An Act To Include Institutions Providing an Educational Program among Entities Eligible To Borrow from the Maine Health and Higher Educational Facilities Authority
Maine Legislature, Session 123, LD 1899
Committee: Health and Human Services
Sponsors: ADAMS, EDMONDS, CUMMINGS
Amends: 22 MRSA §2053, 22 MRSA §2054, 22 MRSA §2055, 22 MRSA §2058, 22 MRSA §2060, 22 MRSA §2061, 22 MRSA §2064, 22 MRSA §2072

Legislative Document 
No. 1899 
H.P.1332 
House of Representatives, May 8, 2007 
An Act To Include Institutions Providing an Educational Program 
among Entities Eligible To Borrow from the Maine Health and 
Higher Educational Facilities Authority 
Reference to the Committee on Health and Human Services suggested and ordered printed. 
Presented by Representative ADAMS of Portland. 
Cosponsored by President EDMONDS of Cumberland and 
Representative: Speaker CUMMINGS of Portland. 
Printtd on recycled paper 
1!/~1'J?~ 
MILLICENT M. MacFARLAND 
Clerk 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 22 MRS A §2052, as amended by PL 1993, c. 390, § 1, is further amended 
to read: 
§2052. Declaration of necessity 
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 health care facilities within the State be provided with 
appropriate additional means to expand, enlarge and establish health care facilities and 
other related facilities; that this and future generations of students be given the fullest 
opportunity to learn and to develop their intellectual capacities; and that it is the purpose 
of this chapter to provide a measure of assistance and an alternative method to enable 
health care facilities aHd, institutions for higher education and nonprofit institutions 
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providing an educational program in the State to provide the facilities and structures 
needed to accomplish the purposes ofthis chapter, all to the public benefit and good, and 
the exercise of the powers, to the extent and manner provided in this chapter, is declared 
the exercise of an essential governmental function. 
Sec. 2. 22 MRSA §2053, sub-§2, as amended by PL 1993, c. 390, §2, is further 
amended to read: 
2. Bonds and notes. "Bonds" and "notes" mean bonds and notes of the authority 
issued under this chapter, including refunding bonds, notwithstanding that the same may 
be secured by mortgage or the full faith and credit of the authority or the full faith and 
credit of a participating health care facility er-ef, a participating institution for higher 
education or a participating' institution providing an educational program, or any other 
lawfully pledged security of a participating health care facility eF-Bf, a participating 
institution for higher education or a participating institution providing an educational 
program. 
Sec. 3. 22 MRSA §2053, sub-§3-B, as enacted by PL 1997, c. 385, §1, is 
amended to read: 
3-B. Eligible entity. "Eligible entity" means a facility or institution eligible to 
participate in financing or other borrowing services authorized by this chapter and 
includes a participating community health or social service facility, a participating health 
care facility ef, a participating institution for higher education or a participating 
institution providing an educational program. 
Sec. 4. 22 MRS A §2053, sub-§4-E is enacted to read: 
4-E. Institution providing an educational program. "Institution providing an 
educational program" means a nonprofit or charitable institution, public or private, that is 
exempt from federal taxation pursuant to the United States Internal Revenue Code of 
1986, as amended, Section 501 and that provides a program of education for the purpose 
of enhancing the knowledge or abilities of its members or the general public. 
Sec. 5. 22 MRS A §2053, sub-§5-B is enacted to read: 
5-B. Participating institution providing an educational program. "Participating 
institution providing an educational program" means an institution providing an 
educational program that, pursuant to this chapter, undertakes the financing and 
construction or acquisition of a project or undertakes the refunding or refinancing of 
obligations or of a mortgage or of advances as provided in and permitted by this chapter. 
