§ 5051 Findings; declaration of policy.
(a) It is determined and declared as a matter of legislative finding that:
(1) The good order of the State and the health and welfare of its citizens depend upon the steady employment, in useful occupations, of the citizens of the State;
(2) In certain areas of the State, many citizens are employed sporadically or not at all. In these areas of the State, many citizens have heretofore found employment in agricultural pursuits. As agriculture becomes more efficient, and requires fewer employees for the maintenance of economic output levels, increasing numbers of citizens cannot find agricultural employment. Opportunities for other forms of employment in these areas are very limited. This condition threatens the economic stability of the State, discourages thrift and depresses the standard of living of the citizens of the State, all to the detriment of the public health, welfare and order. Moreover, the viability and attractiveness of expanded agricultural enterprise in the State (with consequential increase in agricultural employment opportunity) is jeopardized by competition from agricultural enterprises located in states enjoying longer growing seasons and other competitive advantages;
(3) Stable and useful employment can be made available for citizens of the State by financing the construction, acquisition, rehabilitation, modernization or renovation of commercial, industrial and agricultural facilities in the State;
(4) In many areas of the State, substantial unemployment or cyclical employment (involving cessations of work and temporary layoff of employees) exists. This condition threatens the economic stability of the State, discourages thrift and depresses the standard of living of the citizens of the State, all to the detriment of the public health, welfare and order;
(5) There is a continuing need to prevent decline in business employment, including employment in industrial, commercial and agricultural businesses within the State and to reduce unemployment and cyclical employment within the State;
(6) The availability of financial assistance and suitable facilities are important inducements to industrial, commercial and agricultural businesses to locate, remain and expand in the State which in time will result in increased employment opportunities in the State;
(7) Due to increased industrialization and urbanization of many areas of the State, greater dangers to the public health and welfare exist because of pollution of the air, water and soil, and high levels of noise. Therefore, it is necessary to protect the public health and welfare by fostering the reduction, abatement or prevention of the pollution of the state's environment and the protection of its natural resources;
(8) There is a need to assist in the financing of medical facilities, nursing facilities and facilities for the residence or care of the aged in order to provide modern and efficient medical and nursing care and residence facilities for the citizens of the State thereby promoting their health and welfare;
(9) There is a need to encourage the development of the State as a banking and financial service center by expanding the types of projects and activities for which the State will provide financing assistance, thereby enhancing the inducements for banks and financial service enterprises to locate, remain and expand in the State which in time will result in increased employment opportunities and commercial transactions in the State;
(10) There is a need to assist in the financing of facilities and activities of exempt persons in order to contribute to the prosperity, health or general welfare of the citizens of the State; and
(11) There is a need to assist the Delaware State Housing Authority and Dover-Del Housing Corp. in solving housing problems for low- and moderate-income residents of Liberty Court Apartments, Dover, Delaware, thereby contributing to the prosperity, health or general welfare of the citizens of the State.
(b) It is further determined and declared that in order to aid in remedying such conditions and to implement the purposes of this subchapter, there shall be created an Authority which shall be a body politic and corporate having the powers, duties and functions provided in this subchapter; that the creation of the Authority and the powers conferred upon such Authority under this subchapter and the expenditure of moneys pursuant to this subchapter constitute a valid public purpose and the performance of a valid public function; that the enactment of the provisions hereinafter set forth is in the public interest and for the public benefit and welfare and is hereby so declared to be as a matter of express legislative determination.
6 Del. C. 1953, § 7001; 53 Del. Laws, c. 167; 54 Del. Laws, c. 66, § 1; 57 Del. Laws, c. 679, §§ 3A-3C; 58 Del. Laws, c. 316, §§ 2-4; 62 Del. Laws, c. 269, § 1; 63 Del. Laws, c. 189, § 5(a), (b); 64 Del. Laws, c. 131, § 10(a); 64 Del. Laws, c. 343, § 18(a); 67 Del. Laws, c. 46, § 18(a)(1), (2).;
§ 5052 Definitions.
The following words and terms, unless the context clearly indicates a different meaning, shall have the following respective meaning:
(1) "Agricultural business" means any enterprise engaged in raising, preparing or marketing crops, timber, nursery stock, livestock or the like or any related products, and facilities directly related, incidental or subordinate to any of the foregoing.
(2) "Assisted person" means any person, including individuals, firms, partnerships, associations, societies, trusts, public or private corporations, not for profit corporations or other legal entities, including public or governmental bodies as well as natural persons for which a project is undertaken or proposed to be undertaken.
(3) "Authority" means the Delaware Economic Development Authority created by § 5053 of this title.
(4) "Bonds" means bonds, notes or other obligations issued by the Authority pursuant to this subchapter.
