PRINTER'S NO. 2954
No. 2245 Session of 2000
INTRODUCED BY STEELMAN, COY, DeWEESE, HARHAI, FREEMAN,
LESCOVITZ, M. COHEN, STURLA, DeLUCA, GEORGE, TANGRETTI,
FRANKEL, LaGROTTA, PISTELLA, YOUNGBLOOD, BATTISTO, YUDICHAK,
JOSEPHS, BEBKO-JONES, SHANER, GRUCELA, MANN, SOLOBAY, TIGUE,
WALKO, SANTONI, BELARDI, VEON, VAN HORNE, ROBINSON,
WASHINGTON, MUNDY, MELIO, SCRIMENTI, TRAVAGLIO AND GORDNER,
FEBRUARY 9, 2000
REFERRED TO COMMITTEE ON HEALTH AND HUMAN SERVICES,
FEBRUARY 9, 2000
AN ACT
1 Providing for the establishment, implementation and
2 administration of the Pennsylvania Biomedical Research
3 Authority; imposing powers and duties on a board of trustees;
4 and providing for the issuance of notes and bonds.
5 TABLE OF CONTENTS
6 Chapter 1. General Provisions
7 Section 101. Short title.
8 Section 102. Legislative intent.
9 Section 103. Definitions.
10 Chapter 3. Pennsylvania Biomedical Research Authority
11 Section 301. Creation of Pennsylvania Biomedical Research
12 Authority.
13 Section 302. Revenues of authority.
14 Section 303. Powers and duties of authority.
15 Section 304. Specific power to issue bonds.
16 Section 305. Covenants and express conditions on obligations.
1 Section 306. Nature and effect of pledges.
2 Chapter 11. Miscellaneous Provisions
3 Section 1101. State Employees Retirement System and Public
4 School Employees Retirement System.
5 Section 1102. Effective date.
6 The General Assembly of the Commonwealth of Pennsylvania
7 hereby enacts as follows:
8 CHAPTER 1
9 GENERAL PROVISIONS
10 Section 101. Short title.
11 This act shall be known and may be cited as the Pennsylvania
12 Biomedical Research Authority Act.
13 Section 102. Legislative intent.
14 The General Assembly finds and declares as follows:
15 (1) Pennsylvania's teaching colleges, academic health
16 centers and cancer research institutes have allowed this
17 Commonwealth to become a national leader in medical education
18 and research.
19 (2) Health care, the largest nonagriculture segment of
20 this Commonwealth's economy, accounts for more than 14% of
21 the domestic State product.
22 (3) At the heart of this Commonwealth's pharmaceutical
23 and emerging biotechnology industries is medical research for
24 which Pennsylvania provides no direct support or investment.
25 (4) Many academic health centers have reorganized their
26 research operations to encourage technology transfer and to
27 allow these institutions to share in the intellectual
28 property created by researchers at the institutions.
29 Section 103. Definitions.
30 The following words and phrases when used in this act shall
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1 have the meanings given to them in this section unless the
2 context clearly indicates otherwise:
3 "Authority." The Pennsylvania Biomedical Research Authority.
4 "Biomedical company." A person whose headquarters or base of
5 operations is located in this Commonwealth, engaged in the
6 research, development, production or provision of biomedicine
7 for the purpose of developing or providing products, processes
8 or technologies for specific commercial or public purposes,
9 including, but not limited to, medical, pharmaceutical and
10 nutritional and other health-related purposes, or a person whose
11 headquarters or base of operations is located in this
12 Commonwealth who is engaged in providing services or products
13 necessary for such research, development, product or provision
14 of service. The term includes bioinformatics, biomedicine,
15 biopharmacogenomics, biopharmaceuticals, biorobotics,
16 bioscience, biotechnology and genome research companies.
17 "Biomedicine." The continually expanding body of fundamental
18 knowledge about the structure and function of biological systems
19 which seeks, through research, to use that knowledge of
20 naturally occurring processes to develop products, services and
21 technologies to address medical problems, prolong life and
22 prevent and treat disease.
23 "Board." The board of directors of the Pennsylvania
24 Biomedical Research Authority.
25 "Bonds." Bonds, notes or other evidences of indebtedness
26 issued by the authority pursuant to this act.
