# Title 6 — Banks and Banking

## Chapter 6-09.4 — Public Finance Authority

### § 6-09.4-01. Title.

This chapter must be known as the "North Dakota Public Finance Authority Act".
### § 6-09.4-02. Legislative policy.

It is declared to be the policy of the state of North Dakota to foster and promote the
provision of adequate capital markets and facilities for borrowing money by political subdivisions
or other contracting parties and for the financing of their respective public improvements or
projects as those terms are used or defined in this chapter or chapter 40-57. It is in the public
interest to encourage political subdivisions or other contracting parties to continue their
independent undertakings of public improvements or projects and the financing thereof by
making funds available at reduced interest costs, especially during periods of restricted credit or
money supply. Current credit and municipal bond market conditions require the exercise of the
powers of the state to further and implement such policies by authorizing a state instrumentality
to be created to borrow money and to issue its bonds to make funds available at reduced rates
and on favorable terms for borrowing by political subdivisions or other contracting parties
through the purchase or holding of marketable municipal securities of political subdivisions or
other contracting parties in fully marketable form or in another form adequate to secure bonds
issued by the state instrumentality and by granting broad powers to accomplish and to carry out
the policies of the state.
### § 6-09.4-03. Definitions.

In this chapter, unless the context or subject matter otherwise requires:
1. "Bondholder" or "holder" or any similar term when used with reference to a bond of the
public finance authority means any person who is the bearer of any outstanding bond
of the public finance authority.
2. "Bonds" or "bond" means evidences of indebtedness of the public finance authority
issued pursuant to this chapter.
3. "Fully marketable form" means a municipal security duly executed and accompanied
by an approving legal opinion of a counsel whose opinions are generally accepted by
the public finance authority or other purchasers of municipal securities.
4. "Municipal security" means an evidence of indebtedness issued by a political
subdivision, including a clean renewable energy bond issued under 26 U.S.C. 54
[Pub. L. 109-58; 119 Stat. 991], and a revenue agreement entered into by a
contracting party as those terms are used in chapter 40-57, but does not generally
include an evidence of indebtedness issued pursuant to chapter 40-57 other than an
evidence of indebtedness that qualifies as a qualified small issue bond as defined
under 26 U.S.C. 144(a) [Pub. L. 99-514; 100 Stat. 2606], as amended, and regulations
promulgated and officially proposed to be promulgated thereunder, or as an "exempt
facility bond" as defined under 26 U.S.C. 142(a)(4), (5), or (6) [Pub. L. 99-514;
100 Stat. 2606], as amended, and regulations promulgated and officially proposed to
be promulgated thereunder, issued to provide one of the following:
a. A facility for the furnishing of water.
b. A wastewater facility.
c. A solid waste disposal facility.
5. "Political subdivision" means:
a. A local governmental unit created by statute or by the Constitution of North
Dakota for local governmental or other public purposes.
b. The department of environmental quality, or any other state agency or authority,
or any member-owned association or publicly owned and nonprofit corporation:
(1) Operating any public water system that is subject to chapter 61-28.1.
(2) Operating any facility, system, or other related activity that is eligible for
financial assistance under chapter 61-28.2.

c. The Bank of North Dakota for purposes of the revolving loan fund program
established by chapter 61-28.2.
d. The state water commission for purposes of the revolving loan fund program
established by chapter 61-28.1.
e. A qualified borrower within the meaning of 26 U.S.C. 54(j)(5) [Pub. L. 109-58;
119 Stat. 995].
f. The Garrison Diversion Conservancy District or any successor entity or
improvement district created under chapter 61-24.8 to finance or refinance
irrigation and water supply projects.
g. The Lake Agassiz water authority, for use in financing the construction,
acquisition, extension, expansion, alteration, betterment, maintenance, or
renovation of a project under section 61-39-16.
6. "Public finance authority" means the public finance authority created by section
6-09.4-04.
7. "Required debt service reserve" means the amount required to be on deposit in the
reserve fund.
8. "Reserve fund" means the public finance authority reserve fund or funds created as
provided in section 6-09.4-10.
9. "Revenues" means any or all fees, charges, moneys, profits, payments of principal of
or interest on municipal securities, investment income, revenues, appropriations, and
all other income derived or to be derived by the public finance authority under this
chapter.
### § 6-09.4-04. Creation of public finance authority.