(5) "Commercial business" means any enterprise other than an agricultural business or industrial business which may include, but is not limited to, wholesale, retail or other mercantile activities; office buildings; cable television facilities; hotels; motels; shopping centers; department stores; sports facilities; restaurants; convention, auditorium or trade show facilities; tourism and recreational facilities; medical facilities, nursing facilities and facilities for the residence or care of the aged; public transportation facilities; parking facilities; and facilities directly related, incidental or subordinate to any of the foregoing.
(6) "Cost" means, with respect to any project, all costs, whether capital or otherwise, and includes the cost of acquisition, construction, reconstruction, repair, alteration or extension of any building, structure, facility or other improvement; the cost of demolishing, removing or relocating any building, structure, facility or other improvement, including the cost of acquiring any lands to which such building, structure, facility or other improvement may be moved or relocated; the cost of machinery and equipment; the cost of acquisition, construction, reconstruction, repair, alteration, modernization, renovation, rehabilitation, improvement or extension of pollution control devices, equipment or facilities; the cost of land, rights-in-land, easements, privileges, agreements; franchises, utility extension, disposal facilities, access roads and site developments necessary, useful or convenient for any project or in connection therewith; the cost of providing working capital or the acquisition or carrying of accounts receivable, chattel paper or other commercial instruments or inventory; interest prior to, during and for a reasonable period after completion of construction; discount on bonds; costs of issuance of bonds; engineering and inspection costs; costs of financial, legal, professional and other services; organizational, administrative, insurance, operating and other expenses of the Authority or any assisted person prior to and during any acquisition or construction; all such expenses as may be necessary or incident to the financing, acquisition, construction or completion of any project or part thereof; and all provision for reserves for payment or security of principal, premium, if any, or interest on, bonds during or after acquisition or construction of any project as the Authority may determine to be appropriate. Cost with respect to any project financed by state guaranteed bonds shall not include the cost of providing working capital or inventory.
(7) "Director" means the Director of the Delaware Economic Development Office.
(8) "Exempt person" means a governmental unit or an organization described in § 501(c)(3) of the federal Internal Revenue Code [26 U.S.C. § 501(c)(3)] and exempt from tax under § 501(a) of the federal Internal Revenue Code [26 U.S.C. § 501(a)] but only with respect to a trade or business carried on by such organization which is not an unrelated trade or business, determined by applying § 513(a) of the federal Internal Revenue Code [26 U.S.C. § 513(a)] to such organization.
(9) "Industrial business" means any enterprise other than an agricultural business or commercial business and may include, but is not limited to, industrial parks; public utilities; activities involving the development, production, collection, conversion, storage, conservation or transmission of coal, electricity, gas, oil, steam, water or sources of energy not covered by the foregoing; manufacturing, fabricating or processing activities; research and development activities; docks, wharves, airports; storage, shipping, receiving, warehouse and distribution facilities; and facilities directly related, incidental or subordinate to any of the foregoing.
(10) "Outstanding bonds" means the principal amount of state guaranteed bonds on which there is principal and interest owing and for which there have not been set aside with a trustee sufficient moneys to pay principal, premium, if any, and interest on such state guaranteed bonds, which moneys are subject to an irrevocable instruction that they be applied to the payment of principal, premium, if any, and interest on such state guaranteed bonds when due and payable, whether at maturity or otherwise.
(11) "Pollution control project" means any device, equipment, improvement, structure or facility or any land and any building, structure, facility or other improvement thereon, or any combination thereof, whether or not in existence or under construction, or additions thereto or upgrading thereof, and all real and personal property deemed necessary thereto, having to do with, or the end purpose of which is, the control, abatement or prevention of land, water, air or general environmental pollution in or adjacent to the State, whether by solids, liquids, gases, particulates, radiation, heat, noise or otherwise, including, but not limited to, any air pollution control facility, noise abatement facility, water management facility, wastewater collection system, wastewater treatment works, sewage treatment system or solid waste disposal or resource recovery facility or site.
(12) "Project" means:
a. Acquisition, construction, reconstruction, repair, alteration, improvement, extension or financing of any building, structure or facility whether or not in existence or under construction;
b. Purchase, installation or financing of equipment, machinery and other personal property;
c. Acquisition, improvement or financing of real estate and the extension or provision of utilities, access roads and other appurtenant facilities; or
d. Any other activity (including, without limitation, the providing of working capital or the acquisition or carrying of inventory, accounts receivable, chattel paper or commercial instruments);
any of which are to be used, occupied or undertaken by any assisted person in any enterprise which will tend to maintain or provide gainful employment within the State, including, but not limited to, facilities and activities for industrial business, agricultural business, commercial business or any combination thereof. Project, in addition, shall mean a pollution control project. A project shall not be considered a public work or public improvement for purposes of this subchapter or for purposes of any other law, rule or regulation of the State or any political subdivision thereof.
(13) "Related person" means a person who is a related person under § 144(a)(3) of the Internal Revenue Code of 1986 [26 U.S.C. § 144(a)(3)], as amended.
