HB 1989 — An Act amending Title 64 (Public Authorities and Quasi-Public Corporations) of the Pennsylvania Consolidated Statutes, in economic development financing, providing for Keystone National Finance Authority.

PRINTER'S NO.   2508

                     THE GENERAL ASSEMBLY OF PENNSYLVANIA



                         HOUSE BILL
                         No. 1989
                                                 Session of
                                                   2025

     INTRODUCED BY BIZZARRO, WHITE, RIVERA, PROBST, HILL-EVANS,
        SCHLOSSBERG, GUENST, SANCHEZ, GALLAGHER, NEILSON, BOYD,
        DELLOSO AND FLEMING, OCTOBER 23, 2025

     REFERRED TO COMMITTEE ON FINANCE, OCTOBER 23, 2025


                                      AN ACT
 1   Amending Title 64 (Public Authorities and Quasi-Public
 2      Corporations) of the Pennsylvania Consolidated Statutes, in
 3      economic development financing, providing for Keystone
 4      National Finance Authority.
 5      The General Assembly of the Commonwealth of Pennsylvania
 6   hereby enacts as follows:
 7      Section 1.    Part II of Title 64 of the Pennsylvania
 8   Consolidated Statutes is amended by adding a chapter to read:
 9                                  CHAPTER 17
10                    KEYSTONE NATIONAL FINANCE AUTHORITY
11   Subchapter
12      A.   General Provisions
13      B.   Structure and Powers
14      C.   Bonds
15                                SUBCHAPTER A
16                            GENERAL PROVISIONS
17   Sec.
18   1701.   Scope of chapter.
 1   1702.   Findings and declaration of policy.
 2   1703.   Definitions.
 3   § 1701.    Scope of chapter.
 4      This chapter relates to the Keystone National Finance
 5   Authority.
 6   § 1702.    Findings and declaration of policy.
 7      The General Assembly finds and declares as follows:
 8             (1)   Activities which lead to the creation and retention
 9      of jobs in this Commonwealth and throughout the United
10      States, the establishment of economically viable communities,
11      the reuse of abandoned industrial, commercial and other
12      previously utilized sites and the investment of private
13      capital in enterprises improve the health, safety and general
14      welfare of the people of this Commonwealth and the United
15      States by increasing employment, revitalizing communities by
16      reducing, eliminating and preventing blight and providing a
17      source of additional revenue to the Commonwealth.
18             (2)   Many existing industrial, commercial and other
19      economic activities throughout this Commonwealth and the
20      United States could become more competitive and could expand
21      more rapidly if additional means of financing were available.
22      Additional activities could be attracted to this Commonwealth
23      and other states if additional means of financing were
24      available to acquire, construct, rehabilitate and expand
25      facilities. Financing for cost-saving activities related to
26      buildings, plants, machinery and equipment and other
27      facilities would further the purposes specified under this
28      paragraph.
29             (3)   A minimum level of unemployment and a maximum level
30      of business opportunity can best be provided by the

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 1    promotion, attraction, stimulation, rehabilitation and
 2    revitalization of industrial, commercial, technological,
 3    tourist, agricultural and other economic activities in this
 4    Commonwealth and throughout the United States.
 5        (4)   Industrial, commercial and residential facilities
 6    should be promoted by the financing of the facilities which
 7    will eliminate blight or otherwise improve an area for
 8    industrial, commercial or other economic activity.
 9        (5)   Housing and affordable housing are scarce in many
10    areas of the nation and could be advanced by mixed-use and
11    transit-oriented development. Transit expansion, including
12    passenger rail expansion, throughout the nation will create
13    opportunities for the growth of adjacent commercial,
14    residential and mixed-use development in nearby communities.
15        (6)   To further encourage economic development and
16    efficiency within this Commonwealth and the United States by
17    providing basic services and facilities, it is necessary to
18    provide additional or alternative means of financing
19    infrastructure facilities, transportation systems, industrial
20    parks, energy conversion facilities, facilities for the
21    furnishing of energy, water and telecommunications,
22    facilities for the collection or treatment of wastewater and
23    storm water, tourism, parking facilities, health care
24    facilities and other basic service and related facilities
25    which are conducive to economic activity within this
26    Commonwealth and the United States and which are consistent
27    with the purposes of this chapter.
28        (7)   It is the policy of this Commonwealth to promote the
29    health, safety, employment, business opportunities, economic
30    activity and general welfare of the people by establishing an

