§ 376.3. Financing authority indebtedness
Purdon's Pennsylvania Statutes and Consolidated StatutesTitle 73 P.S. Trade and Commerce
73 P.S. § 376.3
§ 376.3. Financing authority indebtedness
(a) The financing authority shall have the power and is hereby authorized to issue its limited obligation revenue bonds and other types of financing as in the judgment of the financing authority shall be necessary to provide sufficient funds for any related or unrelated projects: (i) provided that the issuance by the financing authority of taxable or tax-exempt bonds on behalf of projects comprising industrial facilities, commercial facilities, pollution control facilities, energy conversion facilities, energy producing facilities and disaster relief project facilities shall have been authorized by an industrial and commercial development authority or a group of industrial and commercial development authorities or by an industrial development agency or a group of industrial and development agencies; (ii) further provided that the financing authority may issue taxable or tax-exempt bonds on behalf of interagency projects only if the applicant has first applied to the Pennsylvania Infrastructure Investment Authority for financing under the provisions of the act of March 1, 1988 (P.L. 82, No. 16), known as the “Pennsylvania Infrastructure Investment Authority Act,”1 and the Pennsylvania Infrastructure Investment Authority in writing refers the applicant to the financing authority to finance all or part of the interagency project in accordance with this act; and (iii) further provided that the issuance by the financing authority of taxable or tax-exempt bonds for a public facility other than interagency projects and projects for roads and transportation facilities and transportation systems of every kind shall have been authorized by a municipality, municipal authority or Commonwealth agency and only if both the applicant and the financing authority have determined that the cost of obtaining the financing for the public facility will be reduced through the issuance of bonds through the financing authority. For purposes of the determination required in this subsection, any financing for a public facility that the financing authority reasonably believes could have received a rating of “A” or better from either Moody's Investors Service or Standard & Poor's Corporation shall be presumed not to be eligible for financing by the financing authority. The financing authority is authorized and empowered to use the proceeds of any bonds issued for the making of loans, purchasing loans, mortgages, security interests or loan participations and paying all incidental expenses in connection therewith, paying expenses of authorizing and issuing the bonds, paying interest on the bonds until revenues thereof are available in sufficient amounts and funding the reserves as the financing authority deems necessary and desirable.
(b) The financing authority, whenever it deems it expedient, shall have the power to refund any bonds previously issued by the financing authority or any other entity by the issuance of new bonds whether the bonds to be refunded have or have not matured. Refunding bonds shall be sold and the proceeds applied to the purchase, redemption or payment of the bonds to be refunded, the establishment or increase in reserves to secure or to pay the bonds or interest thereon and all other costs or expenses of the financing authority incident to and necessary to carry out the refunding of bonds.
(c) Bonds issued under this section shall not be a debt or liability of the Commonwealth and shall not create or constitute any indebtedness, liability or obligation of the Commonwealth. All bonds shall be payable solely from revenues or funds pledged or available for their repayment as authorized in this act, including the proceeds of any issue of bonds and, in the case of a public project, the pledge of fees, taxes and other revenues by a political subdivision or other instrumentality of the Commonwealth. Each bond shall contain on its face a statement to the effect that the financing authority is obligated to pay the principal thereof or the interest thereon only from its revenues, receipts or funds pledged or available for their payment as authorized in this act, and that neither the Commonwealth nor any political subdivisions are obligated to pay the principal or interest, and that neither the faith and credit nor the taxing power of the Commonwealth nor any political subdivision is pledged to the payment of the principal of or the interest on the bonds.
(d) If the bonds issued by the financing authority are tax-exempt bonds for which Federal law requires an allocation, the Department of Commerce2 shall issue an allocation charging such small issue project's pro rata share of the issue to the county in which said project is to be located provided that the project requires a type of allocation distributed by the department to the counties.
(e) When gubernatorial approval is required by the provisions of Federal or Commonwealth law, the Governor is hereby authorized to approve the issuance of bonds by the financing authority upon receipt of written request for approval from the financing board. Such written request shall state that the financing authority has conducted a public hearing, pursuant to appropriate public notice, concerning the purposes for which the bonds are to be issued, shall contain a description of the project or projects and shall describe the method of financing the project or projects. The written request shall also summarize the comments made and questions posed at the public hearing.