(14) "Resolution" means any resolution adopted, or trust agreement or other agreement executed, by the Authority pursuant to which bonds are authorized to be issued.
(15) "Revenues" means receipts, fees, rentals, loan repayments or other payments or income derived from the lease, sale or other disposition of a project, the loan of money, the acquisition and sale of loans, moneys or securities in reserve and insurance funds or accounts or other funds and accounts and income from the investment thereof, and fees, charges or other moneys to be received by the Authority in connection with a project.
(16) "State" means the State of Delaware.
(17) "State guaranteed bonds" means bonds to which the full faith and credit of the State has been pledged as provided in this subchapter.
6 Del. C. 1953, § 7002; 58 Del. Laws, c. 316, § 5; 58 Del. Laws, c. 356, § 1; 62 Del. Laws, c. 269, § 1; 63 Del. Laws, c. 189, § 5(a)-(d), (f); 64 Del. Laws, c. 131, § 10(b), (c); 64 Del. Laws, c. 343, § 18(b); 66 Del. Laws, c. 92, § 17(a), (b); 69 Del. Laws, c. 458, § 1.;
§ 5053 Established; organization.
(a) There is hereby established a body corporate and politic, with corporate succession, to be known as "The Delaware Economic Development Authority." The Authority is hereby constituted as an instrumentality of the State exercising public and essential governmental functions, and the exercise by the Authority of the powers conferred in this subchapter shall be deemed and held to be an essential governmental function of the State.
(b) The Authority shall consist of the Director who shall serve ex officio. The Director shall hold office for the term of the Director's appointment. Should a vacancy in the Office of the Director occur, then the Authority shall consist of the Acting Director (with references to the Director in this subchapter deemed to refer to such Acting Director) until the Director's successor is duly qualified and appointed.
(c) The Director shall be the Chairperson of the Authority. Subject to its annual budget as approved by the Governor and the General Assembly, the Authority shall employ such persons as the Director shall determine are necessary to fulfill the powers granted to the Authority in this subchapter. The powers of the Authority shall be vested in the Director and all action by the Authority shall be taken by the Director or by a designee acting on the Director's behalf as provided in this subchapter.
(d) Notwithstanding any other law, neither the Director nor any officer or employee of the State shall be deemed to have forfeited or shall forfeit such office or employment or any benefits or emoluments thereof by reason of such service as an officer of the Authority.
(e) The Director may designate officers or employees of the Delaware Economic Development Office to represent the Director, and each such designee may lawfully act on behalf of the Director; provided, however, that, except in instances where the Director determines that the Director may have a direct interest in a project as provided in subsection (i) of this section and therefore disassociates from that project, no such designee may lawfully approve a project or adopt a resolution. However, notwithstanding the foregoing, the Director may during absence from the State, in accordance with § 5004 of this title, appoint any qualified employee of the Delaware Economic Development Office to serve as Acting Director during such absence and such Acting Director may, among other things, lawfully approve a project, adopt a resolution or sign a bond. Neither the Director nor any such designee shall be subject to any personal liability or accountability by reason of execution of any bonds or the issuance thereof.
(f) The Authority may be dissolved by act of the General Assembly on condition that the Authority has no debts or obligations outstanding or that provision has been made for the payment or retirement of such debts or obligations. Upon any such dissolution of the Authority, all property, funds and assets thereof shall be vested in the State.
(g) The Authority shall prepare an annual budget for each fiscal year of the Authority (the "annual budget") and shall submit the annual budget to the Director of the Office of Management and Budget and General Assembly in accordance with Chapter 63 of this title. The annual budget need not include amounts representing expenditures for debt service on bonds, except for such amounts with respect to projects which are financed by proceeds from state guaranteed bonds and for which either:
(1) Any payment due to the Authority or to a trustee or other person as assignee of the Authority is in default; or
(2) Sufficient revenues are not available to make payments due to such trustee or other person.
(h) The Office of Auditor of Accounts shall cause an audit of the Authority's bonds issued under § 5054(d) of this title to be made annually by a certified public accountant licensed to practice in the State. In addition, the Authority shall make an annual report of its activities to the Governor which shall set forth a complete operating and financial statement covering the Authority's operations during the year and shall include the report of the certified public accountant who makes the audit of the Authority's books and accounts. The Authority shall furnish a copy of the annual report to the Speaker of the House of Representatives and the President Pro Tempore of the Senate, the Auditor of Accounts and Controller General.
(i) No member, officer, employee or agent of the Authority shall be interested, either directly or indirectly, in any project or in any contract, sale, purchase, lease or transfer of real or personal property to which the Authority is a party. The existence of any such interest shall not affect the validity of bonds issued pursuant to this subchapter.
(j) All expenses incurred by the Authority shall be included and charged to the project to which they apply. Any refunds or reimbursements of such expenses shall be credited to the same project to which such expense was charged.
