Senate Bill sb0302c1
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Florida Senate - 2001 CS for SB 302
By the Committee on Appropriations and Senators Pruitt and
Horne
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1 A bill to be entitled
2 An act relating to financing for private
3 not-for-profit institutions of higher
4 education; creating the "Higher Educational
5 Facilities Financing Act"; providing
6 legislative findings and declarations;
7 providing definitions; creating the Higher
8 Educational Facilities Financing Authority;
9 providing for membership of the authority;
10 providing for its powers; providing criteria
11 for and covenants relating to the authorization
12 of the issuance of notes and revenue bonds not
13 obligating the full faith and credit of the
14 authority, any municipality, the state, or any
15 political subdivision thereof; providing for
16 loans from revenue bonds to participating
17 institutions; providing for the validation of
18 revenue bonds; providing for trust funds and
19 remedies of bondholders; providing for a tax
20 exemption; providing for agreement of the
21 state; providing other powers and authorities
22 incident thereto; requiring reports and audits;
23 amending s. 196.012, F.S.; providing that
24 institutions funded by the Higher Educational
25 Facilities Financing Act are educational
26 institutions for purposes of state taxation;
27 providing an effective date.
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29 Be It Enacted by the Legislature of the State of Florida:
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1 Section 1. Short title.--Sections 1-30 of this act may
2 be cited as the "Higher Educational Facilities Financing Act."
3 Section 2. Findings and declarations.--It is declared
4 that for the benefit of the public; the increase of their
5 commerce, welfare, and prosperity; and the improvement of
6 their health and living conditions, it is essential that this
7 and future generations of youth be given the fullest
8 opportunity to learn and to develop their intellectual and
9 mental capacities. The Legislature finds that it is essential
10 for private institutions of higher education in the state to
11 be provided with appropriate additional means to assist such
12 youth in achieving the required levels of learning and
13 development of their intellectual and mental capacities. It is
14 the purpose of sections 1-30 of this act to provide a measure
15 of assistance and an alternative method enabling private
16 institutions of higher education of this state to provide the
17 facilities and structures that are sorely needed to accomplish
18 these purposes. The Legislature declares that it is essential
19 to provide additional assistance to private institutions of
20 higher education by enabling those institutions to coordinate
21 their budgetary needs with the timing of receipt of tuition
22 revenues.
23 Section 3. Definitions.--As used in sections 1-30 of
24 this act, the term:
25 (1) "Authority" or "educational facilities authority"
26 means the public corporation created by sections 1-30 of this
27 act.
28 (2) "Real property" includes all lands, including
29 improvements and fixtures thereon, and any such property
30 appurtenant thereto, or used in connection therewith, and
31 every estate, interest and right, legal or equitable, therein,
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1 including terms for years and liens by way of judgment,
2 mortgage, or otherwise and the indebtedness secured by such
3 liens. This definition does not affect the classification of
4 property as real property or tangible personal property for
5 purposes of ad valorem taxation under chapters 192 and 193,
6 Florida Statutes, or sales and use taxation under chapter 212,
7 Florida Statutes.
8 (3) "Project" means a structure suitable for use as a
9 dormitory or other housing facility, dining hall, student
10 union, administration building, academic building, library,
11 laboratory, research facility, classroom, athletic facility,
12 health care facility, maintenance facility, storage facility,
13 or utility facility, and other structures or facilities
14 related thereto, or required thereby, or required or useful
15 for the instruction of students, the conducting of research,
16 or the operation of an institution of higher education,
17 including parking and other facilities or structures that are
18 essential for the orderly conduct of an institution of higher
19 education. The term also includes equipment, machinery, and
20 other similar items necessary for operating a particular
21 facility or structure in the manner for which its use is
22 intended. The term does not include such items as books, fuel,
23 supplies, or other items that are customarily considered to
24 result in a current operating charge. The term includes a loan
25 in anticipation of tuition revenues by a private institution
26 of higher education.
27 (4) "Cost," as applied to a project or any portion
28 thereof financed under sections 1-30 of this act, includes all
29 or any part of the cost of construction and acquisition of all
30 lands, structures, real or personal property, rights,
31 rights-of-way, franchises, easements, and interests acquired
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1 or used for a project; the cost of demolishing or removing any
2 buildings or structures on land so acquired, including the
3 cost of acquiring any lands to which the buildings or
4 structures may be removed; the cost of all machinery and
5 equipment, financing charges, and interest before, during, and
6 for a period of 30 months after completion of the
7 construction; provisions for working capital, reserves for
8 principal, interest, and rebate; provisions for extensions,
9 enlargements, additions, and improvements; the cost of
10 engineering, financial, and legal services; the cost of plans,
11 specifications, studies, surveys, estimates of costs and
12 revenues, administrative expenses, expenses necessary to
13 determining the feasibility or practicability of constructing
14 the project; and other expenses necessary for constructing and
15 acquiring the project, financing the construction, and placing
16 the project in operation. In the case of a loan in
17 anticipation of tuition revenues, the term "cost" means the
18 amount of the loan in anticipation of revenues which does not
19 exceed the amount of tuition revenues anticipated to be
20 received by the borrowing institution of higher education in
21 the 1-year period following the date of the loan, plus costs
22 related to the issuance of the loan, or the amount of the
23 bonds, the proceeds of which fund the loans and any related
24 cost of debt service, reserve funds, and rebate associated
25 therewith.
26 (5) "Bond" or "revenue bond" means a revenue bond of
27 the authority issued under sections 1-30 of this act,
28 including a revenue refunding bond, notwithstanding that it
29 may be secured by mortgage or the full faith and credit of a
30 participating institution of higher education or any other
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1 lawfully pledged security of a participating institution of
2 higher education.
3 (6) "Institution of higher education" means an
4 educational institution that by virtue of law or charter is a
5 nonprofit educational institution empowered to provide a
6 project of education beyond the high school level; is not
7 owned or controlled by the state or any political subdivision,
8 agency, instrumentality, district, or municipality of the
9 state; and otherwise meets the requirements of section
10 196.012(5), Florida Statutes.
