Sec. 10a-221. Declaration of policy. It is declared that for the benefit of the people
of the state, the increase of their commerce, welfare and prosperity and the improvement
of their health and living conditions, it is essential that this and future generations of
youth be given the fullest opportunity to learn and to develop their intellectual capacity
and skills. It is recognized that costs connected with collegiate education are increasingly
burdensome and that it is essential that students attending institutions for higher education, and parents and others responsible for paying the costs thereof, be provided with
lower cost financial assistance in order to help such students to achieve higher levels
of learning and development of their intellectual capacity and skills. It is also recognized
that Connecticut institutions for higher education should be provided with appropriate
additional means to assist qualified students financially to achieve the required levels
of learning and development of their intellectual capacity and skills. It is the purpose
of this chapter and policy of the state to provide a measure of financial assistance to
students in or from the state, their parents and others responsible for the costs of their
education and an alternative method to enable Connecticut institutions for higher education to assist qualified students to attend such institutions, all to the public benefit and
good, to the extent and manner provided herein. Sec. 10a-222. Short title. This chapter may be referred to and cited as the "Connecticut Higher Education Supplemental Loan Authority Act". Sec. 10a-223. Definitions. In this chapter, the following words and terms shall
have the following meanings unless the context indicates another or different meaning
or intent: Sec. 10a-224. Connecticut Higher Education Supplemental Loan Authority.
Executive director. (a) There is created a body politic and corporate to be known as
the "Connecticut Higher Education Supplemental Loan Authority". The authority is
constituted a public instrumentality and political subdivision of the state and the exercise
by the authority of the powers conferred by this chapter shall be deemed and held to be
the performance of an essential public and governmental function. The powers of the
authority shall be vested in and exercised by a board of directors which shall consist of
eight members, one of whom shall be the State Treasurer, one of whom shall be the
Secretary of the Office of Policy and Management and one of whom shall be the Commissioner of Higher Education, each serving ex officio, and five of whom shall be
residents of the state appointed by the Governor, not more than three of such appointed
members to be members of the same political party. Three of the appointed members
shall be trustees, directors, officers or employees of Connecticut institutions for higher
education, of whom not more than one shall be from a constituent unit of the state system
of higher education. At least one of the appointed members shall be a person having a
favorable reputation for skill, knowledge and experience in the higher education loan
finance field, and at least one of such appointed members shall be a person having a
favorable reputation for skill, knowledge and experience in state and municipal finance,
either as a partner, officer or employee of an investment banking firm which originates
and purchases state and municipal securities, or as an officer or employee of an insurance
company or bank whose duties relate to the purchase of state and municipal securities
as an investment and to the management and control of a state and municipal securities
portfolio. Of the three members first appointed who are trustees, directors, officers or
employees of Connecticut institutions for higher education, one shall serve until July
1, 1986, one shall serve until July 1, 1987, and one shall serve until July 1, 1988. Of the
three remaining members first appointed, one shall serve until July 1, 1983, one shall
serve until July 1, 1984, and one shall serve until July 1, 1985. On or before the first
day of July, annually, the Governor shall appoint a member or members to succeed
those whose terms expire, each for a term of six years and until his successor is appointed
and has qualified. The Governor shall fill any vacancy for the unexpired term. 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 board before entering upon his or her duties shall take and subscribe the
oath or affirmation required by section 1 of article eleventh of the State Constitution.
A record of each such oath shall be filed in the office of the Secretary of the State.
The State Treasurer, the Secretary of the Office of Policy and Management and the
Commissioner of Higher Education may each designate a deputy or any staff member
to represent him as a member at meetings of the board with full power to act and vote
on his behalf. Sec. 10a-225. Powers of authority. Use of authority loans. Reduction of principal and interest owed by participating institutions. (a) The purpose of the authority
shall be to assist borrowers and Connecticut institutions for higher education in the
financing and refinancing of the costs of education and for this purpose the authority is
authorized and empowered: Sec. 10a-226. Payment of expenses. All expenses incurred in carrying out the
provisions of this chapter shall be payable solely from funds provided under the authority
of this chapter and no liability or obligations shall be incurred by the authority hereunder
beyond the extent to which moneys shall have been provided under the provisions of
this chapter. Sec. 10a-227. Acquisition of property by authority. The authority is authorized
and empowered to establish specific guidelines relating to the deposits of certain moneys, endowments or properties by Connecticut institutions for higher education which
would provide security for education loan funding programs, authority loans, education
loans or for bonds and to establish guidelines relating to guarantees of or contracts to
purchase education loans or bonds by such institutions or by financial institutions or
others. A default reserve fund may be established for each series or issue of bonds. In
this regard, the authority is empowered to receive such moneys, endowments, properties
and guarantees as it deems appropriate and, if necessary, to take title in the name of the
authority or in the name of a participating institution for higher education or a trustee. Sec. 10a-228. Conveyance of title to participating institutions. When the principal of, interest on and premium, if any, due in connection with bonds of the authority
issued to finance the cost of an education loan financing program or programs, including
any refunding bonds issued to refund and refinance such bonds, have been fully paid
and retired or when adequate provision has been made to fully pay and retire the same,
and all other conditions of the bond resolution authorizing the same have been satisfied
and the security interest or lien created by such bond resolution has been released in
accordance with the provisions thereof, the authority shall promptly execute such deeds
and conveyances as are necessary and required to convey any remaining moneys, properties and other assets comprising loan funding deposits to the participating institutions
for higher education which furnished the same in proportion to the amounts furnished
by the respective participating institutions for higher education. Sec. 10a-229. Notes of authority. The authority may from time to time issue negotiable notes for any corporate purpose and may from time to time renew any notes by
the issuance of new notes, whether the notes to be renewed have or have not matured.