(k) The Authority shall prescribe such regulations as may be necessary to carry out the purposes of this subchapter and, in addition to any other regulation, the Authority shall require that any new applicant approved for a loan under this chapter shall agree to give the first opportunity of employment to qualified Delaware residents.
Each applicant shall report to the Authority, no later than June 30 of the year following the start of its operation in this State, the number of employees and the number of employees who were residents of Delaware at the time of their employment. This subsection shall not apply to industry employing highly skilled workers, except that any such industry, if it employs unskilled or semiskilled workers as a part of its work force, shall comply.
(l ) Any net earnings of the Authority (beyond those necessary for retirement of any indebtedness or to implement the public purposes of this subchapter) shall not inure to the benefit of any person other than the State.
62 Del. Laws, c. 269, § 1; 63 Del. Laws, c. 189, § 5(a)-(d); 64 Del. Laws, c. 131, § 10(d); 64 Del. Laws, c. 320, § 1; 65 Del. Laws, c. 212, § 17(c); 69 Del. Laws, c. 438, § 1; 69 Del. Laws, c. 458, § 1; 70 Del. Laws, c. 186, § 1; 75 Del. Laws, c. 88, § 21(13); 76 Del. Laws, c. 79, § 57.;
§ 5054 Deauthorization of State guaranteed bonds.
(a) The Authority may issue bonds to finance the cost of any project or part thereof with respect to which the Authority has adopted a resolution.
(b) The Authority may issue bonds to refund bonds previously issued by the Authority or any other issuer, past or present, within the State (including, without limitation, the former Department of Community Affairs and Economic Development), including the payment of any redemption premium thereon and any interest accrued to the date of redemption of such bonds.
(c) The Authority may issue bonds payable solely from the revenues of the project for which the bonds have been issued. Such bonds may be issued for a project whether or not such project is or will be financed by state guaranteed bonds.
(d) The Authority may pledge the full faith and credit of the State to the payment of principal, premium, if any, and interest due on bonds (whether at stated or accelerated maturity or otherwise) subject to the following conditions:
(1) With respect to any project proposed to be financed by state guaranteed bonds, the Authority shall find and determine, which findings and determinations shall be conclusive, in addition to making the appropriate findings and determinations required by § 5055 of this title, that:
a. The aggregate principal amount of state guaranteed bonds, the proceeds of which are used to finance the proposed project together with the aggregate principal amount of outstanding bonds used to finance any other project or projects owned, used, leased or occupied by the same assisted person, or by a related person to the assisted person, does not exceed $3,000,000;
b. Not more than 50 percent of the cost of the proposed project shall be financed by state guaranteed bonds, and no part of the assisted person's contribution to the cost of a proposed project may be supplied, in whole or in part, by funds appropriated by an act of the General Assembly of the State; and
c. The fulfillment, discharge and satisfaction of the assisted person's obligations under the terms of the lease, mortgage, loan agreement or other financing agreements between the Authority and the assisted person shall be adequately secured.
(2) The aggregate principal amount of state guaranteed bonds that may be authorized to be outstanding shall be limited to $4,449,015. The limit shall automatically be reduced below $4,449,015, once the aggregate principal amount of outstanding state guaranteed bonds is reduced to $4,449,015 by an amount equal to the principal amount of state guaranteed bonds thereafter retired by the Authority.
(3) In no event shall the proceeds of state guaranteed bonds be used to finance a project for commercial business or agricultural business.
(4) The Authority may not adopt a resolution authorizing the issuance of state guaranteed bonds without the approval of at least 5 of the 7 members (the "members") of the Council on Development Finance (the "Council") or three quarters of the members if vacancies on the Council exist.
(5) The assisted person shall be legally obligated to deposit (prior to the delivery of the bonds and from a source other than the proceeds of the bonds), and thereafter maintain, with a person in trust, a cash reserve fund in an amount equal to the maximum principal and interest payable on such bonds during any consecutive 12-month period by such assisted person to the Authority under the terms of the lease, mortgage, loan agreement or other financing agreement between the Authority and such assisted person. Such cash reserve fund shall be pledged solely for the purposes provided in § 5061 of this title and shall not be construed as a security deposit under the state's Landlord Tenant Code (Part III of Title 25).
(6) In the case of accelerated maturity, the pledge of the full faith and credit of the State to the payment of principal, premium, if any, and interest due on state guaranteed bonds prior to their stated maturity shall not apply without the express written approval of the Secretary of Finance. Such approval may be given at any time after the occurrence of a default which would permit the acceleration of payment of principal, premium, if any, or interest on such state guaranteed bonds under the terms of the lease, mortgage, loan agreement or other financing agreements between the Authority and the assisted person.
