Substitute Senate Bill No. 823

Public Act No. 01-179

AN ACT CONCERNING ISSUANCE OF BONDS BY THE CONNECTICUT DEVELOPMENT AUTHORITY AND ITS SUBSIDIARIES ON BEHALF OF MUNICIPALITIES FOR INFORMATION TECHNOLOGY AND REMEDIATION PROJECTS.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. (NEW) (a) For the purpose of assisting (1) any information technology project, as defined in subsection (ee) of section 32-23d of the general statutes, which is located in an eligible municipality, as defined in subdivision (12) of subsection (a) of section 32-9t of the general statutes, or (2) any remediation project, as defined in subsection (ii) of section 32-23d of the general statutes, as amended by this act, the Connecticut Development Authority may, upon a resolution of the legislative body of a municipality, issue and administer bonds which are payable solely or in part from and secured by: (A) A pledge of and lien upon any and all of the income, proceeds, revenues and property of such a project, including the proceeds of grants, loans, advances or contributions from the federal government, the state or any other source, including financial assistance furnished by the municipality or any other public body, (B) taxes or payments or grants in lieu of taxes allocated to and payable into a special fund of the Connecticut Development Authority pursuant to the provisions of subsection (b) of this section, or (C) any combination of the foregoing. Any such bonds of the Connecticut Development Authority shall mature at such time or times not exceeding thirty years from their date of issuance and shall be subject to the general terms and provisions of law applicable to the issuance of bonds by the Connecticut Development Authority, except that such bonds shall be issued without a special capital reserve fund as provided in subsection (b) of section 32-23j of the general statutes and, for purposes of section 32-23f of the general statutes, only the approval of the board of directors of the authority shall be required for the issuance and sale of such bonds. Any pledge made by the municipality or the Connecticut Development Authority for bonds issued as provided in this section shall be valid and binding from the time when the pledge is made, and revenues and other receipts, funds or moneys so pledged and thereafter received by the municipality or the Connecticut Development Authority shall be subject to the lien of such pledge without any physical delivery thereof or further act. The lien of such pledge shall be valid and binding against all parties having claims of any kind in tort, contract or otherwise against the municipality or the Connecticut Development Authority, even if the parties have no notice of such lien. Recording of the resolution or any other instrument by which such a pledge is created shall not be required. In connection with any such assignment of taxes or payments in lieu of taxes, the Connecticut Development Authority may, if the resolution so provides, exercise the rights provided for in section 12-195h of the general statutes of an assignee for consideration of any lien filed to secure the payment of such taxes or payments in lieu of taxes. All expenses incurred in providing such assistance may be treated as project costs.

(b) Any proceedings authorizing the issuance of bonds under this section may contain a provision that taxes or a specified portion thereof, if any, identified in such authorizing proceedings and levied upon taxable real or personal property, or both, in a project each year, or payments or grants in lieu of such taxes or a specified portion thereof, by or for the benefit of any one or more municipalities, districts or other public taxing agencies, as the case may be, shall be divided as follows: (1) In each fiscal year that portion of the taxes or payments or grants in lieu of taxes which would be produced by applying the then current tax rate of each of the taxing agencies to the total sum of the assessed value of the taxable property in the project on the date of such authorizing proceedings, adjusted in the case of grants in lieu of taxes to reflect the applicable statutory rate of reimbursement, shall be allocated to and when collected shall be paid into the funds of the respective taxing agencies in the same manner as taxes by or for said taxing agencies on all other property are paid; and (2) that portion of the assessed taxes or the payments or grants in lieu of taxes, or both, each fiscal year in excess of the amount referred to in subdivision (1) of this subsection shall be allocated to and when collected shall be paid into a special fund of the Connecticut Development Authority to be used in each fiscal year, in the discretion of the Connecticut Development Authority, to pay the principal of and interest due in such fiscal year on bonds issued by the Connecticut Development Authority to finance, refinance or otherwise assist such project, to purchase bonds issued for such project, or to reimburse the provider of or reimbursement party with respect to any guarantee, letter of credit, policy of bond insurance, funds deposited in a debt service reserve fund, funds deposited as capitalized interest or other credit enhancement device used to secure payment of debt service on any bonds issued by the Connecticut Development Authority to finance, refinance or otherwise assist such project, to the extent of any payments of debt service made therefrom. Unless and until the total assessed valuation of the taxable property in a project exceeds the total assessed value of the taxable property in such project as shown by the last assessment list referred to in subdivision (1) of this subsection, all of the taxes levied and collected and all of the payments or grants in lieu of taxes due and collected upon the taxable property in such project shall be paid into the funds of the respective taxing agencies. When such bonds and interest thereof, and such debt service reimbursement to the provider of or reimbursement party with respect to such credit enhancement, have been paid in full, all moneys thereafter received from taxes or payments or grants in lieu of taxes upon the taxable property in such development project shall be paid into the funds of the respective taxing agencies in the same manner as taxes on all other property are paid. The total amount of bonds issued pursuant to this section which are payable from grants in lieu of taxes payable by the state shall not exceed an amount of bonds, the debt service on which is, in total, equal to one million dollars.

(c) The authority may make grants or provide loans or other forms of financial assistance from the proceeds of special or general obligation notes or bonds of the authority issued without the security of a special capital reserve fund within the meaning of subsection (b) of section 32-23j of the general statutes, which bonds are payable from and secured by, in whole or in part, the pledge and security provided for in section 8-134, as amended by this act, 8-192, as amended by this act, 32-227 of the general statutes, or section 1 of this act, all on such terms and conditions, including such agreements with the municipality and the developer of the project, as the authority determines to be appropriate in the circumstances, provided any such project in an area designated as an enterprise zone pursuant to section 32-70 of the general statutes receiving such financial assistance shall be ineligible for any fixed assessment pursuant to section 32-71 of the general statutes, and the authority, as a condition of such grant, loan or other financial assistance, may require the waiver, in whole or in part, of any property tax exemption with respect to such project otherwise available under subsection (59) or (60) of section 12-81 of the general statutes.