11 (7) "Participating institution" means an institution
12 of higher education that undertakes the financing and
13 construction or acquisition of a project or undertakes the
14 refunding or refinancing of obligations or of a mortgage or of
15 advances as provided in and permitted by sections 1-30 of this
16 act.
17 (8) "Loan in anticipation of tuition revenues" means a
18 loan to an institution of higher education under circumstances
19 in which tuition revenues anticipated to be received by the
20 institution in any budget year are estimated to be
21 insufficient at any time during the budget year to pay the
22 operating expenses or other obligations of the institution in
23 accordance with the budget of the institution.
24 Section 4. Creation of Higher Educational Facilities
25 Financing Authority.--
26 (1) There is created a public body corporate and
27 politic to be known as the Higher Educational Facilities
28 Financing Authority. The authority is constituted as a public
29 instrumentality and the exercise by the authority of the
30 powers conferred by sections 1-30 of this act is considered to
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1 be the performance of an essential public function. Chapters
2 119 and 286, Florida Statutes, apply to the authority.
3 (2) The authority shall consist of five members to be
4 appointed by the Governor, subject to confirmation by the
5 Senate. One member shall be a trustee, director, officer, or
6 employee of an institution of higher education. Of the members
7 first appointed, one shall serve for 1 year, one for 2 years,
8 one for 3 years, one for 4 years, and one for 5 years, and in
9 each case until his or her successor is appointed and has
10 qualified. Thereafter, the Governor shall appoint for terms of
11 5 years each a member or members to succeed those whose terms
12 expire. The Governor shall fill any vacancy for an unexpired
13 term. A member of the authority is eligible for reappointment.
14 Any member of the authority may be removed by the Governor for
15 misfeasance, malfeasance, or willful neglect of duty. Each
16 member of the authority before entering upon his or her duties
17 shall take and subscribe to the oath or affirmation required
18 by the State Constitution. A record of each oath must be filed
19 in the office of the Department of State and with the
20 authority.
21 (3) The authority shall annually elect one of its
22 members as chair and one as vice chair, and shall also appoint
23 an executive director who is not a member of the authority and
24 who serves at the pleasure of the authority and receives
25 compensation as fixed by the authority. The duties of the
26 executive director may be discharged under a contract with the
27 Independent Colleges and Universities of Florida, a
28 not-for-profit corporation representing the independent
29 colleges and universities of the state, or any successor
30 corporation or other such entity providing similar
31 representation chosen by the authority, or an agency or other
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1 entity representing independent colleges and universities
2 providing such services, in which case the entity shall
3 designate a person to perform those duties.
4 (4) The executive director shall keep a record of the
5 proceedings of the authority and shall be custodian of all
6 books, documents, and papers filed with the authority and of
7 the minute book or journal of the authority and of its
8 official seal. He or she may cause copies to be made of all
9 minutes and other records and documents of the authority and
10 may give certificates under the official seal of the authority
11 to the effect that the copies are true copies, and all persons
12 dealing with the authority may rely upon those certificates.
13 (5) A majority of the members of the authority
14 constitutes a quorum, and the affirmative vote of a majority
15 of the members present at a meeting of the authority is
16 necessary for any action taken by the authority. A vacancy in
17 the membership of the authority does not impair the right of a
18 quorum to exercise all the rights and perform all the duties
19 of the authority. Any action taken by the authority under
20 sections 1-30 of this act may be authorized by resolution at
21 any regular or special meeting, and each resolution takes
22 effect immediately and need not be published or posted.
23 (6) The members of the authority shall receive no
24 compensation for the performance of their duties, but each
25 member is entitled to reimbursement as provided in section
26 112.016, Florida Statutes, for necessary expenses incurred
27 while engaged in the performance of his or her duties.
28 (7) The authority is assigned to the Department of
29 Education for administrative purposes. However, no general
30 revenue funds shall be expended for administrative costs and
31 expenses incurred by the authority.
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1 Section 5. Powers of the authority.--The purpose of
2 the authority is to assist institutions of higher education in
3 constructing, financing, and refinancing projects throughout
4 the state and for this purpose the authority may:
5 (1) Exercise all powers granted to corporations under
6 the Florida Business Corporation Act, chapter 607, Florida
7 Statutes.
8 (2) Have perpetual succession as a body politic and
9 corporate and adopt bylaws for the regulation of its affairs
10 and the conduct of its business.
11 (3) Adopt an official seal and alter the same at its
12 pleasure.
13 (4) Maintain an office at any place in the state that
14 it may designate.
15 (5) Sue and be sued in its own name, and plead and be
16 impleaded.
17 (6) Make and execute financing agreements, leases, as
18 lessee or as lessor, contracts, deeds, and other instruments
19 necessary or convenient in the exercise of the powers and
20 functions of the authority, including contracts with persons,
21 firms, corporations, federal and state agencies, and other
22 authorities, which state agencies and other authorities are
23 authorized to enter into contracts and otherwise cooperate
24 with the authority to facilitate the financing, construction,
25 leasing, or sale of any project or the institution of any
26 program; engage in sale-leaseback, lease-purchase,
27 lease-leaseback, or other undertakings and provide for the
28 sale of certificates of participation incident thereto; and
29 enter into interlocal agreements in the manner provided in
30 section 163.01, Florida Statutes.
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1 (7) Determine the location and character of any
2 project to be financed under sections 1-30 of this act and
3 may:
4 (a) Construct, reconstruct, maintain, repair, operate,
5 lease as lessee or lessor, and regulate the project;
6 (b) Enter into contracts for any of those purposes;
7 (c) Enter into contracts for the management and
8 operation of a project; and
9 (d) Designate a participating institution of higher
10 education as its agent to determine the location and character
11 of a project undertaken by a participating institution of
12 higher education under sections 1-30 of this act and, as the
13 agent of the authority, construct, reconstruct, maintain,
14 repair, operate, own, lease as lessee or lessor, and regulate
15 the project, and, as the agent of the authority, enter into
16 contracts for any of those purposes, including contracts for
17 the management and operation of the project.