A public finance authority is established under the operation, management, and control of
the industrial commission to be known as the "public finance authority". The public finance
authority is constituted as an instrumentality of the state exercising public and governmental
functions, and the exercise by the public finance authority of the powers conferred by this
chapter must be deemed and held to be an essential governmental function of the state.
### § 6-09.4-05. Participation voluntary - Agreement to participate.

Participation by a political subdivision is entirely voluntary and no political subdivision may
be required to sell its bond issues to the public finance authority. Notwithstanding any other
state law applicable to the issuance of bonds, a political subdivision desiring to participate in the
public finance authority may enter into an agreement with the public finance authority for the
purchase by the public finance authority of a bond issue or issues of the political subdivision,
including the purchase by the public finance authority of an issue or issues of refunding bonds,
which refunding bonds may be required by the agreement to be issued at a rate or rates of
interest higher or lower than that of the bond issue or issues to be refunded.
### § 6-09.4-05.1. Administrative agreements with state agencies.

The public finance authority and any state agency authorized by state or federal law to
make an allocation of bonds or bonding authority or to make loans, or to issue bonds to obtain
funds for the purpose of making loans or grants, may enter into an administrative agreement,
which may authorize the public finance authority to administer the loan or bond program for the
state agency. The agreement may delegate to the public finance authority the authority to make
loans, or to issue bonds to obtain funds for the purpose of making loans or grants.
### § 6-09.4-06. Lending and borrowing powers generally.

1. The public finance authority may lend money to political subdivisions or other
contracting parties through the purchase or holding of municipal securities which, in
the opinion of the attorney general, are properly eligible for purchase or holding by the
public finance authority under this chapter or chapter 40-57 and for purposes of the
public finance authority's capital financing program the principal amount of any one
issue does not exceed five hundred thousand dollars. However, the public finance

authority may lend money to political subdivisions through the purchase of securities
issued by the political subdivisions through the capital financing program without
regard to the principal amount of the bonds issued, if the industrial commission
approves a resolution that authorizes the public finance authority to purchase the
securities. The capital financing program authorizing resolution must state that the
industrial commission has determined that private bond markets will not be responsive
to the needs of the issuing political subdivision concerning the securities or, if it
appears that the securities can be sold through private bond markets without the
involvement of the public finance authority, the authorizing resolution must state
reasons for the public finance authority's involvement in the bond issue. The public
finance authority may hold such municipal securities for any length of time it finds to be
necessary. The public finance authority, for the purposes authorized by this chapter or
chapter 40-57, may issue its bonds payable solely from the revenues available to the
public finance authority which are authorized or pledged for payment of public finance
authority obligations, and to otherwise assist political subdivisions or other contracting
parties as provided in this chapter or chapter 40-57.
2. The public finance authority may lend money to the Bank of North Dakota under terms
and conditions requiring the Bank to use the proceeds to make loans for agricultural
improvements that qualify for assistance under the revolving loan fund program
established by chapter 61-28.2.
3. The public finance authority may transfer money to the Bank of North Dakota for
allocations to infrastructure projects and programs. Bonds issued for these purposes
are payable in each biennium solely from amounts the legislative assembly may
appropriate for debt service for any biennium or from a reserve fund established for
the bonds. Neither the obligation of the state to pay the bonds nor the obligation of the
issuer to pay debt service will constitute a debt of the state or any agency or political
subdivision of the state within the meaning of any constitutional or statutory provision.
The issuance of the bond does not directly or contingently obligate the state to pay the
bond payments beyond the appropriation for the current biennium of the state. The
issuer has no taxing power. In addition to providing funds for the transfers, the public
finance authority may use the bond proceeds to pay the costs of issuance of the
bonds, capitalized interest, and establish a reserve fund for the bonds.
4. Bonds of the public finance authority issued under this chapter or chapter 40-57 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 debts, liability or liabilities, on behalf of the state, or
constitute a pledge of the faith and credit of the state, but all such bonds are payable
solely from revenues pledged or available for their payment as authorized in this
chapter. Each bond must contain on its face a statement to the effect that the public
finance authority is obligated to pay such principal or interest, and redemption
premium, if any, and that neither the faith and credit nor the taxing power of the state is
pledged to the payment of the principal of or the interest on such bonds. Specific funds
pledged to fulfill the public finance authority's obligations are obligations of the public
finance authority.
5. All expenses incurred in carrying out the purposes of this chapter or chapter 40-57 are
payable solely from revenues or funds provided or to be provided under this chapter or
chapter 40-57 and nothing in this chapter may be construed to authorize the public
finance authority to incur any indebtedness or liability on behalf of or payable by the
state.
### § 6-09.4-07. Powers.

