110 ILCS 681/26-20

(110 ILCS 681/26-20)

Sec. 26-20. Security of Bonds. In connection with the issuance of any bonds under this Article, and in order to secure the payment of any such bonds and the interest thereon, the Board shall have power for such University:

(1) To fix, maintain and collect (i) fees, rentals and other charges from students, staff members and others using or being served by, or having the right to use or the right to be served by, or to operate any project, (ii) tuition, registration, matriculation, health, hospital, medical, laboratory, admission, student activities, student services, and all other fees collected from students matriculated, registered or otherwise enrolled and attending such University, and (iii) rentals from any facility or building leased to the United States of America, the aggregate of which shall be sufficient at all times to pay all necessary expenses of the operation and maintenance of any project, to pay the bonds at maturity and accruing interest thereon in accordance with their terms, and to create and maintain all reserves therefor as provided by the resolution authorizing such bonds.

(2) To provide that bonds issued under this Article, subject only to the prior payment of the operation and maintenance expenses of any project, shall be payable from and secured by a pledge of and lien on all or any part of the income and revenues derived from, and to pledge and assign to, or in trust for the benefit of, the holder or holders of bonds under this Article all or any part of the income and revenues derived from (i) fees, rentals and other charges from students, staff members and others using or being served by, or having the right to use or the right to be served by, or to operate, any project, (ii) tuition, registration, matriculation, health, hospital, medical, laboratory, admission, student activities, student services, and all other fees collected from students matriculated, registered or otherwise enrolled at and attending such University, and (iii) rentals from any facility or building leased to the United States of America; provided that, if the Board provides that any bonds issued under this Article shall be payable from the income and revenues of any project heretofore acquired, any such provision for the payment of such bonds from the income and revenues of any such project heretofore acquired shall be subject to, and in all respects in full conformity and compliance with, the rights of the holders of any bonds or obligations payable from the income and revenues of any such project heretofore issued by the Board and then outstanding.

(3) To covenant with or for the benefit of the holder or holders of the bonds issued under this Article that so long as any such bonds shall remain outstanding and unpaid the Board will fix, maintain and collect in such installments as may be agreed upon (i) fees, rentals and other charges from students, staff members and others using or being served by, or having the right to use or the right to be served by, or to operate any project, (ii) tuition, registration, matriculation, health, hospital, medical, laboratory, admission, student activities, student services, and all other fees collected from students matriculated, registered or otherwise enrolled at and attending such University pledged under the terms of any resolution authorizing bonds pursuant to this Article, and (iii) rentals from any facility or building leased to the United States of America, the aggregate of which shall be sufficient at all times to pay all necessary expenses of the operation and maintenance of any project, to pay the bonds at maturity and accruing interest thereon in accordance with their terms, and to create and maintain all reserves therefor as provided by the resolution authorizing such bonds, until such bonds and accruing interest have been paid in accordance with their terms.

(4) To covenant with or for the benefit of the holder or holders of bonds issued under this Article as to all matters deemed advisable by the Board, including:

(i) The purposes, terms, and conditions for the issuance of additional parity or junior lien bonds that may thereafter be issued, and for the payment of the principal, redemption premiums and interest on such bonds.

(ii) The kind and amount of all insurance to be carried, the cost of which shall be charged as an operation and maintenance expense of any project.

(iii) The operation, maintenance and management of any project to assure the maximum use and occupancy thereof; the accounting for, and the auditing of, all income and revenue from, and all expenses of, any project; the employment of engineers and consultants; and the keeping of records, reports and audits of any project.

(iv) The obligation of the Board to maintain any project in good condition and to operate the same at all times in an economical and efficient manner.

(v) The terms and conditions for creating and maintaining sinking funds, reserve funds, and such other special funds as may be created in the resolution authorizing the bonds, separate and apart from all other funds and accounts of the Board and the University.

(vi) The procedure by which the terms of any contract with the holders of the bonds may be amended, the amount of bonds the holders of which must consent thereto, and the manner in which consent may be given.

(vii) Providing the procedure for refunding such bonds.

(viii) Such other covenants as may be deemed necessary or desirable to assure a successful operation of any project and the prompt payment of the principal of and interest upon the bonds so authorized.

(5) To make and enforce and agree to make and enforce parietal rules that shall insure the use of any project to the maximum extent to which such project is capable of serving students, staff members and others using or being served by, or having the right to use or the right to be served by, or to operate, any project.

(6) To covenant that so long as any of the bonds issued under this Article shall remain outstanding and unpaid, it will not, except upon such terms and conditions as may be determined:

(i) Voluntarily create or cause to be created any debt, lien, mortgage, pledge, assignment, encumbrance or other charge having priority to the lien of the bonds issued under this Article upon any of the income and revenues derived from (A) all fees, rentals and other charges from students, staff members and others using or being served by, or having the right to use or the right to be served by or to operate, any project, (B) all tuition, registration, matriculation, health, hospital, medical, laboratory, admission, student activities, student services, and all other fees collected from students matriculated, registered or otherwise enrolled at and attending such University, and (C) all rentals from any facility or building leased to the United States of America.

(ii) Convey or otherwise alienate any project or the real estate upon which such project shall be located, except at a price sufficient to pay all the bonds issued for such project then outstanding and interest accrued thereon, and then only in accordance with any agreements with the holder or holders of such bonds.

(7) To vest in a trustee or trustees the right to receive all or any part of the income and revenue pledged and assigned to, or for the benefit of the holder or holders of bonds issued under this Article, and to hold, apply and dispose of the same and the right to enforce any covenant made to secure or pay or in relation to the bonds; to execute and deliver a trust agreement or trust agreements which may set forth the powers and duties and the remedies available to such trustee or trustees and limiting the liabilities thereof and describing what occurrences shall constitute events of default and prescribing the terms and conditions upon which such trustee or trustees or the holder or holders of any specified amount or percentage of such bonds may exercise such rights; and to enforce any and all such covenants and resort to such remedies as may be appropriate.

(8) To covenant to perform any and all acts and to do any and all such things as may be necessary or convenient or desirable in order to secure its bonds, or as may in the judgment of the Board tend to make the bonds more marketable, notwithstanding that such acts or things may not be enumerated herein, it being the intention hereof to give the Board issuing bonds pursuant to this Article power to make all covenants, to perform all acts and to do all things not inconsistent with the Constitution of the State of Illinois.

(Source: P.A. 89-4, eff. 1-1-96.)