Code of the District of Columbia

§ 47–340.29. Bond details.

(a) The Chief Financial Officer may take any action reasonably necessary or appropriate in accordance with this subchapter in connection with the preparation, execution, issuance, sale, delivery, security for, and payment of the bonds of each series, including, determinations of:

(1) Whether the bonds are to be issued in one or more series and the principal amount of each series;

(2) The final form, content, denominations, lettering, numbering, designation, and terms of each series of the bonds, or the manner of determining the designations and denominations, lettering, and numbering, including a determination that the bonds may be issued in certificated or book-entry form;

(3) The rate or rates of interest or the method for determining the rate or rates of interest on each series of the bonds;

(4) The date or dates of issuance, sale, and delivery of, and the payment of interest on each series of the bonds, and the maturity date or dates of the bonds;

(5) The price and terms under which any series of the bonds may be paid, optionally or mandatorily redeemed, accelerated, tendered, called, or put for redemption, repurchase, or remarketing before their respective stated maturities;

(6) The maximum debt service payable in any fiscal year for each series of the bonds;

(7) Provisions for the registration, transfer, and exchange of each series of the bonds and the replacement of mutilated, lost, stolen, or destroyed bonds;

(8) The creation of any reserve fund, sinking fund, or other fund with respect to each series of the bonds;

(9) The method of collection and deposit of Available Tax Revenues into the Income Tax Secured Bond Fund and the distributions from the Income Tax Secured Bond Fund to the trustee;

(10) The dates and place of payment of each series of the bonds;

(11) Procedures for monitoring the use of the proceeds received from the sale of each series of the bonds to ensure that the proceeds are properly applied and used to accomplish the purposes of Chapter 2 of Title 1, this subchapter, or Chapter 28 of Title 42;

(12) The designation of the Collection Agent, trustee, Paying Agent, and registrar for each series of the bonds;

(13) Actions necessary to qualify each series of the bonds under blue sky laws of any jurisdiction where the bonds are marketed;

(14) Whether to enter into a Hedge Agreement related to all or a portion of a series of bonds; and

(15) The terms and types of security granted to the holders of each series of the bonds, including bond insurance and other credit enhancement.

(b) The bonds shall be executed in the name of the District and on its behalf by the manual or facsimile signature of the Mayor, and attested by the Secretary of the District of Columbia by the Secretary’s manual or facsimile signature.

(c) The bonds of any series may be issued in accordance with the terms of a trust instrument to be entered into by the District and the trustee, and may be subject to the terms of one or more agreements entered into by the Mayor, through the Chief Financial Officer, pursuant to § 1-204.90.

(d) The bonds may be issued at any time or from time to time in one or more issues and in one or more series.

(e) The bonds are declared to be issued for essential public and governmental purposes. The bonds, the interest thereon, and the income therefrom shall at all times be exempt from taxation by the District, except for estate, inheritance, and gift taxes.

(f) The District irrevocably pledges for and on behalf of the owners of the bonds as further security for the due and punctual payment of the principal and redemption price, if any, and interest on, the bonds as they shall become due and payable for any reason, all of its right, title, and interest now owned or later acquired in and to the Available Tax Revenues, whether received or to be received, or held at the time, by a Collection Agent, custodian, escrow agent, or District officials. This pledge creates and grants a security interest as contemplated in § 1-204.90, subject to the terms, conditions, and limitations in this subchapter.

(g)(1) The District pledges, covenants, and agrees with the holders of the bonds that, subject to the provisions of the Financing Documents, the District will not:

(A) Limit or alter the revenues pledged to secure the bonds or the basis on which the revenues are collected or allocated in a manner that would generate Available Tax Revenues below the levels required to pay or secure the payment of the bonds;

(B) Impair the contractual obligations of the District to fulfill the terms of any agreement made with the holders of the bonds; provided, that the District may modify the Business Franchise Tax or Income Tax rates or the income subject to those rates only if the modification, if in effect, would not have reduced the ratio of Income Tax generated by the withholding portion of the Available Income Tax Revenues for any 12-consecutive-month period during the 15-month period immediately preceding the calculation to the maximum annual debt service on the Parity Bonds then outstanding, below 2.0 times, pursuant to the Financing Documents;

(C) In any way impair the rights or remedies of the holders of the bonds; and

(D) Modify in any way the exemptions from taxation provided for in subsection (e) of this section until the bonds, together with interest thereon, and all costs and expenses in connection with any suit, action, or proceeding by or on behalf of the holders of the bonds, are fully met and discharged.

(2) The pledge and agreement of the District under this subsection may be included as part of the contract with the holders of the bonds and this subsection shall constitute a contract between the District and the holders of the bonds. To the extent that any acts or resolutions of the Council may be in conflict with this subchapter, this subchapter shall be controlling.

(h) Consistent with § 1-204.90(a)(4)(B) and notwithstanding Article 9 of Title 28:

(1) A pledge made and security interest created in respect of the bonds or pursuant to any related Financing Document shall be valid, binding, and perfected from the time the security interest is created, with or without physical delivery of any funds or any property and with or without any further action;

(2) The lien of the pledge shall be valid, binding, and perfected as against all parties having any claim of any kind in tort, contract, or otherwise against the District, whether or not the party has notice of the lien; and

(3) The security interest shall be valid, binding, and perfected whether or not any statement, document, or instrument relating to the security interest is recorded or filed.

(Oct. 22, 2008, D.C. Law 17-254, § 2(b), 55 DCR 9275; June 26, 2014, D.C. Law 20-117, § 10(c), 61 DCR 2032.)

Effect of Amendments

The 2014 amendment by D.C. Law 20-117 substituted “this subchapter, or Chapter 28 of Title 42” for “and this subchapter” in (a)(11).

Editor's Notes

Applicability of D.C. Law 20-117: Section 18 of D.C. Law 20-117 provided that the act shall apply as of October 1, 2013.