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 1      authority to exist and operate as a public instrumentality of
 2      the Commonwealth, which is not intended to compete with any
 3      Commonwealth agency or any other authority created under the
 4      laws of this Commonwealth.
 5   § 1703.   Definitions.
 6      The following words and phrases when used in this chapter
 7   shall have the meanings given to them in this section unless the
 8   context clearly indicates otherwise:
 9      "Administrator."      The person contracted by the authority
10   under section 1713(a)(10) (relating to powers) to operate the
11   authority, which person or the leadership of the person shall be
12   a registered municipal advisor that has significant experience
13   operating a governmental entity or authority that issues bonds
14   for projects throughout the United States.
15      "Authority."   The Keystone National Finance Authority
16   established in section 1711 (relating to authority).
17      "Board."   The board of the authority established in section
18   1712 (relating to board).
19      "Bonds."   Bonds, notes, instruments, refunding notes and
20   bonds and other evidences of indebtedness or obligations which
21   the authority is authorized to issue under this chapter.
22      "Commonwealth agency."      An agency, authority or other
23   instrumentality of the Commonwealth.
24      "Conduit borrower."      The borrower of the proceeds of the
25   bonds issued by the authority.
26      "Conduit financing."      The financing of the costs of a project
27   in which the authority is only obligated to repay bonds from
28   revenues received from a conduit borrower.
29      "Conduit revenue bonds."      Bonds or other evidence of
30   indebtedness of the authority.

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 1    "Cost of the project" or "cost."     Any of the following:
 2        (1)    Costs and expenses of acquisition of interests in
 3    land, infrastructure, buildings, structures, equipment,
 4    furnishings, fixtures and other tangible or intangible
 5    property, which comprise the project.
 6        (2)    Costs and expenses of construction, reconstruction,
 7    erection, equipping, expansion, extension, improvement,
 8    installation, rehabilitation, renovation or repair of the
 9    buildings, structures and equipment, which comprise the
10    project.
11        (3)    Costs and expenses of demolishing, removing or
12    relocating buildings or structures on lands acquired or to be
13    acquired and the expense of acquiring land to which the
14    buildings or structures may be moved or relocated.
15        (4)    Costs and expenses of preparing land for
16    development.
17        (5)    Costs and expenses of engineering services,
18    financial services, accounting services and legal services,
19    plans, specifications, studies and surveys necessary or
20    incidental to determining the feasibility or practicability
21    of the project.
22        (6)    Working capital or other capital needs related to
23    the project.
24        (7)    Other costs and expenses deemed necessary by the
25    authority.
26    "Finance."    Providing funding to pay for costs of a project.
27    "Government agency."   The following:
28        (1)    A State agency.
29        (2)    The Unified Judicial System and its courts, officers
30    and agencies.

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 1          (3)   The General Assembly or its officers and agencies.
 2          (4)   A political subdivision.
 3          (5)   A municipal authority or other local authority.
 4          (6)   A local, regional or metropolitan transportation
 5      authority.
 6          (7)   A board, commission or other agency or
 7      instrumentality of a political subdivision, a municipal
 8      authority or other local authority.
 9      "Independent agency."    A board, commission or other agency or
10   officer of the Commonwealth which is not subject to the policy,
11   supervision and control of the Governor. The term does not
12   include a State-affiliated entity, a court or other officer or
13   agency of the Unified Judicial System, the General Assembly and
14   its officers and agencies, a State-related institution, a
15   political subdivision or a local, regional or metropolitan
16   transportation authority.
17      "Municipal authority."   A public authority created under the
18   governing laws of any state.
19      "Obligee of the authority."     Any of the following:
20          (1)   A holder or owner of bonds of the authority.
21          (2)   A trustee or other fiduciary for any holder or owner
22      of bonds of the authority.
23          (3)   A provider of a letter of credit, policy of
24      municipal bond insurance or other credit enhancement or
25      liquidity facility for bonds of the authority.
26          (4)   A lessor or installment seller demising property to
27      the authority in connection with a project.
28          (5)   A provider of an interest rate exchange agreement or
29      other agreement or arrangement authorized under section
30      1713(a)(28).

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 1      "Project."      A capital improvement, purchase of receivables,
 2   property, assets, commodities, bonds or other revenue streams or
 3   related assets, working capital program or any activity that
 4   promotes economic development or opportunities within any state
 5   or territory of the United States.
 6      "Project user."      A person, political subdivision, municipal
 7   authority, state or other entity that owns, leases, uses or
 8   occupies all or any part of a project.
 9      "Registered municipal advisor."       A person that is registered
10   as a municipal advisor under rules promulgated by the Securities
11   and Exchange Commission.
12      "Tax-exempt bonds."     Bonds or other evidence of indebtedness,
13   the interest on which is excludable from gross income for
14   Federal income taxation purposes.
15      "Taxable bonds."     Bonds or other evidence of indebtedness,
16   the interest on which is includable in gross income for Federal
17   income taxation purposes.
18                                 SUBCHAPTER B
19                             STRUCTURE AND POWERS
20   Sec.
21   1711.    Authority.
22   1712.    Board.
23   1713.    Powers.
24   § 1711.    Authority.
25      (a)    Establishment.--The Keystone National Finance Authority
26   is established as an independent authority. The authority is an
27   instrumentality of the Commonwealth and a body corporate and
28   politic, with corporate succession.
29      (b)    Governance.--The authority shall be governed by the
30   board. The powers of the authority shall be exercised by the

