2023 Laws of Puerto Rico › TITLE THIRTEEN - Taxation and Finance (§§ 1 — 33423) › Subtitle 1 - Governmental Finances (§§ 1 — 155) › Chapter 1 - Treasury Funds and Accounts (§§ 1 — 17) › § 11a - Dedicated Sales Tax Fund—Creation of the public corporation

(a) A public corporation and instrumentality of the Commonwealth of Puerto Rico, is hereby created, which constitutes a corporate and political entity independent and separate from the Commonwealth of Puerto Rico to be known as the Corporación del Fondo de Interés Apremiante de Puerto Rico (“COFINA”, Spanish acronym), whose name in English shall be Puerto Rico Sales Tax Financing Corporation.
(b) COFINA is created for the purpose of issuing bonds and utilizing other financing mechanisms for the following ends:
(1) To pay or refinance, directly or indirectly, all or part of the extraconstitutional debt of the Commonwealth of Puerto Rico outstanding as of June 30, 2006, and the accrued interest thereon;
(2) to pay all or part of the debt of the Secretary of the Treasury with the Government Development Bank for Puerto Rico in the amount of one (1) billion dollars, used to finance the budget deficit of fiscal year 2008-2009;
(3) to pay all or part of (A) the financing granted or to be granted to the Commonwealth of Puerto Rico until June 30, 2014, by the Government Development Bank for Puerto Rico or other financial institutions, payable from future general obligation bond issues of the Commonwealth of Puerto Rico, including but not limited to bond anticipation notes issued by the Commonwealth of Puerto Rico; (B) financing backed by bonds and notes of the Commonwealth of Puerto Rico with variable interests and obligations incurred under any type of financing, guarantee, or interest rate swap agreements entered into with respect to such variable-interest bonds or notes; and (C) any debt of the Commonwealth of Puerto Rico with no repayment source or which is payable from budget appropriations of the Commonwealth of Puerto Rico, existing as of June 30, 2013;
(4) to pay all or part of the accounts payable to suppliers of the Commonwealth of Puerto Rico;
(5) to pay or finance operating expenses of the Government of the Commonwealth of Puerto Rico corresponding to fiscal years 2008-2009, 2009-2010, and 2010-2011;
(6) to pay or finance operating expenses of the Government of the Commonwealth of Puerto Rico corresponding to fiscal year 2011-2012, which shall be included in the annual budget of the Government of Puerto Rico;
(7) to pay or finance operating expenses of the Government of the Commonwealth of Puerto Rico corresponding to fiscal years 2012-2013, 2013-2014, and 2014-2015;
(8) to generate funds to nourish the Puerto Rico Economic Stimulus Fund established under § 14a of this title;
(9) to nourish the Emergency Fund of the Commonwealth of Puerto Rico to meet expenses arising as a result of a catastrophic event, such as hurricanes or floods;
(10) to generate funds to nourish the Economic Cooperation and Alternatives Fund for Public Employees;
(11) to nourish the Fiscal Reconstruction Fund created under Act No. 45-2013, or to pay or refinance, directly or indirectly, all or part of the debt authorized under Act No. 45-2013; and
(12) to pay, finance, or refinance any bonds, loans, bond anticipation notes issued by the Commonwealth of Puerto Rico under Act No. 242-2011 and Act No. 47-2013, or to cover the cost of necessary public improvements that may be financed by bonds authorized under Act No. 242-2011, and Act No. 47-2013.
(c) The source of repayment of COFINA bonds shall be the portion of the tax deposited in the Dedicated Sales Tax Fund pursuant to the provisions of § 12(a) of this title and any subsidy that COFINA may receive under the federal program known as “Build America Bonds”. The Board of Directors of COFINA shall not authorize any COFINA bond issue, unless the Chair or a COFINA officer designated by the Chair certifies that the principal of and interest on the COFINA bonds he/she intends to authorize, plus the principal of and interest on all outstanding COFINA bonds (except those bonds to be paid with the proceeds of the new bonds or those payments of principal or interest for which sufficient funds have been set aside to cover the payment thereof,) payable each fiscal year (beginning with the current fiscal year) is equal to or lesser than the fixed income appropriated to COFINA, corresponding to said fiscal year, plus any subsidy expected to be received by COFINA during said fiscal year under the federal Build America Bonds Program.
(d) Notwithstanding the provisions of § 13 of this title, COFINA may use any necessary amount from the moneys received from the revenues stated in §§ 12(a) and 14(d) of this title or the proceeds from the sale of the bonds issued pursuant to the provisions of §§ 11a—16 of this title, to pay any interest accrued on such bonds, to pay the expenses incurred in connection with the issue and sale of such bonds, including those expenses related to insurance, letters of credit or other instruments, and to defray any operating expense.
(e) COFINA shall be attached to the Government Development Bank for Puerto Rico (hereinafter, “GDB”). The Board of Directors of COFINA shall be the Board of Directors of the GDB. COFINA shall have the same powers, rights and faculties granted to the GDB pursuant to the provisions of its Constitutional Charter, which powers shall only be exercised to carry out the purposes for which COFINA was created, but it shall not have the power to act as fiscal agent of the government. The revenues, operations and properties of the COFINA shall enjoy the same tax exemption enjoyed by the GDB and the bonds, notes and other obligations of COFINA and the income derived therefrom shall enjoy the same tax exemption enjoyed by the bonds, notes and other obligations of the GDB.
(f) The prohibitions of § 8754 of Title 3, known as the “Commonwealth of Puerto Rico Government Fiscal Reform Act of 2006”, shall not apply to the COFINA bond issues authorized by §§ 11a–16 of this title.
(g) COFINA may issue notes in advance of bonds, “notes”, and said notes:
(1) May be issued in a maximum amount which shall not exceed such amount that, as determined by the Board of Directors of COFINA, may be used to repay the proceeds of the bond issue authorized under subsection (b) of this section and allowed under subsection (c) of this section;
(2) shall not be subject to the limitation of subsection (c) of this section, unless the documents authorizing COFINA bonds provide otherwise nor be considered in the calculation of outstanding bonds required by said subsection;
(3) shall not be taken into account for purposes of the first sentence of § 14(d) of this title, and
(4) may be repaid from the proceeds of the bonds issued under §§ 11a–16 of this title and any of its available funds.
History —May 13, 2006, No. 91, added as § 2 on July 5, 2007, No. 56, § 1; Jan. 14, 2009, No. 1, § 1; Mar. 9, 2009, No. 7, § 49; May 22, 2009, No. 18, § 1; July 2, 2012, No. 133, § 1; Oct. 10, 2013, No. 116, § 1.