Common use of Authority to Issue Bonds Clause in Contracts

Authority to Issue Bonds. A. GBRA shall have the power, with prior approval of the WCID, to issue from time to time Bonds (subject to obtaining the opinion of the Attorney General approving such bonds), payable from and secured by a pledge of the Debt Service Requirement component of the Annual WCID Payments from this Contract. The Bonds shall be issued in such amount as the GBRA Board determines to be necessary or desirable, but not to exceed the Maximum Principal Amount, to obtain funds: (i) To pay all Capital Costs; (ii) To pay all capitalized interest costs on the Bonds; (iii) To provide such reserve or contingency funds as the GBRA Board, in its judgement, deems necessary and as reasonably acceptable to the WCID; and (iv) To pay all costs incurred in connection with the issuance of the Bonds. B. The par amount of the Bonds shall not exceed the Maximum Principal Amount. This limitation that the Bonds shall not exceed the Maximum Principal Amount shall not be construed to prevent or impair GBRA’s authority to issue other bonds or evidences of indebtedness to fund costs of the Initial Improvements or other Project components and GBRA shall retain full authority to incur such indebtedness, but the WCID shall have no obligation to pay any debt service costs on such other bonds or evidences of indebtedness. The Parties acknowledge and agree that GBRA’s ability to issue other bonds or evidences of indebtedness is discretionary and GBRA is not obligated to incur Capital Costs that exceed the available Bond proceeds. C. From time to time the Parties may also agree to issue Bonds to fund Budgeted or Non- Budgeted CRR Costs when such costs exceed annual funds budgeted therefor, or if such costs exceed the available balance in the CRR Fund or the Hydro Fund. However, if the Parties elect not to issue Bonds and do not otherwise reach agreement concerning the payment of such costs, then GBRA shall be under no obligation to perform the associated improvements, repair or replacement under this Contract for so long as such improvements, repair or replacement remains unfunded. Further, as stated in Section 5.2(E), if the nonperformance of such repair or replacement reduces the Hydro Revenues received by GBRA, GBRA shall continue to remit all Hydro Revenues received but shall be relieved of its obligation to fund the GBRA Minimum Payment until and unless the improvement, repair or replacement is completed. D. GBRA is authorized to refund or refinance any Bonds, with prior approval of the WCID, issued in any manner provided by law.