Section 87-A. Investment in obligations of the municipal assistance corporation for the city of New York; indemnification

1.  The  state
  insurance  fund,  and  all  state  officers  with responsibility for the
  custody or investment thereof, are authorized and directed to  take  any
  and  all  actions  necessary  or  appropriate to cause such fund to make
  purchases as soon as possible, in  accordance  with  a  schedule  to  be
  established by the New York state emergency financial control board, but
  in no event later than December first, nineteen hundred seventy-five, of
  bonds  of  the municipal assistance corporation for the city of New York
  in the aggregate  principal  amount  of  one  hundred  million  dollars,
  provided, however, that at the date of any such purchase the city of New
  York has not defaulted in the payment of any of its outstanding bonds or
  notes.  The  terms  and conditions of such bonds, including the rates of
  interest thereon,  shall  be  determined  by  the  municipal  assistance
  corporation  for  the  city  of  New  York,  after consultation with the
  commissioners of the fund, provided such terms and conditions are  found
  to  be  fair  and  reasonable  by the New York state emergency financial
  control board.
    2. It is hereby found and declared that obligations of  the  municipal
  assistance corporation for the city of New York are reasonable, prudent,
  proper  and  legal  investments  for the state insurance fund or for any
  state officer with custody or responsibility for the investment  of  the
  assets thereof.
    3.   Notwithstanding   any  other  provision  of  law,  including  the
  provisions of section seventeen of the public  officers  law,  no  state
  officer  with custody or responsibility for the investment of the assets
  thereof shall incur or suffer any liability  whatsoever  to  any  person
  beneficially  interested  in  such  system  by  reason  of actions taken
  pursuant to the authorization and direction of subdivision one and  such
  fund  shall  save  harmless  and  indemnify  all  such  officers and any
  investment advisors from  financial  loss  arising  out  of  any  claim,
  demand, suit, action or judgment for alleged negligence, waste or breach
  of fiduciary duty by reason of any investment of any monies of the state
  insurance  fund  in  obligations of the municipal assistance corporation
  for the city of New York provided that such person  shall,  within  five
  days  after  the date on which he is served with any summons, complaint,
  process, notice, demand, claim or pleading, deliver the  original  or  a
  true  copy  thereof  to  the  legal  advisor  of  such system. Upon such
  delivery the legal advisor  of  the  state  insurance  fund  may  assume
  control  of  the  representation  of such person in connection with such
  claim, demand, suit, action or proceeding. Such person  shall  cooperate
  fully  with  the  legal  advisor  of  the  system  or  any  other person
  designated to assume such defense in respect of such  representation  or
  defense.
    4.  In  order  to  obtain  the  funds  necessary to purchase the bonds
  required by this chapter, the commissioners of the state insurance  fund
  in  accordance  with rules and regulations adopted by such commissioners
  shall have the right to borrow an amount not  exceeding  the  obligation
  incurred  by  such  fund  pursuant  to  this  chapter  and  to pledge as
  collateral therefor such assets as they may deem advisable.