The authority may issue notes partly to renew notes or to discharge other obligations
then outstanding and partly for any other purpose. The notes may be authorized, sold,
executed and delivered in the same manner as bonds. Any resolution or resolutions
authorizing notes of the authority or any issue thereof may contain any provisions which
the authority is authorized to include in any resolution or resolutions authorizing revenue
bonds of the authority or any issue thereof, and the authority may include in any notes,
any terms, covenants or conditions which it is authorized to include in any bonds. Such
resolution or resolutions may delegate to the executive director, assistant executive
director, or any member of the board of directors of the authority or any combination
of them, the power to determine any of the details of the notes and to award such notes
to a purchaser or purchasers. All such notes shall be payable solely from the revenues
of the authority, subject only to any contractual rights of the holders of any of its notes
or other obligations then outstanding. Sec. 10a-230. Bonds. (a) The authority may from time to time issue revenue bonds
for any corporate purpose and all such revenue bonds, notes, bond anticipation notes
or other obligations of the authority issued pursuant to this chapter shall be and are
hereby declared to be negotiable for all purposes notwithstanding their payment from
a limited source and without regard to any other law or laws. In anticipation of the sale
of such revenue bonds, the authority may issue negotiable bond anticipation notes and
may renew the same from time to time, but the maximum maturity of any such note,
including renewals thereof, shall not exceed five years from the date of issue of the
original note. Such notes shall be paid from any revenues of the authority available
therefor and not otherwise pledged, or from the proceeds of sale of the revenue bonds
of the authority in anticipation of which they were issued. The notes shall be issued in
the same manner as the revenue bonds. Such notes and the resolution or resolutions
authorizing the same may contain any provisions, conditions or limitations which a bond
resolution of the authority may contain. Sec. 10a-231. Trust agreement to secure bonds or notes. In the discretion of the
authority any revenue bonds or notes issued under the provisions of this chapter may
be secured by a trust agreement by and between the authority and a corporate trustee
or trustees, which may be any trust company or bank having the powers of a trust company within the state. Such trust agreement or the resolution providing for the issuance
of such revenue bonds or notes may pledge or assign the revenues to be received or
proceeds of any contract or contracts pledged. Such trust agreement or resolution providing for the issuance of such revenue bonds or notes may contain such provisions for
protecting and enforcing the rights and remedies of the bondholders or noteholders as
may be reasonable and proper and not in violation of law, including particularly provisions specifically authorized by this chapter to be included in any resolution or resolutions of the authority authorizing revenue bonds or notes thereof. Any bank or trust
company incorporated under the laws of the state which may act as depository of the
proceeds of bonds or notes or of revenues or other moneys may furnish such indemnity
bonds or pledge such securities as may be required by the authority. Any such trust
agreement may set forth the rights and remedies of the bondholders or noteholders and
of the trustee or trustees, and may restrict the individual right of action by bondholders
or noteholders. In addition to the foregoing, any such trust agreement or resolution may
contain such other provisions as the authority may deem reasonable and proper for the
security of the bondholders and noteholders. All expenses incurred in carrying out the
provisions of such trust agreement or resolutions may be treated as a part of the cost of
the education loan program. Sec. 10a-232. Payment of bonds or notes. Creation of special capital reserve
funds. (a) Revenue bonds or notes issued under the provisions of this chapter shall not
be deemed to constitute a debt or liability of the state or of any political subdivision
thereof or a pledge of the full faith and credit of the state or of any such political subdivision, but shall be payable solely from the revenues and funds herein provided therefor.
All such revenue bonds or notes shall contain on the face thereof a statement to the
effect that: (1) The state of Connecticut shall not be obligated to pay the same or the
interest thereon and (2) the authority shall not be obligated to pay the same or the interest
thereon except from revenues of the education loan program or programs or the portion
thereof for which they are issued, and that neither the full faith and credit nor the taxing
power of the state of Connecticut or of any political subdivision thereof is pledged to
the payment of the principal of or the interest on such bonds or notes. Sec. 10a-233. Fees. The authority shall fix, revise, charge and collect fees and is
empowered to contract with any person, partnership, association or corporation, or other
body, public or private, in respect thereof. Each agreement entered into by the authority
with a participating institution or institutions for higher education shall provide that the
fees and other amounts payable by said institution or institutions with respect to any
program or programs of the authority shall be sufficient at all times, (1) to pay its or
their share of the administrative costs and expenses of such program, (2) to pay the
principal of, the premium, if any, and the interest on outstanding bonds or notes of the
authority issued with respect to such program to the extent that other revenues of the
authority pledged for the payment of the bonds or notes are insufficient to pay the bonds
or notes as they become due and payable, (3) to create and maintain reserves which may
but need not be required or provided for in the bond resolution relating to such bonds
or notes of the authority, and (4) to establish and maintain whatever education loan
servicing, control, or audit procedures are deemed to be necessary to the operations of
the authority. The authority shall pledge the revenues from each program, as described
in subsection (b) of section 10a-230, as security for the issue of bonds or notes relating
to such program. Such pledge shall be valid and binding from the time when the pledge
is made; the revenues so pledged by the authority 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 against all parties having claims of any kind
in tort, contract or otherwise against the authority or any participating institution for
higher education, irrespective of whether such parties have notice thereof. Neither the
bond resolution nor any financing statement, continuation statement or other instrument
by which a pledge or security interest is created or by which the authority's interest in
revenues is assigned need be filed in any public records in order to perfect the security
interest or lien thereof as against third parties except in the records of the authority. The
authority may elect, notwithstanding the exclusions provided in subsection (d) of section
42a-9-104, to have the provisions of the Connecticut Uniform Commercial Code apply
to any pledge made by or to the authority to secure its bonds or notes by filing a financing
statement with respect to the security interest created by the pledge. The use and disposition of moneys to the credit of such sinking or other similar fund shall be subject to the
provisions of the resolution authorizing the issuance of such bonds or notes or of such
trust agreement. Except as may otherwise be provided in such resolution, or such trust
agreement, such sinking or other similar fund shall be a fund for all such revenue bonds or
notes issued to finance an educational program or programs at one or more participating
institutions for higher education, without distinction or priority of one over another;
provided, the authority in any such resolution or trust agreement may provide that such
sinking or other similar fund shall be the fund for a particular educational program or
programs at a participating institution or institutions for higher education and for the
revenue bonds or notes issued to finance a particular education program or programs
and may, additionally, permit and provide for the issuance of revenue bonds or notes
having a subordinate lien in respect of the security herein authorized to other revenue
bonds or notes of the authority and, in such case, the authority may create separate or
other similar funds in respect of such subordinate lien bonds or notes. Sec. 10a-234. Use of bond proceeds and revenues. All moneys received under
the provisions of this chapter, whether as proceeds from the sale of bonds or notes or
as revenues, shall be deemed to be trust funds to be held and applied solely as provided
in this chapter. Any officer with whom, or any bank or trust company with which, such
moneys shall be deposited shall act as trustee of such moneys and shall hold and apply
the same for the purposes hereof, subject to such regulations as this chapter and the
resolution authorizing the bonds or notes of any issue or the trust agreement securing
such bonds or notes may provide. Sec. 10a-235. Enforcement of rights and duties. Any holder of revenue bonds,
notes, bond anticipation notes, other notes or other obligations of the authority issued
under the provisions of this chapter or any of the coupons appertaining thereto, and the