The public finance authority has the following powers:
1. To sue and be sued.
2. To make and enforce bylaws, rules, and regulations for the conduct of its affairs and
business and for use of its services.
3. To acquire, hold, use, and dispose of its income, revenue, funds, and moneys in
accordance with law, this chapter or chapter 40-57, or legislative appropriations.

4. To acquire, rent, lease, hold, use, and dispose of other personal property for its
purposes.
5. To borrow money and to issue its negotiable bonds or notes and to provide for and
secure the payment thereof and to provide for the rights of the holders thereof, and to
purchase, hold, and dispose of any of its bonds.
6. To fix and revise from time to time and charge and collect fees and charges for the use
of its services or facilities.
7. To do and perform any acts and things authorized by this chapter or chapter 40-57
under, through, or by means of its officers, agents, or employees or by contracts with
any person, firm, or corporation.
8. To make, enter into, and enforce all contracts or agreements necessary, convenient, or
desirable for the purposes of the public finance authority or pertaining to any loan to a
political subdivision or other contracting party or any purchase or sale of municipal
securities or other investments or to the performance of its duties and execution or
carrying out of any of its powers under this chapter or chapter 40-57.
9. To purchase or hold municipal securities of political subdivisions or other contracting
parties at such prices and in such manner as the public finance authority shall deem
advisable, and to sell municipal securities acquired or held by it at such prices without
relation to cost and in such manner as the public finance authority deems advisable.
10. To invest any funds or moneys of the public finance authority not then required for loan
to political subdivisions or other contracting parties and for the purchase of municipal
securities in the same manner as permitted for investment of funds belonging to the
state or the Bank of North Dakota.
11. To fix and prescribe any form of application or procedure to be required of a political
subdivision or other contracting party for the purpose of any loan or the purchase of its
municipal securities, and to fix the terms and conditions of any such loan or purchase
and to enter into agreements with political subdivisions or other contracting parties
with respect to any such loan or purchase.
12. To consider the need, desirability, or eligibility of such loan, the ability of such political
subdivision or other contracting party to secure borrowed money from other sources
and the costs thereof, and the particular public improvement, project, or purpose to be
financed by the municipal securities to be purchased by the public finance authority.
13. To impose and collect charges from a political subdivision or other contracting party for
its costs and services in review or consideration of any proposed loan to a political
subdivision or other contracting party or purchase of municipal securities of such
political subdivision or other contracting party, and to impose and collect charges
therefor whether or not such loan has been made or such municipal securities have
been purchased.
14. To fix and establish any and all terms and provisions with respect to any purchase of
municipal securities by the public finance authority, including dates and maturities of
such bonds, provisions as to redemption or payment prior to maturity, and any and all
other matters which in connection therewith are necessary, desirable, or advisable in
the judgment of the public finance authority.
15. To procure insurance against any losses in connection with its property, operations, or
assets in such amounts and from such insurers as it deems desirable to pay the
premiums on such insurance.
16. To the extent permitted under its contracts with the holders of bonds of the public
finance authority, to consent to any modification with respect to rates of interest, time,
and payment of any installment of principal or interest, security, or any other term of
bond, contract, or agreement of any kind to which the public finance authority is a
party.
17. To do all acts and things necessary, convenient, or desirable to carry out the powers
expressly granted or necessarily implied in this chapter or chapter 40-57.
18. To do and perform any act and thing authorized by section 54-01-27 or 54-17-36
under, through, or by means of its officers, agents, or employees or by contracts with
any person to assist the state, or any agency or institution of the state, in making,

entering, and enforcing all contracts or agreements necessary, convenient, or
desirable for the purposes of leasing all or part of, or an undivided or other interest in,
property.
### § 6-09.4-08. Bonds of the public finance authority.

