V.I. Code tit. 21, § 104 (2019)
2019 US Virgin Islands Code|Title 21 - Homesteads and Home Loans|Chapter 2 - Home Owners Construction and Mortgage Assistance|§ 104. Issuance of bonds and notes

 (a) Notwithstanding any other provision of law to the contrary, the Authority shall authorize from time to time the sale by the Director of the Office of Management and Budget of bonds and notes of the Government of the Virgin Islands in such principal amounts as may be set forth in a declaration of the Authority as the Authority deems necessary to provide sufficient funds for achieving the purposes of this chapter; Provided, however, That the aggregate principal amount of bonds and notes that may be issued under this chapter shall not exceed $250,000,000 outstanding at any time. In computing the total amount of bonds and notes which may at any time be outstanding for any purpose under this chapter the amount of the outstanding bonds and notes retired or refunded or to be retired or refunded from the proceeds of the sale of new bonds and notes or by exchange of new bonds and notes shall be excluded. In computing the total amount of bonds and notes that may at any time be outstanding for any purpose under this chapter the amount of the outstanding bonds and notes that constitutes interest under the United States Internal Revenue Code of 1954, as amended, shall also be excluded. Any such bonds or notes may be separately secured in accordance with the pledge contained in the declaration authorizing such bonds or notes. The Director of the Office of Management and Budget is authorized and empowered to sell bonds and notes as authorized by the Authority. (b) The Authority shall have the power pursuant to declaration, from time to time, to issue (1) notes to renew notes and (2) bonds to pay notes, including the interest thereon, and (3) whenever it deems refunding expedient, to refund any bonds by the issuance of new bonds, whether the bonds to be refunded have or have not matured, and to issue bonds partly to refund bonds then outstanding for any of the purposes of this chapter. The refunding bonds may be exchanged for the bonds to be refunded or sold and the proceeds applied to the purchase, redemption or payment of such bonds. (c) The bonds and notes shall be issued after declaration of the Authority, shall be in such amounts, shall bear such date or dates and shall mature at such time or times not exceeding thirty (30) years from the date thereof as such declaration may provide. The bonds may be issued as serial bonds or as term bonds or as a combination thereof. The bonds and notes shall be in registered form, and shall bear interest, if any, at such rate or rates, be payable at such time, be in such denominations, carry such exchange, transfer ad registration privileges, be executed in such manner and by such officials of the Authority, be payable in such medium of payment, at such place or places, and be subject to such terms of redemption, as such declaration may provide. Such bonds and notes shall be sold by the Authority in accordance with the Revised Organic Act, either public or private, at such price or prices as the Authority shall determine. The declaration shall designate a trustee to make payment on the bonds and the interest thereon and to hold and invest any reserves and other funds and may name or determine the manner of selection of paying agents. (d) Any declaration authorizing bonds or notes or any issue thereof may contain provisions, which shall be a part of the contract or contracts with the holders thereof: (i) to pledge all or any part of the pledged assets, including the revenues or receipts derived by the Authority from the home mortgages, to the punctual payment of bonds or notes issued for such home mortgages, and interest thereon, and to covenant against thereafter pledging any such revenues or receipts to any other bonds or notes of the Authority for any other purpose, except as otherwise provided in the declaration with respect to the issuance of additional bonds or notes to be equally and ratably secured by a lien upon such pledged revenues and receipts; (ii) to covenant as to limitations on the use and purposes and disposition of the proceeds from the sale of such bonds or notes and the pledging of such proceeds to secure the bonds or notes or of any issue thereof; (iii) to covenant as to the rates or charges fixed in connection with the home mortgages for which such bonds or notes are to be issued and as to the use and disposition to be made thereof, including the maximum interest rate payable on any home mortgage or loan; (iv) to provide for the replacement of lost, destroyed, stolen or mutilated bonds or notes; (v) to provide limitations on the issuance of additional bonds or notes the terms upon which additional bonds or notes may be issued and secured and the refunding of outstanding or other bonds or notes; (vi) the procedure, if any, by which the terms of any contract with bondholders or noteholders may be amended or abrogated, the amount of bonds and notes the holders of which must consent