trustee or trustees under any trust agreement, except to the extent the rights herein given
may be restricted by any resolution authorizing the issuance of, or any such trust
agreement securing, such bonds or other obligations, may, either at law or in equity, by
suit, action, mandamus or other proceedings, protect and enforce any and all rights under
the laws of the state or granted hereunder or under such resolution or trust agreement,
and may enforce and compel the performance of all duties required by this chapter or
by such resolution or trust agreement to be performed by the authority or any officer,
employee or agent of the authority, including the appointment of a receiver to administer
and operate the education loan program or programs, the revenues of which are pledged
to the payment of principal of, premium, if any, and interest on such bonds or notes,
with full power to pay, and to provide for payment of, principal of, premiums, if any,
and interest on such bonds or notes, and with such powers, subject to the direction of
the court, as are permitted by law and are accorded receivers, excluding any power to
pledge additional revenues of the authority to the payment of such principal, premium
and interest. Sec. 10a-236. Tax exemption. The exercise of the powers granted by this chapter
shall be in all respects for the benefit of the people of the state, for the increase of their
commerce, welfare and prosperity, and for the improvement of their health and living
conditions, and as operation of an educational program and assistance to students to
secure a better education by the authority or its agent shall constitute the performance
of an essential public function, neither the authority nor its agent shall be required to
pay any taxes or assessments, including mortgage recording taxes, upon or with respect
to any property acquired or used by the authority or its agent under the provisions of
this chapter or upon the income therefrom. Any bonds issued under the provisions of
this chapter, their transfer and income therefrom, including any profit made on the sale
thereof, shall at all times be free from taxation of every kind by the state and by the
municipalities and other political subdivisions in the state, but the interest on such bonds
shall be included in the computation of any excise or franchise tax. Sec. 10a-237. Refunding bonds. (a) The authority is hereby authorized to provide
for the issuance of revenue bonds or notes of the authority for the purposes of refunding
any revenue bonds or notes of the authority then outstanding, including the payment of
any redemption premium thereon and any interest accrued or to accrue to the earliest
or any subsequent date of redemption, purchase or maturity of such revenue bonds or
notes, and, if deemed advisable by the authority, for the additional purpose of making
additional authority loans. Sec. 10a-238. Investment of funds. Except as otherwise provided in subsection
(c) of section 10a-237, the authority may invest any funds in (1) direct obligations of
the United States or the state of Connecticut, (2) obligations as to which the timely
payment of principal and interest is fully guaranteed by the United States or the state
of Connecticut, including Connecticut's Short-Term Investment Fund, (3) obligations
of the federal intermediate credit banks, federal banks for cooperatives, federal land
bank, federal home loan banks, Federal National Mortgage Association, Government
National Mortgage Association and the Student Loan Marketing Association, (4) certificates of deposit or time deposits constituting direct obligations of any bank in the state,
provided that investments may be made only in those certificates of deposit or time
deposits in banks which are insured by the Federal Deposit Insurance Corporation if
then in existence, (5) withdrawable capital accounts or deposits of federal chartered
savings and loan associations which are insured by the Federal Savings and Loan Insurance Corporation, (6) other obligations which are legal investments for savings banks
in the state, (7) investment agreements with financial institutions whose short-term obligations are rated within the top two rating categories of any nationally recognized rating
service or of any rating service recognized by the commissioner of banking, or investment agreements fully secured by obligations of, or guaranteed by, the United States or
agencies or instrumentalities of the United States and (8) securities or obligations which
are legal investments for savings banks in Connecticut, subject to repurchase agreements
in the manner in which such agreements are negotiated in sales of securities in the market
place, provided the authority shall not enter into any such agreement with any securities
dealer or bank acting as a securities dealer unless such dealer or bank is included in the
list of primary dealers, as prepared by the Federal Reserve Bank of New York, effective
at the time of the agreement. Any such securities may be purchased at the offering or
market price thereof at the time of such purchase. All such securities so purchased shall
mature or be redeemable on a date or dates prior to the time when, in the judgment of the
authority, the funds so invested will be required for expenditure. The express judgment of
the authority as to the time when any funds shall be required for expenditure or be
redeemable is final and conclusive. Sec. 10a-239. Bonds declared legal investments. Bonds issued by the authority
under the provisions of this chapter are hereby made securities in which all public offices
and public bodies of the state and its political subdivisions, all insurance companies,
trust companies, savings banks, cooperative banks, banking associations, investment
companies, executors, administrators, trustees and other fiduciaries 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 or 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 or obligations of the state is now or may
hereafter be authorized by law. Sec. 10a-240. Report of authority. The authority shall keep an accurate account
of all its activities and of all its receipts and expenditures and shall, annually, in the
month of December, make a report thereof to its board of directors, to the Governor, to
the state Auditors of Public Accounts and to the joint standing committees of the General
Assembly having cognizance of matters relating to education and finance, revenue and
bonding. The report shall be in a form prescribed by the members, with the written
approval of said auditors. The report shall include: (1) Summaries of all applications
by borrowers for education loan financing assistance presented to the authority during
such fiscal year; (2) summaries of all education loan programs which have received any
form of financial assistance from the authority during such year; (3) the nature and
amount of all such assistance; (4) a report concerning the financial condition of the
various education loan series portfolios; (5) a statement of the number of students assisted by education loans who attended Connecticut institutions for higher education
and the number of such students who attended institutions for higher education outside
of the state and the amount loaned for each category of students, and (6) projected
activities of the authority for the next fiscal year, including projections of the total
amount of financial assistance anticipated and the amount of revenue bonds or notes or
other evidences of indebtedness that will be necessary to provide the projected levels
of assistance during the next fiscal year. The members or said auditors may investigate
the affairs of the authority, may severally examine the properties and records of the
authority, and may prescribe methods of accounting and the rendering of periodical
reports in relation to projects undertaken by the authority. Sec. 10a-241. Institutions of higher education authorized to take necessary
action. Rate of interest. (a) Notwithstanding any other provision of law, any participating institution for higher education shall have the power to borrow money from the
authority, make education loans and take all other actions and do such things as are
necessary or convenient to consummate the transactions contemplated under this
chapter. Sec. 10a-242. Employee benefits. The authority may take such action as it deems
appropriate to enable its employees to come within the provisions and obtain the benefits
of the federal Social Security Act. Sec. 10a-243. Chapter supplemental to other laws. Power of authority not subject to supervision or regulation. The provisions of this chapter shall be deemed to
provide a complete, additional and alternative method for the actions of the things authorized thereby and shall be regarded as supplemental and additional to powers granted
by other laws; the issuance of revenue bonds or notes and revenue refunding bonds or
notes under the provisions of this chapter need not comply with the requirements of any
other law applicable to the issuance of bonds or notes. This chapter, being necessary
for the welfare of the state and its inhabitants, shall be liberally construed to effect its
purpose. Except as otherwise expressly provided in this chapter, none of the powers
granted to the authority under the provisions of this chapter shall be subject to the supervision or regulation or require the approval or consent of any municipality or political
subdivision or any department, division, commission, board, body, bureau, official or
agency thereof or of the state. The authority shall not be construed to be an agency
within the scope of chapter 54 or a department, institution or agency of the state. Sec. 10a-244. Chapter independent of Connecticut Student Loan Foundation.
