§ 3236. Bonds and notes of the corporation. 1. (a) The corporation
shall have power and is hereby authorized from time to time to issue its
bonds and notes in such principal amount or amounts, subject to
subdivision eight of this section, as the corporation shall determine to
be necessary, to provide sufficient funds for achieving its corporate
purposes, including the making of payments pursuant to section three
thousand two hundred thirty-eight of this title, the payment of interest
on bonds and notes of the corporation, the establishment of reserves to
secure such bonds and notes, the payment of amounts required under bond
or note facilities or agreements relating thereto, and the payment of
all costs of issuance of its bonds and notes.

(b) The corporation shall have the power and is hereby authorized from
time to time to issue (i) notes to renew notes and (ii) bonds to pay
notes, including the interest thereon and, whenever it deems refunding
expedient, to refund any bonds by the issuance of new bonds, whether the
bonds to be refunded have or have not matured, and to issue bonds partly
to refund bonds then outstanding and partly for any of its other
corporate purposes. The refunding bonds may be exchanged for the bonds
to be refunded or sold and the proceeds applied to the purchase,
redemption or payment of such bonds.

(c) Except as may otherwise be expressly provided by the corporation,
every issue of its bonds and notes shall be general obligations of the
corporation payable out of any revenues of the corporation, subject only
to any agreements with the holders of particular bonds or notes pledging
any particular revenues.

(d) (i) Bonds and notes shall be authorized by resolution of the
corporation, be in such denominations and bear such date or dates and
mature at such time or times, as such resolution may provide, provided
that bonds and notes and renewals or refundings thereof shall mature on
a date not later than December thirty-first, two thousand twenty-five
nor more than thirty years from the date of original issuance.

(ii) Bonds and notes shall be subject to such terms of redemption,
bear interest at such rate or rates, be payable at such times, be in
such form, either coupon, registered or book entry form, 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
and conditions as such resolution may provide.

(e) Such bonds shall be sold to the bidder offering the lowest
interest cost to the corporation, taking into consideration any premium
or discount and, in the case of refunding bonds, the bona fide initial
public offering price, not less than four nor more than fifteen days,
Sundays excepted, after a notice of such sale has been published at
least once in a definitive trade publication of the municipal bond
industry published on each business day in the state of New York which
is generally available to participants in the municipal bond industry,
which notice shall state the terms of the sale. The corporation may not
change the terms of the sale unless notice of such change is sent via a
definitive trade wire service of the municipal bond industry which, in
general, makes available information regarding activity and sales of
municipal bonds and is generally available to participants in the
municipal bond industry, at least one hour prior to the time of the sale
as set forth in the original notice of sale. In so changing the terms or
conditions of a sale the corporation may send notice by such wire
service that the sale will be delayed by up to thirty days, provided
that wire notice of the new sale date will be given at least one
business day prior to the new time when bids will be accepted. In such
event, no new notice of sale shall be required to be published.
Advertisements shall contain a provision to the effect that the
corporation, in its discretion, may reject any or all bids made in
pursuance of such advertisements, and in the event of such rejection,
the corporation is authorized to negotiate a private sale or readvertise
for bids in the form and manner above described as many times as, in its
judgment, may be necessary to effect a satisfactory sale.
Notwithstanding the foregoing provisions of this paragraph, whenever in
the judgment of the corporation the interests of the corporation will be
served thereby, the corporation may sell bonds at private sale. The
corporation shall promulgate regulations governing the terms and
conditions of any such private sales, which regulations shall include a
provision that it give notice to the governor, the temporary president
of the senate, and the speaker of the assembly of its intention to
conduct a private sale of obligations pursuant to this section not less
than five days prior to such sale or the execution of any binding
agreement to effect such sale.

(f) The corporation shall enter into an agreement with the comptroller
pursuant to which the comptroller shall be the exclusive agent of the
corporation for the sale of its bonds and notes.

2. Consistent with the provisions of this title, any resolution
authorizing any bonds or notes or any issue thereof may contain
provisions, which shall be a part of the contract with the holders
thereof, as to:

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

(b) pledging all or any part of the assets of the corporation to
secure the payment of the bonds or notes or of any issue of bonds or
notes, subject to such agreements with bondholders or noteholders as may
then exist;

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

(d) limitations on the purposes to which the proceeds of sale of bonds
or notes may be applied and pledging such proceeds to secure the payment
of the bonds or notes or of any issue thereof;

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

(f) 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;

(g) limitations on the amount of moneys to be expended by the
corporation for operating expenses of the corporation;

(h) vesting in a trustee, as described in subdivision six of this
section, such property, rights, powers and duties in trust as the
corporation may determine, which may include any or all of the rights,
powers and duties of the trustee appointed by the bondholders pursuant
to this title, and limiting or abrogating the right of the bondholders
to appoint a trustee under this title or limiting the rights, powers,
and duties of such trustee;

(i) the acts or omissions to act which shall constitute a default in
the obligations and duties of the corporation to the holders of the
bonds or notes and providing for the rights and remedies of the holders
of the bonds or notes in event of such default, including the right to
appointment of a receiver; providing, however, that such rights and
remedies shall not be inconsistent with the general laws of the state
and the other provisions of this title;

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

(k) the application of any of the foregoing provisions to any provider
of any applicable bond or note facility.