(d) As used in this section, "bonds" means any bonds, including refunding bonds, notes, temporary notes, interim certificates, debentures or other obligations; "legislative body" has the meaning provided in subsection (y) of section 32-222 of the general statutes; and "municipality" means a town, city, consolidated town or city or consolidated town and borough.

(e) For purposes of this section, references to the Connecticut Development Authority shall include any subsidiary of the Connecticut Development Authority established pursuant to subsection (l) of section 32-11a of the general statutes, as amended by this act, and a municipality may act by and through its implementing agency, as defined in subsection (k) of section 32-222 of the general statutes.

(f) No commitments for new projects shall be approved by the authority under this section on or after July 1, 2005.

Sec. 2. Section 8-134 of the general statutes is repealed and the following is substituted in lieu thereof:

For the purpose of carrying out or administering a redevelopment plan or other functions authorized under this chapter, a municipality, acting by and through its redevelopment agency, is hereby authorized, subject only to the limitations and procedures set forth in this section, to issue from time to time bonds of the municipality which are payable solely from and secured by: (a) A pledge of and lien upon any or all of the income, proceeds, revenues and property of redevelopment projects, including the proceeds of grants, loans, advances or contributions from the federal government, the state or other source, including financial assistance furnished by the municipality or any other public body pursuant to section 8-135; (b) taxes or payments in lieu of taxes, or both, in whole or in part, allocated to and paid into a special fund of the municipality pursuant to the provisions of section 8-134a; or (c) any combination of the methods in subsections (a) and (b) of this section. For the purposes of a specified project only, the Connecticut Development Authority may, upon a resolution with respect to such project adopted by the legislative body of the municipality, issue and administer bonds which are payable solely or in part from and secured by the pledge and security provided for in this section subject to the general terms and provisions of law applicable to the issuance of bonds by the Connecticut Development Authority, except that the provisions of subsection (b) of section 32-23j shall not apply. Any bonds payable and secured as provided in this section shall be authorized by a resolution adopted by the legislative body of the municipality, notwithstanding the provisions of any other statute, local law or charter governing the authorization and issuance of bonds generally by the municipality. No such resolution shall be adopted until after a public hearing has been held upon such authorization. Notice of such hearing shall be published not less than five days prior to such hearing in a newspaper having a general circulation in the municipality. Such bonds shall be issued and sold in such manner; bear interest at such rate or rates, including variable rates to be determined in such manner as set forth in the proceedings authorizing the issuance of the bonds; provide for the payment of interest on such dates, whether before or at maturity; be issued at, above or below par; mature at such time or times not exceeding forty years from their date in the case of bonds issued to finance housing and facilities related thereto or thirty years from their date in all other cases; have such rank or priority; be payable in such medium of payment; be issued in such form, including, without limitation, registered or book-entry form, carry such registration and transfer privileges and be made subject to purchase or redemption before maturity at such price or prices and under such terms and conditions, including the condition that such bonds be subject to purchase or redemption on the demand of the owner thereof; and contain such other terms and particulars as the legislative body of the municipality or the officers delegated such authority by the legislative body of the municipality body shall determine. The proceedings under which bonds are authorized to be issued may, subject to the provisions of the general statutes, contain any or all of the following: (1) Provisions respecting custody of the proceeds from the sale of the bonds and any bond anticipation notes, including any requirements that such proceeds be held separate from or not be commingled with other funds of the municipality; (2) provisions for the investment and reinvestment of bond proceeds until such proceeds are used to pay project costs and for 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 limited to, letters of credit or policies of bond insurance, remarketing agreements and agreements for the purpose of moderating interest rate fluctuations; (4) provisions for the collection, custody, investment, reinvestment and use of the pledged revenues or other receipts, funds or moneys pledged for payment of bonds as provided in this section; (5) provisions regarding the establishment and maintenance of reserves, sinking funds and any other funds and accounts as shall be approved by the legislative body of the municipality in such amounts as may be established by the legislative body of the municipality and the regulation and disposition thereof, including requirements that any such funds and accounts be held separate from or not be commingled with other funds of the municipality; (6) covenants for the establishment of maintenance requirements with respect to facilities and properties; (7) provisions for the issuance of additional bonds on a parity with bonds issued prior to the issuance of such additional bonds, including establishment of coverage requirements with respect to such bonds as herein provided; (8) provisions regarding the rights and remedies available to the bond owners, note owners or any trustee under any contract, loan agreement, document, instrument or trust indenture in case of a default, including the right to appoint a trustee to represent their interests upon occurrence of any event of default, as defined in any such default proceedings, provided that if any bonds or bond anticipation notes are secured by a trust indenture, the respective owners of such bonds or notes shall have no authority except as set forth in such trust indenture to appoint a separate trustee to represent them; and (9) other provisions or covenants of like or different character from the foregoing which are consistent with this section and which the legislative body of the municipality determines in such proceedings are necessary, convenient or desirable in order to better secure the bonds or bond anticipation notes, or will tend to make the bonds or bond anticipation notes more marketable, and which are in the best interests of the municipality. Any provisions which may be included in proceedings authorizing the issuance of bonds under this section may be included in an indenture of trust duly approved in accordance with this section which secures the bonds and any notes issued in anticipation thereof, and in such case the provisions of such indenture shall be deemed to be a part of such proceedings as though they were expressly included therein. Any pledge made by the municipality shall be valid and binding from the time when the pledge is made, and any revenues or other receipts, funds or moneys so pledged and thereafter received by the municipality shall be subject immediately to the lien of such pledge without any physical delivery thereof or further act. 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 municipality, irrespective of whether such parties have notice of such lien. Neither the resolution nor any other instrument by which a pledge is created need be recorded. The legislative body of the municipality may enter into a trust indenture by and between the municipality and a corporate trustee, which may be any trust company or bank having the powers of a trust company within or without the municipality. Such trust indenture may contain such provisions for protecting and enforcing the rights and remedies of the bond owners and note owners as may be reasonable and proper and not in violation of law, including covenants setting forth the duties of the municipality in relation to the exercise of its powers pursuant to this section and the custody, safeguarding and application of all moneys. The municipality may provide by such trust indenture for the payment of the pledged revenues or other receipts, funds or moneys to the trustee under such trust indenture or to any other depository, and for the method of disbursement thereof, with such safeguards and restrictions as it may determine. All expenses incurred in carrying out such trust indenture may be treated as project costs. Such bonds shall not be included in computing the aggregate indebtedness of the municipality, provided, if such bonds are made payable, in whole or in part, from funds contracted to be advanced by the municipality, the aggregate amount of such funds not yet appropriated to such purpose shall be included in computing the aggregate indebtedness of the municipality. As used in this section, "bonds" means any bonds, including refunding bonds, notes, interim certificates, debentures or other obligations. For purposes of this section and section 8-134a, references to the Connecticut Development Authority shall include any subsidiary of the Connecticut Development Authority established pursuant to subsection (l) of section 32-11a, as amended by this act.

