California Health and Safety Code 129174 – (a) In the event a borrower has defaulted in making its …
(a) In the event a borrower has defaulted in making its payments on the loan insured by the department to the lender or the borrower’s bond trustee, at any time thereafter, the office may do any of the following:
(1) Decease a portion or all of the bonds or may purchase a portion or all of the bonds at a private or public sale or on the open market. For this purpose, the department may use any funds available, including, but not limited to, funds in the Health Facility Construction Loan Insurance Fund, funds that the department may receive either from settlement or recoveries from lawsuits, funds from the sale of assets of the borrower, or funds held by the borrower’s bond trustee. If requested by the department, the Treasurer shall purchase the bonds on behalf of the office. Upon the purchase of any bonds under this section, the department shall direct the borrower’s bond trustee to cancel the bonds purchased.
Terms Used In California Health and Safety Code 129174
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- department: means State Department of Health Services. See California Health and Safety Code 20
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- Trustee: A person or institution holding and administering property in trust.
(2) Issue bonds used for the sole purpose of refunding any part or all of the defaulted bonds, provided that, in the opinion of the department, there are adequate present value savings to refund all or part of the defaulted bonds. If requested by the department, the Treasurer shall act as the issuer for this purpose.
(3) Require the lender or borrower’s bond trustee to accelerate the borrower’s debt and the maturity dates of the bonds, if any. If the bond trustee accelerates the bond debt and maturity dates, the department shall pay from the fund to the lender or borrower’s bond trustee the full amount of the remaining principal of the loan, any interest accrued and unpaid on this amount, and any costs enumerated in Section 129125.
(b) For the purposes of this section, “bonds” mean bonds, certificate of participation, notes, or other evidence of indebtedness of a loan insured by the department.
(Amended by Stats. 2021, Ch. 143, Sec. 262. (AB 133) Effective July 27, 2021.)