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 1   board.
 2      (c)   Expenses.--Expenses of the authority shall be paid from
 3   assets or income of the authority. The Commonwealth shall not be
 4   responsible for funding the expenses of the authority.
 5      (d)   Fiscal year.--The fiscal year of the authority shall end
 6   on June 30.
 7      (e)   Audit.--
 8            (1)   The accounts and books of the authority shall be
 9      audited annually by an independent certified public
10      accountant in accordance with generally accepted auditing
11      standards.
12            (2)   The authority shall, by December 31 of each year,
13      file a copy of the audit required under paragraph (1) with
14      the Secretary of the Senate and the Chief Clerk of the House
15      of Representatives.
16      (f)   Publication.--The authority shall annually transmit
17   audited financial statements to the Legislative Reference Bureau
18   for publication in the next available issue of the Pennsylvania
19   Bulletin.
20      (g)   Cooperation.--Executive agencies shall cooperate with
21   and provide assistance to the authority without financial
22   reimbursement.
23      (h)   Existence and dissolution.--The authority may be
24   dissolved by law if all outstanding liabilities of the
25   authority, including bonds and other contractual obligations,
26   have been fully paid, retired, satisfied or discharged or
27   provision has been made for payment of all outstanding
28   liabilities of the authority, including bonds and other
29   contractual obligations. Upon the dissolution of the authority,
30   all money, assets and other property of the authority shall vest

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 1   in the Commonwealth.
 2      (i)   Procurement.--The authority shall be exempt from the
 3   provisions of 62 Pa.C.S. (relating to procurement) relating to
 4   operations of Commonwealth agencies. The authority shall adopt
 5   policies and procedures for procurement in a manner that the
 6   board determines best balances efficiency, effectiveness and
 7   transparency, which may include delegation of certain tasks to
 8   the Department of Community and Economic Development or the
 9   Department of General Services and which may incorporate by
10   reference elements of 62 Pa.C.S. The board shall publish the
11   policies and procedures within 180 days of the effective date of
12   this subsection, subject to further adjustment by the board, on
13   the authority's publicly accessible Internet website.
14      (j)   Limitation on action.--
15            (1)   If any provision of this section or section 1712
16      (relating to board) is held invalid by a court of competent
17      jurisdiction, the authority shall not thereafter:
18                  (i)    borrow additional money;
19                  (ii)    issue additional bonds; or
20                  (iii)    disburse proceeds of any issue of bonds
21            previously authorized.
22            (2)   All provisions of outstanding bonds of the authority
23      and all rights and remedies of obligees of the authority
24      under this chapter shall be and shall remain valid and
25      enforceable.
26      (k)   Administrator.--The administrator shall operate the
27   authority. The cost of the administrator shall be payable from
28   fees generated by the authority. Neither the Commonwealth nor
29   the authority shall be responsible for the cost of the
30   administrator. The following apply:

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 1             (1)   The administrator shall provide administrative
 2      services and staff to the authority and the board.
 3             (2)   The authority may enter into agreements with the
 4      administrator specifying the rights and obligations the
 5      parties have to each other in carrying out their respective
 6      responsibilities under and to further the intent of this
 7      chapter.
 8      (l)    Applicability.--The following acts shall apply to the
 9   authority and the board relating to notice and open meetings:
10             (1)   The act of July 19, 1957 (P.L.1017, No.451), known
11      as the State Adverse Interest Act.
12             (2)   The act of February 14, 2008 (P.L.6, No.3), known as
13      the Right-to-Know Law.
14             (3)   The provisions of 65 Pa.C.S. Chs. 7 (relating to
15      open meetings) and 11 (relating to ethics standards and
16      financial disclosure).
17   § 1712.    Board.
18      (a)    Composition.--The board shall be comprised as follows:
19             (1)   An individual with large-scale construction
20      experience appointed by the Governor, who shall serve at the
21      pleasure of the Governor.
22             (2)   An individual with public finance or project finance
23      experience appointed by the Governor, who shall serve at the
24      pleasure of the Governor.
25             (3)   An individual appointed by the State Treasurer, who
26      shall serve at the pleasure of the State Treasurer.
27             (4)   An individual appointed by the Auditor General, who
28      shall serve at the pleasure of the Auditor General.
29             (5)   Four legislative appointees:
30                   (i)   Appointments under this paragraph shall be as

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 1        follows:
 2                     (A)   One individual appointed by the President
 3              pro tempore of the Senate.
 4                     (B)   One individual appointed by the Speaker of
 5              the House of Representatives.
 6                     (C)   One individual appointed by the Minority
 7              Leader of the Senate.
 8                     (D)   One individual appointed by the Minority
 9              Leader of the House of Representatives.
10              (ii)    Legislative appointees shall serve at the
11        pleasure of the appointing authority.
12              (iii)    An individual appointed to the board under
13        subparagraph (i) may not be a member of the General
14        Assembly or staff of a member of the General Assembly.
15        (6)   Five appointees who shall be appointed to an initial
16    term within 180 days of the effective date of this paragraph,
17    as follows:
18              (i)    One board member appointed by the other members
19        of the board by a vote of a majority, whose initial term
20        shall be two years and a term of 10 years thereafter.
21              (ii)    One board member appointed by the other members
22        of the board by a vote of a majority, whose initial term
23        shall be four years and a term of 10 years thereafter.
24              (iii)    One board member appointed by the other
25        members of the board by a vote of a majority, whose
26        initial term shall be six years and a term of 10 years
27        thereafter.
28              (iv)    One board member appointed by the other members
29        of the board by a vote of a majority, whose initial term
30        shall be eight years and a term of 10 years thereafter.

