(a) The state funding board is authorized to issue bonds of this state, without limitation as to amount, for the purpose of financing costs associated with the development of user fee facility projects, as shall be requested by the commissioner, subject to approval of the board. The request shall be accompanied by such information as the state funding board may require.(b) The bonds shall be issued from time to time in such principal amounts and bearing such terms, including, but not limited to, optional or mandatory redemption prior to maturity, and may be sold in such manner, either at competitive or negotiated sale, and at such prices and subject to such terms and conditions, as shall be determined by the state funding board. The state funding board may delegate to any member of the state funding board the power to establish any such matters within parameters determined by the state funding board.(c) The bonds shall be payable solely from and secured solely by moneys on deposit from time to time in the state user fee fund, including any proceeds of bonds as may be deposited in the state user fee fund, and shall not be a debt of, nor constitute a general obligation or pledge of the full faith and credit of, the state, except to the extent expressly provided by this section, or of any county, municipality, taxing entity or other political subdivision thereof.(d) In case any member of the state funding board whose signature appears on any bond ceases to be a member before the delivery of the bond, that signature nevertheless shall be valid and sufficient for all purposes, the same as if the member had remained in office until delivery.(e) With respect to all or any portion of any issue of bonds, the state funding board may authorize and enter into hedging agreements and ancillary agreements, upon request by the commissioner, under such terms and agreements as the funding board may determine, including, but not limited to, with respect to hedging agreements, provisions permitting the funding board to pay to or receive from any person or entity any loss of benefits under the agreement upon early termination of the agreement, or default under the agreement.(f) When entering into any ancillary agreements, hedging agreements and agreements with purchasers of bonds, evidencing a transaction bearing a reasonable relationship to this state and also to another state or nation, the state funding board may agree in the written contract or agreement that the rights and remedies of the parties to the contracts and agreements shall be governed by the laws of this state, or the laws of the other state or nation; provided, that jurisdiction over the state funding board against which an action on such a contract or agreement is brought shall lie solely in the Tennessee claims commission or, if and to the extent permitted by law, a court in this state that would otherwise have jurisdiction of actions brought in contract against the state funding board.(g) All banks, trust companies, bankers, savings banks and institutions, building and loan associations, savings and loan associations, investment companies, and other persons carrying on a banking and investment business; all insurance companies, insurance associations, and other persons carrying on an insurance business; and all executors, administrators, curators, trustees, and other fiduciaries may legally invest any sinking funds, moneys, or other funds belonging to them or within their control in any of the bonds, and the bonds shall be authorized security for all public deposits. Nothing contained in this subsection (g) with regard to legal investments shall be construed as relieving any person of any duty of exercising reasonable care in selecting securities.(h) The state funding board is authorized to procure such legal and technical advice, approving opinions and financial assistance as it may consider necessary, and also to pay all necessary expenses, in connection with carrying into effect this section, all of which may be funded from proceeds of the bonds or other state indebtedness.(i) The powers conferred by this section shall be in addition and supplementary to any other general, special or local law. No proceedings, notice or approval shall be required for the issuance of any bonds or any instrument as security for the bonds, except as may be provided in this section, any other law to the contrary notwithstanding.(j) The proceeds of sale of the bonds shall be deposited in the state user fee fund and disbursed in accordance with law and other instruments governing the state user fee fund, but only for the purposes of this chapter.(k) The bonds and the interest on the bonds shall be exempt from taxation by the state and by any county, municipality or taxing entity of the state, except for inheritance, transfer and estate taxes.(l) A resolution authorizing bonds may provide that the bonds contain a recital that they are issued pursuant to this chapter, which recital shall be conclusive evidence of their validity and the regularity of their issuance. The validity of the authorization and issuance of bonds shall not be dependent on or affected in any way by proceedings taken for, or contracts or agreements made in connection with, the development of user fee facility projects.