Sec. 3-62h. Special Abandoned Property Fund. Deposit of abandoned property receipts. Special obligation bond authorization. Disbursement of resources of fund.
Sec. 3-62h. Special Abandoned Property Fund. Deposit of abandoned property receipts. Special obligation bond authorization. Disbursement of resources of
fund. (a) As used in this section, the following terms shall have the following meanings,
unless the context clearly indicates a different meaning or intent:
(1) "Abandoned property receipts" means the cash portion of all funds received
under sections 3-56a to 3-76, inclusive.
(2) "Abandoned property fund bond or bonds" means one or more Special Abandoned Property Fund obligation bonds authorized to be issued pursuant to this section
and, unless otherwise indicated, any bonds issued to refund such abandoned property
fund bonds.
(3) "Debt service requirements" means, for any period, and subject to the provisions
of this section and the proceedings authorizing the issuance of abandoned property fund
bonds, the sum of (A) the principal and interest accruing during such period with respect
to abandoned property fund bonds, (B) the amounts, if any, required during such period
to establish or maintain reserves, sinking funds or other funds or accounts at the respective levels required to be established or maintained therein, (C) expenses of issuance
and administration with respect to abandoned property fund bonds as determined by the
Treasurer, (D) the amounts, if any, becoming due and payable under a reimbursement
agreement, a swap agreement or similar agreement entered into in connection with the
abandoned property fund bonds, and (E) any other costs or expenses deemed by the
Treasurer to be necessary or proper to be paid in connection with the abandoned property
fund bonds, including, without limitation, the cost of any credit facility, including but
not limited to a letter of credit or policy of bond insurance or any cost incurred under
section 3-20a.
(4) "Pledged revenues" means all receipts of the state credited to and held in the
Special Abandoned Property Fund pursuant to the provisions of this section, as amended
from time to time.
(5) "Proceedings" means the proceedings of the State Bond Commission authorizing or relating to the issuance of abandoned property fund bonds, the provisions of
any indenture of trust securing abandoned property fund bonds, which provisions are
incorporated into such proceedings and the provisions of any other documents or
agreements which are incorporated into such proceedings and to extent applicable the
determination of the Treasurer.
(6) "Special Abandoned Property Fund" means the Special Abandoned Property
Fund created under this section.
(7) "Special Abandoned Property Fund financing costs" includes (A) amounts necessary to create and maintain reserves for the payment of the principal of and interest
on any such abandoned property fund bonds, and (B) payment of costs, fees and expenses
which the Treasurer may deem necessary or advantageous in connection with the authorization, sale, issuance and administration of abandoned property fund bonds including
but not limited to, underwriters' discount.
(8) "State Bond Commission" means the commission established under section
3-20.
(9) "Treasurer" means the State Treasurer and includes each successor in office or
authority.
(b) There is established a fund to be known as the "Special Abandoned Property
Fund". The fund may contain any moneys required or permitted by the proceedings to
be deposited in the fund and shall be held by the Treasurer separate and apart from all
other moneys, funds and accounts. Investment earnings credited to the assets of said
fund shall become part of the assets of said fund. Any balance remaining in said fund
at the end of any fiscal year shall be carried forward in said fund for the fiscal year next
succeeding.
(c) As provided in the proceedings, the Treasurer shall deposit all abandoned property receipts in the Special Abandoned Property Fund to pay and secure the abandoned
property fund bonds and the debt service requirements.
(d) The Treasurer shall apply the resources in the Special Abandoned Property Fund,
upon their receipt, first, to pay or provide for the payment of debt service requirements,
as defined in this section, at such time or times, in such amount or amounts and in such
manner, as provided by the proceedings authorizing the issuance of abandoned property
fund bonds; second, to pay Special Abandoned Property Fund financing costs; third, to
pay all costs incident to the collection and recovery of such abandoned property receipts
and any other property collected and recovered under sections 3-56a to 3-76, inclusive;
and fourth, to deposit in the General Fund.