Sec. 6. 22 MRSA §2053, sub-§6, as amended by PL 1995, c. 179, §3, is further 
amended to read: 
6. Project. "Project" means: 
lOA. In the case of a participating health care facility or a participating community 
health or social service facility, the acquisition, construction, improvement, 
reconstruction or equipping of, or construction of an addition or additions to, a 
structure designed for use as a health care facility, community health or social service 
facility, congregate housing facility, laboratory, laundry, nurses or interns residence 
or other multi uRit multiunit housing facility for staff, employees, patients or relatives 
of patients admitted for treatment in the health care facility, community health or 
social service facility, doctors office building, administration building, research 
facility, maintenance, storage or utility facility or other structures or facilities related 
to any of the foregoing or required or useful for the operation of the project, or the 
refinancing of existing indebtedness in connection with any of the foregoing, 
including parking and other facilities or structures essential or convenient for the 
orderly conduct of the health care facility or community health or social service 
facility. "Project" also includes all real and personal property, lands, improvements, 
driveways, roads, approaches, pedestrian access roads, rights-of-way, utilities, 
easements and other interests in land, parking lots, machinery and equipment, and all 
other appurtenances and facilities either on, above or under the ground that are used 
or usable in connection with the structures mentioned in this paragraph, and includes 
landscaping, site preparation, furniture, machinery and equipment and other similar 
items necessary or convenient for the operation of a particular facility or structure in 
the manner for which its use is intended, but does not include such items as food, 
fuel, supplies or other items that are customarily considered as a current operating 
charge. 
In the case of a hospital, as defined in subsection 4, paragraph B, a 
community health center or a community health or social service facility, "project" 
does not include any facilities, structures or appurtenances, the use of which is not 
directly related to the provision of patient care by its members; ana 
B. 
In the case of a participating institution for higher education, the acquisition, 
construction, improvement, reconstruction or equipping of, or construction of an 
addition or additions to, any structure designed for use as a dormitory or other 
housing facility, dining facility, student union, academic building, administrative 
facility, library, classroom building, research facility, faculty facility, office facility, 
athletic facility, health care facility, laboratory, maintenance, storage or utility facility 
or other building or structure essential, necessary or useful for instruction in a 
program of education provided by an institution for higher education, including a 
parking facility, or any multi purpose mUltipurpose structure designed to combine 2 
or more of the functions performed by the types of structures enumerated in this 
paragraph. "Project" includes all real and personal property, lands, improvements, 
driveways, roads, approaches, pedestrian access roads, rights-of-way, utilities, 
easements and other interests in land, machinery and equipment, and all 
appurtenances and facilities either on, above or under the ground wffieI:t that are used 
or usable in connection with any of the structures mentioned in this paragraph, and 
also includes landscaping, site preparation, furniture, machinery, equipment and other 
similar items necessary or convenient for the operation of a particular facility or 
structure in the manner for which its use is intended, but does not include such items 
as books, fuel, supplies or other items wffieI:t that are customarily considered as a 
current operating charge~; and 
C. In the case of a participating institution providing an educational program, the 
. acquisition, construction, improvement, reconstruction or equipping of, 
or 
construction of an addition or additions to, any structure designed for use as a 
dormitory or other housing facility, dining facility, student union, academic building, 
administrative facility, library, classroom building, research facility, faculty facility, 
office facility, athletic facility, health care facility, laboratory, maintenance, storage 
or utility facility, exhibition facility or space, performing arts facility. museum, 
theater, studio or other building or structure essential, necessary or useful to the 
participating institution providing an educational program, including a parkiD.g 
facility or any multipurpose structure designed to combine 2 or more of the functions 
performed by the types of structures enumerated in this paragraph. "Project" includes 
all real and personal property, lands, improvements, driveways. roads, approaches, 
pedestrian access roads, rights-of-way, utilities, easements and other interests in land, 
machinery and equipment, anc ~,; ~ppurtenances and facilities either on, above or 
under the ground that are usel. or ; 'able in connection with any of the structures 
mentioned in this paragraph, and also includes landscaping, site preparation, 
furniture, machinery, equipment and other_ similar items necessary or convenient for 
the operation of a particular facility or structure in the manner for which its use is 
intended, but does not include such items as books, fuel, supplies or other items that 
are customarily considered as a current operating charge. 