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 1                 (v)   One board member appointed by the other members
 2            of the board by a vote of a majority, whose initial term
 3            shall be 10 years and a term of 10 years thereafter.
 4      (b)   Organization.--The Governor shall select a member of the
 5   board to serve as chairperson. The members shall select other
 6   officers from among members of the board as the board
 7   determines.
 8      (c)   Meetings and proxy.--The board shall meet at the call of
 9   the chairperson. The board may hold virtual or telephonic
10   meetings. A board member may designate a proxy to act on the
11   board member's behalf by notifying the board in writing of the
12   proxy.
13      (d)   Quorum.--Two-thirds of the members of the board shall
14   constitute a quorum. The consent of at least two-thirds of the
15   members of the board, with at least four of the consenting
16   members being appointed under subsection (a)(5), shall be
17   necessary to take any action on behalf of the authority.
18      (e)   Compensation.--The members of the board shall not be
19   compensated for their service as members of the board but shall
20   be entitled to reimbursement for all necessary and reasonable
21   expenses incurred in connection with the performance of their
22   duties as members of the board.
23      (f)   Fiduciary relationship.--The members of the board and
24   the professional personnel of the board shall stand in a
25   fiduciary relationship with the authority as to the money in the
26   accounts of the authority and investments of the authority.
27      (g)   Standard of care.--The members of the board in
28   performance of their duties under this chapter shall exercise
29   the standard of care required by 20 Pa.C.S. Ch. 73 (relating to
30   municipalities investments).

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 1      (h)    Liability.--Members of the board shall not be personally
 2   liable on any obligations of the authority, including bonds of
 3   the authority.
 4      (i)    Initial appointment and vacancy.--Appointing authorities
 5   shall appoint initial members to the board within 30 days of the
 6   effective date of this subsection. If a vacancy occurs on the
 7   board, the appointing authority shall appoint a successor member
 8   within 30 days of the vacancy. If the appointing authority does
 9   not make an appointment during the 30-day period, the remainder
10   of the board may select a replacement member to serve in the
11   role, subject to replacement by the authorized appointing
12   authority.
13   § 1713.    Powers.
14      (a)    Powers.--The authority may do all of the following:
15             (1)   Adopt bylaws and guidelines.
16             (2)   Sue and be sued, implead and be impleaded,
17      interplead, complain and defend in any court.
18             (3)   Adopt, use and alter a corporate seal.
19             (4)   Establish accounts necessary or desirable for its
20      corporate purposes.
21             (5)   Employ an executive director, if necessary.
22             (6)   Retain attorneys, accountants, auditors and
23      financial experts to render services and engage the services
24      of other advisors, consultants and agents as necessary. For
25      the purposes of this paragraph, the authority shall be
26      considered an independent agency for purposes of the act of
27      October 15, 1980 (P.L.950, No.164), known as the Commonwealth
28      Attorneys Act.
29             (7)   Pay or satisfy obligations of the authority.
30             (8)   Contract and execute instruments, including

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 1    financing agreements, loan agreements, letter of credit
 2    agreements, liquidity agreements, guarantees, sureties,
 3    mortgages, standby loan commitments and contracts of
 4    insurance, which are necessary or appropriate for carrying on
 5    the business of the authority. Power under this paragraph
 6    includes the ability to make and execute contracts for the
 7    servicing of loans and mortgages acquired by the authority.
 8        (9)    Borrow money, issue bonds, obtain lines and letters
 9    of credit and incur debt.
10        (10)     Contract with an administrator to operate the
11    authority.
12        (11)     Use or pledge an account for a special purpose,
13    including debt service reserves and other reserves, as may be
14    necessary or desirable to carry out the authority's powers
15    and duties.
16        (12)     Negotiate modifications or alterations to financing
17    agreements, mortgages or security interests.
18        (13)     Foreclose on a mortgage or security interest in
19    default.
20        (14)     Commence any action necessary to protect or enforce
21    any right conferred upon the authority by law, mortgage,
22    security agreement, contract or other agreement.
23        (15)     Bid for or purchase property which was the subject
24    of a mortgage or security interest at a foreclosure or other
25    sale and acquire and take possession of that property.
26        (16)     Impose and collect fees and charges in connection
27    with loan commitments and servicing, including reimbursement
28    of costs of financing.
29        (17)     Acquire, accept, purchase, receive, collect, hold,
30    convey and invest money, fees and property, whether tangible

