2023 New York Laws › PBA - Public Authorities › Article 5 - Public Utility Authorities › Title 11 - Metropolitan Commuter Transportation Authority › 1269 - Notes, Bonds and Other Obligations of the Authority.

§  1269.  Notes,  bonds and other obligations of the authority. 1. (a)
The authority shall have power and is hereby  authorized  from  time  to
time  to  issue its bonds, notes and other obligations in such principal
amount as,  in  the  opinion  of  the  authority,  shall  be  necessary,
convenient  or  desirable  to effectuate any of its powers and purposes,
including to  provide  sufficient  funds  for  achieving  its  purposes,
including  the  acquisition,  establishment, construction, effectuation,
operation,    maintenance,    renovation,    improvement,     extension,
rehabilitation  or repair of any transportation facility, the payment of
principal, redemption premium and interest on  bonds,  notes  and  other
obligations  of  the authority, establishment of reserves to secure such
bonds notes and other obligations, the provision of working capital  and
all other expenditures of the authority and its subsidiary corporations,
and  New  York  city  transit  authority and its subsidiary corporations
incident to and necessary or convenient to carry out their purposes  and
powers.  Such  bonds,  notes  or  other obligations may be issued for an
individual transportation facility or issued on a consolidated basis for
such groups or classes of facilities and projects as  the  authority  in
its  discretion  deems  appropriate  and  be  payable  from  and secured
separately or on a consolidated basis by, among other things, all or any
portion of such revenues and other monies and assets  of  the  authority
and its subsidiary corporations, and New York city transit authority and
its  subsidiary  corporations  as the authority determines in accordance
with the provisions of section twelve hundred seventy-d of this title;
(b) The authority shall have  power,  from  time  to  time,  to  issue
renewal  notes,  to  issue  bonds  to  refund,  redeem or otherwise pay,
including by  purchase  or  tender,  notes  of  the  authority  and  its
subsidiary  corporations,  and  New  York city transit authority and its
subsidiary corporations and whenever it deems refunding,  redemption  or
payment  expedient,  to  refund,  redeem  or otherwise pay, including by
purchase or tender, any  bonds  of  the  authority  and  its  subsidiary
corporations,  New  York  city  transit  authority  and  its  subsidiary
corporations and Triborough bridge and tunnel authority by the  issuance
of  new  bonds,  whether the bonds to be refunded, redeemed or otherwise
paid have or have not matured,  and  to  issue  bonds  partly  for  such
purpose  and  partly  for  any  other  purpose  and to otherwise refund,
redeem, acquire by purchase or tender, or in any  other  way  repay  any
outstanding  notes,  bonds or other obligations of the authority, any of
its subsidiary corporations, New York city transit authority, any of its
subsidiary corporations and Triborough bridge and tunnel authority;
(c) Every issue of its notes, bonds  or  other  obligations  shall  be
general  obligations  or  special  obligations.  Every  issue of general
obligations of the authority shall be payable out  of  any  revenues  or
monies of the authority, subject only to any agreements with the holders
of  particular  notes  or  bonds  pledging  any  particular  receipts or
revenues. Every issue of special obligations shall be payable out of any
revenues, receipts, monies or other assets  of  the  authority  and  its
subsidiary  corporations,  the  New  York city transit authority and its
subsidiary corporations and the Triborough bridge and  tunnel  authority
identified  for  such  purposes  in  accordance with agreements with the
holders of particular notes, bonds or other obligations.  The  authority
may  issue  transportation  revenue  special  obligation bonds, notes or
other obligations as provided in section  twelve  hundred  seventy-d  of
this title;
1-a.  Pension  obligation  bonds.  The authority may from time to time
issue its bonds and notes in such principal amounts as, in  the  opinion
of  the  authority,  shall  be necessary to finance the unfunded pension
fund liabilities of the  authority,  its  affiliates  and  subsidiaries,

provided,  however,  that  in  no  event shall the cumulative amounts of
bonds and notes issued pursuant to the  authority  of  this  subdivision
exceed  one billion two hundred million dollars or sixty percent of such
unfunded  pension  fund  liabilities,  whichever  is less, and provided,
further, that no bonds shall be issued under this subdivision for a term
longer than twenty years. The authority may not issue bonds or notes  in
any  twelve  month  period in a cumulative principal amount in excess of
forty percent of the total amount permitted  to  be  issued  under  this
subdivision.  Prior to the issuance of any bonds or notes, the authority