(e) The Authority shall have all of the powers necessary or convenient to carry out and effectuate the purposes and provisions of this subchapter including without limitation the power:
(1) To adopt bylaws for the regulation of its affairs and the conduct of its business and to adopt rules, regulations and policies in connection with the performance of its functions and duties;
(2) To adopt, use and alter at will an official seal;
(3) To sue in its own name;
(4) To acquire in its own name by purchase, lease or otherwise, on such terms and conditions and in such manner as it may deem proper, any franchise, property, real, personal or mixed, tangible or intangible, or any interest therein, whether or not in connection with a project, and to sell, lease as lessor, mortgage or otherwise encumber, transfer or dispose of any such property or interest therein;
(5) To enter into contracts with a person upon such terms and conditions as the Authority shall determine to be reasonable, providing, without limitation, for reimbursement for the planning, designing, financing, construction, reconstruction, improvement, equipping, furnishing, operation and maintenance of a project and to pay or compromise any claims arising from any such contracts;
(6) To enter into loan agreements with, to provide any other forms of financing support and to make loans to, an assisted person, for the cost of a project (title to which project may remain or vest in such assisted person), which loans or other financing support may be secured or evidenced by notes, debentures, bonds, mortgages, leases or other instruments, delivered to the Authority or to a trustee or other person as assignee of the Authority, all upon such terms and conditions as the Authority may deem advisable;
(7) To establish and maintain funds of any kind, including without limitation reserve and insurance funds with respect to any financing of a project;
(8) To mortgage, pledge, assign or otherwise encumber all or any portion of a project or revenues;
(9) To grant options to purchase or renew a lease for any project;
(10) To contract for and to accept any gifts, grants or loans of funds or property or financial or other aid from any source, and to comply, subject to this subchapter, with the terms and conditions thereof;
(11) To charge and collect such fees and charges as it shall determine to be reasonable for the use of its services;
(12) To acquire, purchase, manage, operate, hold and dispose of real and personal property or interests therein, take assignments of rentals and leases and make and enter into all contracts, leases, agreements and arrangements necessary or incidental to the performance of its duties;
(13) To purchase, acquire and take assignments of notes, mortgages and other forms of security and evidences of indebtedness;
(14) To purchase, acquire, attach, seize, accept or take title to any project by conveyance or by foreclosure, and sell, lease, manage or operate any project for a use specified in this subchapter;
(15) To borrow money and issue bonds (the interest on which may be taxable or exempt from tax under the Internal Revenue Code of 1986, as amended) as provided in this subchapter, and provide for the rights of the holders thereof;
(16) To pledge the full faith and credit of the State to the payment of the principal, premium, if any, and interest on bonds, but only to the extent permitted under this subchapter;
(17) To invest any funds or moneys of the Authority pending the application of such funds or moneys to the purposes specified in this subchapter;
(18) To employ consulting engineers, architects, attorneys (in accordance with § 2507 of this title), real estate counselors, appraisers and such other consultants and employees, who shall not be members of the classified service, as may be required in the judgment of the Authority to carry out the purposes of this subchapter, and to fix and pay their compensation from funds available to the Authority therefor;
(19) To do and perform any acts and things authorized by this subchapter under, through or by means of its own officers, agents and employees, or by contracts with any person;
(20) To procure insurance against any losses in connection with its property, operations or assets in such amounts and from such insurers as it deems desirable; and
(21) To acquire all of the issued and outstanding stock of Dover-Del Housing Corp., a Delaware nonprofit housing development corporation, and to serve as the sole member thereof during such period of time that Liberty Court Apartments, Dover, Delaware, is being rehabilitated and, upon completion of such rehabilitation, to cause Dover-Del Housing Corp. to convey title to such apartments to the Delaware State Housing Authority for such consideration as the Authority shall, at such time, deem adequate and, as soon as practicable thereafter, to divest its interest in Dover-Del Housing Corp., and to take any and all other actions deemed to be necessary or appropriate by the Authority in connection with the foregoing.
(f) Notwithstanding any other provision in this subchapter, the Authority shall have the power to issue bonds for the benefit of any exempt person, subject only to the following conditions:
(1) The Authority may not pledge the full faith and credit of the State to the payment of principal, premium, if any, or interest due on such bonds; and
(2) Prior to approving an application for the issuance of such bonds, the Authority shall find and determine, which finding and determination shall be conclusive, on the basis of all information reasonably available to it, that any proposed financing for an exempt person will effectuate the purpose set forth in § 5051(a)(10) of this title. With respect to such applications, the Authority need not make the findings and determinations otherwise required under this subchapter.