Sec. 7. 22 MRS A §2053, sub-§7, as amended by PL 1993, c. 390, §9, is further 
amended to read: 
7. Refinancing of existing indebtedness. "Refinancing of existing indebtedness" 
means liquidation, with the proceeds of bonds or notes issued by the authority, of an 
indebtedness of a health care facility ef..........ill! institution for higher education or a 
participating institution providing an educational program incurred to finance or aid in 
financing a lawful purpose of that health care facility ef~ institution for higher education 
or participating institution providing an educational program not financed pursuant to this 
chapter that would constitute a project had it been undertaken and financed by the 
authority, or consolidation of such indebtedness with indebtedness of the authority 
incurred for a project related to the purpose for which the indebtedness of the health care 
facility ef~ institution for higher education or participating institution providing an 
educational program was incurred. 
Sec. 8. 22 MRSA §2054, sub-§7, as amended by PL 1993, c. 390, § 11, is further 
amended to read: 
7. Conflict of interest. Notwithstanding any other law to the contrary, it does not 
constitute a conflict of interest for a trustee, director, officer or employee of a health care 
facility or a participating institution providing an educational program or for a trustee, 
member of a corporation or board of governors, officer or employee of an institution for 
higher education to serve as a member of the authority, if SttGh that trustee, director, 
member of a corporation or board of governors, officer or employee abstains from 
deliberation, action and vote by the authority under this chapter in specific respect to the 
health care facility ef~ institution for higher education or 
participating institution 
providing an educational program uf which SttGh that member is a trustee, director, 
member of a corporation or board of governors, officer or employee. 
Sec. 9. 22 MRS A §2055, first ~, as amended by PL 1993, c. 390, § 12, is further 
amended to read: 
The purpose of the authority is to assist participating health care 
facilities~ 
participating institutions providing an educational program and participating institutions 
for higher education in the undertaking of projects and the refinancing of existing 
indebtedness that are declared to be public purposes~ and for the purposes of this chapter 
the authority is authorized and empowered: 
Sec. 10. 22 MRSA §2055, sub-§5, as amended by PL 1993, c. 390, §13, IS 
further amended to read: 
5. Projects. To determine the location and character of any project to be financed 
under this chapter, and to acquire, construct, reconstruct, renovate, improve, replace, 
maintain, repair, extend, enlarge, operate, lease, as lessee or lessor, and regulate the same, 
to enter into contracts for any or all of such purposes, to enter into contracts for the 
management and operation of a project, and to designate a participating health care 
facility ef~ a participating institution for higher education or a participating institution 
providing an educational program as its agent to determine the location and character of a 
project undertaken by the participating health care facility ef~ participating institution for 
higher education or participating institution providing an educational program under this 
chapter and, as the agent of the authority, to acquire, construct, reconstruct, renovate, 
improve, replace, maintain, repair, extend, enlarge, operate, lease, as lessee or lessor, and 
regulate the same;- and, as the agent of the authority, to enter into contracts for any or all 
of such purposes, including contracts for the management and operation of such project; 
Sec. 11. 22 MRSA §2055, sub-§8, as amended by PL 1993, c. 390, § 14, is 
further amended to read: 
n 
8. 
Rule~. To establish rules for the use of a project or any portion thereof and to 
designate a participating health care facility ef~ a participating institution for higher 
education or a participating institution providing an educational program as its agent to 
establish rules for the use of a project undertaken by the participating health care facility 
Sf, participating institution for higher education or participating institution providing an 
educational program; 
I 
Sec. 12. 22 MRSA §2055, sub-§12, as amended by PL 1993, c. 390, § 15, is 
further amended to read: 
12. 