18 (8) Issue bonds, bond anticipation notes, and other
19 obligations of the authority for any of its corporate
20 purposes, including the providing of funds to pay all or any
21 part of the cost of any project and to fund or refund the cost
22 of any project as provided in sections 1-30 of this act.
23 (9) Generally fix and revise and charge and collect
24 rates, rents, fees, and charges for the use of and for the
25 services furnished or to be furnished by a project or any
26 portion thereof and to contract with any person, partnership,
27 association, or corporation or other body public or private in
28 respect thereof.
29 (10) Establish rules for the use of a project or any
30 portion thereof and designate a participating institution of
31 higher education as its agent to establish rules for the use
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1 of a project undertaken by the participating institution of
2 higher education.
3 (11) Employ consulting engineers, architects,
4 attorneys, accountants, construction and financial experts,
5 superintendents, managers, and other employees and agents as
6 necessary, and fix their compensation.
7 (12) Receive and accept from any public agency loans
8 or grants for or in aid of the construction of a project or
9 any portion thereof, and receive and accept loans, grants,
10 aid, or contributions from any source of money, property,
11 labor, or other things of value, to be held, used, and applied
12 only for the purposes for which the loans, grants, aid, and
13 contributions are made.
14 (13) Mortgage any project and the site thereof for the
15 benefit of the holders of revenue bonds issued to finance
16 projects or those providing credit for that purpose.
17 (14) Make loans to any participating institution of
18 higher education for the cost of a project, including a loan
19 in anticipation of tuition revenues, in accordance with an
20 agreement between the authority and the participating
21 institution of higher education. However, a loan may not
22 exceed the total cost of the project as determined by the
23 participating institution of higher education and approved by
24 the authority.
25 (15) Make loans to a participating institution of
26 higher education to refund outstanding obligations, mortgages,
27 or advances issued, made, or given by the participating
28 institution of higher education for the cost of a project.
29 (16) Charge to and equitably apportion among
30 participating institutions of higher education its
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1 administrative costs and expenses incurred in the exercise of
2 the powers and duties conferred by sections 1-30 of this act.
3 (17) Do all things necessary or convenient to carry
4 out the purposes of sections 1-30 of this act.
5 Section 6. Payment of expenses.--All expenses incurred
6 in carrying out sections 1-30 of this act are payable solely
7 from funds provided under the authority of sections 1-30 of
8 this act, and the authority may not incur any liability or
9 obligation beyond the extent to which moneys have been
10 provided under sections 1-30 of this act.
11 Section 7. Acquisition of real property.--The
12 authority may directly, or by and through a participating
13 institution of higher education as its agent, acquire by
14 purchase or lease solely from funds provided under sections
15 1-30 of this act, or by gift or devise, any lands, structures,
16 property, real or personal, rights, rights-of-way, franchises,
17 easements, and other interests in lands, including lands lying
18 underwater and riparian rights, which are located within or
19 outside the state as it considers necessary or convenient for
20 the construction or operation of a project, upon terms and at
21 prices that are considered by it to be reasonable and that can
22 be agreed upon between it and the owner thereof, and to take
23 title thereto in the name of the authority or in the name of a
24 participating institution of higher education as its agent or
25 as an owner and borrower.
26 Section 8. Conveyance of title or interest to
27 participating institutions.--When the principal of and
28 interest on revenue bonds of the authority issued to finance
29 the cost of a particular project or projects at a
30 participating institution of higher education, including any
31 revenue refunding bonds issued to refund and refinance the
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1 revenue bonds, have been fully paid and retired, or when
2 adequate provision has been made to pay fully and retire them,
3 and all other conditions of the resolution or trust agreement
4 authorizing and securing the revenue bonds have been satisfied
5 and the lien of the resolution or trust agreement has been
6 released in accordance with the provisions thereof, the
7 authority shall promptly execute deeds and conveyances
8 necessary and required to convey title to the project or
9 projects to the participating institution of higher education,
10 free and clear of all liens and encumbrances.
11 Section 9. Criteria and requirements.--In undertaking
12 any project under sections 1-30 of this act, the authority
13 shall be guided by and shall observe the following criteria
14 and requirements; however, the determination of the authority
15 as to compliance with the criteria and requirements is final
16 and conclusive:
17 (1) The project, in the determination of the
18 authority, is appropriate to the needs and circumstances of,
19 and shall make a significant contribution to the purposes of,
20 the authority and sections 1-30 of this act as set forth in
21 the findings and declarations, and shall serve a public
22 purpose by advancing the prosperity and general welfare of the
23 state and the public.
24 (2) A financing agreement for a project may not be
25 entered into with a participating institution that is not
26 financially responsible and fully capable of and willing to
27 fulfill its obligations under the financing agreement,
28 including the obligations to make payments in the amounts and
29 at the times required; to operate, repair, and maintain at its
30 own expense the project owned or leased; and to serve the
31 purposes of sections 1-30 of this act and any other
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1 responsibilities that may be imposed under the financing
2 agreement. In determining the financial responsibility of the
3 participating institution, consideration must be given to the
4 party's ratio of current assets to current liabilities; net
5 worth; endowments; pledges; earning trends; coverage of all
6 fixed charges; the nature of the project involved; its
7 inherent stability; any guarantee of the obligations by some
8 other financially responsible corporation, firm, or person;
9 means by which the bonds are to be marketed to the public; and
10 other factors determinative of the capability of the
11 participating institution, financially and otherwise, to
12 fulfill its obligations consistently with the purposes of
13 sections 1-30 of this act.
14 (3) Adequate provision must be made for the operation,
15 repair, and maintenance of the project at the expense of the
16 owner or lessee and for the payment of principal of and
17 interest on the bonds.
18 (4) The costs to be paid from the proceeds of the
19 bonds are costs of a project within the meaning of sections
20 1-30 of this act, except for payments included in the purposes
21 for which revenue refunding bonds may be issued under sections
22 1-30 of this act.