Bonds of the public finance authority must be authorized by resolution of the industrial
commission and may be issued in one or more series and must bear such date or dates, mature
at such time or times, bear interest at such rate or rates of interest per year, be in such
denomination or denominations, be in such form, either coupon or registered, carry such
conversion or registration privileges, have such rank or priority, be executed in such manner, be
payable from such sources in such medium of payment at such place or places within or without
the state, and be subject to such terms of redemption, with or without premium, as such
resolution or resolutions may provide. Bonds of the public finance authority, issued to provide
funds to a municipal pipeline authority, are to mature not more than thirty years from the date of
issue. Bonds of the public finance authority may be sold at public or private sale at such time or
times and at such price or prices as the public finance authority determines.
### § 6-09.4-09. Pledges.

Any pledge of revenue or of a revenue agreement under chapter 40-57 made by the
industrial commission as security for public finance authority bonds is valid and binding from
time to time when the pledge is made. The industrial commission may also pledge assets of the
Bank of North Dakota as security for public finance authority bonds. The revenues or other
moneys so pledged and thereafter received by the public finance authority are immediately
subject to the lien of such pledge without any physical delivery thereof or further act, and the
lien of any such pledge is valid and binding as against all parties having claims of any kind in
tort, contract, or otherwise against the public finance authority, regardless of whether such
parties have notice thereof. Neither the resolution nor any other instrument by which a pledge is
created need be filed or recorded, except in the records of the public finance authority.
### § 6-09.4-10. Reserve fund.

1. The public finance authority shall establish and maintain a reserve fund in which there
must be deposited all moneys appropriated by the state for the purpose of the fund, all
proceeds of bonds required to be deposited therein by terms of any contract between
the public finance authority and its bondholders or any resolution of the public finance
authority with respect to the proceeds of bonds, any other moneys or funds of the
public finance authority which it determines to deposit therein, any contractual right to
the receipt of moneys by the public finance authority for the purpose of the fund,
including a letter of credit or similar instrument, and any other moneys made available
to the public finance authority only for the purposes of the fund from any other source
or sources. Moneys in the reserve fund must be held and applied solely to the
payment of the interest on and the principal of bonds and sinking fund payments as
the same become due and payable and for the retirement of bonds, including payment
of any redemption premium required to be paid when any bonds are redeemed or
retired prior to maturity. Moneys in the reserve fund may not be withdrawn therefrom if
the withdrawal would reduce the amount in the reserve fund to an amount less than
the required debt service reserve, except for payment of interest then due and payable
on bonds and the principal of bonds then maturing and payable and sinking fund
payments and for the retirement of bonds in accordance with the terms of any contract
between the public finance authority and its bondholders and for the payments on
account of which interest or principal or sinking fund payments or retirement of bonds,
other moneys of the public finance authority are not then available in accordance with
the terms of the contract. The required debt service reserve must be an aggregate
amount equal to at least the largest amount of money required by the terms of all
contracts between the public finance authority and its bondholders to be raised in the
then current or any succeeding calendar year for the payment of interest on and

