Sec. 10a-230. Bonds.
Sec. 10a-230. Bonds. (a) The authority may from time to time issue revenue bonds
for any corporate purpose and all such revenue bonds, notes, bond anticipation notes
or other obligations of the authority issued pursuant to this chapter shall be and are
hereby declared to be negotiable for all purposes notwithstanding their payment from
a limited source and without regard to any other law or laws. In anticipation of the sale
of such revenue bonds, the authority may issue negotiable bond anticipation notes and
may renew the same from time to time, but the maximum maturity of any such note,
including renewals of such notes shall not exceed five years from the date of issue of
the original note. Such notes shall be paid from any revenues of the authority available
therefor and not otherwise pledged, or from the proceeds of sale of the revenue bonds
of the authority in anticipation of which they were issued. The notes shall be issued in
the same manner as the revenue bonds. Such notes and the resolution or resolutions
authorizing the same may contain any provisions, conditions or limitations which a bond
resolution of the authority may contain.
(b) The revenue bonds and notes of every issue shall be payable solely out of the
revenues of the authority pertaining to the program relating to such bonds or notes
including principal and interest on authority loans and education loans, and any other
revenues derived from or in connection with any other authority loans and education
loans, payments by participating institutions for higher education, banks, guarantors,
insurance companies or others pursuant to letters of credit or purchase agreements,
investment earnings from funds or accounts maintained pursuant to the bond resolution,
insurance proceeds, loan funding deposits, proceeds of sales of education loans, proceeds of refunding bonds and fees, charges and other revenues, funds and other assets
of the authority but subject only to any agreements with the holders of particular revenue
bonds or notes pledging any particular revenues and subject to any agreements with any
participating institution for higher education.
(c) The revenue bonds or notes may be issued as serial bonds or notes or as term
bonds or notes, or the authority, in its discretion, may issue bonds or notes of both types.
The revenue bonds or notes shall be authorized by resolution of the members of the
board of directors of the authority and shall bear such date or dates, mature at such time
or times, not exceeding the year following the last year in which the final payments in
an education loan series portfolio are due, or thirty years from the date of issuance,
whichever is sooner, from their respective dates, bear interest at such rate or rates, payable at such time or times, be in such denominations, be in such form either coupon or
registered, carry such registration or conversion privileges, be executed with manual or
facsimile signatures in such manner, be payable in lawful money of the United States
at such place or places, and be subject to such terms of redemption, as such resolution
or resolutions may provide. Such resolution or resolutions may delegate to the executive
director, assistant executive director or any member of the board of directors of the
authority, or any combination of them, the power to determine any of the matters set
forth in this section and the power to award the bonds to a purchaser or purchasers at
public sale or to negotiate a sale to a purchaser or purchasers. The revenue bonds or
notes may be sold for such price or prices as the authority shall determine. Pending
preparation of the definitive bonds, the authority may issue interim receipts or certificates which shall be exchanged for such definitive bonds.
(d) Any resolution or resolutions authorizing any revenue bonds or any issue of
revenue bonds may contain provisions, which shall be a part of the contract with the
holders of the revenue bonds to be authorized, as to: (1) Pledging all or any part of the
revenues, funds or other assets of the authority, including, but not limited to, the authority
loans and education loans to secure such bonds or notes; (2) pledging all or any part of
the revenues paid to the authority by any guarantor or insurance company; (3) pledging
any revenue-producing contract or contracts made by the authority with any individual,
partnership, corporation or association or other body, public or private, or any federally
guaranteed security and moneys received or receivable therefrom whether such security
is acquired by the authority or a participating institution for higher education to secure
the payment of the revenue bonds or notes or of any particular issue of revenue bonds
or notes, subject to such agreements with bondholders or noteholders as may then exist;
(4) the fees and other amounts to be charged, and the sums to be raised in each year
thereby, and the use, investment and disposition of such sums; (5) the establishment
and setting aside of reserves or sinking funds, the setting aside of loan funding deposits,
capitalized interest accounts, and cost of issuance accounts, and the regulation and disposition thereof; (6) limitations on the use of the education loans; (7) limitations on the
purpose to which the proceeds of the sale of any issue of revenue bonds or notes then
or thereafter to be issued may be applied, including as authorized purposes, all costs
and expenses necessary or incidental to the issuance of bonds, to the acquisition of or
commitment to acquire any federally guaranteed security and pledging such proceeds
to secure the payment of the revenue bonds, notes or any issue of the revenue bonds or
notes; (8) limitations on the issuance of additional bonds or notes, the terms upon which
additional bonds or notes may be issued and secured and the terms on which additional
bonds or notes rank on a parity with, or are subordinate or superior to, other bonds or
notes; (9) the refunding of outstanding bonds or notes; (10) the procedure, if any, by
which the terms of any contract with bondholders or noteholders may be amended or
abrogated, the amount of bonds or notes the holders of which must consent thereto, and
the manner in which such consent may be given; (11) limitations on the amount of
moneys derived from the educational program to be expended for operating, administrative or other expenses of the authority; (12) defining the acts or omissions to act which
shall constitute a default in the duties of the authority to holders of its obligations and
providing the rights and remedies of such holders in the event of default; (13) the duties,
obligations and liabilities of any trustee or paying agent; (14) providing for guarantees,
pledges of endowments, letters of credit, property or other security for the benefit of
the holders of such bonds or notes; and (15) any other matters relating to the bonds or
notes which the authority deems desirable.