Sec. 3. Subsection (d) of section 8-192 of the general statutes is repealed and the following is substituted in lieu thereof:

(d) For the purposes of carrying out or administering a specified development plan authorized under this chapter, the Connecticut Development Authority may, upon a resolution with respect to such project adopted by the legislative body of the municipality, issue and administer bonds which are payable solely or in part from and secured by the pledge and security provided for in subsection (a) of this section subject to the general terms and provisions of law applicable to the issuance of bonds by the Connecticut Development Authority, except that the provisions of subsection (b) of section 32-23j shall not apply. For purposes of this section and section 8-192a, references to the Connecticut Development Authority shall include any subsidiary of the Connecticut Development Authority established pursuant to subsection (l) of section 32-11a, as amended by this act.

Sec. 4. Subsection (a) of section 32-11a of the general statutes is repealed and the following is substituted in lieu thereof:

(a) There is hereby created as a body politic and corporate, constituting a public instrumentality and political subdivision of the state created for the performance of an essential public and governmental function, the Connecticut Development Authority which is empowered to carry out the purposes of the authority, as defined in [this chapter, chapter 578, subsection (a) of section 10-320b and sections 25-33a and 32-68a] subsection (t) of section 32-23d, as amended by this act, which are hereby determined to be public purposes for which public funds may be expended. The Connecticut Development Authority shall not be construed to be a department, institution or agency of the state.

Sec. 5. Subsection (c) of section 32-11a of the general statutes is repealed and the following is substituted in lieu thereof:

(c) The board of directors of the authority shall consist of the Commissioner of Economic and Community Development, the Treasurer of the state and the Secretary of the Office of Policy and Management, each serving ex officio, four members appointed by the Governor who shall be experienced in the field of financial lending or the development of commerce, trade and business and four members appointed as follows: One by the president pro tempore of the Senate, one by the minority leader of the Senate, one by the speaker of the House of Representatives and one by the minority leader of the House of Representatives. Each ex-officio member may designate [his] a deputy or any member of [his] the agency staff to represent [him] the member at meetings of the authority with full powers to act and vote [in his] on the member's behalf. The chairperson of the board shall be appointed by the Governor, with the advice and consent of both houses of the General Assembly. The board shall annually elect one of its members as vice chairman. Each member appointed by the Governor shall serve at the pleasure of the Governor but no longer than the term of office of the Governor or until the member's successor is appointed and qualified, whichever is longer. Each member appointed by a member of the General Assembly shall serve in accordance with the provisions of section 4-1a. Members shall receive no compensation but shall be reimbursed for necessary expenses incurred in the performance of their duties under [this chapter, chapter 578, subsection (a) of section 10-320b, and sections 25-33a and 32-68a] the authority legislation, as defined in subsection (hh) of section 32-23d, as amended by this act. The Governor shall fill any vacancy for the unexpired term of a member appointed by the Governor. The appropriate legislative appointing authority shall fill any vacancy for the unexpired term of a member appointed by such authority. A member of the board shall be eligible for reappointment. Any member of the board may be removed by the Governor for misfeasance, malfeasance or wilful neglect of duty. Each member of the authority before entering upon his or her duties shall take and subscribe the oath or affirmation required by article XI, section 1, of the State Constitution. A record of each such oath shall be filed in the office of the Secretary of the State. Meetings of the board shall be held at such times as shall be specified in the bylaws adopted by the board and at such other time or times as the chairman deems necessary. The board is empowered to adopt bylaws and regulations for putting into effect the provisions of said chapters and sections. Not later than November first, annually, the authority shall submit a report to the Commissioner of Economic and Community Development, the Auditors of Public Accounts and the joint standing committees of the General Assembly having cognizance of matters relating to the Department of Economic and Community Development, appropriations and capital bonding, which shall include the following information with respect to new and outstanding financial assistance provided by the authority during the twelve-month period ending on June thirtieth next preceding the date of the report for each financial assistance program administered by the authority: (1) A list of the names, addresses and locations of all recipients of such assistance, (2) for each recipient: (A) The business activities, (B) the Standard Industrial Classification Manual codes, (C) the gross revenues during the recipient's most recent fiscal year, (D) the number of employees at the time of application, (E) whether the recipient is a minority or women-owned business, (F) a summary of the terms and conditions for the assistance, including the type and amount of state financial assistance, job creation or retention requirements, and anticipated wage rates, and (G) the amount of investments from private and other nonstate sources that have been leveraged by the assistance, (3) the economic benefit criteria used in determining which applications have been approved or disapproved, and (4) for each recipient of assistance on or after July 1, 1991, a comparison between the number of jobs to be created, the number of jobs to be retained and the average wage rates for each such category of jobs, as projected in the recipient's application, versus the actual number of jobs created, the actual number of jobs retained and the average wage rates for each such category. The report shall also indicate the actual number of full-time jobs and the actual number of part-time jobs in each such category and the benefit levels for each such subcategory. In addition, the report shall state (A) for each final application approved during the twelve-month period covered by the report, (i) the date that the final application was received by the authority and (ii) the date of such approval; (B) for each final application withdrawn during the twelve-month period covered by the report, (i) the municipality in which the applicant is located, (ii) the Standard Industrial Classification Manual code for the applicant, (iii) the date that the final application was received by the authority, and (iv) the date of such withdrawal; (C) for each final application disapproved during the twelve-month period covered by the report, (i) the municipality in which the applicant is located, (ii) the Standard Industrial Classification Manual code for the applicant, (iii) the date that the final application was received by the authority, and (iv) the date of such disapproval; and (D) for each final application on which no action has been taken by the applicant or the agency in the twelve-month period covered by the report and for which no report has been submitted under this subsection, (i) the municipality in which the applicant is located, (ii) the Standard Industrial Classification Manual code for the applicant, and (iii) the date that the final application was received by the authority. The November first report shall include a summary of the activities of the authority, including all activities to assist small businesses and minority business enterprises, as defined in section 4a-60g, a complete operating and financial statement and recommendations for legislation to promote the purposes of the authority. The authority shall furnish such additional reports upon the written request of any such committee at such times and containing such information as the committee may request. The accounts of the authority shall be subject to annual audit by the state Auditors of Public Accounts. The authority may cause an audit of its books and accounts to be made at least once each fiscal year by certified public accountants. The powers of the authority shall be vested in and exercised by not less than six of the members of the board of directors then in office. Such number of members shall constitute a quorum and the affirmative vote of a majority of the members present at a meeting of the board shall be necessary for any action taken by the authority. No vacancy in the membership of the board shall impair the right to exercise all the rights and perform all the duties of the authority. Any action taken by the board under the provisions of said chapters and sections may be authorized by resolution at any regular or special meeting, and each such resolution shall take effect immediately and need not be published or posted. The authority shall be exempt from the provisions of section 4-9a.

Sec. 6. Subdivision (6) of subsection (l) of section 32-11a of the general statutes is repealed and the following is substituted in lieu thereof:

(6) The authority may make loans or grants to, and may guarantee specified obligations of, any each such subsidiary, following standard authority procedures, from the authority's assets and the proceeds of its bonds, notes, and other obligations, provided however, that the source and security, if any, for the repayment of any such loans or guarantees is derived from the assets, revenues and resources of such subsidiary.

Sec. 7. Subsection (d) of section 32-23d of the general statutes is repealed and the following is substituted in lieu thereof:

(d) "Project" means any facility, plant, works, system, building, structure, utility, fixture or other real property improvement located in the state, any machinery, equipment, furniture, fixture or other personal property to be located in the state and the land on which it is located or which is reasonably necessary in connection therewith, which is of a nature or which is to be used or occupied by any person for purposes which would constitute it as an economic development project, information technology project, public service project, urban project, recreation project, commercial fishing project, health care project, the convention center project, as defined in subdivision (3) of section 32-600, [or] nonprofit project or remediation project, and any real property improvement reasonably related thereto. A project may be acquired (1) directly, or (2) indirectly through the purchase of all or substantially all of the stock of a corporation. A project shall not include new materials, work in process, stock in trade or stock of a corporation.

Sec. 8. Subsection (t) of section 32-23d of the general statutes is repealed and the following is substituted in lieu thereof:

(t) "Purposes of [this chapter, chapter 578, subsection (a) of section 10-320b and sections 25-33a and 32-68a] the authority", means the purposes of the authority expressed in and pursuant to the authority legislation, including with respect to the promotion, planning and designing, developing, encouraging, assisting, acquiring, constructing, reconstructing, improving, maintaining and equipping and furnishing of a project and assisting directly or indirectly in the financing of the cost thereof.

Sec. 9. Section 32-23d of the general statutes is amended by adding subsections (hh) and (ii) as follows:

(NEW) (hh) "Authority legislation" means this chapter, chapters 578, 584, 588l, 588n, 588r and 588u, sections 8-134, as amended by this act, 8-134a, 8-192, as amended by this act, 8-192a, 25-33a, and 32-68a, section 1 of this act, and any other provisions of the general statutes or any public or special act setting forth or governing the powers and duties of the authority.