Loans. To make loans to a participating health care facility, participating 
institution for higher education, participating institution providing an educational 
program, other entity eligible to use the authority or consortium of entities eligible to use 
the authority for the cost of a project in accordance with an agreement between the 
authority and the participating entity or entities, except that no such loan may exceed the 
total cost of the project as determined by the participating entity or entities and approved 
by the authority; 
Sec. 13. 22 MRSA §2055, sub-§13, as amended by PL 1993, c. 390, §16, is 
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further amended to read: 
13. Refund. To make loans to a participating health care facility eF~ a participating 
institution for higher education or a participating institution providing an educational 
program to refund outstanding obligations, mortgages or advances issued, made or given 
by such ~ participating health care facility eF~ participating institution for higher 
education or participating institution providing an educational program for the cost of the 
project; 
Sec. 14. 22 MRSA §2055, sub-§14, as amended by PL 1997, c. 385, §2, IS 
further amended to read: 
14. Apportionment. To charge to and equitably apportion among participating 
health care facilities and~ participating institutions for higher education and participating 
institutions providing an educational program its administrative costs and expenses 
incurred in the exercise of the powers and duties conferred by this chapter; 
Sec. 15. 22 MRSA §2055, sub-§15, as amended by PL 1997, c. 385, §3, IS 
further amended to read: 
15. Other acts. 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 undertake a 
project for 2 or more participating health care facilities jointly eF~ 2 or more participating 
institutions for higher education jointly or 2 or more participating institutions providing 
educational programs, and, upon undertaking the project, all other provisions of this 
chapter apply to and for the benefit of the authority and such joint participants; 
Sec. 16. 22 MRS A §2057, as amended by PL 1993, c. 390, § 19, IS further 
amended to read: 
§2057. Acquisition of property by authority 
The authority is authorized and empowered, directly or by and through a participating 
health care facility eF~ a participating institution for higher education or a participating 
institution providing an educational program, as its agent, to acquire by purchase or by 
gift or devise such lands, structures, property, real or personal, rights and air rights, 
rights-of-way, franchises, easements and other interests in lands, including lands lying 
under water and riparian rights, and air rights, that are located inside or outside the State, 
as it detennines necessary or convenient for the construction or operation of a project, 
upon such tenns and at such prices as may be considered by it to be reasonable and can 
be agreed upon between it and the owner of lands, including lands lying under water and 
riparian rights, and air rights, that are located inside or outside the State, and to take title 
to lands, including lands lying under water and riparian rights, and air rights, that are 
located inside or outside the State in the name of the authority or in the name of a 
participating health care facility ef, a participating institution for higher education or a 
participating institution providing an educational program as its agent. 
Sec. 17. 22 MRSA §2058, as amended by PL 1993, c. 390, §20, IS further 
II 
amended to read: 
§2058. Conveyance of title to participating institutions 
When the principal of and interest on bonds of the authority issued to finance the cost 
of a particular project or projects for a participating health care facility ef, a participating 
institution for higher education or a participating institution providing an educational 
program, 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 resolution or trust agreement authorizing 
and securing the same have been satisfied and the lien of such resolution or trust 
agreement has been released in accordance with the provisions of the bonds, the authority 
shall promptly do such things and execute such deeds and conveyances as are necessary 
and required to convey title to such project or projects to such participating health care 
facility ef, participating institution for higher education or participating institution 
providing an educational program, free and clear of all liens and encumbrances, all to the 
extent that title to such project or projects is not, at the time, vested in such participating 
health care facility ef ... participating institution for higher education or participating 
institution providing an educational program. 