shall make a finding that such issue is expected to result, on a present
value basis, in a lower effective cost to the authority than funding the
unfunded pension fund liability solely through  the  payment  of  annual
amounts  to  the  pension fund, assuming that the principal component of
the unfunded liability will be amortized over the same number  of  years
as  the term of the bonds or notes and that the interest payable thereon
is the actuarial rate of interest determined  by  the  actuary  for  the
pension  fund  at  the  time of the issuance of such bonds or notes. The
aggregate principal amount of bonds and notes issued for  such  purposes
may  be  increased to fund costs of issuance and may reasonably required
debt service of other reserve funds. Bonds and notes may  be  issued  to
refund  or  otherwise  repay  bonds or notes theretofore issued for such
purposes; provided, however, that upon any such refunding  or  repayment
(including  for  purpose of such calculation the principal amount of the
refunding bonds or notes then to be issued and excluding  the  principal
amount  of  the  bonds  or  notes  so  to be refunded or repaid and also
excluding any amounts used to  pay  costs  of  issuance  and  reasonably
required  debt  service or other reserve funds) the present value of the
aggregate debt service of the refunding or repayment bonds or  notes  to
be  issued  shall  not  exceed  the  present value of the aggregate debt
service of the bonds or notes so to be refunded or repaid. For  purposes
of  the  preceding  sentence,  the  present values of the aggregate debt
service of the  refunding  or  repayment  bonds  or  notes  and  of  the
aggregate debt service of the bonds or notes so to be refunded or repaid
shall  be  calculated  by  utilizing  the effective interest rate of the
refunding or repayment bonds or notes, which shall be that rate  arrived
at  by doubling the semi-annual interest rate (compounded semi-annually)
necessary to discount the debt service  payments  on  the  refunding  or
repayment  bonds  or notes from the payment dates thereof to the date of
issue of the refunding or repayment bonds or notes and to the price  bid
including  estimated  accrued  interest  or  proceeds  received  by  the
authority including estimated accrued interest from  the  sale  thereof.
Debt  service  on  the  bonds  or  notes shall be structured so that the
economic benefits thereof shall be relatively uniform for each full year
throughout the term of the bonds or notes. Beginning with  the  date  of
first  issuance  of  bonds  under  this  section,  the authority and its
subsidiaries shall make annual payments into the pension fund in amounts
at least equal to the current pension contribution liability  applicable
to  such  year.  The  net  proceeds of the bonds or notes intended to be
invested in non-debt securities may be invested by the recipient pension
fund in a fiscally prudent manner  in  securities  consistent  with  any
trust  indentures  and  all  applicable  state  and  federal  law over a
reasonable period of time not less than 30 days following  the  issuance
of  the bonds or notes. The operating budget savings associated with the
issuance of pension obligation bonds during the period from April first,
two  thousand  five,  through  March  thirty-first,  two  thousand  ten,
pursuant  to  this  subdivision  shall  be dedicated to reducing service
eliminations projected to occur within that period.
2. The notes, bonds and  other  obligations  shall  be  authorized  by
resolution approved by not less than a majority vote of the whole number
of  members of the authority then in office, except that in the event of
a tie vote the chairman shall cast  one  additional  vote.  Such  notes,
bonds  and  other  obligations  shall bear such date or dates, and shall
mature at such time or times, in the  case  of  any  such  note  or  any
renewals thereof not exceeding five years from the date of issue of such
original  note,  and  in  the  case of any such bond not exceeding fifty
years from the date of issue, as  such  resolution  or  resolutions  may
provide.  The  notes, bonds and other obligations shall bear interest at
such rate or rates, be in such denominations, be in  such  form,  either
coupon or registered, carry such registration privileges, be executed in
such  manner,  be  payable  in  such medium of payment, at such place or
places and be subject to such terms of redemption as such resolution  or
resolutions  may  provide. The notes, bonds and other obligations of the
authority may be sold by the authority, at public or  private  sale,  at
such price or prices as the authority shall determine. No notes or bonds
of  the authority may be sold by the authority at private sale, however,
unless such sale and the terms thereof have been approved in writing  by
(a)  the  comptroller, where such sale is not to the comptroller, or (b)
the director of the budget, where such sale is to the comptroller.