maturing principal of outstanding bonds, and sinking fund payments required by the
terms of any contracts to sinking funds established for the payment or redemption of
the bonds.
2. If the establishment of the reserve fund for an issue or the maintenance of an existing
reserve fund at a required level under this section would necessitate the investment of
all or any portion of a new reserve fund or all or any portion of an existing reserve fund
at a restricted yield, because to not restrict the yield may cause the bonds to be
taxable under the Internal Revenue Code, then at the discretion of the public finance
authority no reserve fund need be established prior to the issuance of bonds or the
reserve fund need not be funded to the levels required by other subsections of this
section or an existing reserve fund may be reduced.
3. No bonds may be issued by the public finance authority unless there is in the reserve
fund the required debt service reserve for all bonds then issued and outstanding and
the bonds to be issued. Nothing in this chapter prevents or precludes the public
finance authority from satisfying the foregoing requirement by depositing so much of
the proceeds of the bonds to be issued, upon their issuance, as is needed to achieve
the required debt service reserve. The public finance authority may at any time issue
its bonds or notes for the purpose of providing any amount necessary to increase the
amount in the reserve fund to the required debt service reserve, or to meet such
higher or additional reserve as may be fixed by the public finance authority with
respect to such fund.
4. In order to assure the maintenance of the required debt service reserve, there shall be
appropriated by the legislative assembly and paid to the public finance authority for
deposit in the reserve fund, such sum, if any, as shall be certified by the industrial
commission as necessary to restore the reserve fund to an amount equal to the
required debt service reserve. However, the commission may approve a resolution for
the issuance of bonds, as provided by section 6-09.4-06, which states in substance
that this subsection is not applicable to the required debt service reserve for bonds
issued under that resolution.
5. If the maturity of a series of bonds of the public finance authority is three years or less
from the date of issuance of the bonds, the public finance authority may determine that
no reserve fund need be established for that respective series of bonds. If such a
determination is made, holders of that respective series of bonds may have no interest
in or claim on existing reserve funds established for the security of the holders of
previously issued public finance authority bonds, and may have no interest in or claim
on reserve funds established for the holders of subsequent issues of bonds of the
public finance authority.
6. The industrial commission may determine this section is inapplicable in whole or in
part for bonds issued under:
a. Section 6-09.4-06;
b. Section 6-09.4-24; or
c. The public finance authority's state revolving fund program.
### § 6-09.4-10.1. Legacy sinking and interest fund - Debt service requirements - Public

finance authority.
There is created in the state treasury the legacy sinking and interest fund. The fund consists
of all moneys deposited in the fund under section 54-27-32. Moneys in the fund may be spent
by the public finance authority pursuant to legislative appropriations to meet the debt service
requirements for evidences of indebtedness issued by the authority for transfer to the Bank of
North Dakota for allocations to infrastructure projects and programs.
### § 6-09.4-10.2. Debt service requirements - Bonds for infrastructure projects and

programs.
Each biennium, the public finance authority shall request from the legislative assembly an
appropriation from the general fund, derived from legacy fund earnings, Bank of North Dakota

profits, or other sources to meet the debt service requirements for bonds issued by the authority
for allocations to infrastructure projects and programs.
### § 6-09.4-11. Additional reserves and funds.

The public finance authority may establish such additional and further reserves or such
other funds or accounts as may be, in its discretion, necessary, desirable, or convenient to
further the accomplishment of the purposes of the public finance authority to comply with the
provisions of any agreement made by or any resolution of the public finance authority.
### § 6-09.4-12. Participation by public finance authority in bonds held by Bank of North

Dakota.
The public finance authority may issue its bonds from time to time in an amount sufficient to
purchase municipal securities held by the Bank of North Dakota at a price established by mutual
agreement between the public finance authority and the Bank of North Dakota.
### § 6-09.4-13. Personal liability.

Neither the members of the industrial commission nor any person executing bonds issued
pursuant to this chapter or chapter 40-57 is liable personally on such bonds by reason of the
issuance thereof.
### § 6-09.4-14. Purchase of bonds of public finance authority.

The public finance authority has the power to purchase bonds of the public finance authority
out of any funds or money of the public finance authority available therefor. The public finance
authority may hold, cancel, or resell such bonds or notes subject to and in accordance with
agreements with holders of its bonds.
### § 6-09.4-15. Bonds as legal investments and security.

Notwithstanding any restrictions contained in any other law, the state and all public officers,
boards, and agencies, and political subdivisions and agencies thereof, all national banking
associations, state banks, trust companies, savings banks and institutions, savings and loan
associations, investment companies, and other persons carrying on a banking business, and all
executors, administrators, guardians, trustees, and other fiduciaries, may legally invest any
sinking funds, moneys, or other funds belonging to them or within their control in any bonds
issued by the public finance authority pursuant to this chapter, and the bonds are authorized
security for any and all public deposits.
### § 6-09.4-16. Tax exemptions.