Sec. 18. 22 MRSA §2060, sub-§2, as amended by PL 1993, c. 390, §21, IS 
further amended to read: 
2. General obligations. Except as may otherwise be expressly provided by the 
authority, every issue of its bonds, notes or other obligations is a general obligation of the 
authority payable from revenues or money of the authority available for the payment of 
the obligation and not otherwise pledged, subject only to agreements with the holders of 
particular bonds, notes or other obligations pledging particular revenues or money and 
subject to any agreements with a participating health care facility ef, participating 
institution for higher education or participating institution providing an educational 
program. Notwithstanding that such bonds, notes or other obligations may be payable 
from a special fund, they are and must be deemed to be for all purposes negotiable 
instruments within the meaning of and for all the purposes of the Unifonn Commercial 
Code, Article 8, subject only to the provisions of such bonds, notes or other obligations 
for registration. 
Sec. 19. 22 MRS A §2060, sub-§4, ~A, as amended by PL 1993, c. 390, §22, is 
further amended to read: 
A. 
Pledging the full faith and credit of the authority, the full faith and credit of a 
participating health care facility eF~ a participating institution of higher education or a 
participating institution providing an educational program, all or a part of the 
revenues of a project or a revenue-producing contract or contracts made by the 
authority with an individual, partnership, corporation or association or other body, 
public or private, to secure the payment of the bonds or of a particular issue of bonds, 
subject to such agreements with bondholders as may then exist; 
-Sec. 20. 22 MRS A §2061, sub-§l, as amended by PL 1993, c. 390, §23, is 
further amended to read: 
1. Assistance. Such ~ project will enable or assist a health care facility to fulfill its 
obligation to provide health care facilities eF~ an institution for higher education to 
provide educational facilities within the State or a participating institution providing an 
educational program to fulfill its mission within the State; 
Sec. 21. 22 MRSA §2061, sub-§3, as amended by PL 2001, c. 609, § 1, is further 
amended to read: 
3. Lease. Such ~ project will be leased to, or owned by, a health care facility eF~ 
institution for higher education or institution providing an educational program inside the 
State; 
Sec. 22. 22 MRS A §2063, as amended by PL 1993, c. 390, §26, is further 
amended to read: 
§2063. Credit of State not pledged 
Bonds and notes issued under this chapter do not constitute or create a debt or debts, 
liability or liabilities on behalf of the State or of a political subdivision of the State other 
than the authority or a loan of the credit of the State or a pledge of the faith and credit of 
the State or of any such political subdivision other than the authority, but are payable 
solely from the funds provided for the bonds and notes. All such bonds and notes must 
contain on the face of the bonds and notes a statement to the effect that neither the State 
nor a political subdivision of the State is obligated to pay the same or the interest on the 
bonds and notes, except from revenues of the project or the portion of the project for 
which they are issued and that neither the faith and credit nor the taxing power of the 
State or of a political subdivision of the State is pledged to the payment ofthe principal of 
or the interest on such bonds or notes. The issuance of bonds or notes under this chapter 
may not directly or indirectly or contingently obligate the State or a political subdivision 
of the State to levy or to pledge any form of taxation whatever for the bonds and notes or 
to make an appropriation for their payment. Nothing in this section may prevent nor be 
construed to prevent the authority from pledging its full faith and credit or the full faith 
and credit of a participating health care facility eF, participating institution for higher 
education or participating institution providing an educational program to the payment of 
bonds or notes or issue of notes or bonds authorized pursuant to this chapter. 
