Sec. 8-80. Issuance of bonds and notes. - Connecticut Statutes

      Sec. 8-80. Issuance of bonds and notes. (a) For the purposes of this part, the State Treasurer is authorized and directed, subject to the approval of the State Bond Commission, to issue bonds and notes of the state, from time to time, to the amount provided in section 8-78. Such bonds and notes shall be issued at such times, in such amounts and denominations, subject to such redemption provisions with or without premium and maturing at such time or times as shall be determined by said commission, and shall be subject to such further conditions and be secured by such covenants and agreement, on behalf of the state as the State Bond Commission determines will tend to make the bonds and notes more marketable. The full faith and credit of the state is pledged for the payment of the principal and interest on said bonds and notes as the same become due.

      (b) Such bond shall be sold at not less than par and accrued interest, shall be issued as serial or term bonds or any combination thereof, shall be in such form, either coupon or registered and carry such conversion or registration privileges, shall bear interest at such rate or rates and on such date or dates as the State Bond Commission shall determine, shall be payable at the Treasurer's office in Hartford and at such other place or places as the Treasurer may determine on dates to be determined by the State Bond Commission and shall be signed in the name of the state by the Governor, the State Treasurer and the Comptroller manually or by facsimile signature.

      (c) The State Treasurer shall, at least ten days before the date of issue of any bonds, advertise for proposals for bids for such portion of such bonds as has been determined to be issued at such date, such proposals to be under seal and opened in public by said Treasurer at some time and place by him appointed. Such bids shall contain proposals for the rate of interest to be paid on the interest coupons and shall be submitted in eighths of one per cent and multiples thereof. The State Treasurer shall have the power to reject any and all bids and to readvertise for the sale of such bonds.

      (d) Such notes shall be sold at not less than par and accrued interest, shall be in such form as may be determined by the State Bond Commission and shall be signed in the name of the state by the State Treasurer or his deputy. They shall be sold at public sale on such notice and terms as said commission shall determine and the Treasurer shall have the power to reject any and all bids and to readvertise the sale of such notes.

      (e) The proceeds from the sale of such bonds and notes, except refunding bonds and notes, shall be deposited in a fund designated the "Rental Housing Fund", which fund shall be used to provide the state financial assistance authorized by section 8-70. Payments from the fund to eligible developers shall be made by the State Treasurer on certification of the Commissioner of Economic and Community Development in accordance with the contract for financial assistance between the state and such developer. All payments by a developer of interest and principal on loans by the state and of state service charges, as authorized by section 8-70, shall be paid to the State Treasurer for deposit in said fund. State service charges, as authorized by section 8-72, shall be paid to the State Treasurer for deposit in the Housing Repayment and Revolving Loan Fund. The principal of, and interest on, bonds and notes referred to in subsection (a) of this section, not paid from refunding bonds and notes, shall be paid first out of the moneys in the Rental Housing Fund, and if in any year said fund is not sufficient, then such deficit shall be paid from the General Fund of the state; and if in any year said fund is more than sufficient to meet the principal of the bonds and notes maturing in such year and the interest thereon, the excess shall be applied to the payment of, and principal on, the bonds and notes maturing in any succeeding year or years. Notwithstanding the next preceding sentence, whenever the State Bond Commission authorizes the issuance of a series of bonds which consist of or include term bonds, it shall determine whether or not the annual sinking fund requirement for such term bonds shall be paid out of the moneys in the Rental Housing Fund or out of moneys in the General Fund of the state; if the State Bond Commission determines not to use such moneys in said Rental Housing Fund therefor, such moneys shall be used and expended to pay interest and redemption premium, if any, on any rental housing bonds or notes, or the principal of any rental housing notes or serial bonds, or the principal upon redemption of such term bonds, or to purchase and retire any rental housing bond at a price not to exceed the principal amount thereof and, notwithstanding the foregoing provisions may be used in whole or in part in any year to assist housing projects in the state upon the prior approval of the State Bond Commission of a request by the Commissioner of Economic and Community Development which request shall briefly identify the projects and state the amount of such moneys to be used and expended therefor. Amounts paid from the General Fund to cover any deficits in the Rental Housing Fund, including any such amounts paid prior to July 1, 1994, shall be deemed appropriated for such purpose.

      (f) The State Treasurer is authorized to invest such moneys in the Rental Housing Fund as he deems to be available for such purpose in obligations of or guaranteed by the state or the United States of America or agencies or instrumentalities thereof and, without limitation on the foregoing, in such other obligations, including time deposits or certificates of deposit, as may be permitted investments by the Treasurer for the General Fund of the state and secured in such manner as the Treasurer may require.

