Section 1. Amend Title 14 of the Delaware Code by creating a new Chapter 94 to read as follows:
“Title 14
Education
Chapter 94. Delaware Higher Educational Facilities Authority
§ 9401. Short Title.
This Chapter shall be known as the Delaware Higher Educational Facilities Authority Act.
§ 9402. Legislative findings and determinations.
The General Assembly finds that annual Capital Improvement appropriations are insufficient to finance the immediate building and facility requirements of the institutions of higher education in the State, and in order to provide these buildings and facilities, it is necessary to authorize the issuance of revenue bonds, subject to the restrictions and limitations hereinafter set forth. It is the intent of the General Assembly that revenue bonds issued for academic and administrative buildings and facilities shall supplement and not supplant legislative appropriations for the same or similar purposes.
§ 9403. Definitions.
The following words or terms, as used in this Chapter, shall have the respective meanings as stated:
(1) ‘Authority’ means the Delaware Higher Educational Facilities Authority.
(2) ‘Bonds’ means revenue bonds which are payable solely and only from student tuition, fees, charges and institutional income received by the institution at which the project is being undertaken.
(3) ‘Buildings and facilities’ means those academic buildings and other facilities used primarily for instructional and research purposes, including libraries, and such other administrative buildings and facilities as are deemed necessary by the Authority to provide supporting services to the instructional and research programs and activities of the institutions, including, but not limited to, administrative offices, facilities for business services, student services and extension and continuing education services.
(4) ‘Project’ means the acquisition by gift, purchase, lease or construction of buildings and facilities which are deemed necessary by the Authority for the proper performance of the instructional, research and service functions of the institutions, and additions to buildings and facilities, the reconstruction, completion, equipment, improvement, repair or remodeling of buildings and facilities, including the demolition of existing buildings and facilities which are to be replaced, and the acquisition of property whether real, personal, or mixed, for buildings and facilities by gift, purchase, lease, condemnation or otherwise.
(5) ‘Institution’ or “institutions” means the University of Delaware, Delaware State University and Delaware Technical and Community College.
(6) ‘Institutional income’ means income received by institutions that is not related to State appropriations or grant income.
§ 9404. Established; composition; term of
office; vacancies; officers; compensation.
(a)
There is hereby established the Delaware Higher
Educational Facilities Authority. The
Authority is constituted a public instrumentality and the exercise by the
Authority of the powers conferred by this Chapter is the performance of an
essential public function.
(b)
The Authority shall consist of nine (9) members as
follows:
(1)
One (1) Member approved by the Governor
(2)
The Budget
Director
(3)
The Secretary of
Education or designee
(4)
The University of Delaware President or designee
(5)
The Delaware State University President or designee
(6)
The Delaware Technical Community College President or
designee
(7)
One (1) Member of the House of Representatives appointed
by the Speaker of the House
(8)
One (1) Member of the Senate appointed by the President
Pro Tempore
(9)
The Controller General or designee
§ 9405. Executive Director; General Counsel;
quorum; power to issue bonds.
(a) (1) The
Authority may appoint an Executive Director and a General Counsel, and any
other officers, none of whom may be members of the Authority.
(2) The Executive Director shall:
a. Serve at the pleasure of the Authority;
and
b. Receive compensation as fixed by the
Authority.
(3) The Executive Director or other person
designated by resolution of the Authority:
a. Shall keep a record of the proceedings
of the Authority;
b. Shall be custodian of all books,
documents and papers filed with the Authority, the minute book or journal of
the Authority and its official seal; and
c. May cause copies to be made of all
minutes and other records and documents of the Authority and may give
certificates under the official seal of the Authority to the effect that the
copies are true copies, and all persons dealing with the Authority may rely
upon the certificates.
(b) (1) Six
(6) members of the Authority shall constitute a quorum.
(2) The affirmative vote of a majority of the members present, and
not less than five (5) votes, is necessary for any action taken by the
Authority.
(c) (1) A
vacancy in the membership of the Authority may not impair the right of a quorum
to exercise all the rights and perform all the duties of the Authority.
(2) Any action taken by the Authority under
this chapter may be authorized by resolution at any regular or special meeting
and may take effect immediately and need not be published.
(d) (1) The
Authority may issue bonds to pay all or any part of the cost of carrying out
any project at any institution and may refund or refinance bonds issued for any
project.
(2) The bonds may not grant to the owners or
holders any right to have the Authority or the General Assembly levy any taxes
or appropriate any funds for the payment of principal or interest.
§ 9406. Powers and duties.
(a) (1) In
addition to any other powers granted or duties imposed upon it, the Authority
has the powers and duties set forth in this Section.
(2) The Authority shall adopt any rule or
regulation necessary to carry out its powers and duties.
