Sec. 10a-89b. Authority for board of trustees to borrow money from the Connecticut Health and Educational Facilities Authority.
Sec. 10a-89b. Authority for board of trustees to borrow money from the Connecticut Health and Educational Facilities Authority. (a) The Board of Trustees
for the Connecticut State University System is authorized to borrow money from the
Connecticut Health and Educational Facilities Authority for any project for which the
authority is authorized to make loans pursuant to chapter 187 and to refinance any such
borrowing, and in connection therewith the Board of Trustees for the Connecticut State
University System is authorized to enter into any loan or other agreement and to make
such covenants, representations and indemnities as the board of trustees deems necessary
or desirable to obtain such loans from the authority or to facilitate the issue of bonds
by the authority to finance such loans, including agreements with providers of letters
of credit, insurance or other credit facilities for such financings. Any such agreement,
covenant, representation and indemnification shall be a full faith and credit obligation
of the Connecticut State University System. The Board of Trustees of the Connecticut
State University System may secure such obligations by a pledge of the revenues to be
derived from the operation or use of a project or projects, from tuition payments, from
student fees, from dormitory or dining hall income or from other general revenues. Any
pledge made by the Connecticut State University System pursuant to this section and
sections 10a-186a and 10a-187 shall be valid and binding from the time when the pledge
is made. 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 Connecticut State
University System, irrespective of whether the parties have notice of the claims. Notwithstanding any provision of the Uniform Commercial Code to the contrary, no instrument by which such a pledge is created need be recorded or filed. Any revenues or other
receipts, funds, moneys or income so pledged and thereafter received by the Connecticut
State University System shall be subject immediately to the lien of the pledge without
any physical delivery thereof or further act and such lien shall have priority over all
other liens, including without limitation the lien of any person who, in the ordinary
course of business, furnishes services or materials to the Connecticut State University
System.
(b) The obligations of the Connecticut State University System and any pledge
entered into by the Connecticut State University System pursuant to this section and
sections 10a-186a and 10a-187 shall be binding upon any successor body or entity and
no dissolution or termination of the Connecticut State University System shall take
effect unless adequate provision is made for the payment and fulfillment of any obligations entered into by the Connecticut State University System pursuant to this section
and said sections 10a-186a and 10a-187.
(c) Notwithstanding the provisions of any general or special act which may require
that any revenue from the operation of facilities of the Connecticut State University
System or any revenue of all state universities from student fees and dormitory and
dining hall income or any other revenue of the Connecticut State University System be
paid to the State Treasurer for the payment of debt service on any bonds issued by the
state, any revenues pledged by the board of trustees pursuant to this section and said
sections 10a-186a and 10a-187 shall be applied first to the extent necessary to fulfill
the obligations for which such revenues are pledged, and only thereafter to the State
Treasurer.
(d) The Connecticut Health and Educational Facilities Authority shall not borrow
any money or issue any bonds or notes which are secured by a pledge of any revenues
of the Connecticut State University System, until and unless such borrowing or issuance
has been approved by the Secretary of the Office of Policy and Management or his
deputy. In granting such approval the secretary shall consider the adequacy of revenues
available to the Connecticut State University System to pay (1) debt service on all the
borrowings, bonds or notes issued by the Connecticut Health and Educational Facilities
Authority for which revenues of the Connecticut State University System are pledged
and (2) debt service on all the bonds issued by the state for which revenues of the
Connecticut State University System are to be paid to the State Treasurer.
(e) The state covenants with the authority and with the purchasers and all other
subsequent owners and transferees of obligations issued by the authority for the benefit
of the Connecticut State University System pursuant to this section and said sections
10a-186a and 10a-187, in consideration of the financing by the authority and the acceptance of and payment for the securities of the authority, until all obligations of the Connecticut State University System and all costs and expenses in connection with any action
or proceeding in connection therewith, are fully met and discharged, unless expressly
permitted or otherwise authorized by the terms of each contract and agreement made
or entered into by or on behalf of the Connecticut State University System with the
authority or for the benefit of such other parties, that the state (1) will not create or
cause to be created any lien or charge on the assets or revenues pledged to secure such
obligations of the Connecticut State University System, prior to or on parity with a lien
or pledge created thereon pursuant to this section and sections 10a-186a and 10a-187;
(2) will not in any way impair the rights, exemptions or remedies of the authority or the
owners of such bonds of the authority; and (3) will not limit, modify, rescind, repeal or
otherwise alter the rights or obligations of the Connecticut State University System to
take such action as may be necessary to fulfill the terms of its obligations in connection
with its borrowing from the authority; provided that nothing herein shall preclude the
state from exercising its power, through a change in law, to limit, modify, rescind, repeal
or otherwise alter this section and sections 10a-186a and 10a-187 if and when adequate
provision shall be made by law for the protection of the authority and the holders of any
outstanding securities of the authority, pursuant to the agreement of the Connecticut
State University System with the authority and pursuant to the indenture or other instrument under which the bonds of the authority are issued. The Connecticut State University
System is authorized to include this covenant of the state, as a contract of the state,
in any such agreement with the authority and in any credit facility or reimbursement
agreement with respect to the obligations of the Connecticut State University System or
the obligations of the authority issued for the benefit of the Connecticut State University
System.
(f) The Superior Court shall have jurisdiction to enter judgment against the Connecticut State University System found upon any express agreement between the Connecticut State University System and the authority, any trustee or underwriter for the authority's bonds, or any bond insurer or other credit facility provider. Any action brought
under this section shall be brought in the superior court for the judicial district of Hartford. Such action shall be tried to the court without a jury. All legal defenses except
governmental immunity shall be reserved to the Connecticut State University System.
Any action brought under this section shall be privileged in respect to assignment for
trial upon motion of either party.
(P.A. 88-230, S. 1, 12; P.A. 90-98, S. 1, 2; 93-142, S. 4, 7, 8; P.A. 95-220, S. 4-6; 95-270, S. 3, 11; P.A. 08-16, S. 1.)
History: P.A. 95-270, S. 3 effective June 22, 1995 (Revisor's note: P.A. 88-230, 90-98, 93-142 and 95-220 authorized
substitution of "judicial district of Hartford" for "judicial district of Hartford-New Britain" in 1995 public and special acts
effective September 1, 1998.); P.A. 08-16 amended Subsec. (c) by adding "system" after "Connecticut State University",
effective July 1, 2008.