Sec. 31-264b. Issuance of unemployment compensation revenue bonds.
Sec. 31-264b. Issuance of unemployment compensation revenue bonds. (a) The
State Bond Commission may authorize the issuance of revenue bonds of the state in
one or more series and in principal amounts necessary or estimated to be necessary as
an advance to the Unemployment Compensation Fund, or to repay advances made to
the state from the federal unemployment account, but not in excess of one billion dollars
outstanding at any one time and such additional amount of bonds required to fund any
debt service and reserve account in accordance with the proceedings authorizing the
bonds and the costs of issuance, capitalized interest, if any, and the initial costs and
expenses of the administration account, provided in computing the total amount of bonds
which may at any one time be outstanding, the principal amount of any refunding bonds
issued to refund bonds shall be excluded. The legislature finds that it is an essential
governmental function to assure that the balance in the state's account in the federal
Unemployment Trust Fund is maintained at a level which is sufficient to pay all benefits
and further finds that the financing and payment of the outstanding principal amount
which has been advanced to the state from the federal account of the Unemployment
Trust Fund and the financing and funding of the state's account in the Unemployment
Trust Fund by the issuance of revenue bonds pursuant to this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259,
31-263, 31-264a and 31-274j is in the public interest, will substantially result in savings
of interest costs, will achieve a public purpose of reducing overall costs of providing
employment benefits and will thereby foster and promote economic growth, provide
employment opportunities for the residents of the state and assist companies by reducing
their overall costs of doing business in the state.
(b) Bonds issued pursuant to subsection (a) of this section shall be special obligations of the state and shall not be payable from nor charged upon any funds other than
the Unemployment Compensation Advance Fund and revenues pledged to the payment
thereof, nor shall the state or any political subdivision thereof be subject to any liability
thereon other than from such sources. The issuance of revenue bonds under the provisions of this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d,
31-232f, 31-236, 31-250a, 31-259, 31-263, 31-264a and 31-274j 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 appropriation for
their payment other than the appropriation set forth in this section. The bonds shall not
constitute a charge, lien or encumbrance, legal or equitable, upon any property of the
state or of any political subdivision thereof, except the Unemployment Compensation
Advance Fund and revenues pledged or otherwise encumbered under the provisions
and for the purpose of said sections. The substance of this limitation shall be plainly
stated on the face of each bond. Revenue bonds issued pursuant to said sections shall
not be subject to any statutory limitation on the indebtedness of the state and the bonds,
when issued, shall not be included in computing the aggregate indebtedness of the state
in respect to, and to the extent of, any such limitation. As part of the contract of the state
with the owners of the revenue bonds, all amounts necessary for the punctual payment
of the debt service requirements with respect to the revenue bonds shall be deemed
appropriated, but only from the sources pledged pursuant to this section and sections
3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259,
31-263, 31-264a and 31-274j.
(c) The revenue bonds referred to in subsection (a) of this section 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 ten 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 State Bond Commission. With the exception of subsections (i) and (p)
all provisions of section 3-20 and the exercise of any right or power granted thereby
which are not inconsistent with the provisions of this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259, 31-263,
31-264a and 31-274j are hereby adopted and may be invoked in respect to all revenue
bonds authorized by the State Bond Commission pursuant to said sections. For the
purposes of subsection (o) of said section 3-20, "bond act" includes said sections. None
of the revenue bonds shall be authorized, except upon a finding by the State Bond
Commission that there has been filed with it a request for authorization, which is signed
by or on behalf of the State Treasurer and states the terms and conditions as said commission, in its discretion, may require.
(d) The principal of and interest on any bonds issued pursuant to this section and
sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a,
31-259, 31-263, 31-264a and 31-274j shall be secured by a pledge of the Unemployment
Compensation Advance Fund and any revenues, receipts, funds or moneys payable to
the fund, including any federal grants or advances available for the fund and including
the amounts of payment received from assessments established pursuant to said sections,
all as set forth in the proceedings authorizing the bonds pursuant to said sections. Any
pledge made by the state pursuant to said sections is a pledge within the meaning and
for all purposes of title 42a and shall be valid and binding from the time when the pledge
is made. Any revenues or other receipts, funds or moneys so pledged and thereafter
received by the state shall be subject immediately to the lien of the pledge without any
physical delivery thereof or further act. 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, irrespective of whether the parties have notice of the claims. Neither this section
nor sections 3-21a, 31-222, 31-225, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259, 31-263, 31-264a and 31-274j, the resolution nor any other instrument by
which a pledge is created need be recorded.
(e) Revenue bonds issued pursuant to this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259, 31-263, 31-264a
and 31-274j are hereby made securities in which public officers and public bodies of
the state and its political subdivisions, all insurance companies, credit unions, savings
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. The 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
other obligations of the state is now or may hereafter be authorized by law.