6 Del. C. 1953, § 7003; 53 Del. Laws, c. 167; 54 Del. Laws, c. 66, §§ 2-7; 57 Del. Laws, c. 679, § 3C; 58 Del. Laws, c. 316, § 6; 58 Del. Laws, c. 356, §§ 2-4; 60 Del. Laws, c. 211, § 1; 62 Del. Laws, c. 269, § 1; 62 Del. Laws, c. 277, § 96; 62 Del. Laws, c. 407, § 4(a); 62 Del. Laws, c. 423, § 6; 63 Del. Laws, c. 179, § 4(a); 63 Del. Laws, c. 189, § 5(a), (b), (d), (e); 63 Del. Laws, c. 387, § 7(a); 64 Del. Laws, c. 131, § 3(a); 64 Del. Laws, c. 343, §§ 4(a), 18(c); 65 Del. Laws, c. 212, § 6(a); 66 Del. Laws, c. 92, §§ 5(a), 17(c), (d); 66 Del. Laws, c. 360, §§ 4(a), 29(h); 67 Del. Laws, c. 46, §§ 4(a), 18(a)(3)-(5); 67 Del. Laws, c. 285, § 4(a); 68 Del. Laws, c. 156, § 2(a); 68 Del. Laws, c. 405, § 1(a); 69 Del. Laws, c. 77, § 2(a); 69 Del. Laws, c. 386, § 2(a); 70 Del. Laws, c. 210, § 2(a); 70 Del. Laws, c. 473, § 2; 71 Del. Laws, c. 150, § 2; 71 Del. Laws, c. 378, § 2(a); 72 Del. Laws, c. 258, § 2; 72 Del. Laws, c. 489, § 2(a); 73 Del. Laws, c. 95, § 2; 73 Del. Laws, c. 350, § 2(a); 74 Del. Laws, c. 69, § 2(a).;
§ 5055 Application for assistance; findings and determinations.
(a) The Authority may adopt a resolution, provided that an application for assistance under this subchapter shall be submitted to the Authority, for the advice or, where required by this subchapter, the approval of the Council on Development Finance, requesting the issuance of bonds to finance a project or to provide another form of financing support to a project. Prior to approving such application, the Authority shall find and determine, which findings and determinations shall be conclusive, on the basis of all information reasonably available to it, that any project financed:
(1) Will tend to maintain or provide gainful employment for citizens of the State, or, in the case of a pollution control project, will reduce, abate or prevent pollution of the state's environment or protect its natural resources, or, in the case of a medical facility, nursing facility or facility for the residence or care of the aged, will help to provide modern and efficient medical, nursing or residence facilities as the case may be for the citizens of the State;
(2) Will serve a public purpose by contributing to the prosperity, health or general welfare of the citizens of the State;
(3) In the case of a project for agricultural business will require a capital investment of at least $10,000, which funds, including the proceeds of the bonds to be issued, if any, will be available or expended on the day the Authority issues the bonds or provides another form of financing support to the project;
(4) In the case of a project for commercial business will require a capital investment of at least $10,000, which funds, including the proceeds of the bonds to be issued, if any, will be available or expended on the day the Authority issues the bonds or provides another form of financing support to the project;
(5) Will be leased to, sold to or financed for a financially responsible assisted person who has not been convicted of a major labor law violation or of illegal conduct involving moral turpitude by any agency or court of the federal government or agency or court of any state in the 2-year period immediately prior to the approval of the assisted person's application for assistance; and
(6) Will effectuate the purposes of this subchapter.
(b) The Authority may make the foregoing findings and determinations on a prospective basis prior to the receipt of any such application provided that the proceeds of bonds are not disbursed or another form of financing support is not provided to any assisted person until such findings and determinations are made specifically with respect to such assisted person's project or projects.
(c) The Authority may issue bonds to refund bonds issued pursuant to this subchapter without making any of the foregoing findings or determinations.
(d) The Council on Development Finance is delegated the authority and responsibility for conducting a public hearing following reasonable public notice prior to the issuance by the Authority of any bond or the provision by the Authority of any other form of financing support. The Council on Development Finance shall adopt such rules and procedures as it determines to be necessary or desirable in fulfilling its responsibilities.
(e) For purposes of § 147(f) of the Internal Revenue Code of 1986 [26 U.S.C. § 147(f)], as amended, the Governor of this State, or an elected official of the State designated by the Governor for this purpose as permitted by such Code, shall have the authority and responsibility for approving, or withholding approval of, the issuance by the Authority of any bond. If, in connection with an application for the issuance of any bond by the Authority, the Governor or the elected official designated by the Governor advises the Attorney General of the State that the Governor or such elected official is unable or believes it would be inappropriate for the Attorney General to consider such application, then the Attorney General shall have the authority and responsibility for approving, or withholding approval of, the issuance of such bond by the Authority.
62 Del. Laws, c. 269, § 1; 63 Del. Laws, c. 189, § 5(a), (b), (e); 64 Del. Laws, c. 10, §§ 1, 2; 65 Del. Laws, c. 212, § 17(b); 66 Del. Laws, c. 92, § 17(e); 66 Del. Laws, c. 360, § 29(h); 67 Del. Laws, c. 46, §§ 30(d)-(g); 70 Del. Laws, c. 186, § 1.;
§ 5056 Bonds.