27 "Clinical trials." Tests conducted at a site located within
28 this Commonwealth that has been approved for conducting studies
29 on the efficacy of drugs and other pharmaceutical products
30 leading to approval by the United States Food and Drug
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1 Administration.
2 "Financial manager." An organization authorized to do
3 business in this Commonwealth that:
4 (1) is authorized to act as a trustee pursuant to the
5 provisions of the Employee Retirement Income Security Act of
6 1974 (Public Law 93-406, 88 Stat. 829) or an insurance
7 company;
8 (2) (i) is licensed or chartered by the Insurance
9 Department or Department of Banking;
10 (ii) is chartered by an agency of the Federal
11 Government; or
12 (iii) is subject to the jurisdiction of the Federal
13 Securities and Exchange Commission; and
14 (3) provides or secures venture capital.
15 "Fund." The Biomedical Research Revolving Fund.
16 "Governmental unit." Any agency of the Commonwealth or any
17 county, municipality or school district, or any agency,
18 instrumentality, authority or corporation thereof, or any public
19 body having local or regional jurisdiction or power.
20 "Public school retirement system." The retirement system for
21 public school employees created pursuant to 24 Pa.C.S. (relating
22 to education).
23 "Research center." An academic health center, medical school
24 or Federally approved cancer research center located within this
25 Commonwealth.
26 "State Employees Retirement System." The retirement system
27 for State employees created pursuant to 71 Pa.C.S. (relating to
28 State government).
29 "Venture capital." A financial investment that results in
30 the acquisition of equity interests or a combination of debt and
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1 equity interests which is expected to grow substantially in the
2 future and in which the expected return on investment is to come
3 predominantly from an increase in the value of the equity
4 interests.
5 CHAPTER 3
6 PENNSYLVANIA BIOMEDICAL
7 RESEARCH AUTHORITY
8 Section 301. Creation of Pennsylvania Biomedical Research
9 Authority.
10 (a) Establishment.--There is hereby established a body
11 corporate and politic, with corporate succession, to be known as
12 the Pennsylvania Biomedical Research Authority. The authority is
13 constituted an instrumentality of the Commonwealth, and the
14 exercise by the authority of the powers conferred by this act
15 shall be deemed and held to be a public and essential
16 governmental function.
17 (b) Membership.--The authority shall consist of an 11-member
18 board of directors composed of:
19 (1) The Physician General.
20 (2) The Secretary of Health.
21 (3) The Secretary of Community and Economic Development.
22 (4) Two Senators, one each to be appointed by the
23 President pro tempore of the Senate and the Minority Leader
24 of the Senate.
25 (5) Two members of the House of Representatives, one
26 each to be appointed by the Speaker of the House of
27 Representatives and the Minority Leader of the House of
28 Representatives.
29 (6) Four persons to be appointed by the Governor, who
30 shall serve for a term of two years and shall be eligible for
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1 reappointment as follows:
2 (i) One shall be a licensed physician in this
3 Commonwealth.
4 (ii) One shall be a representative of a biomedical
5 company or a trade or regional association that
6 represents biomedical companies.
7 (iii) One shall be a representative of a health
8 consumer interest group.
9 (iv) One shall be a representative of a research
10 center.
11 (c) Officers.--The Secretary of Community and Economic
12 Development shall be the chairman and chief executive officer of
13 the authority. The board shall biannually elect a vice chairman.
14 The board shall select a secretary and treasurer who need not be
15 members of the board, and the same person may be selected to
16 serve as both secretary and treasurer.
17 (d) Vesting of powers.--The powers of the authority shall be
18 vested in the board in office from time to time, and eight
19 members of the board shall constitute a quorum at any meeting.
20 Action may be taken and motions and resolutions adopted by the
21 authority by the affirmative vote of at least seven members of
22 the board. No vacancy on the board shall impair the right of a
23 quorum of the members of the board to exercise the powers and
24 perform the duties of the authority.
25 (e) Designees.--Each public officer member of the board may
26 designate an officer or employee of the Commonwealth to
27 represent him at meetings of the board. Each designee may
28 lawfully vote and otherwise act on behalf of the member of the
29 board for whom he constitutes the designee. The designation
30 shall be in writing delivered to the authority and shall
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1 continue in effect until revoked or amended in writing delivered
2 to the authority.
