Section 35-A:24 Withholding of Moneys.
I. The state treasurer is hereby authorized to receive from the United States of America or any department or agency thereof any amounts of money as and when appropriated, allocated, granted, turned over, or in any way provided for the purposes of the bank or this chapter, and said amounts shall be paid to the bank and deposited in the reserve fund and be available to the bank.
II. Any funds or moneys in the custody or control of the state treasurer which shall become available by reason of any grant, allocation, or appropriation by the United States of America to assist any governmental unit in payment of its municipal bonds owned or held by the bank, or required by the terms of any other law to be paid to holders or owners of municipal bonds of a governmental unit upon failure or default of a governmental unit to pay the principal of or interest on its municipal bonds as and when due and payable, shall, to the extent that any such funds or moneys be applicable with respect to municipal bonds of a particular governmental unit which are then owned or held by the bank and as to which such governmental unit has failed or defaulted to make payment of principal or interest as and when due, be paid to the bank for deposit in the reserve fund and made available to the bank.
III. Upon any failure by a governmental unit to make a scheduled payment of principal or interest on its municipal bond or municipal bonds held by the bank, the chairman or vice chairman of the bank shall certify the failure of such governmental unit to make such scheduled payment to the state treasurer. The chairman or vice chairman of the bank shall also certify the amount of the overdue payment and the name of the bank's trustee at which such municipal bond is payable, to the state treasurer.
IV. Three days after receipt of the certification from the chairman or vice chairman of the bank, the state treasurer shall pay to the bank's trustee at which such unpaid municipal bond is payable, the amount of such certified overdue payment, to the extent amounts are appropriated from the general fund or the education trust fund and are payable by the state to such governmental unit during the remainder of the fiscal year, together with any amounts payable in accordance with paragraph II hereof. If any portion of such certified overdue payment has not been paid at the close of the fiscal year, the state treasurer shall pay the same as soon as practicable in the next fiscal year to the extent of amounts otherwise then appropriated by the state and payable by the state to such governmental unit during that fiscal year, together with any amounts then payable in accordance with paragraph II.
V. All amounts paid to the bank in accordance with the provisions of this section shall be in trust and shall be exempt from being levied upon, taken, sequestered, or applied for any purpose other than paying principal or interest, or both, on any due but unpaid municipal bond or municipal bonds held by the bank of the governmental unit.
VI. Any amounts paid by the state treasurer under the provisions of this section, together with all costs accruing to the state as a result of actions undertaken pursuant to this section, including administrative costs as well as loss of interest income, shall be charged against the amounts otherwise payable or becoming payable from the state treasury to the governmental unit.
Source. 1977, 491:1, eff. July 1, 1977. 2008, 324:1, eff. Aug. 31, 2008.