23 Section 10. Approval required to issue bonds.--The
24 authority is created for the purpose of promoting higher
25 education and issuing bonds on behalf of the state, and the
26 Governor may approve any bonds issued by the authority which
27 require approval under federal law.
28 Section 11. Agreements of sale, lease, or loan.--
29 (1) A project financed under sections 1-30 of this act
30 may not be operated by the authority or any other governmental
31 agency, except that the authority may temporarily operate or
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1 cause to be operated all or any part of a project to protect
2 its interest therein, pending any leasing or sale of the
3 project. A project acquired or constructed by the authority,
4 unless sold or contracted to be sold, must be leased to one or
5 more persons, firms, or private corporations for operation and
6 maintenance in a manner that will effectuate the purposes of
7 sections 1-30 of this act, under an agreement of sale,
8 installment sale, lease, or loan, in a form and substance not
9 inconsistent with this subsection. Any agreement may provide,
10 among other provisions, that:
11 (a) The owner or lessee shall at its own expense
12 operate, repair, and maintain the project sold or leased.
13 (b) The payments or rent payable under the agreement
14 will in the aggregate be not less than an amount sufficient to
15 pay all of the interest, principal, and redemption premiums,
16 if any, on the bonds that will be issued by the authority to
17 pay the cost of the project sold or leased.
18 (c) The owner or lessee shall pay all other costs
19 incurred by the authority in connection with the financing,
20 construction, and administration of the project sold or
21 leased, except as may be paid out of the proceeds of bonds or
22 otherwise, including, but not limited to, insurance costs; the
23 cost of administering the bond resolution authorizing the
24 bonds and any trust agreement securing the bonds; and the fees
25 and expenses of the authority, trustees, paying agents,
26 attorneys, consultants, and others.
27 (d) The term of an agreement will terminate not
28 earlier than the date on which all bonds and all other
29 obligations incurred by the authority in connection with the
30 project sold or leased thereunder are paid in full, including
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1 interest, principal, and redemption premiums, if any, or on
2 which adequate funds for payment are deposited in trust.
3 (e) The owner or lessee's obligation to pay payments
4 or rent is not subject to cancellation, termination, or
5 abatement until payment of the bonds or provision for payment
6 is made.
7 (2) An agreement may contain additional provisions
8 that the authority finds are necessary to effectuate the
9 purposes of sections 1-30 of this act, including provisions
10 for extending the term and renewals of the sale or the lease
11 and vesting in the lessee an option to purchase the project
12 leased thereunder pursuant to any terms and conditions
13 consistent with sections 1-30 of this act which are prescribed
14 in the lease. However, except as is otherwise expressly stated
15 in the agreement and except to provide for any contingencies
16 involving the damaging, destruction, or condemnation of the
17 project or any substantial portion thereof, an option to
18 purchase may not be exercised unless all bonds issued for the
19 project, including all principal, interest, and redemption
20 premiums, if any, and all other obligations incurred by the
21 authority in connection with the project have been paid in
22 full or sufficient funds have been deposited in trust or
23 sufficient arrangements have been made for payment. The
24 purchase price of the project may not be less than an amount
25 sufficient to pay in full all of the bonds, including all
26 principal, interest, and redemption premium, if any, issued
27 for the project then outstanding and all other obligations
28 incurred by the authority in connection with the project.
29 Section 12. Notes of authority.--The authority may
30 issue its negotiable notes for any corporate purpose and renew
31 any notes by the issuance of new notes, whether the notes to
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1 be renewed have or have not matured. The authority may issue
2 notes partly to renew notes or to discharge other obligations
3 then outstanding and partly for any other purpose. The notes
4 may be authorized, sold, executed, and delivered in the same
5 manner as bonds. Any resolution authorizing notes of the
6 authority or any issue thereof may contain any provisions that
7 the authority is authorized to include in any resolution
8 authorizing revenue bonds of the authority or any issue
9 thereof, and the authority may include in any notes any terms,
10 covenants, or conditions that it is authorized to include in
11 any bonds. All the notes must be payable solely from the
12 revenues of the project to be financed, subject only to any
13 contractual rights of the holders of any of its notes or other
14 obligations then outstanding.
15 Section 13. Revenue bonds.--
16 (1) The authority may issue its negotiable revenue
17 bonds for any corporate purpose, including the provision of
18 funds to pay all or any part of the cost of any project. In
19 anticipation of the sale of revenue bonds, the authority may
20 issue negotiable bond anticipation notes and may renew them
21 from time to time, but the maximum maturity of any note,
22 including renewals thereof, may not exceed 5 years following
23 the date of issue of the original note. The notes must be paid
24 from any revenues of the authority available therefor or of
25 the project and not otherwise pledged, or from the proceeds of
26 sale of the revenue bonds of the authority in anticipation of
27 which they were issued. The notes must be issued in the same
28 manner as the revenue bonds. The notes and the resolution
29 authorizing them may contain any provisions, conditions, or
30 limitations that a bond resolution of the authority may
31 contain.
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1 (2) The revenue bonds and notes of every issue must be
2 payable solely out of revenues of the authority, including the
3 provision of funds of the participating institution to pay all
4 or any part of the cost of any project, subject only to any
5 agreements with the holders of particular revenue bonds or
6 notes pledging any particular revenues. Notwithstanding that
7 revenue bonds and notes may be payable from a special fund,
8 they are for all purposes negotiable instruments, subject only
9 to the provisions of the revenue bonds and notes for
10 registration.
11 (3) The revenue bonds may be issued as serial bonds or
12 as term bonds, or the authority may issue bonds of both types.
