| 1. Lending and borrowing powers. The bank may assist the |
| State by borrowing money to finance or refinance from time to |
| time all or a portion of the costs of the qualified |
| transportation project and make the proceeds of such borrowing |
| available to the Department of Transportation at terms agreed |
| upon by the bank, the State Budget Officer and the Department of |
| Transportation. The principal of and interest on any bonds or |
| notes issued by the bank to finance or refinance the qualified |
| transportation project must be secured by a pledge of funds paid |
| by the Federal Highway Administration and any matching funds of |
| the State as necessary and legally available that are allocated |
| for such purpose on an annual basis by the Department of |
| Transportation in its sole discretion and may further be secured |
| by a pledge of any rights, grants, reserves, contracts, |
| agreements or other revenues or property as may be determined by |
| resolution of the bank. Bonds, notes, leases, agreements or |
| other forms of debt or liability entered into or issued by the |
| bank under this section are not in any way a debt or liability of |
| the State and do not constitute a loan of the credit of the State |
| or create any debt or liability on behalf of the State or |
| constitute a pledge of the faith and credit of the State. Each |
| bond, note, lease, agreement or other evidence of debt or |
| liability entered into by the bank must contain a statement to |
| the effect that the bank is obligated to pay the principal, |
| interest, redemption premium, if any, and other amounts payable |
| solely from the sources pledged for that purpose by the bank and |
| that neither the faith and credit nor the taxing power of the |
| State is pledged to the payment of the principal, interest, |
| premium, charge, fee or other amount on the bond, note, lease, |
| agreement or other form of indebtedness. |
