§ 1207-b. Issuance of bonds and notes by the authority. 1.
Notwithstanding the provisions of sections twelve hundred through twelve
hundred twenty-one, inclusive, of this title or of any other provisions
of law to the contrary, but subject to the provisions of section twelve
hundred seven-j of this title, the authority shall have the power and is
hereby authorized to borrow money and to issue negotiable bonds and
notes therefor in conformity with applicable provisions of the uniform
commercial code in such principal amount as, in the opinion of the
authority, shall be necessary to provide funds sufficient to pay the
purchase price of no more than seven hundred twenty-four cars for the
rapid transit lines under the jurisdiction of the authority purchased
pursuant to section twelve hundred seven-a of this title, to pay
interest on the bonds and notes of the authority, to establish reserves
to secure such bonds and notes, and to pay all other expenditures of the
authority incident to or incurred in connection with the purchase of
such cars and the authorization, issuance and sale of said bonds and
notes. In no event shall there be outstanding at any one time more than
ninety-two million dollars ($92,000,000) in such bonds and notes.

1-a. The authority may also issue its bonds, notes or other
obligations in such principal amounts as shall be necessary to finance
the construction, purchase, lease or acquisition of, or an equity
interest in, an office building located or to be constructed in the
borough of Brooklyn in the city, provided that (i) all or a portion of
such building is intended to be occupied by the authority and that the
board shall, by resolution, have made findings that the sum of the
capitalized value of all payments due from the authority under such
bonds, notes or other obligations (not including any amounts
attributable to principal repayment) together with any rent payments for
the space in such building to be occupied by the authority and of all
payments required of the authority under any related agreement does not
exceed the capitalized value of those payments which would be made in a
conventional commercial lease transaction for comparable space with an
unrelated party and (ii) not more than an insubstantial portion of any
real property so financed with the proceeds of bonds, notes, or other
obligations is utilized by other than the New York city transit
authority or its designated subsidiary. The term "capitalized value" for
the purposes of this subdivision shall be computed in the manner set
forth in subdivision four of section twelve hundred seven-m of this
title. The metropolitan transportation authority is hereby additionally
authorized from time to time to issue bonds for the purposes of
refunding, redeeming or otherwise paying, including paying by purchase
or tender, bonds issued by the authority for such purposes and to secure
such bonds in the manner set forth in section twelve hundred sixty-nine
of this article.

2. The authority shall have the power from time to time to renew notes
or to issue renewal notes for such purpose, to issue bonds to pay notes,
and whenever it deems refunding expedient, to refund bonds by the
issuance of new bonds and to issue bonds partly to refund bonds and
notes then outstanding and partly for the purposes authorized by
subdivision one of this section. The refunding bonds may be exchanged
for bonds to be refunded, with such cash adjustments as may be agreed,
or may be sold and the proceeds applied to the purchase or payment of
the bonds to be refunded. In no event shall the maturity date of the
refunding bonds be a date beyond thirty-five years from the date the
first bond was issued.

3. Every issue of bonds and notes of the authority shall be special
obligations of the authority payable solely from the moneys and revenues
of the authority derived from the operation of the transit facilities
under its jurisdiction, subject to any agreement with the holders of
particular bonds or notes pledging any particular moneys or revenues.

4. The bonds and notes shall be authorized by resolution of the
authority and shall bear such date or dates and shall mature at such
time or times as such resolution or resolutions may provide, except that
no note or any renewal thereof shall mature more than five years after
the date of issue of the original note and no bond shall mature more
than thirty-five years from the date of issue. Bonds and notes shall
bear interest at such rate or rates, be in such denominations, be in
such form, either coupon or registered, carry such registration
privileges, be executed in such manner, be payable in such medium of
payment, at such place or places, and be subject to such terms of
redemption and to such other terms and conditions as such resolution or
resolutions may provide. The bonds and notes may be sold at public or
private sale for such price or prices as the authority shall determine.
Pending preparation of definitive bonds, the authority may issue interim
receipts which shall be exchanged for such bonds.

5. Any resolution or resolutions authorizing any bonds or notes or any
issue of bonds or notes may contain provisions, which shall be a part of
the contract with the holders of the bonds, or notes thereby authorized,
as to

(a) pledging all or any part of the revenues or other monies of the
authority to secure the payment of the bonds or notes or of any issue of
the bonds or notes, subject to such agreements with bondholders or
noteholders as may then exist;

(b) the rate or rates of fare to be charged and the amounts to be
raised in each year from revenues and the use and disposition of the
revenues;

(c) the setting aside of reserves or sinking funds, and the regulation
and disposition thereof;

(d) limitations on the rights of the authority with respect to the use
and disposition of the cars for which such bonds or notes are issued and
with respect to all other transit facilities of the authority;

(e) limitations on the purpose to which the proceeds of sale of any
issue of bonds or notes then or thereafter to be issued may be applied
and pledging such proceeds to secure the payment of the bonds or notes
or of any issue of the bonds or notes;

(f) limitations on the issuance of additional bonds and notes; the
terms upon which additional bonds and notes may be issued and secured,
and the funding or refunding of outstanding or other bonds and notes;

(g) the procedure, if any, by which the terms of any contract with
bondholders or noteholders may be amended or abrogated, the amount of
bonds or notes the holders of which must consent thereto, and the manner
in which such consent may be given;

(h) vesting in a trustee or trustees such property, rights, powers and
duties in trust as the authority may determine, which may include any or
all of the rights, powers and duties of the trustee appointed by the
bondholders or noteholders pursuant to section twelve hundred seven-h
hereof, and limiting or abrogating the right of the bondholders to
appoint a trustee under section twelve hundred seven-h hereof, or
limiting the rights, duties and powers of such trustee;

(i) defining the acts or omissions to act which shall constitute a
default in the duties of the authority to the holders of its bonds and
notes and providing the rights and remedies of such holders in the event
of default;

(j) any other matters, of like or different character, which in any
way affect the security or protection of the bonds and notes.

6. It is the intention hereof that any pledge of revenues or other
moneys made by the authority shall be valid and binding from the time
when the pledge is made; that the revenues or other moneys so pledged
and thereafter received by the authority shall immediately be subject to
the lien of such pledge without any physical delivery thereof or further
act, and that the lien of any such pledge shall be valid and binding as
against all parties having claims of any kind in tort, contract or
otherwise against the authority irrespective of whether such parties
have notice thereof. Neither the resolution nor any other instrument by
which a pledge is created need be recorded.

7. Neither the members of the board nor any person executing the bonds
or notes shall be liable personally on the bonds or notes or be subject
to any personal liability or accountability by reason of the issuance
thereof.

8. Subject to such agreements with bondholders or noteholders as may
then exist, the authority shall have power out of any funds available
therefor to purchase bonds or notes. The authority may hold, cancel or
resell such bonds and notes, subject to and in accordance with
agreements with bondholders and noteholders.