This chapter shall be independent of the authority of the Connecticut Student Loan
Foundation established by chapter 187a. Sec. 10a-245. Advisory committee. The authority shall appoint an advisory committee to consist of not more than fifteen persons who shall meet with the members of
the board of directors of the authority and with staff at least once each calendar year in
accordance with guidelines established by the authority. The members of the advisory
council may include representatives of the various interests served by the authority such
as students, faculty and administrators of both public and private secondary schools, state
and local education officials, parents, bankers, insurance companies and investment
bankers and other citizens interested in the financing of higher education in the state. Sec. 10a-246. Obligations of borrower. The obligations of a borrower with respect to an education loan under the provisions of this chapter shall not be subject to a
discharge in bankruptcy except as provided in the Bankruptcy Code. Secs. 10a-247 to 10a-249. Reserved for future use.
(P.A. 82-313, S. 1, 28; P.A. 87-295, S. 1, 8.)
History: P.A. 87-295 provided that it is essential that students attending all institutions for higher education, rather than
only institutions in the state be provided with lower cost financial assistance, added that the purpose of the chapter be to
provide financial assistance to students from, as well as in, the state and made technical changes.
(Return to TOC) (Return to Chapters) (Return to Titles)
(P.A. 82-313, S. 2, 28.)
(Return to TOC) (Return to Chapters) (Return to Titles)
(a) "Authority" means the Higher Education Supplemental Loan Authority established pursuant to section 10a-224;
(b) "Authority loans" means education loans by the authority, or loans by the authority from the proceeds of bonds for the purpose of funding education loans;
(c) "Bonds" or "revenue bonds" means revenue bonds or notes of the authority
issued under the provisions of this chapter, including revenue refunding bonds or notes;
(d) "Bond resolution" means the resolution or resolutions of the authority and the
trust agreement, if any, authorizing the issuance of and providing for the terms and
conditions applicable to bonds;
(e) "Borrower" means a student and any parent who has received or agreed to pay
an education loan;
(f) "Connecticut institution for higher education" means an institution for higher
education within the state;
(g) "Default insurance" means insurance insuring education loans, authority loans
or bonds against default;
(h) "Default reserve fund" means a fund established pursuant to a bond resolution
for the purpose of securing education loans, authority loans or bonds;
(i) "Education loan" means a loan which is made by the authority to a student in or
from the state, or the parents of such a student, or both, to finance the attendance of the
student at an institution for higher education, or a loan by or on behalf of a participating
institution for higher education from the proceeds of an authority loan, to a student, or
the parents of a student, or both, to finance the student's attendance at such institution;
(j) "Loan funding deposit" means moneys or other property deposited by a Connecticut institution for higher education with the authority, a guarantor or a trustee for the
purpose of (1) providing security for bonds, (2) funding a default reserve fund, (3)
acquiring default insurance, or (4) defraying costs of the authority, such moneys or
properties to be in such amounts as deemed necessary by the authority or guarantor as
a condition for such institution's participation in the authority's programs;
(k) "Institution for higher education" means a degree-granting educational institution within the United States authorized by applicable law to provide a program of
education beyond the high school level and (1) described in Section 501(c)(3) of the
Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code
of the United States, as from time to time amended, and exempt from taxation under
Section 501(a) of said code with respect to a trade or business carried on by such institution which is not an unrelated trade or business, determined by applying Section 513(a)
of said code to such organization or a foundation established for its benefit or (2) exempt
from taxation under said code as a governmental unit;
(l) "Participating institution for higher education" means a Connecticut institution
for higher education which, pursuant to the provisions of this chapter, undertakes the
financing directly or indirectly of education loans as provided in this chapter;
(m) "Parent" means any parent, legal guardian or sponsor of a student at an institution for higher education;
(n) "Education loan series portfolio" means all education loans made by the authority or by or on behalf of a specific participating institution for higher education which
are funded from the proceeds of a related specific bond issue of the authority.
(P.A. 82-313, S. 3, 28; P.A. 87-295, S. 2, 8; P.A. 89-211, S. 19; P.A. 91-210, S. 1, 5; P.A. 93-96, S. 1.)
History: P.A. 87-295 included "education loans by the authority" in the definition of "authority loans"; added new
Subsec. (f) defining "Connecticut institution for higher education" and renumbered the remaining Subsecs.; redefined
"education loan" to include loans made by the authority; redefined "institution for higher education" to mean an institution in
the United States rather than one in the state; redefined "participating institution for higher education" to mean a Connecticut
institution; redefined "education loan series portfolio" to include loans made by the authority; and made technical changes;
P.A. 89-211 clarified reference to the Internal Revenue Code of 1986; P.A. 91-210 amended Subsec. (k) to reflect changes
in the definitions in the Internal Revenue Code of 1986; P.A. 93-96 made a technical amendment to Subsec. (k), defining
"institution for higher education".
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(b) 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. The board may appoint an executive director and
assistant executive director, who shall not be members of the board and who shall serve
at the pleasure of the board. The executive director and assistant executive director shall
receive such compensation as shall be fixed by the board.
(c) The executive director shall supervise the administrative affairs and technical
activities of the authority in accordance with the directives of the board. The executive
director shall keep a record of the proceedings of the authority and shall be custodian
of all books, documents and papers filed with the authority, the minute book or journal
of the authority, and its official seal. The executive director or assistant executive director
or other person may cause copies to be made of all minutes and other records and documents of the authority and may give certificates under the official seal of the authority
to the effect that such copies are true copies, and all persons dealing with the authority
may rely upon such certificates.
(d) (1) Five members of the board shall constitute a quorum. The affirmative vote
of five of the members of the board shall be necessary for any action taken by the board.
No vacancy in the membership of the board shall impair the right of a quorum of members
to exercise all the rights and perform all the duties of the board. Any action taken by
the board under the provisions of this chapter 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. (2) The board of directors may delegate to three or
more of its members such board powers and duties as it may deem proper. At least one
of such members shall not be a state employee.
(e) Before the issuance of any bonds or notes under the provisions of this chapter,
the chairman and vice-chairman of the board of directors, the executive director and
assistant executive director of the authority and any other member of the board authorized by resolution of the board to handle funds or sign checks of the authority shall
execute a surety bond in the penal sum of fifty thousand dollars, or in lieu thereof the
chairman shall obtain a blanket position bond covering the executive director and every
member of the board and other employee of the authority in the penal sum of fifty
thousand dollars. Each such bond shall be conditioned upon the faithful performance
of the duties of the principal or the members, executive director and other employees,
as the case may be, shall be executed by a surety company authorized to transact business
in the state as surety, and shall be filed in the office of the Secretary of the State. The
cost of each such bond shall be paid by the authority.
(f) The members of the board shall receive no compensation for the performance
of their duties hereunder but each such member shall be paid the necessary expenses
incurred by such member while engaged in the performance of such duties.
(g) (1) No member of the board or officer, agent or employee of the authority shall,
directly or indirectly, have any financial interest in any participating institution for higher
education or in any corporation, business trust, estate, trust, partnership or association,
two or more persons having a joint or common interest, or any other legal or commercial
entity contracting with the authority. Any individual who violates the provisions of this
subsection shall be punished by a fine of not less than fifty dollars nor more than one
thousand dollars, or by imprisonment for not more than one month, or both.