All property of the public finance authority and all bonds issued under this chapter must be
deemed to be serving essential public and governmental purposes and such property and such
bonds so issued, their transfer and the income therefrom, including any profits made on the sale
thereof, shall at all times be exempt from state, county, and municipal taxes of any and all kinds.
### § 6-09.4-17. Exemption of property from execution sale.

All property of the public finance authority is exempt from levy and sale by virtue of an
execution and no execution or other judicial process may issue against the same nor may any
judgment against the public finance authority be a charge or lien upon its property; provided,
that nothing contained in this chapter applies to or limits the rights of the holder of any bonds to
pursue any remedy for the enforcement of any pledge or lien given by the public finance
authority on its revenues. Any action or proceeding in any court to set aside a resolution
authorizing the issuance of bonds by the public finance authority under this chapter or to obtain
any relief upon the ground that such resolution is invalid must be commenced within ten days
after the adoption of said resolution by the industrial commission. After the expiration of such
period of limitation, no claim for relief or defense founded upon the invalidity of the resolution or
any of its provisions may be asserted nor may the validity of the resolution or any of its
provisions be open to question in any court on any ground whatever.

### § 6-09.4-18. Insurance or guaranty.

The public finance authority is authorized and empowered to obtain from any entity of the
state, any department or agency of the United States of America, or any nongovernmental
insurer any insurance, guaranty, or liquidity facility, or from a financial institution a letter of credit
to the extent such insurance, guaranty, liquidity facility, or letter of credit now or hereafter
available, as to, or for, the payment or repayment of, interest or principal, or both, or any part
thereof, on any bonds issued by the public finance authority, or on any municipal securities
purchased or held by the public finance authority, pursuant to this chapter; and to enter into any
agreement or contract with respect to any such insurance, guaranty, letter of credit, or liquidity
facility, and pay any required fee, unless the same would impair or interfere with the ability of the
public finance authority to fulfill the terms of any agreement made with the holders of its bonds.
### § 6-09.4-19. Remedies on default of municipal securities.

In the event of default by a political subdivision in the payment of interest on or principal of
any municipal securities owned or held by the public finance authority, the public finance
authority may proceed to enforce payment, pursuant to applicable provisions of law, of such
interest or principal or other amount then due and payable.
### § 6-09.4-20. Form of municipal securities and investments.

All municipal securities held by the public finance authority as permitted or provided for
under this chapter must at all times be purchased and held in fully marketable form, subject to
provision for any registration in the name of the public finance authority. All municipal securities
at any time purchased, held, or owned by the public finance authority must, upon delivery to the
public finance authority, be in fully marketable form and accompanied by such documentation as
shall from time to time be required by the public finance authority.
### § 6-09.4-21. Presumption of validity.

After issuance, all bonds of the public finance authority are conclusively presumed to be
fully authorized and issued under the laws of the state, and any person or governmental unit is
estopped from questioning their authorization, sale, issuance, execution, or delivery by the
public finance authority.
### § 6-09.4-22. Protection of service during term of loan.

1. The service provided or made available by a political subdivision through the
construction or acquisition of an improvement, or the revenues therefrom, financed in
whole or in part with a loan to the political subdivision from the public finance authority
or any other state agency or enterprise, may not be curtailed or limited by inclusion of
all or any part of the area served by the political subdivision within the boundaries of
any other political subdivision, or by the granting of any private franchise for similar
service within the area served by the political subdivision, during the term of the loan.
The political subdivision providing the service may not be required to obtain or secure
any franchise, license, or permit as a condition of continuing to serve the area if it is
included within the boundaries of another political subdivision during the term of the
loan.
2. Under the circumstances described in subsection 1, nothing prevents the two political
subdivisions, with the public finance authority or other state agency or enterprise, from
negotiating an agreement for the right or obligation to provide the service in question,
provided that any agreement is invalid and unenforceable unless the public finance
authority or other state agency or enterprise is a party to the agreement and unless the
agreement contains adequate safeguards to ensure the security and timely payment of
any outstanding bonds of the public finance authority issued to fund the loan.
3. An agreement made before January 1, 2025, and in violation of subsection 2 is
voidable only at the option of the public finance authority or other state agency or
enterprise upon thirty days written notice from the public finance authority or other

state agency or enterprise to the parties of the agreement. This subsection does not
apply to litigation commenced before January 1, 2025.
### § 6-09.4-23. Evidences of indebtedness - Authority to withhold school district state aid.