(NEW) (ii) "Remediation project" means any project (1) involving the development or redevelopment of real property within this state that (A) has been subject to a spill, as defined in section 22a-452c, (B) is an establishment, as defined in subdivision (3) of section 22a-134, (C) is a facility, as defined in 42 USC 9601(9), or (D) is eligible to be treated as polluted real property for purposes of section 22a-133m or contaminated real property for purposes of section 22a-133aa or section 22a-133bb, provided the development or redevelopment is undertaken pursuant to a remediation plan meeting all applicable standards and requirements of the Department of Environmental Protection, (2) that the authority determines will add or support significant new economic activity or employment in the municipality in which such project is located or will otherwise materially contribute to the economic base of the state or the municipality, and (3) for which assistance from the authority will be needed to attract necessary private investment.

Sec. 10. Section 32-23e of the general statutes is repealed and the following is substituted in lieu thereof:

To accomplish the purposes of [this chapter, chapter 578 and subsection (a) of section 10-320b] the authority, as defined in subsection (t) of section 32-23d, as amended by this act, which are hereby determined to be public purposes for which public funds may be expended, and in addition to any other powers provided by law, the authority shall have power to: (1) Determine the location and character of any project to be financed under the provisions of said chapters and sections, provided any financial assistance shall be approved in accordance with written procedures prepared pursuant to subdivision (14) of this section; (2) purchase, receive, by gift or otherwise, lease, exchange, or otherwise acquire, and construct, reconstruct, improve, maintain, equip and furnish one or more projects, including all real and personal property which the authority may deem necessary in connection therewith, and to enter into a contract with a person therefor upon such terms and conditions as the authority shall determine to be reasonable, including but not limited to reimbursement for the planning, designing, financing, construction, reconstruction, improvement, equipping, furnishing, operation and maintenance of the project and any claims arising therefrom and establishment and maintenance of reserve and insurance funds with respect to the financing of the project; (3) insure any or all payments to be made by the borrower under the terms of any agreement for the extension of credit or making of a loan by the authority in connection with any economic development project to be financed, wholly or in part, through the issuance of bonds or mortgage payments of any mortgage which is given by a mortgagor to the mortgagee who has provided the mortgage for an economic development project upon such terms and conditions as the authority may prescribe and as provided herein, and the faith and credit of the state are pledged thereto; (4) in connection with the insuring of payments of any mortgage, request for its guidance a finding of the municipal planning commission, or, if there is no planning commission, a finding of the municipal officers, of the municipality in which the economic development project is proposed to be located, or of the regional planning agency of which such municipality is a member, as to the expediency and advisability of the economic development project; (5) sell or lease to any person, all or any portion of a project, purchase from eligible financial institutions mortgages with respect to economic development projects, purchase or repurchase its own bonds, and sell, pledge or assign to any person any such [mortgage] bonds, mortgages, or other loans, notes, revenues or assets of the authority, or any interest therein, for such consideration and upon such terms as the authority may determine to be reasonable; (6) mortgage or otherwise encumber all or any portion of a project whenever it shall find such action to be in furtherance of the purposes of said chapters and sections; (7) enter into agreements with any person, including prospective mortgagees and mortgagors, for the purpose of planning, designing, constructing, acquiring, altering and financing projects, providing liquidity or a secondary market for mortgages or other financial obligations incurred with respect to facilities which would qualify as a project under this chapter, purchasing loans made by regional corporations under section 32-276, or for any other purpose in furtherance of any other power of the authority; (8) grant options to purchase or renew a lease for any of its projects on such terms as the authority may determine to be reasonable; (9) employ or retain attorneys, accountants and architectural, engineering and financial consultants and such other employees and agents and to fix their compensation and to employ the Connecticut Development Credit Corporation on a cost basis as it shall deem necessary to assist it in carrying out the purposes of said [chapters and sections] authority legislation; (10) borrow money or accept gifts, grants or loans of funds, property or service from any source, public or private, and comply, subject to the provisions of said [chapters and sections] authority legislation, with the terms and conditions thereof; (11) accept from a federal agency loans or grants for use in carrying out its purpose, and enter into agreements with such agency respecting any such loans or grants; (12) provide tenant lease guarantees and performance guarantees and extend credit or make loans to any person for the planning, designing, financing, acquiring, constructing, reconstructing, improving, equipping and furnishing of a project and for the refinancing of existing indebtedness with respect to any facility or part thereof which would qualify as a project in order to facilitate substantial improvements thereto, which guarantees, credits or loans may be secured by loan agreements, lease agreements, installment sale agreements, mortgages, contracts and all other instruments or fees and charges, upon such terms and conditions as the authority shall determine to be reasonable in connection with such loans, including provision for the establishment and maintenance of reserve and insurance funds and in the exercise of powers granted in this section in connection with a project for such person, to require the inclusion in any contract, loan agreement or other instrument, such provisions for the construction, use, operation and maintenance and financing of a project as the authority may deem necessary or desirable; (13) in connection with any application for assistance under said [chapters and section] authority legislation, or commitments therefor, to make and collect such fees and charges as the authority shall determine to be reasonable; (14) adopt procedures, in accordance with the provisions of section 1-121, to carry out the provisions of said [chapters and sections] authority legislation, which may give priority to applications for financial assistance based upon the extent the project will materially contribute to the economic base of the state by creating or retaining jobs, providing increased wages or benefits to employees, promoting the export of products or services beyond the boundaries of the state, encouraging innovation in products or services, encouraging defense-dependent business to diversify to nondefense production, promoting standards of participation adopted by the Connecticut partnership compact pursuant to section 33-374g of the general statutes, revision of 1958, revised to 1991, or will otherwise enhance existing activities that are important to the economic base of the state, provided regulation-making proceedings commenced before January 1, 1989, shall be governed by sections 4-166 to 4-174, inclusive; (15) adopt an official seal and alter the same at pleasure; (16) maintain an office at such place or places within the state as it may designate; (17) sue and be sued in its own name and plead and be impleaded, service of process in any action to be made by service upon the executive director of said authority either in hand or by leaving a copy of the process at the office of the authority with some person having charge thereof; (18) employ such assistants, agents and other employees as may be necessary or desirable for its purposes, which employees shall be exempt from the classified service and shall not be employees as defined in subsection (b) of section 5-270; establish all necessary or appropriate personnel practices and policies, including those relating to hiring, promotion, compensation, retirement and collective bargaining, which need not be in accordance with chapter 68 and the authority shall not be an employer as defined in subsection (a) of section 5-270; contract for and engage appraisers of industrial machinery and equipment, consultants and property management services, and utilize the services of other governmental agencies; (19) when it becomes necessary or feasible for the authority to safeguard itself from losses, acquire, purchase, manage and operate, hold and dispose of real and personal property, take assignments of rentals and leases and make and enter into all contracts, leases, agreements and arrangements necessary or incidental to the performance of its duties; (20) in order to further the purposes of said [chapters and sections] authority legislation, or to assure the payment of the principal and interest on bonds or notes of the authority or to safeguard the mortgage insurance fund, purchase, acquire and take assignments of notes, mortgages and other forms of security and evidences of indebtedness, purchase, acquire, attach, seize, accept or take title to any project by conveyance or, by foreclosure, and sell, lease or rent any project for a use specified in said chapters and sections or in said chapter 579; (21) adopt rules for the conduct of its business; (22) invest any funds not needed for immediate use or disbursement, including any funds held in reserve, in obligations issued or guaranteed by the United States of America or the state of Connecticut and in other obligations which are legal investments for savings banks in this state; (23) do, or delegate, any and all things necessary or convenient to carry out the purposes and to exercise the powers given and granted in said [chapters and sections] authority legislation; provided, in all matters concerning the internal administrative functions of the authority which are funded by amounts appropriated by the state to the authority or to the department, the procedures of the state relating to office space, supplies, facilities, materials, equipment and professional services shall be followed, and provided further, that in the acquisition by the authority of real estate involving the use of appropriated funds or bonds supported by the full faith and credit of the state, the authority shall be subject to the provisions of section 4b-23; (24) to accept from the department: (A) Financial assistance, (B) revenues or the right to receive revenues with respect to any program under the supervision of the department, and (C) loan assets or equity interests in connection with any program under the supervision of the department; to make advances to and reimburse the department for any expenses incurred or to be incurred by it in the delivery of such assistance, revenues, rights, assets or amounts; to enter into agreements for the delivery of services by the authority, in consultation with the department, the Connecticut Housing Finance Authority and Connecticut Innovations, Incorporated, to third parties which agreements may include provisions for payment by the department to the authority for the delivery of such services; and to enter into agreements with the department or with the Connecticut Housing Finance Authority or Connecticut Innovations, Incorporated for the sharing of assistants, agents and other consultants, professionals and employees, and facilities and other real and personal property used in the conduct of the authority's affairs; and (25) to transfer to the department: (A) Financial assistance, (B) revenues or the right to receive revenues with respect to any program under the supervision of the authority, and (C) loan assets or equity interests in connection with any program under the supervision of the authority, provided the transfer of such financial assistance, revenues, rights, assets or interests is determined by the authority to be practicable, within the constraints and not inconsistent with the fiduciary obligations of the authority imposed upon or established upon the authority by any provision of the general statutes, the authority's bond resolutions or any other agreement or contract of the authority and to have no adverse effect on the tax-exempt status of any bonds of the authority or the state.