(e) The State Bond Commission may, prior to June 30, 2005, authorize the issuance
of abandoned property fund bonds in one or more series and in principal amounts not
to exceed sixty million dollars plus such additional amount of abandoned property fund
bonds required to fund Special Abandoned Property Fund financing costs in accordance
with the proceedings authorizing the abandoned property fund bonds for the purpose
of disbursing funds to the General Fund in support of state programs. Such abandoned
property fund bonds are hereby determined to be issued for valid public proposes in the
exercise of essential government functions.
(f) The debt service requirements with respect to any abandoned property fund
bonds shall be secured by (1) a first call upon the pledged revenues as they are deposited
to the Special Abandoned Property Fund; and (2) a lien upon any and all amounts held
in and to the credit of the Special Abandoned Property Fund from time to time.
(g) Such abandoned property fund bonds shall be special obligations of the state
and shall not be payable from or charged upon any funds other than the pledged revenues
or other receipts, funds or moneys pledged therefor and deposited in the Special Abandoned Property Fund and the state or any political subdivision thereof shall not be subject
to any liability thereon, except to the extent of such pledged revenues or other receipts,
funds or moneys pledged therefor as provided in this section. The issuance of abandoned
property fund bonds shall not directly or indirectly or contingently obligate the state or
any political subdivision thereof to levy or to pledge any form of taxation whatever
therefor, or to make any additional appropriation for their payment. Such abandoned
property fund bonds shall not constitute a charge, lien or encumbrance, legal or equitable,
upon any property of the state or of any political subdivision thereof other than the
pledged receipts, funds or moneys pledged therefor and deposited in the Special Abandoned Property Fund and the substance of such limitation shall be plainly stated on each
such abandoned property fund bond. Notwithstanding any other provision of the general
statutes, abandoned property fund bonds shall not be subject to any statutory limitation
on the indebtedness of the state, and, when issued, shall not be included in computing
the aggregate indebtedness of the state in respect of and to the extent of any such limitation. As part of the contract of the state with the owners of the abandoned property fund
bonds, all amounts necessary for the punctual payment of the debt service requirements
with respect to the abandoned property fund bonds shall be deemed appropriated, but
only from the sources pledged pursuant to this section.
(h) The abandoned property fund bonds may be issued if after authorization the
Treasurer and the Secretary of the Office of Policy and Management find that such
issuance is necessary to disburse funds to the General Fund in support of state programs.
(i) The abandoned property fund bonds may be executed and delivered at the time
or times, shall be dated, shall bear interest at the rate or rates, shall mature at the time
or times not exceeding seven years from their date, have the rank or priority, be payable
in the medium of payment, be issued in coupon or in registered form, or both, carry the
registration and transfer privileges and be made redeemable before maturity at the price
or prices and under the terms and conditions, all as may be provided by the proceedings
and the Treasurer shall continue to deposit all abandoned property receipts in the Special
Abandoned Property Fund to pay the abandoned property fund bonds until such bonds
are fully discharged.
(j) All of the provisions of section 3-20 with the exception of subsections (i) and
(p) of said section 3-20 and the exercise of any right or power granted thereby which
are not inconsistent with the provisions of this section, are hereby adopted and may be
invoked in respect to the abandoned property fund bonds authorized pursuant to this
section.
(k) Any abandoned property fund bonds may be sold at public sale on sealed proposals or by negotiation in such manner, at such price or prices, at such time or times and
on such other terms and conditions of such abandoned property fund bonds and the
issuance and sale thereof as the Treasurer may determine to be in the best interests of
the state.
