Sec. 13b-77. Covenants.
Sec. 13b-77. Covenants. (a) The state covenants with the purchasers and all subsequent owners and transferees of bonds and bond anticipation notes issued by the state
pursuant to sections 13b-74 to 13b-77, inclusive, in consideration of the acceptance of
and payment for the bonds and bond anticipation notes, that the principal and interest
of such bonds and bond anticipation notes shall be free at all times from taxation, except
for estate and gift taxes, imposed by the state or by any political subdivision thereof.
The Treasurer is authorized to include this covenant of the state in any agreement with
the owner of any such bonds or bond anticipation notes.
(b) Bonds and bond anticipation notes issued pursuant to sections 13b-74 to 13b-77, inclusive, are hereby made securities in which all public officers and public bodies
of the state and its political subdivisions, all insurance companies, credit unions, building
and loan associations, investment companies, banking associations, trust companies,
executors, administrators, trustees and other fiduciaries and pension, profit-sharing and
retirement funds may properly and legally invest funds, including capital in their control
or belonging to them. Such bonds and bond anticipation notes are hereby made securities
which may properly and legally be deposited with and received by any state or municipal
officer or any agency or political subdivision of the state for any purpose for which the
deposit of bonds and bond anticipation notes or obligations of the state is now or may
hereafter be authorized by law.
(c) The state covenants with the purchasers and all subsequent owners and transferees of bonds and bond anticipation notes issued by the state pursuant to sections 13b-74 to 13b-77, inclusive, in consideration of the acceptance of the payment for the bonds
and bond anticipation notes, until such bonds and bond anticipation notes, together with
the interest thereon, with interest on any unpaid installment of interest and all costs and
expenses in connection with any action or proceeding on behalf of such owners, are
fully met and discharged, or unless expressly permitted or otherwise authorized by the
terms of each contract and agreement made or entered into by or on behalf of the state
with or for the benefit of such owners, that the state will impose, charge, raise, levy,
collect and apply the pledged revenues and other receipts, funds or moneys pledged for
the payment of debt service requirements as provided in sections 13b-74 to 13b-77,
inclusive, in such amounts as may be necessary to pay such debt service requirements
in each year in which bonds or bond anticipation notes are outstanding and further, that
the state (1) will not limit or alter the duties imposed on the Treasurer and other officers
of the state by sections 3-21a, 3-27a, 3-27f, 12-458 and 12-458d, subsection (c) of section
13a-80a, sections 13a-175p to 13a-175u, inclusive, subsection (f) of section 13b-42,
sections 13b-59, 13b-61, 13b-69, 13b-71, 13b-74 to 13b-77, inclusive, and 13b-80, subsection (a) of section 13b-97, subsection (a) of section 14-12, sections 14-15, 14-16a
and 14-21c, subsection (a) of section 14-25a, section 14-28, subsection (b) of section
14-35, subsection (b) of section 14-41, section 14-41a, subsection (a) of section 14-44,
sections 14-47, 14-48b, 14-49 and 14-50, subsection (a) of section 14-50a, sections 14-52 and 14-58, subsection (c) of section 14-66, subsection (e) of section 14-67, sections
14-67a, 14-67d, 14-67l and 14-69, subsection (e) of section 14-73, subsection (c) of
section 14-96q, sections 14-103a and 14-160, subsection (a) of section 14-164a, subsection (a) of section 14-192, sections 14-319, 14-320 and 14-381, subsection (b) of section
14-382 and section 15-14 and by the proceedings authorizing the issuance of bonds with
respect to application of pledged revenues or other receipts, funds or moneys pledged
for the payment of debt service requirements as provided in said sections; (2) will not
issue any bonds, notes or other evidences of indebtedness, other than the bonds and
bond anticipation notes, having any rights arising out of said sections or secured by any
pledge of or other lien or charge on the pledged revenues or other receipts, funds or
moneys pledged for the payment of debt service requirements as provided in said sections; (3) will not create or cause to be created any lien or charge on such pledged
amounts, other than a lien or pledge created thereon pursuant to said sections, provided
nothing in this subsection shall prevent the state from issuing evidences of indebtedness
(A) which are secured by a pledge or lien which is and shall on the face thereof be
expressly subordinate and junior in all respects to every lien and pledge created by or
pursuant to said sections; or (B) for which the full faith and credit of the state is pledged
and which are not expressly secured by any specific lien or charge on such pledged
amounts; or (C) which are secured by a pledge of or lien on moneys or funds derived
on or after such date as every pledge or lien thereon created by or pursuant to said
sections shall be discharged and satisfied; (4) will carry out and perform, or cause to be
carried out and performed, each and every promise, covenant, agreement or contract
made or entered into by the state or on its behalf with the owners of any bonds or bond
anticipation notes; (5) will not in any way impair the rights, exemptions or remedies of
such owners; and (6) will not limit, modify, rescind, repeal or otherwise alter the rights
or obligations of the appropriate officers of the state to impose, maintain, charge or
collect the taxes, fees, charges and other receipts constituting the pledged revenues as
may be necessary to produce sufficient revenues to fulfill the terms of the proceedings
authorizing the issuance of the bonds, including pledged revenue coverage requirements,
and provided nothing herein shall preclude the state from exercising its power, through
a change in law, to limit, modify, rescind, repeal or otherwise alter the character or
amount of such pledged revenues or to substitute like or different sources of taxes, fees,
charges or other receipts as pledged revenues if, for the ensuing fiscal year, as evidenced
by the proposed or adopted budget of the state with respect to the Special Transportation
Fund, the projected revenues meet or exceed the estimated expenses of the Special
Transportation Fund including accumulated deficits, if any, debt service requirements
and any pledged revenue coverage requirement. The State Bond Commission is authorized to include this covenant of the state in any agreement with the owner of any such
bonds or bond anticipation notes.
(P.A. 84-254, S. 7, 62; P.A. 89-331, S. 13, 30; P.A. 93-307, S. 17, 34; P.A. 02-70, S. 75; P.A. 03-278, S. 33; P.A. 05-218, S. 33.)
History: P.A. 89-331 clarified the exemption from taxation of the principal and interest of the bonds; P.A. 93-307
deleted a reference to Sec. 13b-405 which was repealed by the same act, effective June 29, 1993; P.A. 02-70 amended
Subsec. (c) to substitute reference to Sec. 13b-74 for reference to Sec. 13b-47 and to delete reference to repealed Sec. 14-53, effective July 1, 2002; P.A. 03-278 made a technical change in Subsec. (c), effective July 9, 2003; P.A. 05-218 amended
Subsec. (c)(1) by deleting reference to Sec. 14-383, effective July 1, 2005.