Sec. 11. Subsection (a) of section 32-23f of the general statutes is repealed and the following is substituted in lieu thereof:

(a) Subject to the approval of the Treasurer of the state or [his] the Treasurer's deputy appointed pursuant to section 3-12, and other applicable limitations of [this chapter, chapter 578 and subsection (a) of section 10-320b] the authority legislation, as defined in subsection (hh) of section 32-23d, as amended by this act, the authority may borrow money and issue its bonds and notes from time to time and use the proceeds thereof for the purposes of the authority, as defined in subsection (t) of section 32-23d, as amended by this act, and in order to carry out its powers under said [chapters and sections] authority legislation and to pay all other expenditures of the authority incident to and necessary in connection with such purposes including providing funds to be paid into any fund or funds to secure such bonds or notes. All such bonds issued by the authority, secured by a special capital reserve fund within the meaning of subsection (b) of section 32-23j, shall be general obligations of the authority payable out of any revenues or other receipts, funds, or moneys of the authority, subject only to any agreements with the holders of particular notes or bonds pledging any particular revenues, receipts, funds or moneys, provided the authority may issue general obligation bonds of the authority without the security of a special capital reserve fund. Any other such bonds or notes not issued in anticipation of the issuance of bonds referred to in the preceding sentence shall be special obligations of the authority payable solely out of any revenues or other receipts, funds or moneys of the authority pledged therefor. All such notes and such bonds may be executed and delivered in such manner and at such times, may be in such form and denominations and of such tenor and maturity or maturities, may be in bearer or registered form, as to principal and interest or as to principal alone, may be payable at such time or times not exceeding forty years from the date thereof, may be payable at such place or places whether within or without the state, may bear interest at such rate or rates payable at such time or times and at such place or places and evidenced in such manner, and may contain such provisions not inconsistent with said chapters and sections, as shall be provided in the resolution of the authority authorizing the issuance of the bonds and notes.

