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Borrowing authorized - 32 Pa. Cons. Stat. § 7507

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     § 7507.  Borrowing authorized.
        (a)  Aggregate limitation.--Pursuant to the provisions of
     section 7(a)(3) of Article VIII of the Constitution of
     Pennsylvania and the referendum approved by the electorate on
     November 3, 1981, the issuing officials are authorized and
     directed to borrow, on the credit of the Commonwealth, bonds not
     exceeding in the aggregate the sum of $300,000,000, not
     including refunding bonds, as may be found necessary to carry
     out the purposes of this chapter.
        (b)  Authorization to issue notes.--Pending the issuance of
     bonds of the Commonwealth as authorized in this chapter, the
     issuing officials are authorized in accordance with this chapter
     and on the credit of the Commonwealth to make temporary
     borrowing not to exceed three years in anticipation of the issue
     of bonds with the latest stated maturity date to be set forth in
     the notes, in order to provide funds in such amounts as may from
     time to time be deemed advisable to carry out the purposes of
     this chapter prior to the issue of bonds. In order to provide
     for and in connection with such temporary borrowings, the
     issuing officials are authorized in the name and on behalf of
     the Commonwealth to enter into any loan or credit agreement or
     agreements or other agreements with any banks or trust companies
     or other lending institutions or persons in the United States
     having power to enter into them, which agreements may contain
     such provisions not inconsistent with the provisions of this
     chapter as may be customary in such instruments and as may be
     authorized by the issuing officials.
        (c)  Issuance of notes and renewal notes.--All temporary
     borrowings made under the authorization of this section shall be
     evidenced by notes of the Commonwealth, which shall be issued
     from time to time for such amounts that together with the notes
     outstanding and bonds issued pursuant to this chapter do not
     exceed $300,000,000, in such form and in such denominations, and
     subject to such terms and conditions of sale and issue, renewal,
     prepayment or redemption and maturity, rate or rates of interest
     and time of payment of interests, as the issuing officials shall
     direct and in accordance with this chapter. Such direction may
     provide for the subsequent issuance of the notes (referred to as
     "renewal notes") to refund the notes or renewal notes, which
     renewal notes shall, upon issuance thereof, evidence the
     borrowing, and may specify such other terms and conditions with
     respect to the notes and renewal notes thereby authorized for
     issuance as the issuing officials may determine and direct. Any
     issue of renewal notes may be in a principal amount sufficient
     to repay the principal of and accrued interest on, if any, the
     issue or issues of notes being refunded and to pay the financial
     costs relating to the renewal notes.
        (d)  Funding bonds.--Outstanding notes evidencing the
     borrowings may be funded and retired by the issuance and sale of
     the bonds of the Commonwealth as authorized in this chapter. The
     funding bonds must be issued and sold not later than a date
     three years after the date of the issuance of the first notes
     evidencing the borrowings to the extent that payment of the
     notes has not otherwise been made or provided for by sources
     other than proceeds of renewal notes.
        (e)  Issuance of general obligation bonds.--As evidence of
     the indebtedness authorized in this chapter, general obligation
     bonds of the Commonwealth shall be issued from time to time to
     fund and retire notes issued pursuant to this chapter (referred
     to as "funding bonds") or to provide moneys necessary to carry
     out the purposes of this chapter, or both, for such total
     amounts, in such form, in such denominations and subject to such
     terms and conditions of issue, redemption and maturity, rate of
     interest and time of payment of interest as the issuing
     officials direct except that the latest stated maturity date
     shall not exceed 30 years from the date of the debt first issued
     for each series.
        (f)  Execution of bonds.--All bonds and notes issued under
     the authority of this chapter shall bear facsimile signatures of
     the issuing officials and a facsimile of the great seal of the
     Commonwealth and shall be countersigned by a duly authorized
     officer of a duly authorized loan and transfer agent of the
     Commonwealth.
        (g)  Direct obligation of Commonwealth.--All bonds and notes
     issued in accordance with the provisions of this section shall
     be direct obligations of the Commonwealth and the full faith and
     credit of the Commonwealth are hereby pledged for the payment of
     the interest thereon as it becomes due and the payment of the
     principal at maturity. The principal of and interest on the
     bonds and notes shall be payable in lawful money of the United
     States of America.
        (h)  Exemption from taxation.--All bonds and notes issued
     under the provisions of this section shall be exempt from
     taxation for State and local purposes.
        (i)  Form of bonds.--The bonds may be issued as coupon bonds
     or registered as to both principal and interest as the issuing
     officials may determine. If interest coupons are attached, they
     shall contain the facsimile signature of the State Treasurer.
        (j)  Bond amortization.--The issuing officials shall provide
     for the amortization of the bonds in substantial and regular
     amounts over the term of the debt. The first retirement of
     principal shall be stated to mature prior to the expiration of a
     period of time equal to one-tenth of the time from the date of
     the first obligation issued to evidence the debt to the date of
     the expiration of the term of the debt. Retirements of principal
     shall be regular and substantial if made in annual or semiannual
     amounts whether by stated serial maturities or by mandatory
     sinking fund retirements.
        (k)  Refunding bonds.--The issuing officials are authorized
     to provide, by resolution, for the issuance of refunding bonds
     for the purpose of refunding any bonds issued under the
     provisions of this chapter and then outstanding, either by
     voluntary exchange with the holders of the outstanding bonds, or
     to provide funds to redeem and retire the outstanding bonds with
     accrued interest, any premium payable thereon and the costs of
     issuance and retirement of bonds, at maturity or at any call
     date. The issuance of the refunding bonds, the maturities and
     other details thereof, the rights of the holders thereof and the
     duties of the issuing officials in respect to the same shall be
     governed by the provisions of this section, insofar as they may
     be applicable. Refunding bonds, which are not subject to the
     aggregate limitation of $300,000,000 of bonds to be issued
     pursuant to this chapter, may be issued by the issuing officials
     to refund bonds originally issued or to refund bonds previously
     issued for refunding purposes.
        (l)  Quorum.--Whenever any action is to be taken or decision
     made by the Governor, the Auditor General and the State
     Treasurer acting as issuing officials and the three officers are
     not able unanimously to agree, the action or decision of the
     Governor and either the Auditor General or State Treasurer shall
     be binding and final.

Last modified: November 27, 2007