(2) Notwithstanding the provisions of subdivision (1) of this subsection or the provisions of any other law to the contrary, it shall not be or constitute a conflict of interest
or violation of the provisions of said subdivision or the provisions of any other law for
a trustee, director, officer or employee of a participating institution of higher education
or for a person having the required favorable reputation for skill, knowledge and experience in state and municipal finance or for a person having the required favorable reputation for skill, knowledge and experience in the higher education loan finance field to
serve as a member of the board; provided, in each case to which the provisions of this
subdivision are applicable, such trustee, director, officer or employee of such participating institution of higher education abstains from discussion, deliberation, action and
vote by the board in specific respect to any undertaking pursuant to this chapter in which
such participating institution of higher education has a direct interest separate from the
interests of all of the participating institutions generally, or such person having the
required favorable reputation for skill, knowledge and experience in state and municipal
finance abstains from discussion, deliberation, action and vote by the board in specific
respect to any sale, purchase or ownership of bonds of the authority in which the investment banking firm or insurance company or bank of which such person is a partner,
officer or employee has or may have a current or future interest, or such person having the
required favorable reputation for skill, knowledge and experience in the higher education
loan finance field abstains from discussion, deliberation, action and vote by the board
in specific respect to any action of the authority in which any partnership, firm, joint
venture, sole proprietorship or corporation of which such person is an owner, venturer,
participant, partner, officer or employee has or may have a current or future interest.
(h) The board of directors of the authority shall adopt written procedures, in accordance with the provisions of section 1-121, for: (1) Adopting an annual budget and plan
of operations, including a requirement of board approval before the budget or plan
may take effect; (2) hiring, dismissing, promoting and compensating employees of the
authority, including an affirmative action policy and a requirement of board approval
before a position may be created or a vacancy filled; (3) acquiring real and personal
property and personal services, including a requirement of board approval for any nonbudgeted expenditure in excess of five thousand dollars; (4) contracting for financial,
legal, bond underwriting and other professional services, including a requirement that
the authority solicit proposals at least once every three years for each such service which
it uses; (5) issuing and retiring bonds, bond anticipation notes and other obligations
of the authority; (6) awarding loans, grants and other financial assistance, including
eligibility criteria, the application process and the role played by the authority's staff
and board of directors; and (7) the use of surplus funds to the extent authorized under
this chapter or other provisions of the general statutes.
(i) The authority shall continue as long as it shall have bonds or other obligations
outstanding and until its existence is terminated by law. Upon termination of the existence of the authority, all its rights and properties shall pass to and be vested in the state
of Connecticut.
(P.A. 82-313, S. 4, 28; P.A. 87-295, S. 3, 8; P.A. 88-266, S. 24, 46.)
History: P.A. 87-295 in Subsec. (a) added the commissioner of higher education as a member of the authority and
provided that he may designate a deputy or staff member to represent him, in Subsec. (d) increased the number of members
required for a quorum from four to five, inserted "Connecticut" before institutions for higher education, expanded the
provisions of Subdiv. (1) of Subsec. (g), and made technical changes; P.A. 88-266 amended Subsec. (a) by specifying that
authority is a political subdivision of the state and performs a governmental function and requiring powers of the authority
to be vested in and exercised by a board of directors, amended Subsec. (b) to require chairperson of board to be appointed
by governor with advice and consent of general assembly, amended Subsec. (c) to require executive director to supervise
administrative affairs and technical activities of the authority, designated existing provisions of Subsec. (d) as Subdiv. (1)
and added Subdiv. (2) re delegation of board powers and duties, amended references to board and authority in Subsecs.
(a) to (g), inclusive, and added Subsec. (h) requiring board to adopt written procedures and Subsec. (i) re existence and
termination of the authority.
Subsec. (a):
Cited. 230 C. 24, 33.
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(1) To adopt bylaws for the regulation of its affairs and the conduct of its business.
(2) To adopt an official seal and alter the same at pleasure.
(3) To maintain an office at such place or places in the state as it may designate.
(4) To sue and be sued in its own name, plead and be impleaded.
(5) To establish criteria and guidelines for education loan financing programs. Such
criteria and guidelines shall include such eligibility standards for borrowers as the authority shall determine are necessary or desirable in order to effectuate the purposes of
this chapter, including the following: (A) Each student shall have a certificate of admission or enrollment at an institution for higher education, (B) each student, or the parents
of each student, shall satisfy such financial qualifications as the authority shall establish
to effectuate the purposes of this chapter, and (C) each student, and the parents of each
student, shall submit to the student's institution for higher education or to the authority,
as the authority may determine, such information as may be required by the authority.
(6) To establish specific criteria governing the eligibility of Connecticut institutions
for higher education to participate in its programs, the making of authority loans and
education loans, provisions for default, the establishment of default reserve funds, the
purchase of default insurance, the provision by such institutions of prudent debt service
reserves, the furnishing by Connecticut institutions for higher education and others of
such additional guarantees of the education loans, authority loans or the bonds as the
authority shall determine and any procedures for allocating authority loans among Connecticut institutions for higher education eligible for the program of the authority in
order to effectuate the purpose of this chapter. All such criteria shall be established to
assure the marketability of the bonds and the adequacy of the security for the bonds.
The criteria governing the eligibility of Connecticut institutions for higher education
shall include limitations upon the principal amounts and the terms of education loans
and qualifications and characteristics of borrowers.
(7) To establish guidelines, criteria and procedures not in conflict with existing
statutes with respect to authority loans, education loans and education loan series portfolios. Such guidelines, criteria and procedures shall not be construed as regulations within
the scope of chapter 54.
(8) To receive and accept from any source loans, contributions or grants, including
money, property, labor, and other things of value from any source for or in aid of an
authority education loan financing program or any portion thereof and, when desirable,
to use such funds, property or labor only for the purposes for which it was loaned,
contributed or granted.
(9) To contract with guarantors, financial institutions or other qualified loan origination and servicing organizations, which shall assist in prequalifying borrowers for education loans and which shall service and administer each education loan. The authority
may require that each borrower be charged a fee to defray the costs of origination,
servicing and administration of education loans. The amount and method of collection
of such fee shall be determined by the authority. Participating institutions for higher
education may perform any of the acts described in this subdivision, or contract for their
performance by others, if these acts are authorized by the authority.
(10) To contract with a guarantor to provide security for the payment of education
loans through the issuance of insurance against default or to provide a guarantee of
payment covering all or a portion of any education loan made by or on behalf of the
authority or by or on behalf of a participating institution for higher education from the
proceeds of an authority loan.
(11) To employ attorneys, accountants, consultants, financial experts, loan processors, banks, managers, and such other employees and agents as may be necessary in its
judgment, and to fix their compensation.