13 The revenue bonds must be authorized by resolution of the
14 authority; must bear the date of issuance, the date of
15 maturity, not exceeding 50 years from issuance, and the
16 interest rate of the bonds, which may be a variable rate,
17 notwithstanding any limitation in other laws relating to
18 maximum interest rates; must be payable at a specified time;
19 must be in specified denominations; and must be in specified
20 form, carry registration privileges, be executed in a
21 specified manner, be payable in lawful money of the United
22 States at a specified place, and be subject to the terms of
23 redemption, as the resolution provides. The revenue bonds or
24 notes may be sold at public or private sale for the price the
25 authority determines. Pending preparation of the definitive
26 bonds, the authority may issue interim receipts or
27 certificates that may be exchanged for the definitive bonds.
28 In case any officer whose signature, or a facsimile of whose
29 signature, appears on any bonds or coupons ceases to be that
30 officer before the delivery of the bonds, the signature or
31 facsimile is nevertheless valid and sufficient for all
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1 purposes as if he or she had remained in office until
2 delivery. The authority may also provide for the
3 authentication of the bonds by a trustee or fiscal agent. The
4 bonds may be issued in coupon form or in registered form, or
5 both, as the authority determines. Provision may be made for
6 the registration of any coupon bonds as to principal alone and
7 also as to both principal and interest; for the reconversion
8 into coupon bonds of any bonds registered as to both principal
9 and interest; and for the interchange of registered and coupon
10 bonds. The authority may sell the bonds at public or private
11 sale and for the price it determines will best effectuate the
12 purpose of sections 1-30 of this act, notwithstanding any
13 limitation in other laws relating to the maximum interest rate
14 permitted for bonds or limitations on the manner by which
15 bonds are sold.
16 (4) Any resolution authorizing any revenue bonds may
17 contain provisions, which are a part of the contract with the
18 holders of the revenue bonds to be authorized, as to:
19 (a) Pledging of all or any part of the revenues of a
20 project or any revenue-producing contract made by the
21 authority with any individual, partnership, corporation, or
22 association or other body, public or private, to secure the
23 payment of the revenue bonds or of any particular issue of
24 revenue bonds, subject to any agreements with bondholders as
25 may then exist.
26 (b) The rentals, fees, and other charges to be
27 charged, and the amounts to be raised in each year thereby,
28 and the use and disposition of the revenues.
29 (c) The setting aside of reserves or sinking funds and
30 the regulation and disposition thereof.
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1 (d) Limitations on the right of the authority or its
2 agent to restrict and regulate the use of the project.
3 (e) Limitations on the purpose to which the proceeds
4 of sale of any issue of revenue bonds then or thereafter to be
5 issued may be applied and the pledging of the proceeds to
6 secure the payment of the revenue bonds or any issue of the
7 revenue bonds.
8 (f) Limitations on the issuance of additional bonds,
9 the terms upon which additional bonds may be issued and
10 secured, and the refunding of outstanding bonds.
11 (g) The procedure, if any, by which the terms of any
12 contract with bondholders may be amended or abrogated,
13 including the amount of bonds the holders of which must
14 consent thereto and the manner in which consent may be given.
15 (h) Limitations on the amount of moneys derived from
16 the project to be expended for operating, administrative, or
17 other expenses of the authority.
18 (i) The acts or omissions to act that constitute a
19 default in the duties of the authority to holders of its
20 obligations and provisions for the rights and remedies of the
21 holders in the event of a default.
22 (j) The mortgaging of or granting of a security
23 interest in the project or the site thereof for the purpose of
24 securing the bondholders.
25 (5) Neither the members of the authority nor any
26 person executing the revenue bonds or notes is liable
27 personally on the revenue bonds or notes or is subject to any
28 personal liability or accountability by reason of the issuance
29 thereof.
30 (6) The authority may purchase its bonds or notes out
31 of any funds available therefor. The authority may hold,
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1 pledge, cancel, or resell the bonds, subject to and in
2 accordance with agreements with bondholders.
3 (7) Incident to its powers to issue bonds and notes,
4 the authority may enter into interest rate swap agreements,
5 collars, caps, forward securities purchase agreements, delayed
6 delivery bond purchase agreements, and any other financial
7 agreements considered to be in the best interest of the
8 authority.
9 (8) Bonds may be issued under sections 1-30 of this
10 act without obtaining, except as otherwise expressly provided
11 in sections 1-30 of this act, the consent of any department,
12 division, commission, board, body, bureau, or agency of the
13 state or any local government, and without any other
14 proceedings or the happening of any conditions or things other
15 than those proceedings, conditions, or things that are
16 specifically required by sections 1-30 of this act and the
17 resolution authorizing the issuance of bonds or the trust
18 agreement securing them.
19 Section 14. Authority reporting requirement.--
20 (1) Any authority that issues any revenue bonds under
21 sections 1-30 of this act shall supply the Division of Bond
22 Finance of the State Board of Administration with a copy of
23 the report required in section 103 of the Internal Revenue
24 Code of 1954, as amended, at the times required under that
25 section.
26 (2) The Division of Bond Finance shall, upon receipt,
27 provide a copy of the information supplied under subsection
28 (1) to the Department of Education.
29 Section 15. Covenants.--Any resolution authorizing the
30 issuance of bonds may contain any covenants the authority
31 considers advisable, including those provisions set forth in
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1 section 13(4), and all those covenants constitute valid and
2 legally binding and enforceable contracts between the
3 authority and the bondholders, regardless of the time of
4 issuance thereof. The covenants may include, without
5 limitation, covenants concerning the disposition of the bond
6 proceeds; the use and disposition of project revenues; the
7 pledging of revenues and assessments; the obligations of the
8 authority with respect to the operation of the project and the
9 maintenance of adequate project revenues; the issuance of
10 additional bonds; the appointment, powers, and duties of
11 trustees and receivers; the acquisition of outstanding bonds
12 and obligations; restrictions on the establishing of competing
13 projects or facilities; restrictions on the sale or disposal
14 of the assets and property of the authority; the maintenance
15 of deposits to assure the payment of the bonds issued under
16 sections 1-30 of this act; acceleration upon default; the
17 execution of necessary instruments; the procedure for amending
18 or abrogating covenants with the bondholders; and any other
19 covenants considered necessary for the security of the
20 bondholders.
