Sec. 13b-77. Covenants. - Connecticut Statutes

      Sec. 13b-77. Covenants. (a) The state covenants with the purchasers and all subsequent owners and transferees of bonds and bond anticipation notes issued by the state pursuant to sections 13b-74 to 13b-77, inclusive, in consideration of the acceptance of and payment for the bonds and bond anticipation notes, that the principal and interest of such bonds and bond anticipation notes shall be free at all times from taxation, except for estate and gift taxes, imposed by the state or by any political subdivision thereof. The Treasurer is authorized to include this covenant of the state in any agreement with the owner of any such bonds or bond anticipation notes.

      (b) Bonds and bond anticipation notes issued pursuant to sections 13b-74 to 13b-77, inclusive, 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 bonds and bond anticipation notes 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 and bond anticipation notes or obligations of the state is now or may hereafter be authorized by law.

      (c) The state covenants with the purchasers and all subsequent owners and transferees of bonds and bond anticipation notes issued by the state pursuant to sections 13b-74 to 13b-77, inclusive, in consideration of the acceptance of the payment for the bonds and bond anticipation notes, until such bonds and bond anticipation notes, 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 impose, charge, raise, levy, collect and apply the pledged revenues and other receipts, funds or moneys pledged for the payment of debt service requirements as provided in sections 13b-74 to 13b-77, inclusive, in such amounts as may be necessary to pay such debt service requirements in each year in which bonds or bond anticipation notes 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 sections 3-21a, 3-27a, 3-27f, 12-458 and 12-458d, subsection (c) of section 13a-80a, sections 13a-175p to 13a-175u, inclusive, subsection (f) of section 13b-42, sections 13b-59, 13b-61, 13b-69, 13b-71, 13b-74 to 13b-77, inclusive, and 13b-80, subsection (a) of section 13b-97, subsection (a) of section 14-12, sections 14-15, 14-16a and 14-21c, subsection (a) of section 14-25a, section 14-28, subsection (b) of section 14-35, subsection (b) of section 14-41, section 14-41a, subsection (a) of section 14-44, sections 14-47, 14-48b, 14-49 and 14-50, subsection (a) of section 14-50a, sections 14-52 and 14-58, subsection (c) of section 14-66, subsection (e) of section 14-67, sections 14-67a, 14-67d, 14-67l and 14-69, subsection (e) of section 14-73, subsection (c) of section 14-96q, sections 14-103a and 14-160, subsection (a) of section 14-164a, subsection (a) of section 14-192, sections 14-319, 14-320 and 14-381, subsection (b) of section 14-382 and section 15-14 and by the proceedings authorizing the issuance of 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 said sections; (2) will not issue any bonds, notes or other evidences of indebtedness, other than the bonds and bond anticipation notes, 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 as provided in said sections; (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 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) 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 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 or bond anticipation notes; (5) will not in any way impair the rights, exemptions or remedies of such 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 taxes, fees, charges 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 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 or amount of such pledged revenues or to substitute like or different sources of taxes, fees, charges or other receipts as pledged revenues if, for the ensuing fiscal year, as evidenced by the proposed or adopted budget of the state with respect to the Special Transportation Fund, the projected revenues meet or exceed the estimated expenses of the Special Transportation Fund including accumulated deficits, if any, debt service requirements and any pledged revenue coverage requirement. The State Bond Commission is authorized to include this covenant of the state in any agreement with the owner of any such bonds or bond anticipation notes.

      (P.A. 84-254, S. 7, 62; P.A. 89-331, S. 13, 30; P.A. 93-307, S. 17, 34; P.A. 02-70, S. 75; P.A. 03-278, S. 33; P.A. 05-218, S. 33.)

      History: P.A. 89-331 clarified the exemption from taxation of the principal and interest of the bonds; P.A. 93-307 deleted a reference to Sec. 13b-405 which was repealed by the same act, effective June 29, 1993; P.A. 02-70 amended Subsec. (c) to substitute reference to Sec. 13b-74 for reference to Sec. 13b-47 and to delete reference to repealed Sec. 14-53, effective July 1, 2002; P.A. 03-278 made a technical change in Subsec. (c), effective July 9, 2003; P.A. 05-218 amended Subsec. (c)(1) by deleting reference to Sec. 14-383, effective July 1, 2005.