(a) Securities, their transfer and the income therefrom, including revenues derived from the sale thereof shall at all times be free from taxation except for estate and gift taxes imposed by the state or any political subdivision thereof but the interest on such securities shall be included in the computation of any excise or franchise tax.

(b) Provision may be made in the financing documents or in the financing transaction proceedings for the establishment of a rebate fund and the monitoring thereof and for the execution of a tax regulatory agreement and covenants with respect thereof in order for the interest on the securities to be and to continue to be excludable from gross income for federal income tax purposes pursuant to the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, to the extent permitted and provided for by such code. The State Treasurer may establish such requirements for compliance with said internal revenue code on securities secured by the state debt service commitment.

(c) Pending the use and application of any proceeds from the sale of any securities issued pursuant to sections 10a-109a to 10a-109y, inclusive, such proceeds may be deposited or invested in obligations permitted for state general obligation bonds pursuant to subsection (f) of section 3-20 and subject to the more particular provisions of the financing transaction proceedings.

(P.A. 95-230, S. 17, 45.)

History: P.A. 95-230 effective June 7, 1995