Sec. 12. Subsection (h) of section 32-23f of the general statutes is repealed and the following is substituted in lieu thereof:

(h) The authority may issue notes and bonds in accordance herewith for one or more projects or to provide funds to be used for the purposes of [this chapter, chapter 578 and subsection (a) of section 10-320b] the authority, as defined in subsection (t) of section 32-23d, as amended by this act, without reference to a particular project or projects.

Sec. 13. Subsection (a) of section 32-23g of the general statutes is repealed and the following is substituted in lieu thereof:

(a) Except as provided in subsection (b) of this section, all moneys of the authority, from whatever source derived, shall be paid to the Treasurer of the state as agent of the authority, who shall not commingle such moneys with any other moneys. Such moneys shall be deposited in a separate bank account or accounts. The moneys in such accounts shall be paid by checks signed by the Treasurer of the state or [his] the Treasurer's deputy appointed pursuant to section 3-12, on requisition of the commissioner or of such other officer or employee or officers or employees of the authority as the authority shall authorize to make such requisition. Notwithstanding the foregoing, the authority shall have power, subject to the approval of the Treasurer of the state or [his] the Treasurer's deputy appointed pursuant to section 3-12, to contract with the holders of any of its bonds or notes, as to the custody, collection, securing, investment and payment of any moneys of the authority, or of any moneys held in trust or otherwise for the payment of bonds or notes, and to carry out such contracts. All moneys received pursuant to the authority of [this chapter, chapter 578 and subsection (a) of section 10-320b] the authority legislation, as defined in subsection (hh) of section 32-23d, as amended by this act, whether as proceeds from the sale of bonds or as revenues, receipts or income, shall be deemed to be trust funds to be held and applied solely as provided in said [chapters and sections,] authority legislation and in the resolutions authorizing the issuance of the bonds or notes. Any officer with whom, or any bank or trust company with which such moneys shall be deposited as trustee thereof shall hold and apply the same for the purposes thereof, subject to such provisions as said [chapters and sections,] authority legislation and the resolution authorizing the issue of the bonds or notes or the trust agreement securing such bonds or notes may provide.

Sec. 14. Section 32-23h of the general statutes is repealed and the following is substituted in lieu thereof:

The exercise of the powers granted by [this chapter, chapter 578 and subsection (a) of section 10-320b] the authority legislation, as defined in subsection (hh) of section 32-23d, as amended by this act, shall constitute the performance of an essential governmental function and the authority shall not be required to pay any taxes or assessments upon or in respect of a project, or any property or moneys of the authority, levied by any municipality or political subdivision or special district having taxing powers of the state, nor shall the authority be required to pay state taxes of any kind, and the authority, its projects, property and moneys and any bonds and notes issued under the provisions of said chapters and sections, their transfer and the income therefrom, including any profit made on the sale thereof, shall at all times be free from taxation of every kind by the state except for estate or succession taxes and by the municipalities and all other political subdivisions or special districts having taxing powers of the state; provided any person, leasing a project from the authority shall pay to the municipality or other political subdivision or special district having taxing powers, in which such project is located, a payment in lieu of taxes which shall equal the taxes on real and personal property, including water and sewer assessments, which such lessee would have been required to pay had it been the owner of such property during the period for which such payment is made and neither the authority nor its projects, properties, money or bonds and notes shall be obligated, liable or subject to lien of any kind for the enforcement, collection or payment thereof. The sale of tangible personal property or services by the authority is exempt from the sales tax under chapter 219, and the storage, use or other consumption in this state of tangible personal property or services purchased from the authority is exempt from the use tax under chapter 219. If and to the extent the proceedings under which the bonds authorized to be issued under the provisions of said chapters and sections so provide, the authority may agree to cooperate with the lessee of a project in connection with any administrative or judicial proceedings for determining the validity or amount of such payments and may agree to appoint or designate and reserve the right in and for such lessee to take all action which the authority may lawfully take in respect of such payments and all matters relating thereto, provided such lessee shall bear and pay all costs and expenses of the authority thereby incurred at the request of such lessee or by reason of any such action taken by such lessee in behalf of the authority. Any lessee of a project which has paid the amounts in lieu of taxes required by this section to be paid shall not be required to pay any such taxes in which a payment in lieu thereof has been made to the state or to any such municipality or other political subdivision or special district having taxing powers, any other statute to the contrary notwithstanding. Any industrial pollution control facility financed under said chapters and sections shall be subject to such approvals, as may be required by law, of any agency of the state and any agency of the United States having jurisdiction in the matter and, in the discretion of the authority, may be acquired, constructed or improved as part of or jointly with a pollution control facility undertaken by a municipality or political subdivision or special district having taxing powers in the state and the authority is authorized to cooperate and execute contracts with such a municipality or political subdivision or special district.

Sec. 15. Section 32-23i of the general statutes is repealed and the following is substituted in lieu thereof:

Bonds issued by the authority under the provisions of [this chapter, chapter 578 and subsection (a) of section 10-320b] the authority legislation, as defined in subsection (hh) of section 32-23d, as amended by this act, 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, savings banks, 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 are hereby made securities which may properly and legally be deposited with and received by any state or municipal officer or any agency or municipality of the state for any purpose for which the deposit of bonds or obligations of the state is now or may hereafter be authorized by law.