3. Any resolution or resolutions authorizing any notes, bonds  or  any
issue  thereof,  or  any other obligations of the authority, may contain
provisions, which shall be a part  of  the  contract  with  the  holders
thereof, as to:
(a)  pledging  all  or any part of the revenues of the authority or of
any of its subsidiary corporations or New York city transit authority or
any of its subsidiary  corporations  or  Triborough  bridge  and  tunnel
authority  to  secure  the payment of the notes or bonds or of any issue
thereof, or any other obligations of  the  authority,  subject  to  such
applicable agreements with bondholders, noteholders, or holders of other
obligations  of  the  authority, the New York city transit authority and
its subsidiary corporations, and Triborough bridge and tunnel  authority
as may then exist;
(b)  pledging all or any part of the assets of the authority or of any
of its subsidiary corporations or New York city transit authority or any
of its subsidiary corporations or Triborough bridge and tunnel authority
to secure the payment of the notes or bonds or of any issue of notes  or
bonds,  or  any  other  obligations  of  the  authority, subject to such
agreements  with  noteholders,  bondholders,   or   holders   of   other
obligations  of  the  authority, the New York city transit authority and
its subsidiary corporations, and Triborough bridge and tunnel  authority
as may then exist;
(c)  the  use  and  disposition  of  revenues, including fares, tolls,
rentals, rates,  charges  and  other  fees,  made  or  received  by  the
authority,  any  of  its  subsidiary corporations, New York city transit
authority or any of its subsidiary corporations,  or  Triborough  bridge
and tunnel authority;
(d)  the setting aside of reserves or sinking funds and the regulation
and disposition thereof;
(e) limitations on the purpose to which the proceeds of sale of notes,
bonds or other obligations of the authority may be applied and  pledging
such  proceeds  to  secure  the  payment of the notes or bonds or of any
issue thereof or of other obligations;
(f) limitations on the issuance of additional notes,  bonds  or  other
obligations  of  the  authority;  the terms upon which additional notes,
bonds or other obligations of the authority may be issued  and  secured;

the  refunding of outstanding or other notes, bonds or other obligations
of the authority;
(g)  the  procedure,  if  any, by which the terms of any contract with
noteholders,  bondholders,  or  holders  of  other  obligations  of  the
authority,  may  be  amended or abrogated, the amount of notes, bonds or
other obligations of the authority the holders  of  which  must  consent
thereto, and the manner in which such consent may be given;
(h)  limitations  on  the  amount  of  monies  to  be  expended by the
authority or any of its subsidiary corporations or New York city transit
authority or any of its subsidiary corporations or Triborough bridge and
tunnel authority for operating, administrative or other expenses of  the
authority or any of its subsidiary corporations or New York city transit
authority or any of its subsidiary corporations or Triborough bridge and
tunnel authority;
(i) vesting in a trustee or trustees such 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,  noteholders  or  holders  of  other  obligations  of   the
authority  pursuant  to this title, and limiting or abrogating the right
of the bondholders, noteholders or holders of other obligations  of  the
authority  to  appoint  a  trustee  under  this  article or limiting the
rights, powers and duties of such trustee;
(j) any other matters, of like or different character,  which  in  any
way  affect  the  security  or  protection  of the notes, bonds or other
obligations of the authority.
4. In addition to the powers herein conferred upon  the  authority  to
secure  its notes, bonds and other obligations, the authority shall have
power in  connection  with  the  issuance  of  notes,  bonds  and  other
obligations  to  enter  into  such  agreements as the authority may deem
necessary, convenient or desirable concerning the use or disposition  of
the  monies  or  property  of  any  of  the  authority,  its  subsidiary
corporations, New York city transit authority, or any of its  subsidiary
corporations,  or  Triborough bridge and tunnel authority, including the
mortgaging of any such property and the entrusting, pledging or creation
of any other security interest in any such monies or  property  and  the
doing  of  any  act  (including refraining from doing any act) which the
authority would have the right to do in the absence of such  agreements.
The  authority  shall  have  power  to enter into amendments of any such
agreements within the powers granted to the authority by this title  and
to perform such agreements. The provisions of any such agreements may be
made  a  part  of  the contract with the holders of the notes, bonds and
other obligations of the authority.
5. It is the intention hereof that any pledge,  mortgage  or  security
instrument  made  by  the  authority shall be valid and binding from the
time when the pledge, mortgage or security instrument is made; that  the
monies  or  property  so pledged, mortgaged and entrusted and thereafter
received by the authority, or any of its subsidiary  corporations  shall
immediately  be subject to the lien of such pledge, mortgage or security
instrument without any physical delivery thereof  or  further  act;  and
that  the lien of any such pledge, mortgage or security instrument shall
be valid and binding as against all parties having claims of any kind in
tort, contract or  otherwise  against  the  authority,  or  any  of  its
subsidiary  corporations,  irrespective  of  whether  such  parties have
notice thereof.  Neither  the  resolution  nor  any  mortgage,  security
instrument or other instrument by which a pledge, mortgage lien or other
security  is created need be recorded or filed and neither the authority
nor, any of its subsidiary corporations shall be required to comply with
any of the provisions of the uniform commercial code.
6. Neither the members of the authority, the  New  York  city  transit
authority  or  the Triborough bridge and tunnel authority nor any person
executing  the  notes,  bonds  or  other  obligations  shall  be  liable
personally on the notes, bonds or other obligations or be subject to any
personal liability or accountability by reason of the issuance thereof.
7.  The  authority,  subject  to  such  agreements with the holders of
notes, bonds or other obligations as may then exist,  shall  have  power
out  of  any  funds available therefor to purchase notes, bonds or other
obligations of the authority. The authority may  hold,  cancel  or  sell
such  bonds,  notes  and other obligations, subject to and in accordance
with agreements with such holders.
