N.Y.
Public Authorities Law Section 3407
Bonds or notes of the corporation
1.
The corporation shall have the power and is hereby authorized from time to time to issue bonds, notes or other obligations to pay the cost of any project or for any other corporate purpose, including the establishment of reserves to secure the bonds, the payment of principal of, premium, if any, and interest on the bonds and the payment of incidental expenses in connection therewith. The corporation shall have the power and is hereby authorized to enter into such agreements and perform such acts as may be required under any applicable federal legislation to secure a federal guarantee or other subsidy with respect to any bonds.2.
The corporation shall have the power from time to time to renew bonds or to issue renewal bonds for such purpose, to issue bonds to pay bonds, and, whenever it deems refunding expedient, to refund any bond 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 other corporate purpose of the corporation. Bonds issued for refunding purposes shall be sold and the proceeds applied to the purchase, redemption or payment of the bonds or notes to be refunded.3.
Bonds issued by the corporation may be general obligations secured by the faith and credit of the corporation or may be special obligations payable solely out of particular revenues or other monies as may be designated in the proceedings of the corporation under which the bonds shall be authorized to be issued, subject as to priority only to any agreements with the holders of outstanding bonds pledging any particular property, revenues or monies. The corporation may also enter into loan agreements, lines of credit and other security agreements and obtain for or on its behalf letters of credit, insurance, guarantees or other credit enhancements to the extent now or hereafter available, in each case for the purpose of securing its bonds or notes or to provide direct payment of any amounts which the corporation is authorized to pay.4.
Bonds shall be authorized by resolution of the corporation, and may be in such denominations and bear such date or dates and mature at such time or times as such resolution may provide, except that bonds and any renewals thereof shall mature within forty years from the date of original issuance of any such bonds. Obligations with a maturity of five years or less from the date of their original issuance may be designated as notes. Bonds shall be subject to such terms of redemption, bear interest at such rate or rates per annum payable at such times, be in such 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 terms and conditions as such resolution may provide. Bonds may be sold at public or private sale for such price or prices as the corporation shall determine, provided that no bonds of the corporation, other than obligations designated as notes, may be sold by the corporation at private sale unless such sale in the terms thereof have been approved in writing by the comptroller, where such sale is not to be to such comptroller, or by the state director of the division of the budget, where such sale is to be to the comptroller. The corporation may pay all expenses, premiums and commissions which it may deem necessary or advantageous in connection with the issuance and sale of bonds.5.
Any resolution or resolutions authorizing bonds or any issue of bonds by the corporation may contain provisions which may be a part of the contract with the holders of the bonds thereby authorized as to:(a)
pledging all or part of the revenues, together with any other monies or property of the corporation to secure the payment of the bonds, or any costs of issuance thereof, including but not limited to, any contracts, earnings or proceeds of any grant to the corporation received from any private or public source subject to such agreements with bondholders as may then exist;(b)
the setting aside of reserves and the creation of sinking funds and the regulation and disposition thereof;(c)
limitations on the purpose to which the proceeds from the sale of bonds may be applied;(d)
the rates, rents, fees and other charges to be fixed and collected by the corporation and the amount to be raised in each year thereby and the use and disposition of revenues;(e)
limitations on the right of the corporation to restrict and regulate the use of the project or part thereof in connection with which bonds are issued;(f)
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;(g)
the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, including the proportion of bondholders which must consent thereto, and the manner in which such consent may be given;(h)
the creation of special funds into which any revenues or monies may be deposited;(i)
the terms and provisions of any trust, mortgage, deed or indenture securing the bonds under which the bonds may be issued;(j)
vesting in a trustee or trustees such properties, rights, powers and duties in trust as the corporation may determine which may include any or all of the rights, powers and duties of the trustees appointed by the bondholders pursuant to § 3408 (Remedies of bondholders)section thirty-four hundred eight of this title and limiting the rights 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 may constitute a default in the obligations and duties of the corporation to the bondholders and providing for the rights and remedies of the bondholders in the event of such default, including as a matter of right appointment of a receiver, provided, however, that such rights and remedies shall not be inconsistent with the general laws of the state and other provisions of this title;(l)
limitations on the power of the corporation to sell or otherwise dispose of any project or any part thereof or other property;(m)
limitations on the amount of revenues and other monies to be expended or operating, administrative or other expenses of the corporation;(n)
the payment of the proceeds of bonds, revenues and other monies to a trustee or other depository, and for the method of disbursement thereof with such safeguards and restrictions as the corporation may determine; and(o)
any other matters of like or different character which in any way affect the security or protection of the bonds or the rights and remedies of the bondholders.6.
In addition to the powers herein conferred upon the corporation to secure its bonds, the corporation shall have the power in connection with the issuance of bonds to adopt resolutions and enter into such trust indentures, agreements or other instruments as the corporation may deem necessary, convenient or desirable concerning the use or disposition of its revenues or other monies or property, including the mortgaging of any property and the entrusting, pledging or creation of any other security interest in any such revenues, monies or property and the doing of any act, including refraining from doing any act which the corporation would have the right to do in the absence of such resolutions, trust indentures, agreements or other instruments. The corporation shall have power to enter into amendments of any such resolutions, trust indentures, agreements or other instruments within the powers granted to the corporation by this title and to perform such resolutions, trust indentures, agreements or other instruments. The provisions of any such resolutions, trust indentures, agreements or other instruments may be made a part of the contract with the holders of bonds of the corporation.7.
Any provision of the uniform commercial code to the contrary notwithstanding, any pledge of or other security interest in revenues, monies, accounts, contract rights, general intangibles or other personal property made or created by the corporation shall be valid, binding and perfected from the time when such pledge is made or other security interest attaches without any physical delivery of the collateral or further act, and the lien of any such pledge or other security interest shall be valid, binding and perfected against all parties having claims of any kind in tort, contract or otherwise against the corporation irrespective of whether or not such parties have notice thereof. No instrument by which such a pledge or security interest is created nor any financing statement need be recorded or filed.8.
Whether or not the bonds of the corporation are of such 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 for registration.9.
Neither the directors nor the non-voting representatives nor the officers of the corporation nor any person executing its bonds shall be liable personally on its bonds or be subject to any personal liability or accountability by reason of the issuance thereof.10.
Subject to such agreements with bondholders as may then exist, the corporation shall have power out of any funds available therefor to purchase bonds of the corporation, in lieu of redemption, at a price not exceeding, if the bonds are then redeemable, the redemption price then applicable plus accrued interest to the next interest payment date, or, if the bonds are not then redeemable, the redemption price applicable on the first date after such purchase upon which the bonds become subject to redemption plus accrued interest to the next interest payment date. Bonds so purchased shall thereupon be canceled.11.
The corporation shall have power and is hereby authorized to issue negotiable bond anticipation notes in conformity with applicable provisions of the uniform commercial code and may renew the same from time to time but the maximum maturity of any such note, including renewals thereof, shall not exceed five years from the date of issue of such original note.
Source:
Section 3407 — Bonds or notes of the corporation, https://www.nysenate.gov/legislation/laws/PBA/3407 (updated Sep. 22, 2014; accessed Apr. 27, 2024).