3 (f) Services.--Research, investigation and other services
4 necessary for the operation of the board shall be carried out
5 from resources and by employees from the various executive
6 departments represented on the board. All applicable
7 Commonwealth departments and agencies shall cooperate with and
8 provide assistance to the board, which may at its discretion
9 provide financial reimbursement.
10 (g) Dissolution.--The authority may be dissolved by law,
11 provided that the authority has no bonds or other debts or
12 obligations outstanding or that provision has been made for the
13 payment or retirement of all such bonds, debts and obligations.
14 Upon any dissolution of the authority, all property, funds and
15 assets of the authority shall be vested in the Commonwealth.
16 (h) Credit and taxing power of the Commonwealth.--The
17 authority shall have no power at any time to pledge the credit
18 or taxing power of the Commonwealth or any of its municipalities
19 or political subdivisions nor shall any of its obligations be
20 deemed to be obligations of the Commonwealth or any of its
21 political subdivisions.
22 Section 302. Revenues of authority.
23 (a) Sources of revenues.--The authority may receive money
24 from sources of revenue, including, but not limited to, the
25 following:
26 (1) State funds appropriated to the authority.
27 (2) Federal funds appropriated to or granted to the
28 authority.
29 (3) Venture capital from private companies.
30 (4) Proceeds from the sale of bonds of the authority
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1 authorized under section 304.
2 (5) Proceeds from the sale of any Commonwealth general
3 obligation bonds issued under sections 304 and 305.
4 (6) Proceeds from the sale of authority assets.
5 (7) Repayment of loan principal.
6 (8) Payment of interest on loans made by the authority.
7 (9) Interest earned on the investment of authority
8 moneys.
9 (b) Control of revenues; investment of funds.--The board
10 shall have exclusive control and management of all moneys of the
11 authority and full power to invest moneys not required for
12 immediate use in any securities or other investments in which
13 funds of the Commonwealth are authorized to be invested and in
14 any other type of security or investment if, prior to the
15 acquisition of the securities or investments, the board
16 determines by resolution that the type of security or investment
17 is in the best interests of the authority and the State
18 Treasurer approves of the type of security or other investment.
19 (c) Fiduciary status of board.--
20 (1) The members of the board, employees of the board and
21 agents thereof shall stand in a fiduciary relationship
22 regarding the investments and disbursements of any of the
23 moneys of the fund and shall not profit either directly or
24 indirectly with respect thereto. The board may, when possible
25 and consistent with its fiduciary duties imposed by this
26 subsection or other law, including its obligation to invest
27 and manage the fund, consider whether an investment in any
28 project or business enhances and promotes the general welfare
29 of this Commonwealth and its citizens, including, but not
30 limited to, investments that increase and enhance the
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1 employment of Commonwealth residents and stimulate further
2 investment and economic activity in this Commonwealth.
3 (2) In determining whether an investment meets the
4 standard of prudence, the board may consider, together with
5 the expected return on and the risk characteristics of the
6 particular investment, the actual and expected future returns
7 and the risk characteristics of the total venture capital
8 investments held by the board at the time and the degree to
9 which the proposed new investment would promote further
10 diversification within the venture capital asset class.
11 (3) The board in its prudent discretion may make any
12 investments which meet the standard of prudence set forth in
13 paragraph (1) by becoming:
14 (i) a limited partner in partnerships that will hold
15 or make the investments or by acquiring stocks or shares
16 or units of participation or otherwise participating
17 beneficially in the fund of any corporation or trust
18 organized or created and existing under the laws of the
19 United States or of this Commonwealth, if the liability
20 of the fund shall be limited to the amount of its
21 investment;
22 (ii) by supporting clinical trials of any drug or
23 pharmaceutical in exchange for a financial interest in
24 that drug or pharmaceutical or the company developing
25 that drug or pharmaceutical; or
26 (iii) by supporting research at a research center
27 that the board believes has a reasonable expectation of
28 resulting in a product or service which can or will be
29 transferred to a biomedical company, in exchange for
30 future financial consideration.
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1 (d) Legislative declaration concerning certain authorized
2 investments.--The General Assembly finds and declares that
3 authorized investments of the fund made by or on behalf of the
4 board under this section whereby the board becomes a joint owner
5 or stockholder in any company, corporation or association are
6 outside the scope of the original intent of and therefore do not
7 violate the prohibition set forth in section 8 of Article VIII
8 of the Constitution of Pennsylvania.