thereto, and the manner in which such consent may be given; (vii) limitations on the amount of monies to be expended by the Authority for its operating expenses with respect to construction and home mortgage loans; (viii) vesting in a trustee or trustees, which may or may not be located within the territory, property, rights, powers and duties in trust as the Authority may determine, which may include any or all of the rights, powers and duties of the trustee appointed by the bondholders or noteholders pursuant to this chapter and limiting or abrogating the right of the bondholders or noteholders to appoint a trustee under this chapter or limiting the rights, powers and duties of such trustee; (ix) to covenant to set aside or pay over reserves and sinking funds for such bonds or notes as to the regulation and disposition thereof; (x) to redeem such bonds or notes, and to covenant for their redemption and to provide the terms and conditions thereof; (xi) to covenant and prescribe as to what happenings or occurrences shall constitute “events of default” as to such bonds or notes and to provide for the rights and remedies of the holders of the bonds or notes in the event of such default, including the right to appointment of a receiver; (xii) to covenant as to the terms and conditions upon which any or all of such bonds or notes shall become or may be declared due before maturity and as to the terms and conditions upon which such declaration and its consequences may be waived; (xiii) to covenant as to the rights, liabilities, powers and duties arising upon the breach by the Authority of any covenant, conditions or obligations; (xiv) to vest in a trustee or trustees or custodian or custodians the right to receive all or any part of the revenues and receipts pledged and assigned to, or for the benefit of, the holder or holders of bonds or notes issued hereunder, and to hold, apply and dispose of the same, including the investment thereof, and the right to enforce any covenant made to secure or pay in relation to the bonds or notes; to execute and deliver a trust agreement or trust agreements which may set forth the powers and duties and the remedies available to such trustee or trustees or custodian or custodians and limiting the liabilities thereof and describing what happenings or occurrences shall constitute evidence of default and prescribing the terms and conditions upon which such trustee or trustees or custodian or custodians or the holder or holders of bonds or notes of any specified amount or percentage of such bonds or notes may exercise such rights and enforce any and all such covenants and resort to such remedies as may be appropriate; (xv) to execute all instruments necessary or convenient in the exercise of the powers herein granted or in the performance of its covenants and duties; (xvi) to make such covenants and do any and all such acts and things as may be necessary or convenient or desirable in order to protect and secure such bonds or notes and the holders thereof, or in the discretion of the Authority, tend to make such bonds or notes more marketable, notwithstanding that such covenants, acts or things may not be enumerated herein, it being the purpose hereof to give the Authority on behalf of the government power to do all things in the issuance of the bonds or notes and for their security. (e) Any pledge made by the Authority shall be valid and binding from the time when the pledge is made, and the revenues or property so pledged and thereafter received by the government shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act. The lien of any such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the government, without regard to whether such parties have notice thereof. Neither the declaration nor any other instrument by which a pledge is created need be recorded. There shall be created in the declaration of the Authority a lien, by this chapter made a statutory lien, upon the pledged assets, to and in favor of the holders of such bonds and notes and any interest coupons appertaining thereto, which lien shall be a first lien upon such pledged assets. The pledged assets shall be and remain subject to the statutory lien until the payment in full of the principal of, redemption premium, if any, and interest on the bonds or notes unless the declaration of the Authority provides for earlier discharge of the lien by substitution of other security or unless the earlier discharge of the lien occurs in the process of enforcement, collection, liquidation or sale of any pledged assets, in which case the lien shall attach to the proceeds of such process. The statutory lien shall be construed to give the trustee or custodian acting on behalf of the holders or owners of a bond, note or coupon authority to compel the sale of home mortgage loans or investments the payment of which are pledged to the bonds or notes. (f) There shall be plainly stated on the face of each bond and note language to the effect: that it is issued under the provisions of this chapter; that it is a limited obligation and not a general