(a) The bonds authorized to be issued by this subchapter shall be authorized by a resolution and shall be of such series; bear such date or dates; mature at such time or times, not exceeding 20 years for state guaranteed bonds; bear interest at such rate or rates; be in such denominations; be of a single denomination payable in installments; be in such form, either coupon or fully registered without coupon; carry such registration, exchangeability and interchangeability privileges; be payable in such medium of payment and at such place or places; be subject to such terms of redemption; and be entitled to such priorities in the revenues of the Authority as such resolution may provide. The bonds shall bear the manual or facsimile signature of the Director, and of the Secretary of the Council on Development Finance, and coupon bonds shall have attached thereto interest coupons bearing the facsimile signature of the Director. Any such bonds may be issued and delivered notwithstanding the fact that 1 or more of the officials signing such bonds, or whose facsimile signature shall be upon the bonds or coupons, shall have ceased to be such official or officials at the time when such bonds shall actually be delivered.
(b) The bonds may be sold at public or private sale for such price or prices as the Authority shall determine. Any bonds may be consolidated for sale with any other bonds of the Authority and sold as a single issue. Pending the preparation of the definitive bonds, temporary bonds may be issued to the purchaser or purchasers of such bonds and may contain such terms and conditions as the Authority may determine.
§ 5057 Covenants with bondholders.
(a) The Authority shall have the power to covenant and to agree with the holders of bonds in order to secure the payment of such bonds, as to:
(1) The custody, security, use, expenditure, investment or application of the proceeds of bonds;
(2) The use, regulation, operation, maintenance, insurance or disposition of all or any part of any project;
(3) The payment of the principal, premium, if any, and interest on bonds, the sources and methods of payment thereof, the rank or priority of any such bonds as to any lien or security or the acceleration of the maturity of any such bonds;
(4) The use and disposition of any moneys of the Authority, including all revenues;
(5) The mortgage, pledge, assignment or deposit of all or any part of the revenues or other moneys of the Authority or of all or any part of a project to secure the payment of the principal, premium, if any, and interest on bonds, and the powers and duties of any trustee or agent with regard thereto;
(6) The segregation of revenues or other moneys of the Authority into reserves and sinking funds, and the source, custody, investment, security, regulation, application and disposition thereof;
(7) The rents, fees or other charges for the use of any project, including any parts, replacements or improvements thereafter constructed or acquired, and the fixing, establishment, collection and enforcement of the same;
(8) Any limitation on the issuance of additional bonds or on the incurrence of indebtedness of the Authority;
(9) Any vesting in a trustee or trustees, fiscal or escrow agent or agents, within or without the State, or such property, rights, powers and duties as the Authority may determine, and any limitation on the rights, duties and powers of such trustee or agent;
(10) The payment of costs or expenses incident to the enforcement of the bonds, the resolution or any covenant or contract with the holders of bonds;
(11) The procedure, if any, by which the terms of any covenant or contract with, or duty to, the holders of bonds may be amended or abrogated, the amount of bonds the holders of which must consent thereto and the manner in which such consent may be given or evidenced; or
(12) Any other matter or course of conduct which, by recital in a resolution, is declared to secure further the payment of the principal, premium, if any, or interest on bonds.
(b) All such provisions of a resolution and all such covenants and agreements shall constitute valid and legally binding contracts between the Authority and the several holders of bonds to which they relate, regardless of the time of issuance of such bonds.
§ 5058 Pledge of revenues or other property.
Any pledge of revenues or other property made by the Authority shall be valid and binding from the time when the pledge is made. Revenues so pledged and thereafter received by the Authority shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act. The lien of any such pledge or revenues or other property shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the Authority, whether or not such parties have notice thereof. Neither the resolution nor any other instrument by which a pledge is created need be filed or recorded; however, copies of such resolution or instrument shall be retained by the Authority.
§ 5059 Limitation on liability of State.
(a) Bonds, other than state guaranteed bonds, issued pursuant to this subchapter shall not constitute a debt of the State or any political subdivision or any agency thereof, or a pledge of the full faith and credit or taxing power of the State or any political subdivision or any agency thereof, and shall not obligate the State or the Authority to make any appropriation for their payment.
(b) All bonds, other than state guaranteed bonds, shall contain on the face thereof a statement to the following effect:
"Neither the faith and credit nor the taxing power of the State is pledged to the payment of the principal of, premium, if any, or interest on this bond, nor is the State or the Delaware Economic Development Authority in any manner obligated to make any appropriation for payment thereof."
(c) State guaranteed bonds shall be a debt of the State.
§ 5060 Negotiability of bonds.
The bonds and any coupons appurtenant thereto shall be negotiable instruments and securities under the Uniform Commercial Code of the State.
§ 5061 Default in payment of state guaranteed bonds; insufficient revenues to make payment.