9 (e) Limitations on investments.--Notwithstanding any other
10 provision of this act to the contrary, the board shall invest
11 the moneys in the fund exclusively to provide loans to or take
12 an equity interest in biomedical business ventures, including
13 supporting research and product development and transfer at
14 research centers and supporting clinical trials, within this
15 Commonwealth. The board may make these investments directly or
16 through an approved financial manager.
17 (f) General fund and other separate funds or accounts.--
18 (1) The board shall establish a general fund from which
19 it may authorize expenditures for any of the purposes of this
20 act.
21 (2) The board shall establish and administer a
22 Biomedical Research Revolving Fund and may establish such
23 other separate revolving funds and accounts when determined
24 by the board to be necessary or convenient. The board may
25 deposit no more than $725,000,000 in funds and accounts
26 established under this paragraph from the sources specified
27 in subsection (a)(4) and (5). This limitation shall not apply
28 to any Federal funds.
29 (3) The board may also establish such nonrevolving funds
30 and accounts as it deems necessary or convenient. Any funds
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1 from sources specified in subsection (a)(4) and (5) which are
2 not deposited in the board's revolving funds and accounts
3 shall be deposited into these nonrevolving funds and
4 accounts.
5 (g) Loan repayment.--Subject to any agreement with the
6 holders of bonds, repayments of loan principal, together with
7 any interest thereon, shall be deposited with the authority.
8 Repayments from loans made from revolving funds and accounts may
9 be deposited in such funds and accounts as the board shall
10 determine. Repayments from other loans shall be deposited in
11 nonrevolving funds and accounts for the purpose of repayment of
12 general obligation bonds of the Commonwealth issued under the
13 authority of this act. The board shall maintain such separate
14 funds and accounts as may be necessary for the deposit of
15 payments made under authority or requirement of Federal or State
16 law.
17 Section 303. Powers and duties of authority.
18 The authority shall have and may exercise all powers
19 necessary or appropriate to carry out and effectuate the
20 purposes of this act, including, but not limited to, the
21 following:
22 (1) Conduct examinations and investigations and take
23 testimony, under oath or affirmation, on any matter necessary
24 to the determination and approval of project applications.
25 (2) Sue and be sued, implead and be impleaded, complain
26 and defend in all courts.
27 (3) Adopt, use and alter at will a corporate seal.
28 (4) (i) Make bylaws for the management and regulation
29 of its affairs and make and, from time to time, adopt,
30 amend and repeal rules and regulations governing the
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1 administrative procedures and business of the authority.
2 (ii) Notwithstanding subparagraph (i) and in order
3 to facilitate the speedy implementation of the Biomedical
4 Research Program, the board shall have the power and
5 authority to promulgate, adopt and use guidelines that
6 shall be published in the Pennsylvania Bulletin. The
7 guidelines shall be subject to review pursuant to section
8 204(b) of the act of October 15, 1980 (P.L.950, No.164),
9 known as the Commonwealth Attorneys Act, and shall not be
10 subject to review pursuant to the act of June 25, 1982
11 (P.L.633, No.181), known as the Regulatory Review Act,
12 and shall be effective for a period not to exceed two
13 years from the effective date of this act.
14 (iii) After expiration of the two-year period, all
15 guidelines relating to the Biomedical Research Program
16 shall expire and shall be replaced by regulations which
17 shall have been promulgated, adopted and published as
18 provided by law.
19 (5) Make contracts of every name and nature and execute
20 all instruments necessary or convenient for the carrying on
21 of its business.
22 (6) Accept grants from and enter into contracts or other
23 transactions with any Federal, State or local agency.
24 (7) Provide financial assistance, including, but not
25 limited to, loans, loan guarantees, bond guarantees and
26 grants for projects fulfilling the purposes of this act.
27 (8) Collect fees and charges relating to projects funded
28 under this act, as the board determines to be reasonable,
29 relating to activities undertaken in furtherance of the
30 purposes of this act.
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1 (9) Borrow money and issue bonds and provide for the
2 right of holders thereof in accordance with the provisions of
3 this act.
4 (10) Pledge, hypothecate or otherwise encumber all or
5 any of the revenues or receipts of the authority as security
6 for all or any of the bonds of the authority.
7 (11) Receive appropriations and apply for and accept
8 grants, gifts, donations, bequests and settlements from any
9 public or private source.
