N.Y.
Public Authorities Law Section 1196-F
Bonds and notes of an authority
1.
An authority shall have the power and is hereby authorized from time to time to issue bonds, in conformity with applicable provisions of the uniform commercial code, in such principal amounts as it may determine to be necessary to pay the cost of any water project or projects or for any other corporate purposes, including incidental expenses in connection therewith. An authority shall have power from time to time 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 other corporate purpose. Bonds issued by an authority may be general obligations secured by the faith and credit of the authority or may be special obligations payable solely out of particular revenues or other moneys of the authority as may be designated in the proceedings of the authority under which the bonds shall be authorized to be issued, subject to any agreements with the holders of outstanding bonds pledging particular revenues or moneys.2.
An authority is authorized to obtain from any department or agency of the United States of America or nongovernmental insurer any insurance or guaranty, to the extent now or hereafter available, as to, or for the payment or repayment of interest or principal, or both, or any part thereof, on any bonds or notes issued by the authority and to enter into any agreement or contract with respect to any such insurance or guaranty, except to the extent that the same would in any way impair or interfere with the ability of the authority to perform and fulfill the terms of any agreement made with the holders of the bonds or notes of an authority.3.
Bonds shall be authorized by resolution of an authority, be in such denominations and bear such date or dates, mature at such time or times, except that bonds and any renewal thereof shall mature within forty years of the date of their original issuance and notes and any renewal thereof shall mature within five years of the date of their original issuance. Such bonds shall be subject to such terms of redemption, bear interest at such rate or rates 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 sale or, upon the approval of the state comptroller, at private sale for such price or prices as an authority shall determine, provided that no issue of bonds may be sold at private sale unless the terms of such sale shall have been approved by writing by (a) the comptroller, where such sale is not to the comptroller, or(b)
the director of the division of the budget, where such sale is to the comptroller.4.
Any resolution or resolutions authorizing bonds or any issue of bonds by an authority may contain provisions which may be part of the contract with the holders of the bonds thereby authorized as to:(a)
pledging all or part of its revenues, together with any other moneys, securities, contracts or property, to secure the payment of the bonds, 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)
limitations on the right of the authority to restrict and regulate the use of any project or part thereof in connection with which bonds are issued;(e)
limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and the refunding of outstanding or other bonds;(f)
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;(g)
the creation of special funds into which any revenues or other moneys may be deposited;(h)
the terms and provisions of any trust deed or indenture securing the bonds under which the bonds may be issued;(i)
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 § 1196-G (Remedies of bondholders)section eleven hundred ninety-six-g of this title and limiting or abrogating the rights of the bondholders to appoint a trustee under such section or limiting the rights, duties and powers of such trustee;(j)
defining the acts or omissions to act which may constitute a default in the obligations and duties of the authority 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 the 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;(k)
limitations on the power of the authority to sell or otherwise dispose of any system or any part thereof or other property;(l)
limitations on the amount of revenues and other moneys to be expended for operating, administrative or other expenses of the authority;(m)
the payment of the proceeds of bonds, revenues and other moneys to a trustee or other depository, and for the method of disbursement thereof with such safeguards and restrictions as the authority may determine; and(n)
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 bondholders.5.
In addition to the powers herein conferred upon an authority to secure its bonds, an authority shall have power in connection with the issuance of bonds to enter into such agreements as the authority may deem necessary, consistent or desirable concerning the use or disposition of its revenues or other moneys or property, including the mortgaging of any property and the entrusting, pledging or creation of any other security interest in any such revenues, moneys or property and the doing of any act, including refraining from doing any act, which an authority would have the right to do in the absence of such agreements. An authority shall have power to enter into amendments of any such agreements within the powers granted to the authority by this title and to perform such agreements. The provisions of any such agreements may be made a part of the contract with the holders of bonds of the authority.6.
Any provision of the uniform commercial code to the contrary notwithstanding, any pledge of or other security interest in revenues, moneys, accounts, contract rights, general intangibles or other personal property made or created by an authority 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 authority 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.7.
Whether or not the bonds of an authority 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.8.
Neither the directors of an authority nor any person executing bonds shall be liable personally thereon or be subject to any personal liability or accountability solely by reason of the issuance thereof.9.
An authority, subject to such agreements with bondholders as then may exist, shall have power out of any moneys available therefor to purchase bonds of the authority, which shall thereupon be cancelled, at a price not exceeding (i) if the bonds are then redeemable, the redemption price then applicable, plus accrued interest to the next interest payment date, (ii) 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.10.
An authority 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. Such notes shall be paid from any moneys of the authority available therefore and not otherwise pledged or from the proceeds of sale of the bonds of the authority in anticipation of which they were issued. The notes shall be issued in the same manner as the bonds and such notes and the resolution or resolutions authorizing the same may contain any provisions, conditions or limitations which the bonds or a bond resolution of the authority may contain. Such notes may be sold at public sale or, upon the approval of the state comptroller, at private sale. Such notes shall be as fully negotiable as the bonds of the authority.
Source:
Section 1196-F — Bonds and notes of an authority, https://www.nysenate.gov/legislation/laws/PBA/1196-F (updated Sep. 22, 2014; accessed Oct. 26, 2024).