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 1    or intangible, from all sources, directly or by assignment,
 2    pledge or otherwise.
 3        (18)   Acquire, buy, sell, lease, encumber, mortgage,
 4    hypothecate, pledge, assign, transfer, convey or dispose of
 5    any property, whether tangible or intangible, including the
 6    authority's property or interest in projects, mortgages,
 7    deeds of trust, indentures of mortgage or trust, leases,
 8    purchase or sale or other financing agreements, or similar
 9    instruments, bonds, notes and security interests in property
10    or contracts entered into or acquired in connection with
11    bonds.
12        (19)   Acquire and sell loans, mortgages and security
13    interests at public or private sale and make loans to, lease
14    property from or to or enter into any other kind of an
15    agreement with a participant or other entity, in connection
16    with financing or refinancing a project.
17        (20)   Employ or appoint agents, employees, finance
18    professionals and special advisors.
19        (21)   Apply for an allocation of volume cap, tax credit,
20    subsidy, grant, loan, credit enhancement or any other
21    Federal, State or local program in connection with the
22    financing of a project.
23        (22)   Establish and collect fees and administrative
24    expenses from participants that benefit from the authority's
25    services or services provided by an outside entity.
26        (23)   Develop, adopt and implement binding policies or
27    guidelines assuring that all persons are accorded equal
28    opportunity in employment and contracting associated with the
29    authority. This paragraph includes the authority's
30    contractors, subcontractors, assignees, lessees, agents,

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 1    vendors and suppliers.
 2        (24)     Exercise rights provided by law for the benefit or
 3    protection of the authority or obligees of the authority.
 4        (25)     Invest money of the authority not required for
 5    immediate use, including proceeds from the sale of bonds, as
 6    the board determines, subject to any agreement with
 7    bondholders stated in the authorizing resolution providing
 8    for the issuance of bonds.
 9        (26)     Procure insurance against any loss in connection
10    with the authority's programs, property and other assets.
11        (27)     Promulgate regulations and adopt guidelines and
12    statements of policy containing restrictions as the authority
13    may deem necessary and appropriate to effectuate the public
14    purposes of this chapter.
15        (28)     Negotiate and enter into interest rate exchange
16    agreements, interest rate cap agreements, collar agreements,
17    corridor agreements, ceiling agreements, floor agreements,
18    forward agreements, float agreements and other similar
19    arrangements which, in the judgment of the authority, will
20    assist the authority in managing the interest costs of the
21    authority.
22        (29)     Enter into agreements with applicants and project
23    users providing for any of the following:
24               (i)    Loan, rental or purchase price payments or other
25        payments, sufficient to amortize the principal, interest
26        and premium, if any, of bonds and contractual obligations
27        of the authority incurred to provide money to pay the
28        costs of the projects being financed.
29               (ii)   The applicants or project users to pay or cause
30        to be paid all other costs of acquiring, constructing,

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 1            maintaining and operating the projects being financed.
 2                   (iii)    Conveyance with or without consideration of
 3            any part or all of a project being financed to the
 4            project user or applicant on or before payment of all
 5            bonds and contractual obligations of the authority
 6            incurred with respect to the project.
 7                   (iv)    Other matters as determined by the authority.
 8            (30)    Implement a program to communicate business
 9      opportunities to a range of entities, including businesses
10      owned or operated by veterans, members of underrepresented
11      demographic groups and small businesses located in this
12      Commonwealth.
13            (31)    Carry out appropriate acts necessary or convenient
14      to:
15                   (i)    effectuate the purposes of this chapter; or
16                   (ii)    exercise the powers specified in this
17            subsection, including any act reasonably implied from
18            those powers.
19      (b)    Duties.--The authority shall finance projects in one or
20   more states or territories of the United States by issuing
21   conduit revenue bonds.
22                                    SUBCHAPTER C
23                                       BONDS
24   Sec.
25   1721.    Bonds issuance.
26   1722.    Commonwealth taxation.
27   1723.    Federal taxation.
28   1724.    Validity of bonds and limitation on actions.
29   1725.    Provisions of bonds and trust agreements.
30   1726.    Validity of pledge.