10 (12) Acquire, own, hold, construct, improve,
11 rehabilitate, renovate, operate, maintain, sell, assign,
12 exchange, lease, mortgage or otherwise dispose of real and
13 personal property or any interest therein in the exercise of
14 its powers and the performance of its duties under this act.
15 (13) Procure insurance against any loss in connection
16 with its property and other assets and operations in any
17 amounts and from any insurers as it deems desirable.
18 (14) Contract for the services of attorneys, accountants
19 and financial experts and any other advisors, consultants and
20 agents as may be necessary in its judgment, subject to the
21 requirement that the chairman shall ensure that minority-
22 owned or minority-controlled firms shall have an opportunity
23 to participate to a significant degree in the provision of
24 any contractual services purchased by the authority.
25 (15) Subject to any agreement with holders of its bonds,
26 notes or other obligations, purchase bonds, notes and other
27 obligations of the authority.
28 (16) Subject to any agreement with holders of its bonds,
29 notes or other obligations, obtain as security for payment of
30 all or any part of the principal of and interest and premium
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1 on the bonds, notes and other obligations of the authority,
2 lines of credit and letters of credit in any amounts and upon
3 any terms as the authority may determine, and pay any fees
4 and expenses required in connection therewith.
5 (17) Do any act necessary or convenient to the exercise
6 of the powers enumerated in this section or reasonably
7 implied therefrom.
8 (18) Prepare plans and reports and provide for public
9 participation as deemed appropriate.
10 (19) Fund prefeasibility studies from any of its sources
11 of revenue.
12 (20) Establish an equity interest in any company that
13 receives assistance from the fund in a measure determined on
14 a valuation of the amount of the assistance and to acquire
15 and sell security interests at public or private sale; to
16 negotiate modifications or alterations to security interests;
17 to foreclose on security interest in default or commence any
18 action to protect or enforce any right conferred upon it by
19 any law, security agreement, contract or other agreement; to
20 bid for and purchase property which was the subject of such
21 security interest at any foreclosure or at any other sale; to
22 acquire or take possession of any such property; and to
23 exercise any and all rights as provided by law for the
24 benefit or protection of the authority or security interest
25 holders.
26 (21) To make and execute contracts and to pay the
27 reasonable value of services rendered to the authority
28 pursuant to those contracts.
29 Section 304. Specific power to issue bonds.
30 (a) Principal amounts.--The authority may issue its bonds,
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1 notes or other obligations in principal amounts as in the
2 judgment of the authority shall be necessary, but not to exceed
3 a total sum of $300,000,000, to provide sufficient funds for any
4 of its corporate purposes. Corporate purposes shall be deemed to
5 include:
6 (1) The payment, funding or refunding of the principal
7 of or interest or redemption premiums on any bonds issued by
8 it, whether the bonds to be funded or refunded have or have
9 not become due.
10 (2) The establishment or increase of reserves to secure
11 or to pay the bonds or interest thereon.
12 (3) All other costs or expenses of the authority
13 incident to and necessary to carry out its corporate purposes
14 and powers.
15 (b) Negotiable instrument designation.--Whether or not the
16 bonds are of a form and character as to be negotiable
17 instruments under the terms of 13 Pa.C.S. (relating to
18 commercial code), the bonds are made negotiable instruments
19 within the meaning of and for the purposes of 13 Pa.C.S.,
20 subject only to the provisions of the bonds for registration.
21 (c) Resolution; terms of bonds.--Bonds shall be authorized
22 by resolution of the board, may be issued in one or more series
23 and shall bear any date or dates, mature at any time or times
24 not later than 35 years from the date of issuance thereof, bear
25 interest at any rate or rates or at variable rates, be in any
26 denomination or denominations, be in any form, either coupon or
27 registered, carry any conversion or registration privileges,
28 have any rank or priority, be executed in any manner, be payable
29 from such sources in any medium of payment at any place or
30 places within or without this Commonwealth and be subject to any
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1 terms of redemption, purchase or tender by the authority or the
2 holders thereof, with or without premium, as the resolution or
3 resolutions may provide. A resolution of the authority
4 authorizing the issuance of bonds may provide that the bonds be
5 secured by a trust indenture between the authority and a
6 trustee, vesting in the trustee any property, rights, powers and
7 duties in trust consistent with the provisions of this act as
8 the authority may determine. Such resolution may further provide
9 for the acquisition of credit enhancement devices such as bond
10 insurance, letters of credit or any other instruments to carry
11 out the provisions of this section.
