New York Laws
Title 6-C* - Dutchess County Water and Wastewater Authority
1128*2 - Bonds of the Authority.

(b) The state comptroller shall promulgate rules in conformance with
the state administrative procedure act governing the sale on a
negotiated basis of bonds, notes and certificates of participation by
public authorities and public benefit corporations made subject to such
rules by law. No such sale by the authority on a negotiated basis shall
be conducted without prior approval of the state comptroller except as
provided in such rules, which shall set forth the circumstances under
which such approval shall not be required. Such rules shall be reviewed
at least annually and updated as may be necessary. The corporation shall
annually deliver to the senate finance committee, the assembly ways and
means committee and the director of the division of the budget a report
listing all such sales conducted in the previous year, including but not

limited to the name of the issuer, the amount of the issue, the interest
rate and interest cost per year for each such sale.
(c) Agreements for credit enhancement. (1) The authority is hereby
authorized and empowered to enter into such agreements as it deems
reasonable and appropriate, with any department or agency of the United
States of America, the state, or any other financially responsible
party, to facilitate the issuance, sale, resale and payment of bonds,
notes, or other evidences of indebtedness of the authority, including,
but not limited to letters of credit, lines of credit, revolving credit,
bond insurance or other credit enhancements. Such agreements may provide
for: (i) the advance or advances of funds on behalf of the authority to
pay bonds, notes or other evidences of indebtedness of the authority on
their date or dates of maturity or redemption; and (ii) the
reimbursement of such advance or advances by the authority.
(2) Such agreements may be executed on or before the date of issuance
of the obligations to be paid pursuant thereto, provided, however, that
any reimbursement obligation of the authority shall be deemed
indebtedness of the authority; (i) only as of the date that the
corresponding advance is made pursuant to subparagraph one of this
paragraph; and (ii) only in the amount of the advance made pursuant to
such subparagraph. Such agreements may include a pledge by the authority
of its faith and credit for the payment of any indebtedness deemed to be
contracted as set forth in this paragraph, and may provide that any such
indebtedness arising from a reimbursement obligation contracted pursuant
to this section shall be paid in accordance with the terms of such
agreement. Such indebtedness shall be excluded in ascertaining the power
of the authority to contract indebtedness pursuant to this chapter. Such
agreements shall also include such terms and conditions as the authority
shall deem appropriate, including provisions for the payment of
reasonable fees by the authority in return for a commitment to advance
funds pursuant to such agreement. Such fees shall be deemed part of the
cost of the object or purpose in connection with which they are
incurred.
(3) Prior to procurement of any credit or liquidity enhancements, the
authority shall, to the extent practicable:
(i) consider the ability of the credit or liquidity enhancement
provider to make required payments as and when due under the terms of
the appropriate governing instruments;
(ii) consider the business reputation of the credit or liquidity
enhancement provider;
(iii) consider the maximum term of the credit or liquidity enhancement
relative to the maturity of the bonds, notes or other obligations being
credit or liquidity enhanced;
(iv) provide for the right of substitution for the credit or liquidity
enhancement provider in all agreements, including a provision permitting
such substitution when the rating of the credit or liquidity enhancement
provider falls below the probable credit rating of the issue without
considering the credit or liquidity enhancer; and
(v) consider the cost of the credit or liquidity enhancement relative
to the savings or other benefit likely to be achieved through the
utilization of the credit or liquidity enhancement.
(4) Where the credit or liquidity enhancement procured is an
irrevocable letter of credit or an acquisition arrangement with a
liquidity enhancer, such instrument shall be:
(i) issued or confirmed by a bank holding company or its direct
subsidiaries, a federally chartered bank or its subsidiaries, or a state
chartered bank or its subsidiaries, licensed or authorized to do
business in this state; and
(ii) issued or confirmed by an agency or branch of a foreign banking
institution licensed to do business in this state with total worldwide
assets in excess of five billion dollars.
(5) Any such issuing banking organization referred to in subparagraph
four of this paragraph shall meet the regulatory guidelines for capital
adequacy as promulgated by the appropriate federal banking agency as
defined in the Federal Deposit Insurance Act, 12 U.S.C. 1813(q).
(6) Where the credit or liquidity enhancement procured is provided by
an insurance company, such insurer shall be licensed to write financial
guarantee insurance in this state.
(7) The failure of the authority to comply with subparagraphs three
through six of this paragraph shall not invalidate or impair any credit
or liquidity enhancement contract or instrument.