If any payment of principal, premium, if any, or interest due to the Authority or to a trustee or other person as assignee of the Authority with respect to a project financed by proceeds from state guaranteed bonds is in default, or if sufficient revenues are not available to make such payment, the Authority:
(1) Shall forthwith direct (if it has not previously done so) the person holding the cash reserve fund deposited pursuant to paragraph (5) of subsection (d) of § 5054 of this title to apply such cash reserve fund to the payment of principal, premium, if any, and interest on such state guaranteed bonds as the same become due;
(2) Shall forthwith give notice of such default or occurrence to the Governor, the Secretary of Finance, the Auditor of Accounts, the Speaker of the House of Representatives, the President Pro Tempore of the State and the Controller General. Thereafter, the General Assembly shall appropriate sufficient funds to pay principal, premium, if any, and interest on such state guaranteed bonds when due. Any funds made available pursuant to such appropriation shall be deposited by the Authority in the appropriate cash reserve fund;
(3) Shall exercise its rights to secure its title and take possession of the project and any other assets pledged, assigned or transferred to the Authority in connection with the financing of the project. The Authority shall thereupon attempt to realize from the sale, lease or other disposition of the project assets sufficient funds to meet debt service on the outstanding state guaranteed bonds. Realized funds shall first be applied to meet the costs, incurred or to be incurred, of administering such project. Thereafter, such funds shall be applied by the Authority to any lawful purpose of the Authority including, but not limited to, the payment of principal and interest on state guaranteed bonds for such project. The remainder of such funds, after payment of or provision for the payment of the foregoing, shall be paid into the General Fund of the State;
(4) Trustees for holders of state guaranteed bonds are hereby authorized to release to the Authority the proceeds of sale, lease or other disposition of any real or personal property comprising the project less any proceeds, to be held in a principal or interest payment fund necessary to meet principal of and interest on such state guaranteed bonds for the 12-month period following the date of such transfer. The State shall indemnify, defend and hold harmless the trustee for any losses that may reasonably be incurred by the trustee by virtue of the transfer of such proceeds of the property.
6 Del. C. 1953, § 7005; 53 Del. Laws, c. 167; 54 Del. Laws, c. 66, §§ 8-10; 57 Del. Laws, c. 679, § 3C; 58 Del. Laws, c. 316, § 9; 62 Del. Laws, c. 269, § 1; 63 Del. Laws, c. 189, § 5(a), (b); 63 Del. Laws, c. 387, § 12.;
§ 5062 Limitation of powers of State.
The State pledges to and agrees with any holder of the bonds that the State will not limit or alter the rights vested in the Authority until all bonds at any time issued, together with the interest thereon and all costs and expenses in connection with any action or proceeding by or on behalf of the bondholders, are fully met and discharged. Nothing herein contained shall preclude such limitation or alteration, if, and when, adequate provision shall have been made by law for the protection from impairment of the contracts represented by such bonds.
§ 5063 Delaware Development Corporation.
§ 5064 Bonds as legal investments for institutions and fiduciaries.
Bonds issued under this subchapter are made securities in which all state and municipal officers and administrative departments, boards and commissions of the State, all banks, bankers, savings banks or societies, trust companies, building and loan associations, savings and loan associations, investment companies and other persons carrying on a banking business, all insurance companies, insurance associations and other persons carrying on an insurance business, and all administrators, executors, guardians, trustees and other fiduciaries and all other persons whatsoever authorized to invest in bonds or other obligations of the State, may properly and legally invest any funds, including capital belonging to them or within their control. State guaranteed bonds are made securities which may properly and legally be deposited with and received by any officer of the State, or of any county, municipality or agency of the State for any purpose for which the deposit of bonds or other obligations of the State is authorized by law.
§ 5065 Exemption from taxation.
(a) Interest on bonds issued under this subchapter shall be exempt from income taxation by the State or any political subdivision thereof.
(b) Any real or personal property of the Authority which is not used by an assisted person as part of, or in connection with, a project shall be exempt from any and all taxation by the State or any political subdivision thereof.
§ 5066 Property of Authority exempt from judicial process.
All property of the Authority shall be exempt from execution process, and no attachment, sequestration, execution, levy or other judicial process shall issue against the same, nor shall any judgment against the Authority be a charge or lien upon its property; provided, however, that nothing herein contained shall apply to or limit the rights of the holder of any bonds to pursue any remedy for the enforcement of any pledge or lien given by the Authority on or with respect to any project or any revenues or other moneys.
§ 5067 Liberal construction of subchapter.
This subchapter, being necessary for the prosperity and welfare of the State and its citizens, shall be liberally construed to effect the purposes of this subchapter.
§ 5068 Inconsistent laws inapplicable; facsimile signatures.
Insofar as any provision of this subchapter is inconsistent with any general, special or local laws, or part thereof, this subchapter shall be controlling. Facsimile signatures of officers of the Authority and the Council on Development Finance on bonds issued by the Authority shall have the same legal effect as the manual signatures of such officers, whether or not such officer filed with the Secretary of State the officer's manual signature certified by the officer under oath in accordance with the Uniform Facsimile Signatures of Public Officials Act.