust company or bank having the powers of a trust

company in the state of New York. Such trust indenture may contain such

provisions for protecting and enforcing the rights and remedies of the

bondholders as may be reasonable and proper and not in violation of law,

including covenants setting forth the duties of the authority in

relation to the construction, maintenance, operation, repair and

insurance of the properties, and the custody, safeguarding and

application of all moneys, and may provide that the properties shall be

constructed and paid for under the supervision and approval of

consulting engineers. The authority may provide by such trust indenture

for the payment of the proceeds of the bonds and the revenues of the

properties to the trustee under such trust indenture or other

depository, and for the method of disbursement thereof, with such

safeguards and restrictions as it may determine. All expenses incurred

in carrying out such trust indenture may be treated as a part of the

cost of maintenance, operation and repairs of the properties. If the

bonds shall be secured by a trust indenture the bondholders shall have

no authority to appoint a separate trustee to represent them.

Notwithstanding any other provisions of this title, any resolution or

resolutions authorizing bonds or notes of the authority shall contain a

covenant by the authority that it will at all times maintain rates,

fees, rentals and/or other charges sufficient to pay, and that any

contracts entered into by the authority for the receipt and treatment

and/or disposal of solid wastes shall contain rates, fees, rentals or

other charges sufficient to pay, the cost of operation and maintenance

of the properties, the principal of and interest on any obligation

issued pursuant to such resolution or resolutions as the same severally

become due and payable, and to maintain any reserves or other funds

required by the terms of such resolution or resolutions.