21 Section 16. Validity of bonds; validation
22 proceedings.--Any bonds issued by the authority are
23 incontestable in the hands of bona fide purchasers or holders
24 for value and are not invalid because of any irregularity or
25 defect in the proceedings for the issue and sale thereof.
26 Before the issuance of any bonds, the authority must publish a
27 notice at least once in a newspaper or newspapers published or
28 of general circulation in the county in the state in which the
29 project will be located, stating the date of adoption of the
30 resolution authorizing the obligations; the amount, maximum
31 rate of interest, and maturity of the obligations; and the
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1 purpose in general terms for which the obligations are to be
2 issued. The notice must further state that an action or
3 proceeding questioning the validity of the obligations or of
4 the proceedings authorizing the issuance thereof, or of any
5 covenants made therein, must be instituted within 20 days
6 after the first publication of the notice or the validity of
7 the obligations, proceedings, and covenants may not be
8 thereafter questioned in any court. If no action or proceeding
9 is instituted within the 20-day period, the validity of the
10 obligations, proceedings, and covenants is conclusive, and all
11 persons or parties whatsoever are forever barred from
12 questioning the validity of the obligations, proceedings, or
13 covenants in any court. Notwithstanding this section, the
14 bonds, notes, or other obligations issued by the authority,
15 and the obligations of any participating institution or others
16 providing credit for the obligations, which may be before the
17 jurisdiction of the court, must be validated in the manner
18 provided by chapter 75, Florida Statutes, and the jurisdiction
19 of the action may be in the jurisdiction of the circuit court
20 where the project is to be located or, in the discretion of
21 the authority, in the county seat of state government.
22 Section 17. Act furnishes full authority for issuance
23 of bonds.--Sections 1-30 of this act constitute full authority
24 for the issuance of bonds and the exercise of the powers of
25 the authority provided in sections 1-30 of this act. Any bonds
26 issued by the authority are not secured by the full faith and
27 credit of the state and do not constitute an obligation,
28 either general or special, of the state.
29 Section 18. Security of bondholders.--In the
30 discretion of the authority, any revenue bonds issued under
31 sections 1-30 of this act may be secured by a trust agreement
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1 by and between the authority and a corporate trustee or
2 trustees, which may be any trust company or bank having the
3 powers of a trust company within or without the state. The
4 trust agreement or the resolution providing for the issuance
5 of revenue bonds may pledge or assign the revenues to be
6 received or the proceeds of any contract or contracts pledged
7 and may convey or mortgage the project or any portion thereof.
8 The trust agreement or resolution providing for the issuance
9 of revenue bonds may contain provisions for protecting and
10 enforcing the rights and remedies of the bondholders as may be
11 reasonable and proper and not in violation of law, including
12 particularly those provisions specifically authorized by
13 sections 1-30 of this act to be included in any resolution of
14 the authority authorizing revenue bonds. Any bank or trust
15 company incorporated under the laws of this state or of any
16 other state or the United States which may legally act as
17 depository of the proceeds of bonds or of revenues or other
18 moneys or security may furnish indemnifying bonds or pledge
19 securities required by the authority, if any. Any trust
20 agreement may set forth the rights and remedies of the
21 bondholders and of the trustee or trustees, and may restrict
22 the individual right of action by bondholders. In addition,
23 any trust agreement or resolution may contain any other
24 provisions the authority considers reasonable and proper for
25 the security of the bondholders. All expenses incurred in
26 carrying out the trust agreement or resolution may be treated
27 as a part of the cost of the operation of a project.
28 Section 19. Payment of bonds.--Revenue bonds issued
29 under sections 1-30 of this act are not a debt or liability of
30 the authority, any municipality, the state, or any political
31 subdivision thereof, and are not a pledge of the faith and
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1 credit of the state, the authority, any municipality, or any
2 political subdivision, but are payable solely from revenues of
3 the authority pertaining to the project relating to the issue;
4 payments by participating institutions of higher education,
5 banks, insurance companies, or others under letters of credit
6 or purchase agreements; investment earnings from funds or
7 accounts maintained under the bond resolution; insurance
8 proceeds; loan funding deposits; proceeds of sales of
9 education loans; proceeds of refunding obligations; and fees,
10 charges, and other revenues of the authority from the project.
11 All revenue bonds must contain on the face thereof a statement
12 to the effect that neither the authority, any municipality,
13 the state, or any political subdivision thereof is obligated
14 to pay the bond or the interest thereon except from revenues
15 of the project or the portion thereof for which they are
16 issued, and that neither the faith and credit nor the taxing
17 power of the authority, any municipality, the state, or any
18 political subdivision thereof is pledged to the payment of the
19 principal of or the interest on the bonds. The issuance of
20 revenue bonds under sections 1-30 of this act may not
21 directly, indirectly, or contingently obligate the authority,
22 any municipality, the state, or any political subdivision
23 thereof to levy or to pledge any form of taxation therefor or
24 to make any appropriation for their payment.
25 Section 20. Rates, rents, fees, and charges.--
26 (1) The authority may fix, revise, charge, and collect
27 rates, rents, fees, and charges for the use of and for the
28 services furnished or to be furnished by each project and may
29 contract with any person, partnership, association,
30 corporation, or other body, public or private, in respect
31 thereof. The rates, rents, fees, and charges must be fixed and
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1 adjusted in respect of the aggregate of rates, rents, fees,
2 and charges from the project so as to provide funds sufficient
3 with other revenues, if any, to:
4 (a) Pay the cost of maintaining, repairing, and
5 operating the project and each portion thereof, to the extent
6 that the payment of the cost has not otherwise been adequately
7 provided for.
8 (b) Pay the principal of and the interest on
9 outstanding revenue bonds of the authority issued in respect
10 of the project as the bonds become due and payable.
11 (c) Create and maintain reserves required or provided
12 for in any resolution authorizing, or trust agreement
13 securing, the revenue bonds of the authority. The rates,
14 rents, fees, and charges are not subject to supervision or
15 regulation by any department, commission, board, body, bureau,
16 or agency of this state other than the authority.