4. Any resolution or resolutions authorizing bonds or any issue of
bonds may contain provisions which may be a part of the contract with
the holders of the bonds thereby authorized as to:
(a) pledging all or any part of the revenues of the authority,
together with any other moneys or property of the authority, to secure
the payment of the bonds, subject to such agreements with bondholders as
may then exist;
(b) the setting aside of reserves and the creation of sinking funds
and the regulation and disposition thereof;
(c) limitations on the purpose to which the proceeds from the sale of
bonds may be applied;
(d) the rates, rents, fees and other charges to be fixed and collected
by the authority and the amount to be raised in each year thereby, and
the use and disposition of revenues;
(e) limitations on the right of the authority to restrict and regulate
the use of any project or part hereof in connection with which bonds are
issued;
(f) limitations on the issuance of additional bonds, the terms upon
which additional bonds may be issued and secured and the refunding of
outstanding or other bonds;
(g) the procedure, if any, by which the terms of any contract with
bondholders may be amended or abrogated, including the portion of
bondholders which must consent thereto, and the manner in which such
consent may be given;
(h) the creation of special funds into which any revenues or moneys
may be deposited;
(i) the terms and provisions of any trust, deed, mortgage or indenture
securing the bonds under which the bonds may be issued;
(j) vesting in a trustee or trustees such properties, rights, powers
and duties in trust as the authority may determine which may include any
or all of the rights, powers and duties of the trustee appointed by the
bondholders pursuant to section one thousand one hundred twenty-nine of
this title and limiting or abrogating the rights of the bondholders to
appoint a trustee under such section or limiting the rights, duties and
powers of such trustee;
(k) defining the acts or omissions to act which may constitute a
default in the obligations and duties of the authority to the
bondholders and providing for the rights and remedies of the bondholders
in the event of such default, including as a matter of right the
appointment of a receiver, provided, however, that such rights and
remedies shall not be inconsistent with the general laws of the state
and other provisions of this title;
(l) limitations on the power of the authority to sell or otherwise
dispose of any project or any part thereof;
(m) limitations on the amount of revenues and other moneys to be
expended for operating, administrative or other expenses of the
authority;
(n) the payment of the proceeds of bonds, revenues and other moneys to
a trustee or other depository, and for the method of disbursement
thereof with such safeguards and restrictions as the authority may
determine; and
(o) any other matters of like or different character which may in any
way affect the security or protection of the bonds or the rights and
remedies of bondholders.
5. In addition to the powers herein conferred upon the authority to
secure its bonds, the authority shall have power in connection with the
issuance of bonds to enter into such agreements as the authority may
deem necessary, convenient or desirable concerning the use or
disposition of its revenues or other moneys or property, including the
mortgaging of any of its properties and the entrusting, pledging or
creation of any other security interest in any such revenues, moneys or
properties and the doing of any act (including refraining from doing any
act) which the authority would have to do in the absence of such
agreements. The authority shall have power to enter into amendments of
any such agreements within the powers granted to the authority by this
title and to perform such agreements. The provisions of any such
agreements may be made a part of the contract with the holders of bonds
of the authority.
6. Any provision of the uniform commercial code to the contrary
notwithstanding, any pledge of or other security interest in revenues,
moneys, accounts, contract rights, general intangibles or other personal
property made or created by the authority shall be valid, binding and
perfected from the time such pledge is made or other security interest
attaches without any physical delivery of the collateral or further act,
and the lien of any such pledge, or other security interest shall be
valid, binding and perfected against all parties having claims of any
kind in tort, contract or otherwise against the authority irrespective
of whether or not such parties have notice thereof. No instrument by
which such a pledge or security interest is created nor any financing
statement need be recorded or filed.
7. Whether or not the bonds are of such form and character as to be
negotiable instruments under the terms of the uniform commercial code,
the bonds are hereby made negotiable instruments within the meaning of
and for all the purposes of the uniform commercial code, subject only to
the provisions of the bonds for registration.
8. Neither the members of the authority nor any person executing bonds
shall be liable personally thereon or be subject to any personal
liability or accountability by reason of the issuance thereof.
9. The authority, subject to such agreements with bondholders as then
may exist, shall have power out of any moneys available therefor to
purchase bonds of the authority, which shall thereupon be cancelled at a
price not exceeding; (i) if the bonds are then redeemable, the
redemption price then applicable plus accrued interest to the next
interest payment date, or (ii) if the bonds are not then immediately
redeemable then the redemption price applicable on the first date after
such purchase upon which the bonds become subject to redemption, plus
accrued interest to the next interest payment date.
* NB There are 2 § 1128's