      (g) Whenever the State Bond Commission authorizes the issuance of a series of bonds which consist of or include term bonds, the commission shall establish by resolution a sinking fund for such series which fund shall be held as the commission shall determine, by a trustee or by the Treasurer separate and apart from other funds of the state and shall be used and applied only to the payment of principal of and redemption premium, if any, on the term bonds of such series whether at maturity or on the redemption date thereof. The amount of the annual sinking fund requirement for the outstanding term bonds of such series shall be determined by the commission in such resolution but shall not be less than an amount which, computed from the date of such term bonds or from the last maturity date of any serial bonds of such series of bonds, whichever is later, would if thereafter annually contributed to such fund, with the fund and with the accumulations thereon invested at a rate of four per cent per annum, produce at the date of maturity of such term bonds an amount equal to the amount of such term bonds and shall be deposited in the sinking fund from the General Fund of the state annually commencing one year after the date of the bonds or after the last maturity date of any serial bonds of such series of bonds, whichever is later. Any part of the annual sinking fund requirement, which arises from deposit in the sinking fund of moneys from the Rental Housing Fund, when permitted pursuant to this section, shall be deducted from the amount of the annual sinking fund requirement to be paid from the General Fund of the state. Appropriation of all amounts necessary to meet the annual sinking fund requirement is hereby made and the State Bond Commission is hereby authorized to include as part of the contract of the state with the holders of such term bonds, provisions as to the pledging, or the application, use and disposition of all or any part of the sinking fund. The state pledges to and agrees with the holders of such term bonds that, from and after the date of issuance of any bonds for which a pledge of the moneys in the sinking fund has been made and until all such bonds together with interest thereon, with interest on any unpaid installments of interest and of costs and expenses in connection with any action or proceedings by or on behalf of such holders 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 holders, the state (1) will not limit or alter the duties imposed upon the Treasurer or other officers of the state or a trustee with respect to the application hereunder of the sinking fund and the moneys therein, (2) will carry out and perform or cause to be carried out and performed each and every promise, covenant and agreement entered into by the state or on its behalf pursuant to this section and on its behalf to be performed and (3) will not in any way impair the rights, exemptions and remedies of such holders. Any pledge made by or pursuant to this section shall be valid and binding from the time when the pledge is made. Moneys pledged pursuant to this section and thereafter received shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of any such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the state or any officer thereof irrespective of whether such parties have notice thereof. Neither the resolution nor any other instrument by which a pledge is created need be recorded. Pending use or application of moneys in said sinking fund as hereinabove directed, and subject to any agreement or covenant with the bond holders, such moneys shall be invested or reinvested by the Treasurer in bonds and other obligations of, or guaranteed by, the state or the United States of America or agencies or instrumentalities thereof or any other obligation, including time deposits and certificates of deposit, as may be permitted investments for the General Fund of the state or in accordance with the law governing the investment of savings banks or when deemed prudent, by the Treasurer, in accordance with the law governing the investment of trust funds and shall be secured in such manner as the Treasurer may require. Obligations purchased as such investment of moneys in said fund shall be held at all times as part of said fund and the interest thereon and any other gain arising from the sale thereof shall be credited to said fund and any loss resulting from the sale thereof shall be debited to said fund and the amount of such gain or loss shall decrease or increase the next annual sinking fund requirement by such amount, as the case may be, and notwithstanding any other provision of this section any net gain in any year arising from such crediting and debiting in excess of the next annual sinking fund requirement at the direction of the Treasurer may be used to pay interest on the term bonds.

      (h) For the purposes of this section, bonds of a series which are payable in installments in the next successive years from the date of all bonds of such series shall be known as "serial bonds". All other bonds of such series shall be known as "term bonds".

      (i) The right is expressly reserved at any time to alter, amend or repeal this section unless bonds, for which provisions as to a pledge, or the application, use and disposition of all or any part of the sinking fund has been made, have theretofore been issued and then remain outstanding, provided, if such provisions are made with respect to the sinking fund, the State Bond Commission may, in the resolution authorizing such bonds, reserve for the state the right to alter and amend such provisions to permit the application and use of moneys in the sinking fund to pay the principal and redemption premium, if any, on other term bonds of the state, whether at maturity or on the redemption date thereof.