17 (2) A sufficient amount of the revenues derived in
18 respect of a project, except the part of the revenues
19 necessary to pay the cost of maintenance, repair, and
20 operation and to provide reserves and provide for renewals,
21 replacements, extensions, enlargements, and improvements
22 provided for in the resolution authorizing the issuance of any
23 revenue bonds of the authority or in the trust agreement
24 securing them, must be set aside at regular intervals as
25 provided in the resolution or trust agreement in a sinking or
26 other similar fund that is hereby pledged to, and charged
27 with, the payment of the principal of and the interest on the
28 revenue bonds as they become due and the redemption price or
29 the purchase price of bonds retired by call or purchase as
30 therein provided. The pledge must be valid and binding from
31 the time when the pledge is made. The rates, rents, fees,
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1 charges, and other revenues or other moneys so pledged and
2 thereafter received by the authority must immediately be
3 subject to the lien of the pledge without any physical
4 delivery thereof or further act, and the lien of any pledge is
5 valid and binding as against all parties having claims of any
6 kind in tort, contract, or otherwise against the authority,
7 irrespective of whether the parties have notice thereof.
8 Neither the resolution nor any trust agreement by which a
9 pledge is created need be filed or recorded except in the
10 records of the authority.
11 (3) The use and disposition of moneys to the credit of
12 a sinking or other similar fund must be subject to the
13 resolution authorizing the issuance of the bonds or of the
14 trust agreement. Except as otherwise provided in the
15 resolution or the trust agreement, the sinking or other
16 similar fund must be a fund for all revenue bonds issued to
17 finance projects at a particular institution for higher
18 education without distinction or priority of one over another.
19 However, the authority in any resolution or trust agreement
20 may provide that the sinking or other similar fund be the fund
21 for a particular project at an institution of higher education
22 and for payment of the revenue bonds issued to finance that
23 project, and may, additionally, permit and provide for the
24 issuance of revenue bonds having a subordinate lien in respect
25 of the security authorized to other revenue bonds of the
26 authority, and, in such case, the authority may create
27 separate sinking or other similar funds in respect of the
28 subordinate lien bonds.
29 Section 21. Trust funds.--All moneys received under
30 sections 1-30 of this act, whether as proceeds from the sale
31 of bonds or as revenues, are considered to be trust funds to
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1 be held and applied solely as provided in sections 1-30 of
2 this act. Any officer with whom, or any bank or trust company
3 with which, the moneys are deposited shall act as trustee of
4 the moneys and shall hold and apply them for the purposes of
5 sections 1-30 of this act, subject to the provisions of
6 sections 1-30 of this act and the resolution authorizing the
7 bonds of any issue or the trust agreement securing the bonds.
8 Section 22. Remedies of bondholders.--Any holder of
9 revenue bonds issued under sections 1-30 of this act or any of
10 the coupons appertaining thereto, and the trustee or trustees
11 under any trust agreement, except to the extent the rights
12 given may be restricted by any resolution authorizing the
13 issuance of, or any such trust agreement securing, the bonds,
14 may, either at law or in equity, by suit, action, mandamus, or
15 other proceedings, protect and enforce any rights under the
16 laws of the state or granted hereunder or under the resolution
17 or trust agreement, and may enforce and compel the performance
18 of all duties required by sections 1-30 of this act or by the
19 resolution or trust agreement to be performed by the authority
20 or by any officer, employee, or agent thereof, including the
21 fixing, charging, and collecting of the rates, rents, fees,
22 and charges authorized and required by the provisions of the
23 resolution or trust agreement to be fixed, established, and
24 collected.
25 Section 23. Tax exemption.--The exercise of the powers
26 granted by sections 1-30 of this act is in all respects for
27 the benefit of the people of this state; for the increase of
28 their commerce, education, welfare, and prosperity; and for
29 the improvement of their health and living conditions. Because
30 the operation and maintenance of a project by the authority or
31 its agent or the owner or lessee thereof, as authorized in
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1 sections 1-30 of this act, constitutes the performance of an
2 essential public function, neither the authority nor its agent
3 is required to pay any taxes or assessments upon or in respect
4 of a project or any property acquired or used by the authority
5 or its agent under sections 1-30 of this act or upon the
6 income therefrom, and any bonds issued under sections 1-30 of
7 this act, any security therefor, their transfer, and the
8 income therefrom, including any profit made on the sale
9 thereof, and all notes, mortgages, security agreements,
10 letters of credit, or other instruments that arise out of or
11 are given to secure the repayment of bonds issued in
12 connection with a project financed under sections 1-30 of this
13 act, shall at all times be free from taxation by the state or
14 any local unit, political subdivision, or other
15 instrumentality of the state. The exemption granted by this
16 section is not applicable to any tax imposed by chapter 220,
17 Florida Statutes, on interest, income, or profits or on debt
18 obligations owned by corporations.
19 Section 24. Refunding bonds.--
20 (1) The authority may provide for the issuance of
21 revenue bonds of the authority for the purpose of refunding
22 any revenue bonds of the authority then outstanding, including
23 the payment of any redemption premium thereon and any interest
24 accrued or to accrue to the earliest or subsequent date of
25 redemption, purchase, or maturity of the revenue bonds, and,
26 if considered advisable by the authority, for the additional
27 purpose of paying all or any part of the cost of constructing
28 and acquiring additions, improvements, extensions, or
29 enlargements of a project or any portion thereof.
30 (2) The proceeds of any revenue bonds issued for the
31 purpose of refunding outstanding revenue bonds may be applied
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1 to the purchase or retirement at maturity or redemption of the
2 outstanding revenue bonds on their earliest or any subsequent
3 redemption date or upon the purchase or at the maturity
4 thereof and may, pending the application, be placed in escrow
5 to be applied to the purchase or retirement at maturity or
6 redemption on the date determined by the authority.