(12) To make authority loans, including loans on which interest may accrue and
periodically be added to the principal of such loan and be subject to additional interest,
and to require that the proceeds be used in accordance with guidelines established by the
authority for making education loans and paying costs and fees in connection therewith.
(13) To charge and equitably apportion among participating institutions for higher
education its administrative costs and expenses incurred in the exercise of the powers
and duties granted by this chapter.
(14) To borrow working capital funds and other funds as may be necessary for start-
up and continuing operations, as long as such funds are borrowed in the name of the
authority only. Such borrowings shall be limited obligations of the character described
in section 10a-232 and shall be payable solely from revenues of the authority or the
proceeds of bonds pledged for that purpose.
(15) Notwithstanding any other provisions of this chapter, to commingle and pledge
as security for a series or issue of bonds, only with the consent of all of the Connecticut
institutions for higher education which are participating in such series or issue: (A) The
education loan series portfolios and some or all future education loan series portfolios
of the authority or of such institutions for higher education, and (B) the loan funding
deposits of such institutions, provided education loan series portfolios and other security
and moneys set aside in any fund or funds pledged for any series of bonds or issue of
bonds shall be held for the sole benefit of such series or issues separate and apart from
education loan series portfolios and other security and moneys pledged for any other
series or issue of bonds of the authority. Bonds may be issued in series under one or
more resolutions or trust agreements in the discretion of the authority.
(16) To examine records and financial reports of institutions for higher education,
and to examine records and financial reports of any person, organization or institution
retained under subdivision (9), (10) or (11) of this subsection.
(17) To do all things necessary or convenient to carry out the purposes of this chapter. In carrying out the purposes of this chapter, the authority may issue bonds, the
proceeds of which are used to make authority loans. In the event all or a portion of such
proceeds are loaned to one or more participating institutions for higher education or to
any combination of participating institutions for higher education, all other provisions
of this chapter shall apply to and for the benefit of the authority and the participants in
such joint project or projects. Any such joint participation requires the express approval
of all participants.
(18) To make and enter into all contracts and agreements necessary or incidental
to the performance of its duties and the execution of its powers under this chapter,
including contracts and agreements for such professional services as the board of directors shall deem necessary, including, but not limited to, financial consultants, bond
counsel, underwriters and technical specialists and investment agreements, as provided
in section 10a-238.
(b) The authority shall require that authority loans be used solely for the purpose
of education loans and in an amount not to exceed the total cost of attendance, less other
forms of student assistance, as defined by the authority. In determining "other forms of
student assistance" the authority may consider (1) grants received under any federal or
state grant programs, (2) loan proceeds received under any federal or other state loan
program, (3) scholarship, grants or other nonrepayable assistance received from government agencies, educational institutions or organizations, and (4) expected family contributions. The authority shall require that each borrower under an education loan shall
use the proceeds solely for educational purposes and purposes reasonably related thereto.
(c) Whenever refunding bonds are issued to refund bonds the proceeds of which
were used to make authority loans, the authority may reduce the amounts of principal
or interest, or both, it is owed by the participating institution for higher education which
had received authority loans from the proceeds of the refunded bonds. Such institutions
may, or in accordance with guidelines established by the authority shall, use any reduced
amount to reduce the amount of interest being paid on education loans which the institution has made pursuant to the authority loans from the proceeds of the refunded bonds.
(P.A. 82-313, S. 5, 28; P.A. 87-295, S. 4, 8; P.A. 88-266, S. 25, 46; P.A. 93-96, S. 4; P.A. 94-180, S. 16, 17.)
History: P.A. 87-295 made the section conform with the definitions in Sec. 10a-223 as amended by P.A. 87-295 and
made technical changes; P.A. 88-266 amended Subsec. (a) by requiring that guidelines, procedures, etc., not conflict with
existing statutes in Subdiv. (7), specifying receipt of money, property, labor, and other things of value from any source is
permitted in Subdiv. (8) and adding Subdiv. (18) re authorization and power to make and enter into contracts; P.A. 93-96
amended Subdiv. (18) to allow authority to enter into investment agreements; P.A. 94-180 amended Subdiv. (12) of Subsec.
(a) to specify that the loans include loans on which interest may accrue and periodically be added to the principal of the
loan and be subject to additional interest, effective July 1, 1994.
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(P.A. 82-313, S. 6, 28.)
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(P.A. 82-313, S. 7, 28; P.A. 87-295, S. 5, 8.)
History: P.A. 87-295 inserted "Connecticut" before "institutions for higher education".
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(P.A. 82-313, S. 8, 28.)
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(P.A. 82-313, S. 9, 28; P.A. 88-266, S. 26, 46.)
History: P.A. 88-266 added reference to board of directors.
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(b) The revenue bonds and notes of every issue shall be payable solely out of the
revenues of the authority pertaining to the program relating to such bonds or notes
including principal and interest on authority loans and education loans, payments by
participating institutions for higher education, banks, guarantors, insurance companies
or others pursuant to letters of credit or purchase agreements, investment earnings from
funds or accounts maintained pursuant to the bond resolution, insurance proceeds, loan
funding deposits, proceeds of sales of education loans, proceeds of refunding bonds and
fees, charges and other revenues of the authority from such program but subject only
to any agreements with the holders of particular revenue bonds or notes pledging any
particular revenues and subject to any agreements with any participating institution for
higher education.
(c) The revenue bonds or notes may be issued as serial bonds or notes or as term
bonds or notes, or the authority, in its discretion, may issue bonds or notes of both types.
The revenue bonds or notes shall be authorized by resolution of the members of the
board of directors of the authority and shall bear such date or dates, mature at such time
or times, not exceeding the year following the last year in which the final payments in
an education loan series portfolio are due, or thirty years from the date of issuance,
whichever is sooner, from their respective dates, bear interest at such rate or rates, payable at such time or times, be in such denominations, be in such form either coupon or
registered, carry such registration or conversion privileges, be executed with manual or
facsimile signatures in such manner, be payable in lawful money of the United States
at such place or places, and be subject to such terms of redemption, as such resolution
or resolutions may provide. Such resolution or resolutions may delegate to the executive
director, assistant executive director or any member of the board of directors of the
authority, or any combination of them, the power to determine any of the matters set
forth in this section and the power to award the bonds to a purchaser or purchasers at
public sale or to negotiate a sale to a purchaser or purchasers. The revenue bonds or
notes may be sold for such price or prices as the authority shall determine. Pending
preparation of the definitive bonds, the authority may issue interim receipts or certificates which shall be exchanged for such definitive bonds.