1. If the public finance authority or a paying agent notifies the superintendent of public
instruction, in writing, that a school district has failed to pay when due the principal or
interest on any evidences of indebtedness issued after July 31, 1999, or that the public
finance authority, school district, or the paying agent has reason to believe a school
district will not be able to make a full payment of the principal and interest when the
payment is due, the superintendent of public instruction shall withhold any funds that
are due or payable or appropriated to the school district under chapter 15.1-27 until
the payment of the principal or interest has been made to the public finance authority
or the paying agent, or until the public finance authority, school district, or the paying
agent notifies the superintendent of public instruction that arrangements satisfactory to
the public finance authority or the paying agent have been made for the payment of
the principal and interest then due and owing. The notification must include information
required by the superintendent of public instruction. State funds available to a school
district under chapter 15.1-27 are not subject to withholding under this section unless
the withholding is authorized by resolution of the district's school board.
2. If the public finance authority or a paying agent notifies the state treasurer, in writing,
that a school district has failed to pay when due the principal or interest on any
evidence of indebtedness issued after July 31, 2023, or that the public finance
authority, school district, or the paying agent has reason to believe a school district will
not be able to make a full payment of the principal and interest when the payment is
due, the state treasurer shall withhold any funds that are due or payable or
appropriated to the school district under chapter 57-51 until the payment of the
principal or interest has been made to the public finance authority or the paying agent,
or until the public finance authority, school district, or the paying agent notifies the state
treasurer that arrangements satisfactory to the public finance authority or the paying
agent have been made for the payment of the principal and interest then due and
owing. The notification must include information required by the state treasurer. State
funds available to a school district under chapter 57-51 are not subject to withholding
under this section unless the withholding is authorized by resolution of the district's
school board.
3. If the public finance authority or a paying agent notifies the county auditor, in writing,
that a school district has failed to pay when due the principal or interest on any
evidence of indebtedness issued after July 31, 2023, or that the public finance
authority, school district, or the paying agent has reason to believe a school district will
not be able to make a full payment of the principal and interest when the payment is
due, the county auditor shall withhold any funds that are due or payable or
appropriated to the school district under chapters 57-33.2, 57-34, and 57-55 and
section 21-06-10 until the payment of the principal or interest has been made to the
public finance authority or the paying agent, or until the public finance authority, school
district, or the paying agent notifies the county auditor that arrangements satisfactory
to the public finance authority or the paying agent have been made for the payment of
the principal and interest then due and owing. The notification must include information
required by the county auditor. State funds available to a school district under chapters
57-33.2, 57-34, and 57-55 and section 21-06-10 are not subject to withholding under
this section unless the withholding is authorized by resolution of the district's school
board.
4. Notification by the public finance authority, school district, or the paying agent that
satisfactory arrangements have been made for the payment of the principal and
interest then due and owing under subsection 1, 2, or 3 must be made at least fifteen
working days before the principal or interest is due. The notice must be in writing and
include the name of the school district, an identification of the debt obligation issue, the
date the payment is due, the amount of principal and interest due on the payment