12 (d) Public or private sale.--Bonds shall be sold initially
13 at public sale at any price or prices and in any manner as the
14 authority may determine, subject to the requirement that the
15 chairman shall ensure that minority-owned or minority-controlled
16 firms shall have an opportunity to participate to a significant
17 degree in any bond sale activities. Any portion of any bond
18 issue so offered and not sold or subscribed for may be disposed
19 of by private sale by the authority in such manner and at such
20 prices as the authority shall direct.
21 (e) No prior preconditions on bond issuance.--Bonds may be
22 issued under the provisions of this act without obtaining the
23 consent of any department, division, board, bureau or agency of
24 the Commonwealth and without any other proceeding or the
25 happening of any other conditions or other things than those
26 proceedings, conditions or things which are specifically
27 required by this act.
28 (f) Limitation on obligations.--Bonds issued under the
29 provisions of this act shall not be a debt or liability of the
30 Commonwealth or of any of its political subdivisions other than
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1 the authority and shall not create or constitute any
2 indebtedness, liability or obligation of the Commonwealth or of
3 any political subdivision. All bonds shall be payable solely
4 from revenues or funds pledged or available for their payment as
5 authorized in this act, including the proceeds of any issue of
6 bonds. Each bond shall contain on its face a statement to the
7 effect that the authority is obligated to pay the principal
8 thereof or the interest thereon only from its revenues, receipts
9 or funds pledged or available for their payment as authorized in
10 this act, that neither the Commonwealth nor any political
11 subdivisions are obligated to pay the principal or interest and
12 that neither the faith and credit nor the taxing power of the
13 Commonwealth or any political subdivision is pledged to the
14 payment of the principal of or the interest on the bonds.
15 (g) Nature of obligation and payment.--Each issue of bonds
16 may, if it is determined by the authority, be general
17 obligations of the authority payable out of any revenues,
18 receipts or funds of the authority, or special obligations
19 payable out of particular revenues, receipts or funds, subject
20 only to agreements with the holders of the bonds. Bonds may be
21 secured by one or more of the following:
22 (1) Pledges of revenues and other receipts to be derived
23 from the payment of the interest on and any principal of
24 notes and bonds issued by one or more governmental units and
25 purchased by the authority, and any other payment made to the
26 authority pursuant to agreements with any governmental unit
27 or a pledge or assignment of any notes and bonds of any
28 governmental units, and the rights and interests of the
29 authority therein.
30 (2) Pledges of loan payments, rentals, other revenues to
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1 be derived from loan agreements, leases or other contractual
2 arrangements with any person or entity, public or private, or
3 a pledged or assignment of any such loan agreements, leases
4 or other contractual arrangements, and the rights and
5 interests of the authority therein.
6 (3) Pledges of grants, subsidies, contributions,
7 appropriations or other payments to be received from the
8 Federal Government or any instrumentality thereof or from the
9 Commonwealth, any Commonwealth agency or other governmental
10 unit.
11 (4) Pledges of all moneys, funds, accounts, securities
12 and other funds, including the proceeds of the bonds.
13 (5) Mortgages and security interests covering all or
14 part of any project or other property of any person or
15 entity, real or personal, then owned or thereafter to be
16 acquired, or a pledge or assignment of mortgages and security
17 interests made or granted to the authority by any person or
18 entity, and the rights and interests of the authority
19 therein.
20 (h) Exemption from taxation.--All bonds and notes issued
21 under the provisions of this section shall be exempt from
22 taxation for State and local purposes.
23 Section 305. Covenants and express conditions on obligations.
24 In any resolution of the authority authorizing or relating to
25 the issuance of bonds, the authority, in order to secure payment
26 of the bonds, and, in addition to its other powers, may, by
27 provisions in the resolution which shall constitute covenants by
28 the authority and contracts with the holders of the bonds, do
29 the following:
30 (1) Secure the bonds.
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1 (2) Make covenants against pledging all or part of its
2 revenues or receipts to other parties.
3 (3) Make covenants limiting its right to sell, pledge or
4 otherwise dispose of notes and bonds of governmental units,
5 loan agreements of public or private persons or entities, or
6 other property of any kind.