Notwithstanding the foregoing, the corporation shall not be authorized
to make any covenant, pledge, promise, or agreement purporting to bind
the state except as otherwise specifically authorized by this title.

3. Any pledge made by the corporation shall be valid and binding from
the time when the pledge is made. The revenues or property so pledged
and thereafter received by the corporation shall immediately be subject
to the lien of such pledge without any physical delivery thereof or
further act, and 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 corporation, irrespective of whether such parties
have notice thereof. Neither the resolution nor any other instrument by
which a pledge is created need be recorded or filed to protect such
pledge.

4. Neither the directors of the corporation nor any other person
executing the bonds or notes of the corporation shall be subject to any
personal liability or accountability by reason of the issuance thereof.

5. The corporation, subject to such agreements with bondholders or
noteholders as may then exist, or with the providers of any applicable
bond or note facility, shall have power out of any funds available
therefor to purchase bonds or notes of the corporation, which may or may
not thereupon be cancelled, at a price not substantially exceeding:

(a) if the bonds or notes are then redeemable, the redemption price
then applicable, including any accrued interest;

(b) if the bonds or notes are not then redeemable, the redemption
price and accrued interest applicable on the first date after such
purchase upon which the bonds or notes become subject to redemption.

6. In the discretion of the directors of the corporation, the bonds
and notes may be secured by a trust indenture by and between the
corporation and a corporate trustee, or a corporate trustee may be
appointed under the resolution as provided in subdivision two of this
section.

7. Whether or not the bonds and notes are of such form and character
as to be negotiable instruments under the terms of the uniform
commercial code, the bonds and notes are hereby made negotiable
instruments within the meaning of and for all the purposes of the
uniform commercial code, subject only to the provisions of the bonds and
notes for registration or any book-entry-only system.

8. (a) The corporation shall not issue any bonds or notes in an amount
in excess of four billion seven hundred million dollars, plus a
principal amount of bonds or notes:

(i) to fund any capital reserve fund in accordance with the capital
reserve fund requirement,

(ii) to provide capitalized interest for a period not to exceed six
months, and

(iii) to provide for the payment of fees and other charges and
expenses, including underwriters' discount, related to the issuance of
such bonds or notes, or related to the provision of any applicable bond
or note facilities.

(b) In computing for the purposes of this section, the aggregate
amount of indebtedness evidenced by bonds and notes of the corporation
issued pursuant to this title, there shall be excluded (i) the amount of
bonds or notes issued that would constitute interest under the Code as
amended to the effective date of this title, and (ii) the amount of such
indebtedness represented by such bonds or notes issued to refund or
otherwise repay bonds or notes, provided that the amount so excluded
under this subparagraph (ii) may exceed the principal amount of such
bonds or notes that were issued to refund or otherwise repay only if the
present value of the aggregate debt service on the refunding or
repayment bonds or notes shall not have at the time of their issuance
exceeded the present value of the aggregate debt service of the bonds or
notes they were issued to refund or repay, such present value in each
case being calculated by using the effective interest rate of the
refunding or repayment bonds or notes, which shall be that rate arrived
at by doubling the semi-annual interest rate (compounded semi-annually)
necessary to discount the debt service payments on the refunding or
repayment bonds or notes from the payment date thereof to the date of
issue of the refunding or repayment bonds or notes and to the price bid
therefor, or to the proceeds received by the corporation from the sale
thereof, in each case including estimated accrued interest.

9. Each issuance of bonds by the corporation under this title shall
provide for the retirement thereof so that debt service thereon,
calculated in accordance with reasonably assumed interest rates to the
extent not then determinable, shall be on a substantially level or
decreasing debt-service payment basis no later than one year from the
date of their issuance to the date of retirement of the latest bond
within such issue to retire. Each issuance of notes shall provide for
annual reductions of the aggregate outstanding principal in equal or
increasing amounts of such reduction. Notwithstanding the foregoing, if
the corporation shall issue refunding bonds, the debt service thereon
shall be structured on any basis that the corporation deems is in its
best interest, provided that debt service on all outstanding bonds,
notes and other financial obligations is not increased in any future
fiscal year after giving effect to such refunding.