(l) The proceedings under which abandoned property fund bonds are authorized to
be issued may, subject to the provisions of the general statutes, contain any or all of
the following: (1) Provisions respecting custody of the proceeds from the sale of the
abandoned property fund bonds, including any requirements that such proceeds be held
separate from or not be commingled with other funds of the state; (2) provisions for the
investment and reinvestment of abandoned property fund bond proceeds until used to
pay Special Abandoned Property Fund financing costs and for the disposition of any
excess bond proceeds or investment earnings thereon; (3) provisions for the execution
of reimbursement agreements or similar agreements in connection with credit facilities,
including, but not limited to, letters of credit or policies of bond insurance, remarketing
agreements and agreements for the purpose of moderating interest rate fluctuations, and
of such other agreements entered into pursuant to section 3-20a; (4) provisions for the
collection, custody, investment, reinvestment and use of the pledged revenues or other
receipts, funds or moneys pledged therefor and deposited in the Special Abandoned
Property Fund; (5) provisions regarding the establishment and maintenance of reserves,
sinking funds and any other funds and accounts as shall be approved by the Treasurer in
such amounts as may be established by the Treasurer, and the regulation and disposition
thereof, including requirements that any such funds and accounts be held separate from
or not be commingled with other funds of the state; (6) covenants for the establishment
of pledged revenue coverage requirements for the abandoned property fund bonds; (7)
provisions for the issuance of additional abandoned property fund bonds on a parity with
abandoned property fund bonds theretofore issued, including establishment of coverage
requirements with respect thereto as provided in this subsection; (8) provisions regarding
the rights and remedies available in case of a default to the bondowners, or any trustee
under any contract, document, instrument or indenture of trust, including the right to
appoint a trustee to represent their interests upon occurrence of an event of default, as
defined in said proceedings, provided if any abandoned property fund bonds shall be
secured by an indenture of trust, the respective owners of such abandoned property fund
bonds shall have no authority except as set forth in such trust indenture to appoint a
separate trustee to represent them; and (9) provisions or covenants of like or different
character from the foregoing which are determined in such proceedings are necessary,
convenient or desirable in order to better secure the abandoned property fund bonds, or
will tend to make the abandoned property fund bonds more marketable, and which are
in the best interests of the state.
(m) Any pledge made by the state pursuant to this section is and shall be deemed
a statutory lien. Such lien shall be valid and binding from the time when the pledge is
made. 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 state, including but not
limited to a claim pursuant to sections 3-56a to 3-76, inclusive, irrespective of whether
the parties have notice of the claims. Notwithstanding any provision of the Uniform
Commercial Code, neither this section, the indenture of trust, the proceedings nor any
other instrument by which a pledge is created need be recorded. Any revenues or other
receipts, funds or moneys so pledged and thereafter credited to and held in the Special
Abandoned Property Fund shall be subject immediately to the lien of the pledge without
any physical delivery thereof or further act and such lien shall have priority over all
other liens.
(n) Abandoned property fund bonds may be secured by an indenture of trust by and
between the state and a corporate trustee, which may be any trust company or bank
having the powers of a trust company within or without the state. Such indenture of
trust may contain such provisions for protecting and enforcing the rights and remedies
of the bondowners as may be reasonable and proper and not in violation of law, including
covenants setting forth the custody, safeguarding and application of all moneys. The
state may provide by such indenture of trust for the payment of the pledged revenues
or other receipts, funds or moneys to the trustee under such indenture of trust or to any
other depository, and for the method of disbursement thereof, with such safeguards and
restrictions as it may determine. All expenses incurred in carrying out such indenture
of trust may be treated as Special Abandoned Property Fund financing costs.
(o) The Treasurer shall have power to purchase abandoned property fund bonds
issued pursuant to this section out of any funds available therefor. The Treasurer may
hold, pledge, cancel or resell such abandoned property fund bonds subject to and in
accordance with agreements with bondowners.
(p) Whether or not any abandoned property fund bonds issued pursuant to this section are of the form and character to qualify as negotiable instruments under the terms
of title 42a, the abandoned property fund bonds are hereby made negotiable instruments
within the meaning of and for all purposes of said title 42a, subject only to the provisions
of the abandoned property fund bonds.