(e) Subject to the approval of the State Treasurer or the Treasurer's deputy appointed
pursuant to section 3-12, required under subsection (b) of section 1-124, in connection
with, or incidental to:
(1) The issuance or carrying of bonds, notes or other obligations of the authority,
or the acquisition or carrying of any investment or program of investment, the authority
may enter into any contract which the authority determines to be necessary or appropriate
to place the obligation or investment of the authority, as represented by the bonds, notes
or other obligations, investment or program of investment and the contract or contracts,
in whole or in part, on the interest rate, cash flow or other basis desired by the authority,
including, without limitation, contracts commonly known as interest rate swap
agreements, forward payment conversion agreements, futures or contracts providing
for payments based on levels of, or changes in, interest rates, stock or other indices, or
contracts to exchange cash flows or a series of payments, or contracts, including, without
limitation, interest rate floors or caps, options, puts or calls to hedge payment, rate,
spread or similar exposure or contracts for the purchase of option rights with respect to
the mandatory tender for purchase of bonds, notes or other obligations of the authority,
which are subject to mandatory tender or redemption, including the issuance of certificates evidencing the right of the owner to exercise such option rights. Such contracts
or agreements may also be entered into by the authority in connection with, or incidental
to, entering into or maintaining any agreement which secures its bonds, notes or other
obligations, subject to the terms and conditions of the agreement respecting outstanding
obligations. In entering into any such contract or agreement, the authority shall give
due consideration to the creditworthiness of the counter party or counter parties, including any rating by a nationally recognized rating agency, the impact on any rating on
outstanding bonds or notes of the authority or any other criteria as the authority may
deem appropriate, provided the unsecured long-term obligations of the counter party
are rated the same or higher than the underlying rating of the authority on the applicable
bonds or notes by at least one nationally recognized rating agency. For purposes of this
subsection, counter party includes any party providing an unconditional guaranty of the
obligations of the counter party under such contract or agreement; and
(2) The issuance or carrying of bonds, notes or other obligations or entering into
any of the contracts or agreements referred to in subdivision (1) of this subsection, the
authority may enter into credit enhancement or liquidity agreements, or other necessary
or appropriate agreements, with payment, interest rate, security, default, remedy and
other terms and conditions as the authority determines, and the authority may pledge
all of any part of the collateral that secures the applicable bonds or notes, to the authority's
payment obligations under any contract or agreement entered into pursuant to this subsection. Such pledge shall be valid and binding from the time when the pledge is made;
the interest so pledged 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 against all parties having claims of any kind in tort,
contract or otherwise against the authority or any participating institution of higher
education, irrespective of whether such parties have notice thereof. 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 authority. Notwithstanding the provisions of title 42a, neither the bond resolution nor any financing statement, continuation statement or other instrument by which a pledge or security interest
is created or by which the authority's interest in such collateral is assigned need be filed
in any public records in order to perfect the security interest or lien thereof as against
third parties. The authority's obligations under any contract or agreement entered into
pursuant to this subsection may be enforced as provided in section 10a-235.
(f) Neither the members of the board of directors of the authority nor any person
executing the revenue bonds or notes shall be liable personally on the revenue bonds
or notes or be subject to any personal liability or accountability by reason of the issuance
thereof.
(g) The authority shall have power out of any funds available therefor to purchase
its bonds or notes. The authority may hold, pledge, cancel or resell such bonds or notes
subject to and in accordance with the agreements with bondholders.
(P.A. 82-313, S. 10, 28; P.A. 88-266, S. 27, 28, 46; May Sp. Sess. P.A. 04-2, S. 60, 61; P.A. 07-108, S. 3; P.A. 08-116,
S. 7.)
History: P.A. 88-266 inserted references to "board of directors" in Subsecs. (c) and (e); May Sp. Sess. P.A. 04-2 amended
Subsec. (b) to allow revenue bonds under section to be payable from revenues from other authority loans and education
loans and other funds or assets of the authority and amended Subsec. (d) to authorize the pledging of funds, moneys
receivable and other assets of the authority to secure bonds under section, effective May 12, 2004, and applicable to any
pledge, lien or security interest of this state or any political subdivision of this state in existence on October 1, 2003, or
created after that date; P.A. 07-108 made a technical change in Subsec. (a), added new Subsec. (e) to allow authority to
enter into arrangements to manage interest rate and cash flow fluctuations in connection with issuing, carrying, or securing
its bonds or notes and redesignated existing Subsecs. (e) and (f) as Subsecs. (f) and (g), effective July 1, 2007; P.A. 08-116 made a technical change in Subsec. (d)(8), effective May 27, 2008.