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 1   1727.    Commonwealth pledges.
 2   1728.    Bonds to be legal investments.
 3   1729.    Rights and remedies of obligees.
 4   1730.    Benefits to Commonwealth.
 5   § 1721.    Bonds issuance.
 6      (a)    Authorization.--The authority may engage in conduit
 7   financing to issue limited obligation revenue bonds and other
 8   types of limited obligation revenue financing. Bonds issued
 9   under this subchapter shall be in the name of the authority.
10      (b)    Taxability.--The authority may issue tax-exempt bonds
11   and taxable bonds to fund projects.
12      (c)    Authorization requirements.--
13             (1)   Bonds of the authority shall be authorized by a
14      resolution of the board.
15             (2)   The resolution of the board authorizing an issuance
16      of bonds or the documents approved by the resolution shall
17      provide that the bonds:
18                   (i)    be of a series;
19                   (ii)    bear a date or dates;
20                   (iii)    bear or accrue interest at any rate or rates,
21             whether fixed or variable;
22                   (iv)    be in denominations;
23                   (v)    be in any form, either coupon or fully
24             registered without coupons or in certificated or book-
25             entry-only form;
26                   (vi)    carry registration, exchangeability and
27             interchangeability privileges;
28                   (vii)    be payable in any medium of payment and at any
29             place or places;
30                   (viii)    mature on a date or dates not to exceed 50

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 1          years from the bonds' original issue date; and
 2                 (ix)   be subject to terms of redemption or tender, if
 3          any.
 4          (3)    Bonds shall be signed by or shall bear the facsimile
 5    signature of the officer designated by the board.
 6          (4)    Interest coupons shall be attached to coupon bonds
 7    and shall bear the facsimile signature of the officer
 8    designated by the board.
 9          (5)    Bonds may be authenticated by an authenticating
10    agent, fiscal agent or trustee.
11          (6)    Bonds may be issued and delivered notwithstanding
12    that the officer signing the bonds or whose facsimile
13    signature is on a coupon has ceased to be the officer at the
14    time when bonds are actually delivered.
15          (7)    The proceeds of a bond issued under this section may
16    be used for one or more projects located in this Commonwealth
17    or one or more states or territories of the United States.
18          (8)    The authority may not issue bonds to finance a
19    capital improvement project unless the political subdivision
20    within which the project is to be located approves the
21    financing of the project.
22    (d)   No debt or liability of the Commonwealth.--
23          (1)    Bonds issued under this chapter shall not be a debt
24    or liability of the Commonwealth and shall not create or
25    constitute any indebtedness, liability or obligation of the
26    Commonwealth.
27          (2)    Bonds shall be payable solely from money received by
28    the authority from revenues derived from the operation of the
29    project or accounts pledged or available for repayment of the
30    bonds as authorized in this chapter, which may include any of

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 1      the following:
 2                  (i)    The proceeds of bonds.
 3                  (ii)    Money appropriated to the authority for
 4            repayment as authorized in this chapter.
 5            (3)   All bonds shall contain on their faces statements to
 6      the effect that:
 7                  (i)    the authority is obligated to pay the principal
 8            of or the interest on the bonds only from the authority's
 9            revenues, receipts or money pledged or available for
10            their payment as authorized under this chapter;
11                  (ii)    neither the Commonwealth nor any political
12            subdivision is obligated to pay the principal of or
13            interest on the bonds; and
14                  (iii)    neither the faith and credit nor the taxing
15            power of the Commonwealth or any political subdivision is
16            pledged to the payment of the principal of or the
17            interest on the bonds.
18      (e)   Sale.--Bonds may be sold at public sale, invited sale or
19   private sale for the price or prices the authority determines.
20      (f)   Interim receipts.--Pending the preparation of the
21   definitive bonds, interim receipts may be issued to the
22   purchaser or purchasers of the bonds and shall contain the terms
23   and conditions established by the authority.
24      (g)   Negotiable instruments.--Bonds of the authority shall
25   have the qualities of negotiable instruments under 13 Pa.C.S.
26   (relating to commercial code).
27      (h)   Use.--The authority may use the proceeds of bonds for
28   any of the following:
29            (1)   Making loans, grants or guarantees.
30            (2)   Purchasing loans, mortgages, security interests or

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 1      loan participations.
 2             (3)   Paying expenses in connection with activity under
 3      paragraphs (1) and (2), including administrative costs of the
 4      authority and the administrator.
 5             (4)   Paying expenses of authorizing and issuing the
 6      bonds.
 7             (5)   Paying principal, redemption or purchase price and
 8      interest on bonds.
 9             (6)   Funding reserves.
10             (7)   Any other purpose deemed necessary or appropriate by
11      the authority.
12      (i)    Refunding.--Subject to provisions of this chapter and
13   the terms of bonds or other contractual obligations issued in
14   accordance with this chapter, the authority may refund any
15   outstanding debt of the authority whether the debt represents
16   principal or interest, in whole or in part, at any time. For the
17   purposes of this subsection, the term "refund" and its
18   variations means the issuance and sale of obligations the
19   proceeds of which are used or are to be used for the payment or
20   redemption of outstanding obligations upon or prior to maturity.
21   § 1722.    Commonwealth taxation.
22      (a)    Purposes.--The effectuation of the purposes of the
23   authority is for the benefit of the public in this Commonwealth
24   and nationally, for the increase of commerce and prosperity and
25   for the improvement of health, safety, welfare and living
26   conditions.
27      (b)    No tax liability.--The authority, as a public
28   instrumentality of the Commonwealth performing essential
29   governmental functions, is not required to pay any taxes or
30   assessments upon any property located in this Commonwealth