8. Neither the state nor the city of  New  York  shall  be  liable  on
notes, bonds or other obligations of the authority and such notes, bonds
and  other  obligations  shall not be a debt of the state or the city of
New York, and such notes, bonds and other obligations shall  contain  on
the  face thereof, or in an equally prominent place, a statement to such
effect.
9. So long as the authority has outstanding any bonds, notes or  other
obligations issued pursuant to this section or any bonds, notes or other
obligations  issued  or  incurred  pursuant  to  section  twelve hundred
sixty-six-c of  this  title,  none  of  the  authority  or  any  of  its
subsidiary  corporations,  New York city transit authority or any of its
subsidiary corporations, or Triborough bridge and tunnel authority shall
have the authority to file a voluntary petition under  chapter  nine  of
the  federal  bankruptcy code or such corresponding chapter, chapters or
sections as may, from time to time, be in effect, and neither any public
officer nor any organization, entity or other person shall authorize the
authority or any of its subsidiary corporations, New York  city  transit
authority  or  any  of its subsidiary corporations, or Triborough bridge
and tunnel authority to be or become a debtor under chapter nine or said
corresponding chapter, chapters or sections during any such period.
10. The term "monies" as used in this section shall include,  but  not
be  limited  to,  all  operating  subsidies  provided  by (i) any public
benefit corporation, including without limitation transfers of operating
surplus by Triborough bridge and tunnel authority  pursuant  to  section
twelve  hundred  nineteen-a  of  this  article, or (ii) any governmental
entity, federal, state or local.
11. Any resolution or agreement authorizing  the  issuance  of  bonds,
notes  or  other  obligations pursuant to this section may, in addition,
authorize and provide for the  issuance  of  lease  obligations  of  the
authority  which  may  be  issued  for the purposes and on the terms and
conditions under which the bonds, notes and other obligations authorized
under this section may be issued, and may be secured in the same  manner
as  such  bonds,  notes and other obligations, and which resolution with
respect to such lease obligations, may  contain  such  other  provisions
applicable  to  bonds, notes and other obligations not inconsistent with
the provisions of this section, as the authority may determine.
12.  The  aggregate  principal  amount  of  bonds,  notes   or   other
obligations  issued  after  the  first  day of January, nineteen hundred
ninety-three  by  the  authority,  the  Triborough  bridge  and   tunnel
authority  and  the  New  York  city  transit authority to fund projects
contained in capital program plans approved pursuant to  section  twelve
hundred  sixty-nine-b  of  this  title  for  the period nineteen hundred
ninety-two through two thousand  twenty-four  shall  not  exceed  ninety
billion  one hundred million dollars. Such aggregate principal amount of
bonds, notes or other obligations or the expenditure thereof  shall  not
be  subject to any limitation contained in any other provision of law on
the principal amount  of  bonds,  notes  or  other  obligations  or  the

expenditure  thereof  applicable to the authority, the Triborough bridge
and tunnel authority  or  the  New  York  city  transit  authority.  The
aggregate  limitation  established by this subdivision shall not include
(i)  obligations  issued to refund, redeem or otherwise repay, including
by purchase or tender, obligations  theretofore  issued  either  by  the
issuer  of  such refunding obligations or by the authority, the New York
city transit authority or the Triborough bridge  and  tunnel  authority,
(ii)  obligations issued to fund any debt service or other reserve funds
for such obligations, (iii) obligations issued or incurred to  fund  the
costs  of  issuance, the payment of amounts required under bond and note
facilities, federal or other  governmental  loans,  security  or  credit
arrangements  or  other  agreements  related  thereto and the payment of
other financing, original issue premiums and  related  costs  associated
with  such  obligations,  (iv)  an  amount  equal  to any original issue
discount from the principal  amount  of  such  obligations  or  to  fund
capitalized  interest,  (v)  obligations  incurred  pursuant  to section
twelve hundred seven-m of this article,  (vi)  obligations  incurred  to
fund  the  acquisition  of  certain  buses for the New York city transit
authority as identified in a capital program plan approved  pursuant  to
chapter  fifty-three  of  the laws of nineteen hundred ninety-two, (vii)
obligations  incurred  in  connection  with  the  leasing,  selling   or
transferring  of  equipment, and (viii) bond anticipation notes or other
obligations payable solely from the proceeds of other  bonds,  notes  or
other  obligations  which  would  be included in the aggregate principal
amount specified in the first sentence of this subdivision,  whether  or
not  additionally  secured  by  revenues of the authority, or any of its
subsidiary corporations, New York city transit authority, or any of  its
subsidiary corporations, or Triborough bridge and tunnel authority.