§53-31 Mortgages and mortgage bonds. Any redevelopment corporation, subject to the approval of the redevelopment agency, may borrow funds and secure the repayment thereof by bond and mortgage or by an issue of bonds under a trust indenture. Each mortgage or issue of bonds of a redevelopment corporation shall relate only to a single specified project and to no other and the bonds shall be secured by mortgage upon all of the real property of which the project consists. First lien bonds of the redevelopment corporation when secured by a mortgage not exceeding ninety per cent of the estimated cost prior to the completion of the project, or ninety per cent of the appraised value or actual cost, but in no event, in excess of ninety per cent of the total actual final cost, after the completion, as certified by the agency, are hereby declared securities in which all public officers and bodies of the State, all political subdivisions of the State, all insurance companies and associations, all savings banks and savings institutions, including savings and loan associations, personal representatives, guardians, trustees, and all other persons and fiduciaries in the State may properly and legally invest the funds within their control and available for investment under other provisions of law. The bonds so issued and secured and the mortgage or trust indenture relating thereto, may create a first or senior lien and a second or junior lien upon the real property embraced in any project; provided that the total mortgage liens shall not exceed ninety per cent of the estimated cost prior to the completion of the project, or ninety per cent of the appraised value or actual cost, but in no event in excess of ninety per cent of the total actual final cost after the completion, as certified by the agency. Where there are first and second mortgage liens upon the property embraced in a project, only the first or senior lien thereon shall be deemed a security in which the officer, bodies, subdivisions, corporations, associations, and fiduciaries, may invest the funds within their control. The bonds and mortgages may contain such other clauses and provisions as are approved by the agency, including the right to assignment of rents and entry into possession in case of default; but the operation of the redevelopment project in the event of the entry by mortgage or receiver shall be subject to regulations promulgated by the agency. Provisions for the amortization of the bonded indebtedness of corporations formed under this part shall be subject to the approval of the agency. So long as funds made available by the federal government or by instrumentality thereof or any mortgage or mortgage bonds, insured by the federal housing administrator or any other instrumentality of the federal government are used in financing, in whole or in part, any project under this part, the proportionate amount of the cost of the lands and improvements to be represented by mortgages or bonds shall be entirely in the discretion of the agency, and all restrictions as to the amounts to be represented by mortgages or bonds shall be inapplicable to the projects or to redevelopment corporations undertaking the projects, except that the bonds and mortgages covering any project shall not exceed the total actual final cost of such project as defined in [paragraph] (2) of section 53-32.

Interest rates on mortgage indebtedness shall not exceed such rates to be approved by the agency. [L 1949, c 379, §14; RL 1955, §143-30; am L 1959, c 96, §2; HRS §53-31; am L 1976, c 200, pt of §1]