Sec. 16. Subsection (a) of section 32-23j of the general statutes is repealed and the following is substituted in lieu thereof:

(a) Bonds or notes of the authority issued under the provisions of [this chapter, chapter 578 and subsection (a) of section 10-320b] the authority legislation, as defined in subsection (hh) of section 32-23d, as amended by this act, shall not be deemed to constitute a debt or liability of the state or of any municipality thereof or a pledge of the faith and credit of the state or of any such municipality and shall not constitute bonds or notes issued or guaranteed by the state within the meaning of section 3-21, but shall be payable solely from the revenues and funds herein provided therefor. All such bonds or notes shall contain on the face thereof a statement to the effect that neither the state of Connecticut nor any municipality thereof other than the authority shall be obligated to pay the same or the interest thereon and that neither the faith and credit nor the taxing power of the state of Connecticut or of any municipality is pledged to the payment of the principal of or the interest on such bonds or notes.

Sec. 17. Section 32-23k of the general statutes is repealed and the following is substituted in lieu thereof:

The state of Connecticut does hereby pledge to and agree with the holders of any bonds and notes issued [under this chapter] under the provisions of the authority legislation, as defined in subsection (hh) of section 32-23d, as amended by this act, and with those parties who may enter into contracts with the Connecticut Development Authority or its successor agency pursuant to the provisions of [this chapter, chapter 578 and subsection (a) of section 10-320b] such authority legislation, that the state will not limit or alter the rights hereby vested in the authority until such obligations, together with the interest thereon, are fully met and discharged and such contracts are fully performed on the part of the authority, provided nothing contained herein shall preclude such limitation or alteration if and when adequate provision shall be made by law for the protection of the holders of such bonds and notes of the authority or those entering into such contracts with the authority. The authority is authorized to include this pledge and undertaking for the state in such bonds and notes or contracts.

Sec. 18. Subsection (a) of section 32-227 of the general statutes is repealed and the following is substituted in lieu thereof:

(a) For the purpose of carrying out or administering a municipal or business development project, (1) a municipality, acting by and through its implementing agency, may, subject to the limitations and procedures set forth in this section, issue from time to time bonds of the municipality, and (2) the Connecticut Development Authority may, upon a resolution adopted of the legislative body of the municipality, issue from time to time bonds which, in either case, are payable solely or in part from and secured by: (A) A pledge of and lien upon any or all of the income, proceeds, revenues and property of development projects, including the proceeds of grants, loans, advances or contributions from the federal government, the state or other source, including financial assistance furnished by the municipality or any other public body pursuant to sections 32-220 to 32-234, inclusive; (B) taxes or payments in lieu of taxes, or both, in whole or in part, allocated to and paid into a special fund of the municipality or the Connecticut Development Authority pursuant to the provisions of subsection (c) of this section; or (C) any combination of the methods in subparagraphs (A) and (B) of this section. Any bonds payable and secured as provided in this subsection shall be authorized and the appropriation of the proceeds thereof approved by and subject to a resolution adopted by the legislative body of the municipality, notwithstanding the provisions of any other statute, local law or charter governing the authorization and issuance of bonds and the appropriation of the proceeds thereof generally by the municipality. No such resolution shall be adopted until after a public hearing has been held upon such authorization. Notice of such hearing shall be published not less than five days prior to such hearing in a newspaper having a general circulation in the municipality. Any such bonds of a municipality or the Connecticut Development Authority shall be issued and sold in such manner; bear interest at such rate or rates, including variable rates; provide for the payment of interest on such dates, whether before or at maturity; be issued at, above or below par; mature at such time or times not exceeding thirty years from their date; have such rank or priority; be payable in such medium of payment; be issued in such form, including, without limitation, registered or book-entry form; carry such registration and transfer privileges and be made subject to purchase or redemption before maturity at such price or prices and under such terms and conditions, including the condition that such bonds be subject to purchase or redemption on the demand of the owner thereof; and contain such other terms and particulars as the legislative body of the municipality or the officers delegated such authority by the legislative body of the municipality shall determine. Any such bonds of the Connecticut Development Authority shall be issued and sold in the manner and subject to the general terms and provisions of law applicable to issuance of bonds by the Connecticut Development Authority, except that the provisions of subsection (b) of section 32-23j shall not apply. The proceedings under which bonds are authorized to be issued may, subject to the provisions of indenture or to any other depository agreement, provide for the method of disbursement thereof, with such safeguards and restrictions as it may determine. Any pledge made by the municipality or the Connecticut Development Authority for bonds issued as provided in this subsection shall be valid and binding from the time when the pledge is made, and any revenues or other receipts, funds or moneys so pledged and thereafter received by the municipality or the Connecticut Development authority shall be subject to the lien of such pledge without any physical delivery thereof or further act. 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 municipality or Connecticut Development Authority, irrespective of whether such parties have notice of such lien. Neither the resolution nor any other instrument by which a pledge is created need be recorded. All expenses incurred in carrying out such financing may be treated as project costs. Such bonds shall not be included in computing the aggregate indebtedness of the municipality, provided, if such bonds are made payable, in whole or in part, from funds contracted to be advanced by the municipality, the aggregate amount of such funds not yet appropriated to such purpose shall be included in computing the aggregate indebtedness of the municipality. As used in this section, "bonds" means any bonds, including refunding bonds, notes, temporary notes, interim certificates, debentures or other obligations. Temporary notes issued in accordance with this subsection in anticipation of the receipt of the proceeds of bond issues may be issued for a period of not more than five years, and notes issued for a shorter period of time may be renewed by the issue of other notes, provided the period from the date of the original notes to the maturity of the last notes issued in renewal thereof shall not exceed five years. For purposes of this section, references to the Connecticut Development Authority shall include any subsidiary of the Connecticut Development Authority established pursuant to subsection (l) of section 32-11a, as amended by this act.

Approved July 6, 2001