(g)(1) Bonds issued in accordance herewith shall be authorized by resolution of the financing authority. The bonds shall be of such series, bear any date or dates, mature at such time or times, bear interest at any rate or rates or at variable rates, be of any denomination or denominations, be in any form, either coupon or registered, carry any conversion or registration privileges, have any rank or priority, be executed in any manner, be payable from such sources in any medium of payment at any place or places and at any time or times within or without this Commonwealth and be subject to any terms of redemption, purchase or tender by the financing authority or the holders thereof, with or without premium, as the resolution or resolutions may provide.
(2) The bonds shall be signed by or shall bear the facsimile signature of such officers as the financing authority shall determine, and coupon bonds shall have attached thereto interest coupons bearing the facsimile signature of the chairman of the financing authority, all as may be prescribed in such resolution or resolutions.
(4) Bonds may be sold at public or private sales for such price or prices as the financing authority shall determine, subject to the requirement that the chairman shall ensure that minority-owned or minority-controlled firms shall have an opportunity to participate to a significant degree in any bond sale activities. Pending the preparation of the definitive bonds, interim receipts may be issued to the purchaser or purchasers thereof and may contain such terms and conditions as the financing authority may determine.
(5) Any bond reciting in substance that it has been issued by the financing authority to aid in the financing of one or more projects to accomplish the public purposes of this act shall be conclusively deemed in proceedings involving the validity or enforceability of such bond or security therefor, to have been issued for such purpose.
(10) Provide for the rights, liabilities, powers and duties arising upon the breach of a covenant, condition or obligation, and prescribe the events of default and the terms and conditions upon which any or all of the bonds shall become or may be declared due and payable before maturity and the terms and conditions upon which the declaration and its consequences may be waived.
(11) Vest in a trustee or trustees within or without this Commonwealth in trust any property, rights, powers and duties as the financing authority may determine. These may include any or all of the rights, powers and duties of any trustee appointed by the holders of bonds or notes, including rights with respect to the sale or other disposition of notes and bonds of governmental units and other instruments and security pledged pursuant to a resolution or trust indenture for the benefit of the holders of bonds and the right by suit or action to foreclose any mortgage pledged pursuant to the resolution or trust indenture for the benefit of the holders of the bonds, notes or other obligations, and to limit the right of the holders of any bonds to appoint a trustee under this act, and to limit the rights, powers and duties of the trustee.
(12) Pay the costs or expenses incident to the enforcement of the bonds or of the provisions of the resolution authorizing the issuance of those bonds, or the trust indenture securing the bonds or of any covenant or agreement of the financing authority with the holders of the bonds, notes or other obligations.
(14) Make covenants other than or in addition to the covenants authorized by this act of like or different character, and make covenants to do or refrain from doing any acts and things as may be necessary, or convenient and desirable, in order to better secure bonds or which, in the absolute discretion of the financing authority, will tend to make bonds more marketable, notwithstanding that the covenants, acts or things may not be enumerated herein.
(i) A pledge of revenues, receipts, moneys, funds or other property or instruments made by the financing authority shall be valid and binding from the time when the pledge is made. The revenues, receipts, moneys, funds or other property pledged and thereafter received by the financing authority shall be immediately subject to the lien of the pledge without its physical delivery or further act, and the lien of any pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the financing authority irrespective of whether the parties have notice of the lien. No instrument by which a pledge under this section is created, evidenced or noticed need be filed or recorded except in the records of the financing authority.
(j) Whether or not the bonds are of a form and character as to be negotiable instruments under the terms of Title 13 of the Pennsylvania Consolidated Statutes (relating to commercial code), the bonds are made negotiable instruments within the meaning of and for the purposes of Title 13, subject only to the provisions of the bonds for registration.
(k) The rights and remedies herein conferred upon or granted to the bondholders shall be in addition to and not in limitation of any rights and remedies lawfully granted to such bondholders by the resolution or resolutions providing for the issuance of bonds or by any indenture or other agreement under which the same may be issued.
1967, Aug. 23, P.L. 251, § 6.3, added 1987, July 10, P.L. 273, No. 48, § 3, imd. effective. Amended 1993, Dec. 17, P.L. 490, No. 74, § 7, imd. effective.
35 P.S. § 751.1 et seq.
Now Department of Community and Economic Development. See 71 P.S. § 1709.2103.
73 P.S. § 376.3, PA ST 73 P.S. § 376.3
Current through 2023 Regular Session Act 32. Some statute sections may be more current, see credits for details.
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