Section 1266-G. Excess loss fund

1.  Subject to the provisions of this
  section, the authority is  authorized  to  issue  bonds  and  notes,  in
  accordance with section twelve hundred sixty-nine of this title, in such
  principal  amounts  not  in  excess  of  the seventy-five million dollar
  limitation established in subdivision four of this section  as,  in  the
  opinion of the authority, shall be necessary to provide sufficient funds
  to  meet  the  capital  and  reserve  requirements  of  a trust, pooling
  arrangement or other entity established for  the  purpose  of  providing
  reimbursement and funding to the authority and its subsidiaries, the New
  York  city  transit authority and its subsidiaries and Triborough bridge
  and tunnel authority for excess or extraordinary losses for  damages  to
  real or personal property or for the destruction thereof or for personal
  injuries  or  death  and for certain property damage losses which may be
  incurred or sustained by any of them in  connection  with  the  use  and
  operation  of  their  respective  facilities and in the conduct of their
  respective activities (the trust, pooling arrangement  or  other  entity
  established in order to provide such benefits to such participants being
  referred  to  in  this  section as the "excess loss fund"). Prior to the
  issuance of any bonds or notes, other than  refunding  bonds  or  notes,
  authorized by this section, the authority shall make a finding that such
  issue  is  expected  to  result,  on  a  present value basis, in a lower
  effective  cost  to  the  participating  authorities  than  funding  the
  requirements  of  the  excess  loss  fund  solely through the payment of
  premiums and assessments by such participating authorities.
    2. In order to effectuate the purposes of the excess  loss  fund,  the
  authority shall, subject to the provisions of this section, have all the
  powers provided elsewhere in this title and may:
    (a)  accept  the notes, bonds and other contractual obligations of the
  excess loss fund for funds provided to it by the authority;
    (b) obtain security for the payment by the excess  loss  fund  of  its
  notes,  bonds and other contractual obligations issued to the authority,
  including a pledge of all or any part of the assets and revenues of  the
  excess loss fund, including its receipts and rights to receive premiums,
  assessments,  reimbursements and other payments from the participants in
  the excess loss fund, which pledge may contain covenants with respect to
  the charging and fixing by actuarial estimates,  where  appropriate,  of
  premiums, assessments, reimbursements and other payments and the use and
  disposition thereof; and
    (c)  enter  into  contracts  with  the  excess  loss fund and with the
  participants therein, on such terms and conditions as  the  parties  may
  agree,   with   respect   to   the  payment  of  premiums,  assessments,
  reimbursements and other payments to the excess loss fund and the nature
  and extent of the benefits to be paid by the excess loss  fund  to  such
  participants.
    3.  The  bonds  and  notes of the authority authorized by this section
  shall not constitute general obligations of the authority, but shall  be
  special obligations of the authority payable as to principal, redemption
  premium,  if  any,  and  interest  solely  from the security, sources of
  payment and funds obtained from or on behalf of the  excess  loss  fund,
  all  in  the  manner  more particularly provided by the authority in the
  resolution under which such bonds and notes shall be  authorized  to  be
  issued.
    4.  The  aggregate  principal amount of bonds and notes issued for the
  purposes enumerated in subdivision one of this section shall not  exceed
  seventy-five  million  dollars, excluding: (a) bonds and notes issued to
  fund costs of issuance and any reasonably required debt service  reserve
  fund  for such bonds or notes; (b) an amount equal to any original issue
  discount from the principal amount of any bonds or notes issued; and (c)

  bonds and notes issued to refund  or  otherwise  repay  bonds  or  notes
  theretofore  issued  for such purposes, provided, however, that upon any
  such refunding or repayment the  total  aggregate  principal  amount  of
  outstanding  bonds  and notes (including for purpose of such calculation
  the principal amount of the refunding bonds or notes then to  be  issued
  and  excluding  the  principal  amount  of  the  bonds or notes so to be
  refunded or repaid and any amounts excluded under paragraph (a)  or  (b)
  of  this  subdivision) may be greater than seventy-five million dollars,
  only if the present value of the aggregate debt service of the refunding
  or repayment bonds or notes to be issued shall not  exceed  the  present
  value  of  the  aggregate  debt  service  of the bonds or notes so to be
  refunded or repaid. For purposes of paragraph (c) of  this  subdivision,
  the  present  values  of  the aggregate debt service of the refunding or
  repayment bonds or notes and of the aggregate debt service of the  bonds
  or  notes  so to be refunded or repaid, shall be calculated by utilizing
  the effective interest rate of  the  refunding  or  repayment  bonds  or
  notes,  which  shall be that rate arrived at by doubling the semi-annual
  interest rate (compounded semi-annually) necessary to discount the  debt
  service  payments  on the refunding or repayment bonds or notes from the
  payment dates thereof to the date of issue of the refunding or repayment
  bonds or notes and to the price bid including estimated accrued interest
  or proceeds  received  by  the  authority  including  estimated  accrued
  interest from the sale thereof.
    5.  The  term  "excess  loss  fund"  as used in this section shall not
  include any trust,  pooling  arrangements  or  other  entity  (a)  which
  provides  or  offers  to  provide reimbursement or funding for losses or
  liabilities to any entity other than the authority and its subsidiaries,
  the New York city transit authority and its subsidiaries and  Triborough
  bridge  and  tunnel authority, or (b) in which any entity other than the
  authority and its subsidiaries, the New York city transit authority  and
  its  subsidiaries  and  Triborough  bridge and tunnel authority holds an
  equity interest.