(b) The Authority may:
(1) Adopt an official seal;
(2) Maintain an office at the place or
places it may designate;
(3) Participate in legal proceedings in
the name of the Authority; and
(4) Sue and be sued in its own name,
plead and be impleaded.
(c) The Authority may:
(1) Issue bonds for any of its corporate
purposes and borrow funds as working capital for its operations;
(2) Fix, revise, charge and collect
rates, fees and charges for the services furnished or to be furnished by the
Authority and contract with any person, including financial institutions, loan
originators, administrators, issuers of letters of credit and insurers;
(3) Employ consultants, attorneys,
accountants, financial experts, bankers, managers and other employees and
agents as may be necessary in its judgment, and fix their compensation;
(4) Receive and accept from any source
and in any form, loans, appropriations, contributions, gifts or grants for or
in aid of any Authority purpose and, when required, use the funds, property or
labor only for the purposes for which it was provided;
(5) Charge to and apportion among
participating institutions its administrative and operating costs and expenses
incurred in the exercise of its powers and duties; and
(6) Do all acts and things necessary or
convenient to carry out its corporate purposes and in such manner and upon such
procedure as the Authority may in its discretion from time to time determine or
prescribe.
§ 9407. Bonds.
(a)
The
Authority is hereby authorized to provide by resolution, from time to time, for
the issuance of duly authorized bonds of the Authority for any of its corporate
purposes, including the refunding of its bonds. The principal of, premium, if
any, and the interest on any issue of bonds shall be payable solely from, and
shall be secured by an irrevocable pledge of a sufficient portion of the
student tuition, fees, charges, and institutional income received by the
particular institution.
(b)
The
bonds of each issue shall be dated, shall bear interest at such rate or rates,
shall mature at such time or times, may be redeemed before maturity, at the
option of the Authority, at such price or prices and under such terms and
conditions, all as may be fixed by the Authority prior to the issuance of the
bonds. The Authority shall determine the form of the bonds including any
interest coupons to be attached thereto, and shall fix the denomination or
denominations of the bonds and the place or places of payment of principal and
interest, which may be at any bank or trust company within or without the
State. The bonds may be issued in coupon
or in registered form, or both, as the Authority may determine, and provision
may be made for the registration of any coupon bonds as to principal alone and
also as to both principal and interest, and for the reconversion into coupon
bonds of any bonds registered as to both principal and interest. The Authority may sell such bonds in such
manner, whether at public or private sale, and for such price, as it may
determine to be in the best interests of the Authority.
(c)
The
proceeds of the bonds of each issue shall be disbursed in such manner and under
such restrictions, if any, as the Authority may provide in the resolution
authorizing the issuance of such bonds or in the trust agreement securing the
same, subject to this Chapter.
§ 9408. Credit of State not pledged to Authority
bonds.
(a) Bonds issued by the
Authority under this Chapter shall not constitute a debt or liability of the
State or of any political subdivision thereof or a pledge of the faith and
credit of the State or of any such political subdivision, but such bonds,
unless refunded by bonds of the Authority authorized by this Chapter, shall be
payable solely from funds and property pledged, assigned or available for their
payment as specifically authorized in the resolution authorizing such bonds or
in the trust indenture securing such bonds. All bonds shall contain on the face thereof a
statement to the effect that the Authority is obligated to pay such bonds and
the interest thereon only from revenues or other specifically pledged property,
and that neither the State nor any political subdivision thereof is obligated
to pay the bonds or the interest thereon and that neither the faith and credit
nor the taxing power of the State or any political subdivision thereof is
pledged to the payment of the principal of or the interest on such bonds.
(b)
All expenses incurred in carrying out this Chapter,
other than for the issuance of general obligation bonds by the State, shall be
payable solely from funds provided under this chapter and nothing in this chapter
shall be construed to authorize the Authority to incur indebtedness or any
liability on behalf of or payable by the State or any political subdivision
thereof.
§ 9409. Audit of books and accounts.
The
office of Auditor of Accounts shall cause an annual audit of the books and
accounts of the Authority. The selection
of a firm to perform the annual audit of the books and accounts of the
Authority shall be mutually agreed upon by the office of the Auditor of
Accounts and the Secretary who shall consult and cooperate with each other in
the selection, contract, employment and scope of professional services to be
rendered, provisions in Chapter 29 of Title 29 notwithstanding. The audit shall be performed by an
independent firm of certified public accountants of recognized ability and
standing and shall conform in all respects to the covenants contained in all
trust agreements entered into by the Authority for the benefit of its
bondholders. The Authority shall
transfer funds, as requested by the office of Auditor of Accounts, to cover the
cost of the audit.”.