(d) Any resolution or resolutions authorizing any revenue bonds or any issue of
revenue bonds may contain provisions, which shall be a part of the contract with the
holders of the revenue bonds to be authorized, as to: (1) Pledging all or any part of the
revenues derived from the authority loans and education loans with respect to which
such bonds or notes are to be issued; (2) pledging all or any part of the revenues paid
to the authority by any guarantor or insurance company; (3) any revenue producing
contract or contracts made by the authority with any individual, partnership, corporation
or association or other body, public or private, or any federally guaranteed security
and moneys received therefrom whether such security is acquired by the authority or a
participating institution for higher education to secure the payment of the revenue bonds
or notes or of any particular issue of revenue bonds or notes, subject to such agreements
with bondholders or noteholders as may then exist; (4) the fees and other amounts to
be charged, and the sums to be raised in each year thereby, and the use, investment and
disposition of such sums; (5) the establishment and setting aside of reserves or sinking
funds, the setting aside of loan funding deposits, capitalized interest accounts, and cost
of issuance accounts, and the regulation and disposition thereof; (6) limitations on the
use of the education loans; (7) limitations on the purpose to which the proceeds of the
sale of any issue of revenue bonds or notes then or thereafter to be issued may be applied,
including as authorized purposes, all costs and expenses necessary or incidental to the
issuance of bonds, to the acquisition of or commitment to acquire any federally guaranteed security and pledging such proceeds to secure the payment of the revenue bonds,
notes or any issue of the revenue bonds or notes; (8) limitations on the issuance of
additional bonds or notes, the terms upon which additional bonds or notes may be issued
and secured and the terms on which additional bonds or notes rank on a parity with, or
be subordinate or superior to, other bonds or notes; (9) the refunding of outstanding
bonds or notes; (10) the procedure, if any, by which the terms of any contract with
bondholders or noteholders may be amended or abrogated, the amount of bonds or notes
the holders of which must consent thereto, and the manner in which such consent may be
given; (11) limitations on the amount of moneys derived from the educational program to
be expended for operating, administrative or other expenses of the authority; (12) defining the acts or omissions to act which shall constitute a default in the duties of the
authority to holders of its obligations and providing the rights and remedies of such
holders in the event of default; (13) the duties, obligations and liabilities of any trustee
or paying agent; (14) providing for guarantees, pledges of endowments, letters of credit,
property or other security for the benefit of the holders of such bonds or notes; and (15)
any other matters relating to the bonds or notes which the authority deems desirable.
(e) Neither the members of the board of directors of the authority nor any person
executing the revenue bonds or notes shall be liable personally on the revenue bonds
or notes or be subject to any personal liability or accountability by reason of the issuance
thereof.
(f) The authority shall have power out of any funds available therefor to purchase
its bonds or notes. The authority may hold, pledge, cancel or resell such bonds or notes
subject to and in accordance with the agreements with bondholders.
(P.A. 82-313, S. 10, 28; P.A. 88-266, S. 27, 28, 46.)
History: P.A. 88-266 inserted references to "board of directors" in Subsecs. (c) and (e).
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(P.A. 82-313, S. 11, 28.)
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(b) Notwithstanding the foregoing, (1) the constituent units of the state system of
higher education may participate in one or more education loan programs with the authority and may incur indebtedness pursuant to authority loans and (2) the authority
may create and establish one or more reserve funds to be known as special capital reserve
funds and may pay into such special capital reserve funds (A) any moneys appropriated
and made available by the state for the purposes of such funds, (B) any proceeds of sale
of notes or bonds, to the extent provided in the resolution of the authority authorizing
the issuance thereof, and (C) any other moneys which may be made available to the
authority for the purpose of such funds from any other source or sources. The moneys
held in or credited to any special capital reserve fund established under this section,
except as hereinafter provided, shall be used solely for the payment of the principal of
bonds of the authority secured by such capital reserve fund as the same become due,
the purchase of such bonds of the authority, the payment of interest on such bonds of
the authority or the payment of any redemption premium required to be paid when such
bonds are redeemed prior to maturity; provided, the authority shall have power to provide
that moneys in any such fund shall not be withdrawn therefrom at any time in such
amount as would reduce the amount of such funds to less than the maximum amount
of principal and interest becoming due by reason of maturity or a required sinking fund
installment in any succeeding calendar year on the bonds of the authority then outstanding and secured by such special capital reserve fund, or such lesser amount specified
by the authority in its resolution authorizing the issuance of any such bonds, such amount
being herein referred to as the "required minimum capital reserve", except for the purpose of paying such principal of, redemption premium and interest on such bonds of
the authority secured by such special capital reserve becoming due and for the payment
of which other moneys of the authority are not available. The authority may provide
that it shall not issue bonds at any time if the required minimum capital reserve on
outstanding bonds secured by a special capital reserve fund and the bonds then to be
issued and secured by a special capital reserve fund will exceed the amount of such
special capital reserve fund at the time of issuance, unless the authority, at the time of
the issuance of such bonds, shall deposit in such special capital reserve fund from the
proceeds of the bonds so to be issued, or otherwise, an amount which, together with the
amount then in such special capital reserve fund, will be not less than the required
minimum capital reserve. The authority may, as part of the contract of the authority
with the owners of such bonds, provide that on or before December first, annually, there
is deemed to be appropriated from the state General Fund such sums, if any, as shall be
certified by the chairman of the authority to the Secretary of the Office of Policy and
Management and the Treasurer of the state, as necessary to restore each such special
capital reserve fund to the amount equal to the required minimum capital reserve of
such fund, and such amounts shall be allotted and paid to the authority. For the purpose
of evaluation of any such special capital reserve fund, obligations acquired as an investment for any such fund shall be valued at amortized cost. Nothing contained in this
section shall preclude the authority from establishing and creating other debt service
reserve funds in connection with the issuance of bonds or notes of the authority. Subject
to any agreement or agreements with owners of outstanding notes and bonds of the
authority, any amount or amounts allotted and paid to the authority pursuant to this
section shall be repaid to the state from moneys of the authority at such time as such
moneys are not required for any other of its corporate purposes and in any event shall
be repaid to the state on the date one year after all bonds and notes of the authority
theretofore issued on the date or dates such amount or amounts are allotted and paid to
the authority or thereafter issued, together with interest on such bonds and notes, with
interest on any unpaid installments of interest and all costs and expenses in connection
with any action or proceeding by or on behalf of the owners thereof, are fully met
and discharged. Notwithstanding any other provisions contained in this chapter, the
aggregate amount of bonds outstanding at any time secured by such special capital
reserve funds authorized to be created and established by this section shall not exceed
one hundred seventy million dollars and no such bonds shall be issued to pay program
costs unless the authority is of the opinion and determines that the revenues to be derived
from the program shall be sufficient (1) to pay the principal of and interest on the bonds
issued to finance the program, (2) to establish, increase and maintain any reserves
deemed by the authority to be advisable to secure the payment of the principal of and
interest on such bonds, (3) to pay the cost of maintaining and servicing the program and
keeping it properly insured and (4) to pay such other costs of the program as may be
required.
(P.A. 82-313, S. 12, 28; P.A. 85-401; P.A. 89-274; P.A. 90-317, S. 6, 8; P.A. 91-210, S. 2, 5; P.A. 93-96, S. 2; June 5
Sp. Sess.; P.A. 97-1, S. 12, 20.)