(m) When any bonds are paid and discharged, they shall be cancelled and the cancelled bonds retained and made available for examination in annual audits. The state funding board may, by resolution, authorize and direct the paying agent for the bonds or other person in possession of bonds to destroy all bonds duly paid and cancelled; provided, that the bonds paid and cancelled during any fiscal year may be destroyed only after the fiscal audit of the state covering the fiscal year has been completed. The paying agent or other person in possession of the bonds shall furnish a certified list of bonds duly paid and cancelled showing, for each issue of bonds the bond number, amount, date paid and such additional information as the state funding board may require. This subsection (m) shall be in addition to any other law. Where this subsection (m) is in conflict with other law, this subsection (m) shall prevail.(n) In order to secure the payment of the principal of and interest on the bonds, and the payment of obligations under any ancillary agreements and hedging agreements, including obligations for termination or other nonperiodic payments, or in connection with such bonds or agreements, the state funding board shall have the power to: (1) Pledge all or any part of the user fee revenues, or other moneys on deposit in the state user fee fund, or any rights to receive the revenues and moneys, to the punctual payment of the principal of and interest on the bonds and obligations under any such agreements, and covenant against thereafter pledging any such user fee revenues or other monies to any other bonds or obligations. It is intended that the Perfection, Priority and Enforcement of Public Pledges and Liens Act, compiled in title 9, chapter 22, shall apply to the pledge;(2) Covenant as to establishment and maintenance and collection of user fees;(3) Provide for the terms, form, payment, registration, exchange, execution and authentication of the bonds in a manner not inconsistent with this section, which may include the appointment of paying agents, registrars and authenticating agents within or without the state;(4) Covenant as to the use and disposition of the proceeds from the sale of the bonds in a manner not inconsistent with this chapter;(5) Covenant as to limitations on the issuance of additional obligations to finance user fee facility projects and on the lien on user fee revenues or other moneys for the payment and security of the additional obligations;(6) Covenant as to the amount and kind of insurance to be maintained on user fee facility projects, and the use and disposition of insurance moneys;(7) Covenant as to the operation of user fee facility projects;(8) Covenant to set aside or pay over reserves and sinking funds for the bonds and as to the disposition of the reserves and sinking funds;(9) Redeem the bonds, and covenant for their redemption and to provide the terms and conditions of the redemption;(10) Covenant as to books of account, as to the inspection and audit of the books of account, and as to the accounting methods;(11) Covenant as to the investment of moneys on deposit in the state user fee fund;(12) Covenant and prescribe as to what occurrences shall constitute events of default and the terms and conditions upon which any or all of the bonds shall become or may be declared due before maturity and as to the terms and conditions upon which the declaration and its consequences may be waived;(13) Covenant as to the rights, remedies, liabilities, powers and duties arising upon the breach by it of any covenant, condition or obligation;(14) Make such covenants and do any and all such acts and things as may be necessary, convenient or desirable in order to secure the bonds, or in the discretion of the state funding board, to make the bonds more marketable, notwithstanding that the covenants, acts or things may not be enumerated in this section, it being the purpose of this section to give the state funding board power to do all things in the issuance of the bonds and for their security that may be consistent with the Tennessee constitution;(15) Vest in a trustee or trustees, which may be located within or without the state, powers and duties, including the right to enforce any covenants made to secure, or to pay, the bonds, limitations on liabilities, and the terms and conditions upon which the holders of the bonds or any portion or percentage of them may enforce any covenants under the bonds or duties imposed by the bonds;(16) Prescribe a procedure by which the terms of any resolution authorizing bonds, or any other contract with bondholders, including, but not limited to, an indenture of trust or similar instrument, may be amended or abrogated and as to the amount of bonds the holders of which must consent to the amendment or abrogation, and the manner in which the consent must be given;(17) Covenant and provide for the discharge and satisfaction and defeasance of all or any part of bonds and the indebtedness evidenced by the bonds; and(18) Execute all instruments and perform such other acts as are necessary, convenient or desirable in the exercise of the powers granted in this section, or in the performance of the covenants or duties of the funding board.(o) Nothing in this chapter shall be construed so as to impair the obligation of any contract made by the state upon any bonds, hedging agreements and ancillary agreements. The state covenants and agrees with the holders of the bonds that so long as the bonds are outstanding and unpaid, the state shall not limit or alter the rights and obligations of the state funding board and the commissioner under this section to prescribe, maintain and revise user fees and apply the user fee revenues and other moneys on deposit in the state user fee fund, including the continuing appropriation thereof, as provided in this chapter.Amended by 2023 Tenn. Acts, ch. 159, s 26, eff. 4/17/2023.Amended by 2023 Tenn. Acts, ch. 159, s 25, eff. 4/17/2023. Acts 2007 , ch. 597, § 10.