      (j) The bonds issued pursuant to this section are made and declared to be (1) legal investments for savings banks and trustees unless otherwise provided in the instrument creating the trust, (2) securities in which all public officers and bodies, all insurance companies and associations and persons carrying on an insurance business, all banks, bankers, trust companies, savings banks and savings associations, including savings and loan associations, investment companies and persons carrying on a banking or investment business, all administrators, guardians, executors, trustees and other fiduciaries and all persons whatsoever who are or may be authorized to invest in bonds of the state, may properly and legally invest funds including capital in their control or belonging to them, and (3) securities which may be deposited with and shall be received by all public officers and bodies for any purpose for which the deposit of bonds of the state is or may be authorized.

      (k) All such bonds, their transfer and the income therefrom, including any profit on the sale or transfer thereof, shall at all times be exempt from all taxation by the state or under its authority.

      (1949, October, 1949, March, 1950, 1951, 1953, S. 455d; 1963, P.A. 54, S. 3; 1967, P.A. 522, S. 8; 1972, P.A. 245, S. 1; P.A. 73-598, S. 1, 3; P.A. 77-614, S. 284, 610; P.A. 78-303, S. 81, 136; 78-304, S. 17, 22; P.A. 79-598, S. 3, 4, 10; P.A. 80-382, S. 2, 3; 80-483, S. 24, 186; P.A. 81-370, S. 2, 13; P.A. 85-52, S. 1, 2; P.A. 86-307, S. 6, 12; 86-403, S. 16, 132; P.A. 90-238, S. 5, 32; P.A. 94-173, S. 4, 5; P.A. 95-250, S. 1; P.A. 96-211, S. 1, 5, 6.)

      History: 1963 act deleted provision in Subsec. (a) that issuance of bonds and notes is for the purposes of Parts I and III as well as this part, substituted the State Bond Commission for former committee consisting of governor, treasurer, finance commissioner and public works commissioner and provided for commission to determine interest payment dates instead of treasurer; 1967 act substituted commissioner of community affairs for public works commissioner; 1972 act amended Subsec. (a) to make bonds and notes subject to redemption provisions and covenants and conditions determined by commission, amended Subsec. (b) to include issuance of term bonds and to allow payment of interest at places other than treasurer's office in Hartford, amended Subsec. (c) to change advertisement for bids from 30 to 10 days before date of issue, amended Subsec. (e) re payment of sinking fund requirement of term bonds, amended Subsec. (f) to clarify permitted investments of moneys in rental housing fund and added Subsecs. (g) to (k), inclusive; P.A. 73-598 reworded Subsecs. (a) and (b) and replaced requirement in Subsec. (b) that interest be paid semiannually with provision leaving rates and times for interest at discretion of commission, amended Subsec. (e) to include rental housing bonds or notes and deleted preference scheme for paying sinking fund requirement, i.e. that it be paid first from rental housing fund and second from general fund and amended Subsec. (g) to allow use of net gains beyond sinking fund requirement to pay interest on term bonds; P.A. 77-614 substituted department of economic development for commissioner of community affairs, effective January 1, 1979; P.A. 78-303 substituted commissioner for department; P.A. 78-304 amended Subsec. (a) to remove requirement that specific appellations of bonds to appear on their faces; P.A. 79-598 substituted commissioner of housing for commissioner of economic development; P.A. 80-382 amended Subsec. (a) to impose June 30, 1983, deadline on bond issuance; P.A. 80-483 deleted reference to building and loan associations in Subsec. (j); P.A. 81-370 extended the date for termination of the power of the bond commission to authorize bonds for moderate rental housing from June 30, 1983 to June 30, 1984; P.A. 85-52 repealed provision terminating authorization for issuance of bonds and notes on June 30, 1984; P.A. 86-307 amended Subsec. (e) to replace "make the loans" with "provide the state financial assistance" and "authority" with "developer" or "eligible developer"; P.A. 86-403 made technical change in Subsec. (a); P.A. 90-238 revised provisions re state service fees and allocation of moneys to various housing funds; P.A. 94-173 amended Subsec. (e) by adding provision re consideration of amounts from general fund to cover deficit in Rental Housing Fund as appropriated for the purpose and deleting requirement that year-end surpluses be used to reimburse general fund for covering prior deficits, effective July 1, 1994; P.A. 95-250 and P.A. 96-211 replaced Commissioner and Department of Housing with Commissioner and Department of Economic and Community Development.

      See Sec. 8-93 re tax exemption.