date, the amount of principal or interest the school district will be unable to pay, the
paying agent for the debt obligation, the wire transfer instructions to transfer funds to
the paying agent, and an indication that payment is requested under this section. A
paying agent shall notify the superintendent of public instruction, the state treasurer,
and the appropriate county auditor if the paying agent becomes aware of a potential
default. If the superintendent, state treasurer, or the county auditor receives notice of a
requested payment under this section, the superintendent of public instruction, state
treasurer, or county auditor shall withhold and transfer funds due or payable or
appropriated to the school district under chapter 15.1-27 or 57-51 to the paying agent
after:
a. Consulting with the school district and the paying agent; and
b. Verifying the accuracy of the provided request information.
5. Notwithstanding any withholding of state funds under section 15-39.1-23 or any other
law, the superintendent of public instruction, state treasurer, and county auditor shall
make available any funds withheld under subsection 1, 2, or 3 to the public finance
authority or the paying agent. The public finance authority or the paying agent shall
apply the funds to payments that the school district is required to make to the public
finance authority or the paying agent.
6. If funds are withheld from a school district and made available to the public finance
authority or a paying agent under this section and if tax revenues are received by the
school district during the fiscal year in which the funds are withheld and are deposited
in the district's sinking fund established in accordance with section 21-03-42, the
district, with the consent of the public finance authority or the paying agent, may
withdraw from its sinking fund an amount equal to that withheld and made available to
the public finance authority or a paying agent under this section.
7. The superintendent of public instruction, state treasurer, and county auditor shall
develop detailed procedures for a school district to notify the superintendent of public
instruction, state treasurer, and the county auditor that the school district has obligated
the district to be bound by this section; procedures for a school district, paying agent,
and the public finance authority to notify the superintendent of public instruction, state
treasurer, or county auditors of potential defaults and to request payment under this
section; and procedures for the state to expedite payments to prevent defaults.
### § 6-09.4-24. Public finance authority - Issuance on behalf of other state agencies.

The public finance authority may issue bonds or other evidences of indebtedness on behalf
of other state agencies, instrumentalities, or officers, including the farm finance agency,
industrial commission, North Dakota building authority, student loan trust, and any other state
agency, instrumentality, or officer authorized by law to issue bonds or other evidences of
indebtedness and which elects to enter into an administrative agreement with the public finance
authority under this chapter. The public finance authority may be assisted by any other official
appointed by the industrial commission to aid the executive director or to serve as an authorized
officer of the public finance authority from time to time. Notwithstanding any other provision of
law, in issuing bonds or other evidences of indebtedness and in administering or managing any
bond issue postissuance on behalf of any other state agency, instrumentality, or officer, the
public finance authority may exercise any of the powers and authority of that state agency,
instrumentality, or officer which the industrial commission determines to be necessary or
expedient in the issuance of bonds or other evidences of indebtedness or in the administration
or management of the issue. Any bonds or other evidences of indebtedness issued by the public
finance authority on behalf of any other state agency, instrumentality, or officer, if so determined
by the industrial commission, continues to be the obligation or liability of the state agency or
instrumentality as otherwise provided by law and not an obligation or liability of the public
finance authority.

### § 6-09.4-25. Administrative agreements with state agencies and instrumentalities to

issue bonds and other evidences of indebtedness.
The public finance authority and any state agency, instrumentality, or officer authorized by
law to issue bonds or other evidences of indebtedness to obtain funds for any authorized
purpose may enter into an administrative agreement. The agreement may delegate to the public
finance authority the power and authority to issue bonds or other evidences of indebtedness on
behalf of the state agency, instrumentality, or officer to obtain funds for any other purpose
authorized by law and may contain such other necessary or expedient terms and conditions as
the industrial commission and the parties to the administrative agreement approve to effect the
issuance of the bonds or other evidences of indebtedness and to aid in the administration or
management of any bond issue after issuance.
### § 6-09.4-26. Public finance authority as continuation of and successor in interest to

municipal bond bank.
1. Beginning August 1, 2005, the public finance authority is deemed the continuation of
and successor in interest to the municipal bond bank and any reference to the
municipal bond bank or bond bank in any agreement, certificate, contract, covenant,
indenture, resolution, recital, undertaking, bond, note, other evidence of indebtedness,
or in any other document or instrument means the public finance authority.
2. The public finance authority as the continuation of and successor in interest to the
municipal bond bank is deemed to:
a. Possess all rights, title, privileges, powers, immunities, property, assets, and
claims of the bond bank; and
b. Fulfill and perform all obligations of the bond bank, including all bond bank
obligations relating to outstanding bonds and notes.
### § 6-09.4-27. Confidentiality of certain public finance authority records.

Commercial or financial information of a contracting party provided to the public finance
authority as part of any qualified small issue bonds or municipal industrial revenue bonds
purchased or issued by the public finance authority, whether obtained directly or indirectly, are
confidential records. Confidential records do not include routine credit inquiries; records required
to be disclosed by due legal process; the name, address, and contact information of a
contracting party; or the amount loaned to a contracting party.
