A. The Authority shall have the power and is hereby authorized to borrow money and to issue its bonds in such principal amounts as the Authority determines shall be necessary to provide sufficient funds for: (a) the providing of financing for all or any part of any projects of the state or any of its political subdivisions as authorized under this act; (b) the providing of financing assistance to the state or political subdivisions as authorized under this act; (c) the payment of interest on bonds of the Authority; (d) the establishment of reserves to secure the bonds; and (e) all other expenditures of the Authority incident to and necessary or convenient to carry out its purposes and powers, including the payment of any credit enhancement fees and costs of issuance incurred in connection with the issuance of bonds. The Authority shall have the power to make expenditures for purposes of insuring and securing holders of bonds as provided in this act.

B. The Authority shall have the power to refund any bonds and any bonds, notes or other obligations heretofore or hereafter issued by any other issuer of bonds in the state if the Authority is authorized hereunder to issue bonds for the purpose the refunded bonds were issued 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 of its corporate purposes. Refunding bonds may be issued in such amount as the Authority may determine, but not exceeding an amount sufficient to refund the principal amount of the bonds or notes to be refunded, together with any unpaid interest accrued and to accrue thereon and any premiums, expenses and commissions incurred in connection with the issuance of such refunding bonds and any reserve established in connection with the issuance of such refunding bonds. The refunding bonds may be sold and the proceeds applied to the purchase, redemption, or payment of the bonds to be refunded or exchanged for the bonds to be refunded, all as determined by the Authority.

C. All bonds of the Authority shall be either (i) general obligations of the Authority, secured by any and all moneys and revenues of the Authority, (ii) special and limited obligations of the Authority, secured and payable solely out of the revenues and receipts derived pursuant to a financing agreement, or (iii) both general and special limited obligations, as may be designated in the proceedings of the Authority under which the bonds shall be authorized to be issued.

D. The bonds shall be authorized by resolution or resolutions of the Authority, shall be dated such date or dates, and shall mature at such time or times as such resolution or resolutions may provide. The bonds shall bear interest at such rate or rates or contain terms providing for the means of determining such rate or rates, including variations in such rates, but not to exceed an average interest rate of fourteen percent (14%) per annum if the interest thereon is not includable in the gross income of the recipients thereof for federal income tax purposes or eighteen percent (18%) per annum if the interest thereon is includable in the gross income of recipients thereof for federal income tax purposes, be in such denomination, be in such form, either coupon or registered, or in book-entry form, 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 term of redemption, including redemptions prior to maturity, as such resolution or resolutions may provide. The bonds of the Authority may be sold by the Authority at public or private sale, and at the price or prices as the Authority shall determine.

E. Any resolution or resolutions authorizing any bonds or any issue thereof may contain provisions, which shall be a part of the contract or contracts with the owners thereof, as to:

1. pledging all or any part of the revenues to secure the payment of the bonds or of any issue thereof, subject to such agreements with bondowners as may then exist;

2. pledging all or any part of the assets of the Authority, including mortgages and obligations securing the same, to secure the payment of the bonds or of any issue of bonds, subject to the agreements with bondowners as may then exist;

3. the use and disposition of the gross income from assets of any type owned by the Authority and payment of principal of assets of any type owned by the Authority;

4. the setting aside of reserves or sinking funds and the regulations and disposition thereof;

5. limitations on the purpose to which the proceeds of sale of bonds may be applied and pledging the proceeds to secure the payment of the bonds;

6. limitations on the issuance of additional bonds; the terms upon which additional bonds may be issued and secured; and the refunding of outstanding or other bonds;

7. the procedure, if any, by which the terms of any contract with bondowners may be amended or abrogated, the amount of bonds the owners of which must consent thereto, and the manner in which the consent may be given;

8. vesting in a trustee 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 bondowners pursuant to this act and limiting or abrogating the right of bondowners to appoint a trustee under this act or limiting the rights, powers, and duties of the trustee;

9. defining the acts or omissions to act which shall constitute a default in the obligations and duties of the Authority to the owners of the bonds and providing for the rights and remedies of the owners of the bonds in the event of default, including as a matter of right the appointment of a receiver; but the rights and remedies shall not be inconsistent with the general laws of the state and other provisions of this act; and

10. any other matters, of like or different character, which in any way affect the security or protection of the owners of the bonds.

F. Any pledge made by the Authority shall be valid and binding from the time when the pledge is made. The revenues, monies, or property 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 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 trust indenture whether the parties have notice thereof. Neither the resolution, trust indenture nor any other instrument by which a pledge is created need be recorded.

G. Bonds of the Authority may be secured by resolution of the Authority or a trust indenture or similar document by and between the Authority and a corporate trustee, which may be any bank having the power of a trust company or any trust company within or without the state. Such resolution, trust indenture or similar document may contain such provisions for protecting and enforcing the rights and remedies of the bondowners 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 exercise of its corporate powers and the custody, safeguarding and application of all monies. The Authority may provide by the resolution or trust indenture for the payment of the proceeds of the bonds and the revenues to the trustee under the trust indenture or other depository, and for the method of disbursement thereof, with such safeguards and restrictions as it may determine.

H. Whether or not the bonds are of the form and character as to be negotiable instruments under the terms of the Uniform Commercial Code, the bonds are hereby made negotiable instruments within the meaning of and for all the purposes of the Uniform Commercial Code, subject only to the provisions of the bonds relating to registration.

I. In the event that any of the members or officers of the Authority shall cease to be members or officers of the Authority prior to the delivery of any bonds or coupons signed by them, their signatures or facsimiles thereof shall nevertheless be valid and sufficient for all purposes, the same as if such members or officers had remained in office until such delivery.

J. Neither the members of the Authority nor any other person executing the bonds issued under this act shall be subject to personal liability or accountability by reason of the issuance thereof.

K. The Authority shall have the power to provide for the replacement of lost, destroyed, or mutilated bonds.

L. Except as provided by the Credit Enhancement Reserve Fund Act, bonds issued pursuant to the provisions of this act shall never constitute an indebtedness of the state within the meaning of any state constitutional provision or statutory limitation, but such bonds shall be indebtedness payable solely from sources indicated on the bond documents, and shall never constitute nor give rise to a pecuniary liability of this state or unspecified funds of the Authority or a charge against the general credit of the state or taxing powers of the state, and such fact shall be plainly stated on the face of each bond.

Added by Laws 1987, c. 222, § 58, operative July 1, 1987.