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 1   acquired or used or permitted to be used by the authority for
 2   the authority's purposes.
 3      (c)    Bonds.--The transfer and the income from bonds issued by
 4   the authority for projects, including profit made on their sale,
 5   are not subject to State and local taxation within this
 6   Commonwealth. The exclusion to tax under this subsection shall
 7   not extend to gift, estate, succession or inheritance taxes or
 8   any other taxes not levied directly on the bonds, the bonds'
 9   transfers, the income from the bonds or the realization of
10   profits on the bonds' sales.
11   § 1723.    Federal taxation.
12      (a)    Allocation.--If the bonds issued by the authority for a
13   project are tax-exempt bonds for which Federal law requires an
14   allocation, the authority may apply for the allocation upon
15   receipt of a written request by the board. An allocation must be
16   issued by the appropriate allocating entity prior to the date of
17   issuance of the bonds.
18      (b)    Approval.--If gubernatorial approval is required by
19   Federal or State law, the Governor may approve the issuance of
20   bonds by the authority upon receipt of written request for
21   approval from the board. The written request must state all of
22   the following:
23             (1)   The authority and the local jurisdiction, if
24      applicable, has conducted a public hearing, with appropriate
25      public notice, concerning the purposes for which the bonds
26      are to be issued.
27             (2)   A description of the project or projects to be
28      financed.
29             (3)   A description of the method of financing the project
30      or projects.

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 1             (4)   A summary of the comments made and questions posed
 2      at the public hearing.
 3   § 1724.    Validity of bonds and limitation on actions.
 4      (a)    Presumption.--Bonds issued by the authority to
 5   accomplish the public purposes of this chapter shall be
 6   conclusively deemed in any suit, action or proceeding involving
 7   the validity or enforceability of the bonds or their security to
 8   have been issued for the public purposes of this chapter.
 9      (b)    Estoppel.--After issuance, bonds shall be conclusively
10   presumed to be fully authorized and issued under the laws of
11   this Commonwealth, and any person shall be estopped from
12   questioning their validity, sale, execution or delivery by the
13   authority.
14   § 1725.    Provisions of bonds and trust agreements.
15      A resolution authorizing the issuance of bonds or any trust
16   agreement approved in or by a resolution authorizing the
17   issuance of bonds may contain provisions which do any of the
18   following:
19             (1)   Secure the bonds.
20             (2)   Covenant against any of the following:
21                   (i)    Pledging or granting a security interest in any
22             part of the authority's revenues or any part of the
23             authority's property to which its right or title exists
24             or which may later come into existence.
25                   (ii)    Permitting or suffering any lien on all or any
26             part of its revenues or property.
27                   (iii)   Extending the time for the payment of bonds or
28             interest.
29             (3)   Covenant with respect to limiting the authority's
30      right to sell, pledge or otherwise dispose of bonds or notes

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 1    of governmental units, loan agreements or other property.
 2        (4)   Covenant relating to any of the following:
 3              (i)    Additional bonds to be issued.
 4              (ii)    Limitations on additional bonds.
 5              (iii)    Terms and conditions of additional bonds.
 6              (iv)    Custody, application, investment and
 7        disposition of proceeds of bonds.
 8              (v)    Incurring of other debts or obligations by the
 9        authority.
10              (vi)    Payment of principal of or interest on bonds.
11              (vii)    Sources and methods of payment.
12              (viii)    Rank or priority of bonds with respect to
13        liens or security interests.
14              (ix)    Redemption, purchase and tender of bonds by the
15        authority or the bondholders and the privilege of
16        exchange of the bonds for other bonds.
17              (x)    Use, investment and disposition of the money
18        held in special funds, accounts or reserves.
19              (xi)    Use of any or all of the authority's real or
20        personal property.
21              (xii)    Warrant of title to the authority's real or
22        personal property.
23        (5)   Provide for any of the following:
24              (i)    Replacement of lost, stolen, destroyed or
25        mutilated bonds.
26              (ii)    Maintenance of the authority's real and
27        personal property.
28              (iii)    Replacement of the authority's real and
29        personal property.
30              (iv)    Insurance to be carried on the authority's real

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 1        and personal property and the use and disposition of the
 2        insurance proceeds.
 3               (v)    Rights, liabilities, powers and duties arising
 4        upon the breach of a covenant, condition or obligation.
 5        (6)     Create or authorize the creation of special funds or
 6    accounts to be held in trust or otherwise for the benefit of
 7    bondholders or of reserves for debt service or other
 8    purposes.
 9        (7)     Provide for obtaining letters of credit, bond
10    insurance and other facilities for credit enhancement and
11    liquidity.
12        (8)     Prescribe any of the following:
13               (i)    Procedure by which the terms of a contract with
14        bondholders may be amended or abrogated.
15               (ii)    Percentage of the principal amount of bonds the
16        holders of which must consent to the amendment or
17        abrogation of any contract.
18               (iii)    Manner in which the consent under subparagraph
19        (ii) may be given.
20        (9)     Prescribe any of the following:
21               (i)    Events of default.
22               (ii)    Terms and conditions upon which the bonds
23        become or may be declared due and payable before stated
24        maturity following an event of default.
25               (iii)    Terms and conditions upon which the
26        declaration of default and its consequence may be waived.
27        (10)     Pay the costs or expenses incident to any of the
28    following:
29               (i)    The enforcement of the bonds.
30               (ii)    The provisions of the resolution authorizing