(q) Any moneys held by the Treasurer or by a trustee pursuant to an indenture of
trust with respect to abandoned property fund bonds including pledged revenues, other
pledged receipts, funds or moneys and proceeds from the sale of such abandoned property fund bonds, may, pending the use or application of the proceeds thereof for an
authorized purpose, be (1) invested and reinvested in such obligations, securities and
investments as are set forth in subsection (f) of section 3-20, in participation certificates
in the Short Term Investment Funds created under sections 3-27a and 3-27f and in
participation certificates or securities of the Tax-Exempt Proceeds Fund created under
section 3-24a or (2) deposited or redeposited in such bank or banks as shall be provided in
the proceedings. Unless the proceedings provide otherwise, proceeds from investments
authorized by this subsection, less amounts required under the proceedings authorizing
the issuance of abandoned property fund bonds for the payment of Special Abandoned
Property Fund financing costs relating to such abandoned property fund bonds, shall
be credited to the Special Abandoned Property Fund.
(r) Any abandoned property fund bonds at any time outstanding may, at any time
and from time to time, be refunded by the state by the issuance of its refunding abandoned
property fund bonds in such amounts as the Treasurer may deem necessary, but not to
exceed an amount sufficient to refund the principal of the abandoned property fund
bonds to be so refunded, to pay any unpaid interest on such abandoned property fund
bonds and any premiums and commissions necessary to be paid in connection with such
abandoned property fund bonds and to pay costs and expenses which the Treasurer may
deem necessary or advantageous in connection with the authorization, sale and issuance
of refunding abandoned property fund bonds. Any such refunding may be effected
whether the abandoned property fund bonds to be refunded shall have matured or shall
thereafter mature. All refunding abandoned property fund bonds issued under this subsection shall be payable solely from the revenues or other receipts, funds or moneys out
of which the abandoned property fund bonds to be refunded thereby are payable and
shall be subject to and may be secured in accordance with the provisions of this section.
(s) The state covenants with the purchasers and all subsequent owners and transferees of abandoned property fund bonds, in consideration of the acceptance of and payment
for the abandoned property fund bonds, that the principal and interest of such abandoned
property fund bonds shall be free from taxation at all times, except for estate and gift,
franchise and excise taxes, imposed by the state or any political subdivision thereof.
The Treasurer is authorized to include this covenant of the state in any agreement with
the owner of any such abandoned property fund bonds.
(t) Abandoned property fund bonds issued pursuant to this section 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 abandoned property fund bonds 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 or obligations of the state is now or may hereafter be authorized by law.
(u) The state covenants with the purchasers and all subsequent owners and transferees of abandoned property fund bonds issued by the state pursuant to this section in
consideration of the acceptance of the payment for the abandoned property fund bonds,
until such abandoned property fund bonds, 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 apply the pledged revenues and other receipts, funds or
moneys pledged for the payment of debt service requirements as provided in this section,
in such amounts as may be necessary to pay such debt service requirements in each year
in which such abandoned property fund bonds 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 this section, and by the proceedings authorizing the issuance of abandoned
property fund 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
this section; (2) will not issue any bonds, notes or other evidences of indebtedness, other
than the abandoned property fund bonds, having any rights arising out of this section
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 this section; (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 this section,
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 this section; 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 this section 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 abandoned
property fund bonds; (5) will not in any way impair the rights, exemptions or remedies
of the owners of abandoned property fund bonds; and (6) will not limit, modify, rescind,
repeal or otherwise alter the rights or obligations of the appropriate officers of the state
to collect the funds 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 abandoned property fund bonds, including pledged revenue coverage requirements, and provided, however, nothing in this subsection shall preclude
the state from exercising its power to limit, modify, rescind, repeal or otherwise alter
the character or amount of such pledged revenues, if and when adequate provisions shall
be made by law for the protection of the owners of the outstanding abandoned property
fund bonds. The Treasurer is authorized to include this covenant of the state in any
agreement with the owners of any such abandoned property tax bonds.
(P.A. 04-216, S. 56.)
History: P.A. 04-216 effective May 6, 2004.