7 (3) Any escrowed proceeds, pending use, may be
8 invested and reinvested in direct obligations of the United
9 States of America, or in certificates of deposit or time
10 deposits secured by direct obligations of the United States,
11 or in other investments as the resolution authorizing the
12 issuance and sale of the bonds, or the trust agreement
13 provides, maturing at the time or times as is appropriate to
14 assure the prompt payment, as to principal, interest, and
15 redemption premium, if any, of the outstanding revenue bonds
16 to be refunded. The interest, income, and profits, if any,
17 earned or realized on any such investment may also be applied
18 to the payment of the outstanding revenue bonds to be so
19 refunded. After the terms of the escrow have been fully
20 satisfied and carried out, any balance of the proceeds and
21 interest, income, and profits, if any, earned or realized on
22 the investments thereof may be returned to the authority or to
23 the participating institution for use by it in any lawful
24 manner.
25 (4) The portion of the proceeds of any revenue bonds
26 issued for the additional purpose of paying all or any part of
27 the cost of constructing and acquiring additions,
28 improvements, extensions, or enlargements of a project may be
29 invested and reinvested in direct obligations of the United
30 States, or in certificates of deposit or time deposits secured
31 by direct obligations of the United States, or other
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1 investments as the resolution authorizing the issuance and
2 sale of the bonds, or the trust agreement provides, maturing
3 not later than the time or times when the proceeds will be
4 needed for the purpose of paying all or any part of the cost.
5 The interest, income, and profits, if any, earned or realized
6 on the investment may be applied to the payment of all or any
7 part of the cost or may be used by the authority or the
8 participating institution in any lawful manner.
9 (5) All refunding revenue bonds are subject to
10 sections 1-30 of this act in the same manner and to the same
11 extent as other revenue bonds issued under sections 1-30 of
12 this act.
13 Section 25. Legal investment.--Bonds issued by the
14 authority under sections 1-30 of this act are made securities
15 in which all public officers and public bodies of the state
16 and its political subdivisions, and all insurance companies,
17 trust companies, banking associations, investment companies,
18 executors, administrators, trustees, and other fiduciaries may
19 properly and legally invest funds, including capital in their
20 control or belonging to them. The bonds are made securities
21 that may properly and legally be deposited with and received
22 by any state or municipal officer or any agency or political
23 subdivision of the state for any purpose for which the deposit
24 of bonds or obligations of the state is now or may hereafter
25 be authorized by law.
26 Section 26. Reports.--Within the first 90 days of each
27 calendar year, the authority shall make a report to the
28 Department of Education of its activities for the preceding
29 calendar year. Each report must set forth a complete operating
30 and financial statement covering its operations during the
31 year. The authority shall cause an audit of its books and
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1 accounts to be made at least once each year by a certified
2 public accountant and the cost of the audit shall be paid by
3 the authority from funds available to it under sections 1-30
4 of this act.
5 Section 27. State agreement.--The state agrees with
6 the holders of any obligations issued under sections 1-30 of
7 this act, and with those parties who may enter into contracts
8 with the authority under sections 1-30 of this act, that the
9 state will not limit or alter the rights vested in the
10 authority until the obligations, together with the interest
11 thereon, are fully met and discharged and the contracts are
12 fully performed on the part of the authority. However,
13 sections 1-30 of this act do not preclude any limitation or
14 alteration if adequate provision is made by law for the
15 protection of the holders of the obligations of the authority
16 or those entering into contracts with the authority. The
17 authority may include this pledge and undertaking for the
18 state in any obligations or contracts.
19 Section 28. Alternative means.--Sections 1-30 of this
20 act provide an additional and alternative method for the doing
21 of the things authorized, and shall be regarded as
22 supplemental and additional to powers conferred by other laws;
23 but the issuance of notes, certificates of participation,
24 revenue bonds, and revenue refunding bonds under sections 1-30
25 of this act need not comply with the requirements of any other
26 law applicable to the issuance of bonds or such obligations.
27 Except as otherwise expressly provided in sections 1-30 of
28 this act, the powers granted to the authority under sections
29 1-30 of this act are not subject to the supervision or
30 regulation of, or require the approval or consent of, any
31 municipality or political subdivision or any commission,
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1 board, body, bureau, official, or agency thereof or of the
2 state.
3 Section 29. Liberal construction.--Sections 1-30 of
4 this act shall be liberally construed to effectively carry out
5 their purpose.
6 Section 30. Act controlling.--To the extent that
7 sections 1-30 of this act are inconsistent with any general
8 statute or special act or parts thereof, sections 1-30
9 control.
10 Section 31. Subsection (5) of section 196.012, Florida
11 Statutes, is amended to read:
12 196.012 Definitions.--For the purpose of this chapter,
13 the following terms are defined as follows, except where the
14 context clearly indicates otherwise:
15 (5) "Educational institution" means a federal, state,
16 parochial, church, or private school, college, or university
17 conducting regular classes and courses of study required for
18 eligibility to certification by, accreditation to, or
19 membership in the State Department of Education of Florida,
20 Southern Association of Colleges and Schools, or the Florida
21 Council of Independent Schools; a nonprofit private school the
22 principal activity of which is conducting regular classes and
23 courses of study accepted for continuing postgraduate dental
24 education credit by a board of the Division of Medical Quality
25 Assurance; educational direct-support organizations created
26 pursuant to ss. 229.8021, 240.299, and 240.331; and facilities
27 located on the property of eligible entities which will become
28 owned by those entities on a date certain; and institutions of
29 higher education, as defined under and participating in the
30 Higher Educational Facilities Financing Act.
31
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1 Section 32. This act shall take effect upon becoming a
2 law.
3
4 STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
COMMITTEE SUBSTITUTE FOR
5 SB 302
6
7 Removes a provision authorizing the Independent Colleges and
Universities of Florida to act as an application screening
8 agent on behalf of the Authority.
9 Removes a provision permitting the Authority to rely upon
representations made by the Independent Colleges and
10 Universities of Florida on the financial responsibility of the
applying institutions.
11
Specifies that no general revenue funds are to be expended for
12 administrative costs and expenses of the authority.
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