obligation of the government; that it does not constitute a general obligation or an indebtedness or loan of credit of the government within any applicable statutory limitation or of the United States; that the principal of, redemption premium, if any, and interest on the bond or note are payable solely from pledged assets which shall be identified by reference to the home mortgage revenue bond program for which the bonds or notes are issued; and that the payment of the principal of, redemption premium, if any, and interest on the bond or note are secured by a statutory lien on the pledged assets. There shall be plainly stated on the face of each interest coupon language to the effect that the coupon is not a general obligation of the government and is payable solely from certain pledged assets set forth in the bond or note to which such coupon appertains. (g) Any declaration authorizing bonds or notes under this chapter shall provide that such bonds or notes shall contain a recital that they are issued pursuant to this chapter, which recital shall be conclusive evidence of their validity and the regularity of their issuance. (h) Pending the preparation or delivery of the definitive bonds or notes, interim certificates or other temporary obligations may be issued by the Authority to the purchaser of said bonds or notes. Such interim certificates or other temporary obligations shall be in such form and contain such terms, conditions and provisions as the Authority may determine. (i) The validity of the authorization and issuance of the bonds or notes authorized under this chapter shall not be dependent on or affected in any way by proceedings relating to home mortgages for which the bonds or notes are issued. Bonds or notes issued under this chapter bearing the signatures of officers in office on the date of the signing thereof shall be valid and binding obligations, notwithstanding that before the delivery thereof any or all of the persons whose signatures appear thereon shall have ceased to be officers of the Authority. (j) All bonds and notes issued under the provisions of this chapter shall be limited obligations of the government payable solely out of the revenues and receipts derived from the pledged assets and the mortgages or from any notes or other obligations of lending institutions with respect to which such bonds or notes are issued. No holder of any bonds or notes issued under the provisions of this chapter shall have the right to compel any exercise of the taxing power of the government to pay the bonds or notes, or the interest or redemption premium, if any, thereon, and the bonds or notes shall not constitute a general obligation or an indebtedness or loan of credit of the government within the meaning of any applicable statutory limitation (except the limit set forth in subsection (a) hereof), nor shall the amount of the bonds be included in computing the net bonded indebtedness of the government for the purposes of debt limitations imposed by any statutory or charter provisions (except the limit set forth in subsection (a) hereof). No officer, employee or agent of the Authority or the government nor any person executing any bond or note or coupon appertaining thereto shall be liable personally or be subject to any personal liability or accountability by reason of the issuance thereof. (k) The bonds and notes shall have all the qualities of negotiable instruments under the laws of the Virgin Islands. The bonds and notes of the government issued pursuant to this chapter are hereby made securities in which all public officers and bodies of the territory and all public corporations and subdivisions, all insurance companies and associations and other persons carrying on an insurance business, all banks, bankers, trust companies, savings banks and savings associations, including savings and loan associations, building and loan associations, investment companies and other persons carrying on a banking business, all administrators, guardians, executors, trustees and other fiduciaries, and all other persons whatsoever who are now or may hereafter be authorized to invest in bonds or in other obligations of the government, may properly and legally invest funds, including capital, in their control or belonging to them. The bonds and notes are also hereby made securities which may be deposited with and may be received by all public officers and bodies of the territory and all public corporations for any purpose of which the deposit of bonds or other obligations of the territory is now or may hereafter be authorized. (l) Pursuant to the purposes and provisions of this chapter, and in accordance with section 8(b)(i) of the Revised Organic Act of the Virgin Islands, as amended, all such bonds issued by the Authority pursuant to this chapter shall be exempt as to principal and interest from taxation by the Government of the United States, or by the government of the Virgin Islands, or by any State, Territory, or possession or by any political subdivision of any State, Territory, or possession, or by the District of Columbia.