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 1             the issuance of the bonds.
 2                    (iii)   The trust agreement securing the bonds.
 3                    (iv)    A covenant or agreement of the authority with
 4             the holders of the bonds or other obligees of the
 5             authority.
 6             (11)    Vest in a trustee, within or outside this
 7      Commonwealth, any property, rights, powers and duties in
 8      trust, including rights with respect to the sale or other
 9      disposition of notes and bonds, of governmental units and
10      other instruments and security pledged under a resolution or
11      trust agreement for the benefit of bondholders and rights, by
12      suit or action, to foreclose a mortgage pledged under a
13      resolution or trust indenture for the benefit of bondholders.
14             (12)    Limit the rights, powers and duties of a trustee
15      and the right of bondholders to appoint a trustee.
16             (13)    Establish the terms and conditions upon which a
17      trustee or the bondholders may enforce a covenant or rights
18      securing or relating to the bonds.
19             (14)    Exercise all or any part or combination of the
20      powers granted in this chapter.
21             (15)    Make covenants other than and in addition to the
22      covenants expressly authorized by this chapter.
23             (16)    Do or refrain from doing any other act to better
24      secure the bonds of the authority or make bonds of the
25      authority more marketable.
26   § 1726.    Validity of pledge.
27      A pledge or grant of a security interest in revenues or
28   instruments made by the authority shall be valid and binding
29   from the time the pledge is made. The revenues, receipts, money
30   or other property or instruments pledged and later received by

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 1   the authority shall immediately be subject to the lien of the
 2   pledge or security interest without any physical delivery of the
 3   property pledged or further act. The lien of the pledge or
 4   security interest shall be valid and binding as against all
 5   parties having claims of any kind in tort, contract or otherwise
 6   against the authority irrespective of whether the parties have
 7   notice of the lien, pledge or security interest. No instrument
 8   by which a pledge or security interest is created, evidenced or
 9   noticed need be recorded or filed to perfect the pledge or
10   security interest except in the records of the authority.
11   § 1727.   Commonwealth pledges.
12      (a)    Bondholders.--The Commonwealth pledges to and agrees
13   with each obligee of the authority that the Commonwealth will
14   not limit or alter the rights and powers vested in the authority
15   or otherwise created by this chapter in any manner inconsistent
16   with the obligations of the authority to the obligees of the
17   authority until all bonds at any time issued, together with the
18   interest on the bonds, are fully paid and discharged.
19      (b)    Lessees.--The Commonwealth pledges and agrees with any
20   person that, as owner of property which is leased or subleased
21   to or from the authority, the Commonwealth will not limit or
22   alter the rights and powers vested in the authority or otherwise
23   created by this chapter in any manner which impairs the
24   obligations of the authority until all the obligations of the
25   authority under the lease or sublease are fully met and
26   discharged.
27   § 1728.   Bonds to be legal investments.
28      (a)    Investments.--Bonds issued under this chapter are made
29   securities in which all of the following may properly and
30   legally invest money, including capital, deposits or other money

20250HB1989PN2508                   - 27 -
 1   in their control or belonging to them:
 2             (1)   Government agencies.
 3             (2)   Insurance companies.
 4             (3)   Trust companies.
 5             (4)   Banking associations, banking corporations and
 6      savings banks.
 7             (5)   Investment companies.
 8             (6)   Executors, trustees and other fiduciaries.
 9             (7)   Trustees of any retirement, pension or annuity fund
10      or system of the Commonwealth.
11      (b)    Deposits.--Bonds issued by the authority are made
12   securities which may properly and legally be deposited with and
13   received by a government agency for any purpose for which the
14   deposit of bonds or other obligations of the Commonwealth are
15   authorized by law.
16   § 1729.    Rights and remedies of obligees.
17      The rights and remedies conferred upon or granted to obligees
18   of the authority under this chapter shall be in addition to and
19   not in limitation of rights and remedies lawfully granted to the
20   obligees of the authority by resolution providing for the
21   issuance of bonds or by any trust agreement or other agreement
22   under which the bonds may be issued or secured.
23   § 1730.    Benefits to Commonwealth.
24      The authority shall pay, on an annual basis, to the
25   Commonwealth, the money generated by the authority after the
26   payment of all costs and expenses to operate the authority,
27   including payments to the administrator and the retention of
28   money to maintain reasonable reserves as determined by the
29   board.
30      Section 2.     This act shall take effect in 60 days.

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