§ 143-165. Approval by Governor and Council of State necessary; covenants in resolutions authorizing bonds. - North Carolina Statutes

§ 143‑165. Approval by Governor and Council of State necessary; covenants in resolutionsauthorizing bonds.

The several departments, institutions, agencies and commissions of theState of North Carolina, before issuing any revenue bonds as herein providedfor any undertaking, shall first receive the approval of the undertaking fromthe Governor of North Carolina, which action shall be approved by the Councilof State before such undertaking shall be entered into and revenue bonds issuedin payment therefor in whole or in part.

Any resolution or resolutions heretofore or hereafter adoptedauthorizing the issuance of bonds under this Article may contain covenantswhich shall have the force of contract so long as any of said bonds andinterest thereon remain outstanding and unpaid as to

(1)        The use and disposition of revenue of the undertaking forwhich the said bonds are to be issued,

(2)        The pledging of all the gross receipts or any part thereofderived from the operation of the undertaking to the payment of the principaland interest of said bonds including reserves therefor,

(3)        The operation and maintenance of such undertaking,

(4)        The insurance to be carried thereon and the use anddisposition of the insurance moneys,

(5)        The fixing and collection of rates, fees and charges forthe  services, facilities and commodities furnished by such undertakingsufficient to pay said bonds and interest as the same shall become due, and forthe creation and maintenance of reasonable reserve therefor,

(6)        Provisions that the undertaking shall not be conveyed,leased or mortgaged so long as any of the bonds and interest thereon remainoutstanding and unpaid.

Provided, however, that the credit of the State of North Carolina orany of its departments, institutions, agencies or commissions shall not bepledged to the payment of such bonds except with respect to the rentals,profits and proceeds received in connection with the undertaking for which thesaid bonds are issued, and that none of the appropriations received from the Stateshall be pledged as security for said bonds. (1935, c. 479, s. 3; Ex. Sess. 1936, c. 2, s. 2.)