§ 116-198.36. Proceeds of bonds are deemed trust funds.
§ 116‑198.36. Proceeds of bonds are deemed trust funds.
In the discretion of the Board and subject to the approval of theDirector of the Budget, any revenue bonds issued under this Article may besecured by a trust agreement by and between the Board and a corporate trustee(or trustees) which may be any trust company or bank having the powers of atrust company within or without the State. Such trust agreement or theresolution providing for the issuance of such bonds may pledge or assign therevenues to be received but shall not convey or mortgage any project orprojects or any existing facilities or any part thereof. Such trust agreementor resolution providing for the issuance of such bonds may contain suchprovisions for protecting and enforcing the rights and remedies of the holdersof such bonds as may be reasonable and proper and not in violation of law,including covenants setting forth the duties of the Board in relation to theacquisition, construction, or provision of any project or projects, themaintenance, repair, operation, and insurance of any project or projects andany existing facilities, student fees and admission fees and charges, and otherfees, rents, and charges to be fixed and collected, and the custody,safeguarding, and application of all moneys. It shall be lawful for any bankor trust company incorporated under the laws of the State which may act asdepositary of the proceeds of bonds or revenues to furnish such indemnifyingbonds or to pledge such securities as may be required by the Board. Any suchtrust agreement or resolution may set forth the rights and remedies of theholders of the bonds and the rights, remedies, and immunities of the trustee ortrustees, if any, and may restrict the individual right of action by such holders. In addition to the foregoing, any such trust agreement or resolution maycontain such other provisions as the Board may deem reasonable and proper forthe security of such holders. All expenses incurred in carrying out theprovisions of such trust agreement or resolution may be treated as a part ofthe cost of the project or projects for which such bonds are issued or as anexpense of operation of such project or projects, as the case may be.
The proceeds of all bonds issued and all revenues and other moneysreceived pursuant to the authority of this Article shall be deemed to be trustfunds, to be held and applied solely as provided in this Article. The Boardmay provide for the payment of the proceeds of the sale of the bonds and therevenues, or part thereof, to such officer, board, or depositary as it maydesignate for the custody thereof, and for the method of disbursement thereof,with such safeguards and restrictions as it may determine. Any officer withwhom, or any bank, trust company, or fiscal agent with which, such moneys shallbe deposited shall act as trustee of such moneys and shall hold and apply thesame for the purposes hereof, subject to such requirements as are provided inthis Article and in the resolution or trust agreement authorizing or securingsuch bonds.
Notwithstanding the provisions of any other law, the Board may carryinsurance on any project or projects and any existing facilities in suchamounts and covering such risks as it may deem advisable.
Any holder of bonds issued under this Article or of any of the couponsappertaining thereto, and the trustee or trustees under any trust agreement,except to the extent the rights herein given may be restricted by such trustagreement or the resolution authorizing the issuance of such bonds, may, eitherat law or in equity, by suit, action, mandamus, or other proceedings, protectand enforce any and all rights under the laws of the State or granted hereunderor under such trust agreement or resolution, and may enforce and compel theperformance of all duties required by this Article or by such trust agreementor resolution to be performed by the Board or by any officer thereof, includingthe fixing, charging, and collecting of fees, rents, and charges. (1987, c. 336.)