(f) The proceedings under which bonds are authorized to be issued may contain any
or all of the following: (1) Provisions respecting custody of the proceeds from the sale
of the bonds, including any requirement that the proceeds be deposited in the Unemployment Compensation Advance Fund and held separate from, or not be commingled with,
other funds of the state; (2) provisions for the investment and reinvestment of bond
proceeds and after 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 necessarily 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 as provided in this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259, 31-263,
31-264a and 31-274j; (5) provisions regarding the establishment and maintenance of
reserves, sinking funds and any other funds and accounts of the Unemployment Compensation Advance Fund pursuant to said sections and in the amounts and on the terms
approved by the State Bond Commission in the amounts established by the State Bond
Commission; (6) covenants for the establishment of pledged revenue coverage requirements for the bonds; (7) provisions for the issuance of additional bonds on a parity with
bonds theretofore issued, including establishment of coverage requirements with respect
thereto as herein provided; (8) provisions regarding the rights and remedies available
in case of a default to bondowners, noteowners or any trustee under any contract, loan
agreement, document, instrument or trust indenture, 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 revenue bonds are secured by a trust indenture, the
respective owners of the bonds shall have no authority, except as set forth in the trust
indenture, to appoint a separate trustee to represent them; (9) provisions for the payment
of rebate amounts; and (10) provisions of covenants of like or different character from
the foregoing which are consistent with this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259, 31-263, 31-264a
and 31-274j, and which the State Bond Commission determines in such proceedings
are necessary, convenient or desirable in order to better secure the revenue bonds, or
will tend to make the revenue bonds more marketable, and which are in the best interests
of the state. Any provision which may be included in proceedings authorizing the issuance of bonds hereunder may be included in an indenture of trust duly approved in
accordance with said sections, which secures the revenue bonds issued in anticipation
thereof, and in such case the provision of the indenture shall be deemed to be a part of
the proceedings as though they were expressly included therein.
(g) Whether or not any revenue bonds issued pursuant to this section and sections
3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259,
31-263, 31-264a and 31-274j are of the form and character to qualify as negotiable
instruments under the terms of title 42a, the bonds are hereby made negotiable instruments within the meaning of and for all purposes of title 42a, subject only to the provisions of the bonds.
(h) The state covenants with the purchasers and all subsequent owners and transferees of revenue bonds issued by the state pursuant to this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259, 31-263,
31-264a and 31-274j, in consideration of the acceptance of and payment for the bonds,
that the bonds shall be free at all times from taxes levied by any municipality or political
subdivision or special district having taxing powers of the state, and the principal and
interest of any bonds issued under the provisions of said sections, their transfer and the
income therefrom, including any profit on the sale or transfer thereof, shall at all times
be exempt from any taxation by the state of Connecticut or under its authority, except
for estate or succession taxes. The State Treasurer is authorized to include this covenant
of the state in any agreement with the owner of any bonds and in any credit facility or
reimbursement agreement with respect to the bonds.
(i) The state further covenants with the purchasers and all subsequent owners and
transferees of bonds issued by the state pursuant to this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259, 31-263,
31-264a and 31-274j, in consideration of the acceptance of the payment of the bonds,
until the 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 the 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
cause the administrator to impose, charge, raise, levy, collect and apply the pledged
assessments and other revenues, receipts, funds or moneys pledged for the payment of
debt service requirements in each year in which bonds are outstanding and further, that
the state (1) will not limit or alter the duties imposed on the administrator, the State
Treasurer and other officers of the state by the proceedings authorizing the issuance of
bonds with respect to application of pledged assessments or other revenues, receipts,
funds or moneys pledged for the payment of debt service requirements; (2) will not
issue any bonds, notes or other evidences of indebtedness, other than the bonds, 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; (3) will not create or cause to be created any lien or charge
on the 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) which are secured by a pledge of
or lien on moneys or funds derived on or after the date 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; (5) will not in any way impair the rights, exemptions or remedies of
the 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 assessments and other revenues or 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 of the
pledged assessments or revenues or to substitute like or different sources of assessments,
taxes, fees, charges or other receipts as pledged revenues if and when adequate provision
shall be made by law for the protection of the holders of outstanding bonds pursuant to
the proceedings under which the bonds are issued, including changing or altering the
method of establishing the assessments as provided in subparagraph (B) of subdivision
(2) of subsection (e) of section 31-225a. The State Bond Commission is authorized to
include this covenant of the state, as a contract of the state, in any agreement with the
owner of any bonds and in any credit facility or reimbursement agreement with respect
to the bonds.
(j) Pending the use and application of any bond proceeds, the proceeds may be
invested by, or at the direction of, the State Treasurer in obligations listed in section 3-20.
(k) Any revenue bonds issued under the provisions of this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259,
31-263, 31-264a and 31-274j and at any time outstanding may, at any time and from
time to time, be refunded by the state by the issuance of its revenue refunding bonds in
whatever amounts the State Bond Commission may deem necessary, but not to exceed
an amount sufficient to refund the principal of the revenue bonds to be so refunded, to
pay any unpaid interest thereon and any premiums and commissions necessary to be
paid in connection therewith and to pay costs and expenses which the State Treasurer
may deem necessary or advantageous in connection with the authorization, sale and
issuance of refund bonds. Any such refunding may be effected whether the revenue
bonds to be refunded shall have matured or shall thereafter mature. All revenue refunding
bonds issued hereunder shall be payable solely from the Unemployment Compensation
Advance Fund and revenues or other receipts, funds or moneys out of which the revenue
bonds to be refunded thereby are payable and shall be subject to and may be secured in
accordance with the provisions of this section.
(l) The State Treasurer shall have power, out of any funds available therefor, to
purchase revenue bonds issued pursuant to this section and sections 3-21a, 31-222, 31-225a, 31-231a, 31-232b, 31-232d, 31-232f, 31-236, 31-250a, 31-259, 31-263, 31-264a
and 31-274j. The State Treasurer may hold, pledge, cancel or resell the bonds, subject
to and in accordance with agreements with bondholders.
(P.A. 93-243, S. 10, 15; 93-419, S. 4, 9; P.A. 98-124, S. 10, 12.)
History: P.A. 93-243 effective June 23, 1993; P.A. 93-419 deleted references to bond anticipation notes throughout
section, effective July 1, 1993; P.A. 98-124 amended Subsec. (f)(3) to add agreements entered into pursuant to Sec. 3-20a,
effective May 27, 1998.