(a) For purposes of this section, “required minimum capital reserve” means the maximum amount permitted to be deposited in a special capital reserve fund by the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as amended from time to time, to permit the interest on such bonds to be excluded from gross income for federal tax purposes and secured by such special capital reserve fund.
(b) In connection with the issuance of bonds or to refund bonds previously issued by the Connecticut Green Bank, or in connection with the issuance of bonds to effect a refinancing or other restructuring with respect to one or more projects, said bank may create and establish one or more reserve funds to be known as special capital reserve funds, and may pay into such special capital reserve funds (1) any moneys appropriated and made available by the state for the purposes of such special capital reserve funds, (2) any proceeds of the sale of notes or bonds, to the extent provided in the resolution of said bank authorizing the issuance thereof, and (3) any other moneys which may be made available to said bank for the purpose of such special capital reserve funds from any other source or sources.
(c) The moneys held in or credited to any special capital reserve fund established under this section, except as hereinafter provided, shall be used for (1) the payment of the principal of and interest, when due, whether at maturity or by mandatory sinking fund installments, on bonds of the Connecticut Green Bank secured by such special capital reserve fund as such payments become due, or (2) the purchase of such bonds of said bank and the payment of any redemption premium required to be paid when such bonds are redeemed prior to maturity, including in any such case by way of reimbursement of a provider of bond insurance or of a credit or liquidity facility that has paid such redemption premiums. Notwithstanding the provisions of subdivisions (1) and (2) of this subsection, said bank may provide that moneys in any such special capital reserve fund shall not be withdrawn therefrom at any time in such amount as would reduce the amount of such moneys to less than the maximum amount of principal and interest becoming due by reasons of maturity or a required sinking fund installment in the then current or any succeeding calendar year on the bonds of said bank then outstanding, or less than the required minimum capital reserve, except for the purpose of paying such principal of, redemption premium and interest on such bonds of said bank secured by such special capital reserve becoming due and for the payment of which other moneys of said bank are not available. Said bank may provide that it shall not issue bonds secured by a special capital reserve fund at any time if the required minimum capital reserve on the bonds outstanding and the bonds then to be issued and secured by the same special capital reserve fund at the time of issuance exceeds the moneys in the special capital reserve fund, unless said bank, at the time of the issuance of such bonds, deposits in such special capital reserve fund from the proceeds of the bonds so to be issued, or from other sources, an amount which, together with the amount then in such special capital reserve fund, will be not less than the required minimum capital reserve.
(d) Prior to December first, annually, the Connecticut Green Bank shall deposit into any special capital reserve fund, the balance of which has fallen below the required minimum capital reserve of such fund, the full amount required to meet the minimum capital reserve of such fund, as available to said bank from any resources of said bank not otherwise pledged or dedicated to another purpose. On or before December first, annually, but after said bank has made such required deposit, there is deemed to be appropriated from the General Fund such sums, if any, as shall be certified by the chairperson or vice-chairperson of the Connecticut Green Bank to the Secretary of the Office of Policy and Management, the State Treasurer and the joint standing committees of the General Assembly having cognizance of matters relating to finance, revenue and bonding and energy, as necessary to restore each such special capital reserve fund to the amount equal to the required minimum capital reserve of such fund, and such amounts shall be allotted and paid to said bank. For the purpose of evaluation of any such special capital reserve fund, obligations acquired as an investment for any such special capital reserve fund shall be valued at market. Nothing contained in this section shall preclude said bank from establishing and creating other debt service reserve funds in connection with the issuance of bonds or notes of said bank which are not special capital reserve funds. Subject to any agreement or agreements with holders of outstanding notes and bonds of said bank, any amount or amounts allotted and paid to said bank pursuant to this subsection shall be repaid to the state from moneys of said bank at such time as such moneys are not required for any other of said bank’s corporate purposes, and in any event shall be repaid to the state on the date one year after all bonds and notes of said bank theretofore issued on the date or dates such amount or amounts are allotted and paid to said bank or thereafter issued, together with interest on such bonds and notes, with interest on any unpaid installments of interest and all costs and expenses in connection with any action or proceeding by or on behalf of the holders thereof, are fully met and discharged.
(e) No bonds secured by a special capital reserve fund shall be issued to pay project costs unless the Connecticut Green Bank is of the opinion and determines that the revenues from the project shall be sufficient to (1) pay the principal of and interest on the bonds issued to finance the project, (2) establish, increase and maintain any reserves deemed by said bank to be advisable to secure the payment of the principal of and interest on such bonds, (3) pay the cost of maintaining the project in good repair and keeping it properly insured, and (4) pay such other costs of the project as may be required.
(f) Notwithstanding the provisions of this section, no bonds secured by a special capital reserve fund shall be issued by the Connecticut Green Bank until and unless such issuance has been approved by the Secretary of the Office of Policy and Management or his or her deputy. Any such approval by the secretary pursuant to this subsection shall be in addition to (1) the otherwise required opinion of sufficiency by said bank set forth in subsection (e) of this section, and (2) the approval of the State Treasurer or the Deputy State Treasurer and the documentation by said bank otherwise required under subsection (a) of section 1-124. Such approval may provide for the waiver or modification of such other requirements of this section as the secretary determines to be necessary or appropriate in order to effectuate such issuance, subject to all applicable tax covenants of said bank and the state.
(g) Notwithstanding any other provision contained in this section, the aggregate amount of bonds secured by such special capital reserve fund authorized to be created and established by this section shall not exceed one hundred million dollars.