Sec. 23. 22 MRSA §2064, as corrected by RR 1993, c. 2, § 12, is amended to 
read: 
§2064. Rents and charges 
The authority is authorized to fix, revise, charge and collect rates, rents, fees and 
charges for the use of and for the services furnished or to be furnished by each project 
and to contract with a person, partnership, association or corporation, or other body, 
public or private, in respect of rates, rents, fees and charges. Such rates, rents, fees and 
charges must be fixed and adjusted in respect of the aggregate of rates, rents, fees and 
charges from such project so as to provide funds sufficient with other revenues or money 
available for the project, if any, to pay the cost of maintaining, repairing and operating the 
project and each and every portion of the project, to the extent that the payment of such 
cost has not otherwise been adequately provided for, to pay the principal of and the 
I 
interest on outstanding bonds or notes of the authority issued in respect of such project as 
the same become due and payable, and to create and maintain reserves required or 
provided for in a resolution authorizing, or trust agreement securing, such bonds or notes 
of the authority. Such rates, rents, fees and charges are not subject to supervision or 
regulation by a department, commission, board, body, bureau or agency of this State 
other than the authority. A sufficient amount of the revenues derived in respect of a 
project, except such part of such revenues as may be necessary to pay the cost of 
maintenance, repair and operation and to provide reserves and for renewals, 
replacements, extensions, enlargements and improvements as may be provided for in the 
resolution authorizing the issuance of bonds or notes of the authority or in the trust 
agreement securing the same, must be set aside at such regular intervals as may be 
provided in such resolution or trust agreement in a sinking or other similar fund that is 
pledged to, and charged with, the payment of the principal of and the interest on such 
bonds or notes as the same become due, and the redemption price or the purchase price of 
bonds retired by call or purchase as therein provided. Such pledge is valid and binding 
from the time when the pledge is made; the rates, rents, fees and charges and other 
revenues or other money so pledged and later received by the authority are immediately 
subject to the lien of such pledge without any physical delivery of the revenues or money 
or further act, and the lien of any such pledge is valid and binding as against all parties 
having claims of any kind in tort, contract or otherwise against the authority, irrespective 
of whether such parties have notice of the lien. 
Neither the resolution nor a trust 
agreement nor any other agreement nor any lease by which a pledge is created need be 
filed or recorded except in the records of the authority. The use and disposition of money 
to the credit of such sinking or other similar fund are subject to 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 
may be a fund for alJ such bonds or notes issued to finance projects at a particular 
participating health care facility ef, participating institution for higher education or 
participating institution providing an educational program 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 is the fund for a particular project at a 
participating health care facility ef, participating institution for higher education or 
participating institution providing an educational program and for the bonds issued to 
finance a particular project and may, additionally, permit and provide for the issuance of 
bonds having a subordinate lien in respect of the security authorized in this chapter to 
other bonds of the authority, and, in such case, the authority may create separate sinking 
or other similar funds in respect of such subordinate lien bonds. 
I 
Sec. 24. 22 MRSA §2072, as amended by PL 1993, c. 390, §28, IS further 
amended to read: 
§2072. Agreement of the State 
The State pledges to and agrees with the holders of bonds, notes and other obligations 
issued under this chapter, and with those parties who may enter into contracts with the 
authority pursuant to this chapter, that the State will not limit, alter, restrict or impair the 
rights hereby vested in the authority and the participating health care facilities aOO~ the 
participating institutions for higher education and the participating institutions providing 
an educational program to acquire, construct, reconstruct, maintain and operate a project 
as defined in this chapter or to establish, revise, charge and collect rates, rents, fees and 
I I 
other charges as may be convenient or necessary to produce sufficient revenues to meet 
the expenses of maintenance and operation of the project and to fulfill the terms of any 
agreements made with the holders of bonds, notes or other obligations authorized and 
issued by this chapter, and with the parties who may enter into contracts with the 
authority pursuant to this chapter, or in any way impair the rights or remedies of the 
holders of such bonds, notes or other obligations of such parties until the bonds, notes and 
such other obligations, together with interest on the bonds, notes and other obligations, 
with interest on any unpaid installment of interest and all costs and expenses in 
connection with an action or proceeding by or on behalf of the bondho Iders, are fully met 
and discharged and such contracts are fully performed on the part of the authority. 
Nothing in this chapter precludes such limitation or alteration if and when adequate 
provision is made by law for the protection of the holders of such bonds, notes or other 
obligations 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, 
notes or other obligations or contracts. 
SUMMARY 
This bill allows eligible institutions providing an educational program that meet 
underwriting requirements of the Maine Health and Higher Educational Facilities 
Authority to borrow from the authority.