7 (4) Make covenants as to additional bonds to be issued,
8 the limitations thereon, the terms and conditions thereof,
9 and the custody, application, investment and disposition of
10 the proceeds thereof.
11 (5) Make covenants as to the incurring of other debts by
12 it.
13 (6) Make covenants as to the payment of principal of or
14 interest on bonds, the sources and methods of the payment,
15 the rank or priority of bonds with respect to liens or
16 security interests or the acceleration of maturity of bonds.
17 (7) Provide for replacement of lost, stolen, destroyed
18 or mutilated bonds.
19 (8) Make covenants as to the redemption, purchase or
20 tender of bonds by the authority, or the holders thereof, and
21 the privileges of exchanging them for other bonds.
22 (9) Make covenants to create or authorize the creation
23 of special funds or accounts to be held in trust or otherwise
24 for the benefit of holders of bonds, or of reserves for other
25 purposes and as to the use, investment and disposition of
26 moneys held in those funds, accounts or reserves.
27 (10) Provide for the rights, liabilities, powers and
28 duties arising upon the breach of a covenant, condition or
29 obligation and prescribe the events of default and the terms
30 and conditions upon which any or all of the bonds shall
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1 become or may be declared due and payable before maturity and
2 the terms and conditions upon which the declaration and its
3 consequences may be waived.
4 (11) Vest in a trustee or trustees within or without
5 this Commonwealth in trust any property, rights, powers and
6 duties as the authority may determine. These may include any
7 or all of the rights, powers and duties of any trustee
8 appointed by the holders of bonds or notes, including rights
9 with respect to the sale or other disposition of notes and
10 bonds of governmental units and other instruments and
11 security pledged pursuant to a resolution or trust indenture
12 for the benefit of the holders of bonds and the right, by
13 suit or action, to foreclose any mortgage pledged pursuant to
14 the resolution or trust indenture for the benefit of the
15 holders of the bonds, notes or other obligations, and to
16 limit the right of the holders of any bonds to appoint a
17 trustee under this act and to limit the rights, powers and
18 duties of the trustee.
19 (12) Pay the costs or expenses incident to the
20 enforcement of the bonds or the provisions of the resolution
21 authorizing the issuance of those bonds, or the trust
22 indenture securing the bonds or any covenant or agreement of
23 the authority with the holders of the bonds, notes or other
24 obligations.
25 (13) Limit the rights of the holders of any bonds to
26 enforce any pledge or covenant securing bonds.
27 (14) Make covenants other than or in addition to the
28 covenants authorized by this act of like or different
29 character and make covenants to do or refrain from doing any
30 acts and things as may be necessary, or convenient and
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1 desirable, in order to better secure bonds or which, in the
2 absolute discretion of the authority, will tend to make bonds
3 more marketable, notwithstanding that the covenants, acts or
4 things may not be enumerated in this act.
5 Section 306. Nature and effect of pledges.
6 A pledge of revenues, receipts, moneys, funds or other
7 property or instruments made by the authority shall be valid and
8 binding from the time when the pledge is made. The revenues,
9 receipts, moneys, funds or other property pledged and thereafter
10 received by the authority shall be immediately subject to the
11 lien of the pledge without its physical delivery or further act,
12 and the lien of any pledge shall be valid and binding as against
13 all parties having claims of any kind in tort, contract or
14 otherwise against the authority irrespective of whether the
15 parties have notice of the lien. Neither the resolution nor any
16 other instrument by which a pledge under this section is created
17 or evidenced need be filed or recorded except in the records of
18 the authority.
19 CHAPTER 11
20 MISCELLANEOUS PROVISIONS
21 Section 1101. State Employees Retirement System and Public
22 School Employees Retirement System.
23 The State Employees Retirement System and the Public School
24 Employees Retirement System are authorized to invest funds
25 through the authority, to make investments in conjunction with
26 that authority, to partner with the authority or any financial
27 manager contracting with the authority in making investments in
28 biomedicine. Investments and commitment of funds shall meet the
29 same fiduciary standard applied to investments made by the
30 authority and shall be deemed to meet the applicable fiduciary
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1 standard for each retirement system. Investments or commitment
2 of funds shall not apply against any limitation in statute or
3 regulation on the amount or percentage of retirement system
4 funds that can be invested in high-risk ventures.
5 Section 1102. Effective date.
6 This act shall take effect immediately.
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