History: P.A. 85-401 divided section into Subsecs. and added provision permitting the authority to establish "special
capital reserve funds"; P.A. 89-274 amended Subsec. (b) to increase the maximum aggregate amount of bonds secured by
special capital reserve funds from fifteen million five hundred thousand dollars to thirty-five million dollars; P.A. 90-317
amended Subsec. (b) to allow the authority to reduce the required minimum capital reserve by a resolution authorizing the
issuance of bonds; P.A. 91-210 amended Subsec. (b) to increase the level of bonds secured by the special capital reserve
funds from thirty-five million dollars to sixty million dollars; P.A. 93-96 amended Subsec. (b) to increase the maximum
aggregate amount of bonds secured by special capital reserve funds from sixty million to one hundred ten million dollars;
June 5 Sp. Sess. P.A. 97-1 amended Subsec. (b) to increase amount that can be secured by the special capital reserve fund
from one hundred ten million to one hundred seventy million dollars, effective July 31, 1997.
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(P.A. 82-313, S. 13, 28.)
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(P.A. 82-313, S. 14, 28.)
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(P.A. 82-313, S. 15, 28.)
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(P.A. 82-313, S. 16, 28; P.A. 95-2, S. 17, 37.)
History: P.A. 95-2 required interest on bonds to be included in the computation of excise or franchise tax, where
previously interest was specifically excluded, effective March 8, 1995.
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(b) The proceeds of any such revenue bonds or notes issued for the purpose of
refunding outstanding revenue bonds may, in the discretion of the authority, be applied
to the purchase or retirement at maturity or redemption of such outstanding revenue
bonds either on their earliest or any subsequent redemption date or upon the purchase
or at the maturity thereof and may, pending such application, be placed in escrow to be
applied to such purchase or retirement at maturity or redemption on such date as may
be determined by the authority.
(c) Any such escrowed proceeds pending such use may be invested and reinvested
in direct obligations of, or unconditionally guaranteed by, the United States, or in certificates of deposit or time deposits secured by direct obligations of, or unconditionally
guaranteed by, the United States or in obligations of a state, territory or possession of
the United States, or any political subdivision of any such state, territory or possession,
or of the District of Columbia, within the meaning of Section 103(a) of the Internal
Revenue Code of 1986, or any subsequent corresponding internal revenue code of the
United States, as from time to time amended, the full and timely payment of the principal
of and interest on which are secured by an irrevocable deposit of direct obligations
of the United States or which, if the outstanding bonds are then rated by a nationally
recognized rating agency, are rated in the highest rating category by such rating agency,
maturing at such time or times as shall be appropriate to assure the prompt payment, as
to principal, interest and redemption premium, if any, of the outstanding revenue bonds
to be so refunded. The interest, income and profits, if any, earned or realized on any
such investment may also be applied to the payment of the outstanding revenue bonds
to be so refunded. After the terms of the escrow have been fully satisfied and carried
out, any balance of such proceeds and interest, income and profits, if any, earned or
realized on the investments thereof may be returned to the authority for use by it in any
lawful manner.
(d) The portion of the proceeds of any such revenue bonds or notes issued for the
additional purpose of making additional authority loans may be invested and reinvested
in direct obligations of, or unconditionally guaranteed by, the United States, and certificates of deposit or time deposits secured by direct obligations of, or unconditionally
guaranteed by, the United States, or obligations of a state, territory or possession of the
United States, or any political subdivision of any such state, territory or possession, or
of the District of Columbia, within the meaning of Section 103(a) of the Internal Revenue
Code of 1986, or any subsequent corresponding internal revenue code of the United
States, as from time to time amended, the full and timely payment of the principal of
and interest on which are secured by an irrevocable deposit of direct obligations of the
United States or which, if the outstanding bonds are then rated by a nationally recognized
rating agency, are rated in the highest rating category by such rating agency, maturing
not later than the time or times when such proceeds will be needed for the purpose of
paying all or any part of such cost. The interest, income and profits, if any, earned or
realized on such investment may be applied to the payment of all or any part of such
cost or may be used by the authority in any lawful manner.
(e) All such revenue bonds or notes shall be subject to the provisions of this chapter
in the same manner and to the same extent as other revenue bonds issued pursuant to
this chapter.
(P.A. 82-313, S. 17, 28; P.A. 93-96, S. 5.)
History: P.A. 93-96 amended Subsecs. (c) and (d) to allow the authority to invest in certain obligations unconditionally
guaranteed by a state, territory or the United States.
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(P.A. 82-313, S. 18, 28; P.A. 88-266, S. 29, 46; P.A. 93-96, S. 3.)
History: P.A. 88-266 inserted references to obligations of state in Subdivs. (1) and (2) and added Subdiv. (6) re investment
"in other obligations which are legal investments for savings banks in the state"; P.A. 93-96 amended Subdiv. (2) to allow
investment in Connecticut's Short-Term Investment Fund and added Subdivs. (7) and (8).
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(P.A. 82-313, S. 19, 28.)
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(P.A. 82-313, S. 20, 28; P.A. 87-295, S. 6, 8; P.A. 88-266, S. 30, 46.)
History: P.A. 87-295 substituted "December" for "January", provided that the report be made to the joint standing
committees of the general assembly having cognizance of matters relating to education and finance, revenue and bonding,
in Subdiv. (1) substituted "borrowers" for "institutions for higher education", added new Subdiv. (5) re students attending
in-state and out-of-state institutions, renumbered old Subdiv. (5) as new Subdiv. (6) and made technical changes; P.A. 88-
266 substituted "board of directors" for "members".
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(b) Notwithstanding the provisions of sections 37-4 and 37-6, it shall be lawful: (1)
For the authority to establish, charge, contract for and receive any amount or rate of
interest or compensation with respect to authority loans or education loans; (2) to make
authority loans or education loans at a rate of interest which may, during the life of such
loans, be varied or revised upon such terms or conditions as may be established by the
authority; and (3) for any Connecticut institution for higher education to charge, contract
for and receive any amount or rate of interest or compensation, including amounts or
rates of interest which may be varied or revised upon such terms or conditions as may
be established by the institution, with respect to education loans.
(P.A. 82-313, S. 21, 28; P.A. 87-295, S. 7, 8.)
History: P.A. 87-295 in Subdiv. (3) of Subsec. (b) substituted "Connecticut institution for" for "institution of".
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(P.A. 82-313, S. 22, 28.)
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(P.A. 82-313, S. 23, 28; P.A. 88-266, S. 31, 46.)
History: P.A. 88-266 provided that the authority shall not be construed to be a department, institution or agency of
the state.
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(P.A. 82-313, S. 24, 28.)
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(P.A. 82-313, S. 25, 28; P.A. 88-266, S. 32, 46.)
History: P.A. 88-266 inserted reference to board of directors.
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(P.A. 82-313, S. 26, 28.)
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