Colorado Health Facilities Authority

C.R.S. tit. 25, art. 25
in effect

C.R.S. § 25-25-101 Short title

25-25-101. Short title. This article shall be known and may be cited as the "Colorado Health Facilities Authority Act".

C.R.S. § 25-25-102 Legislative declaration

25-25-102. Legislative declaration. (1) The general assembly hereby finds and declares that, for the benefit of the people of the state of Colorado and the improvement of their health, welfare, and living conditions: (a) It is essential that the people of this state have adequate medical care and health facilities; (b) It is important that medical care and health facilities are made readily available by networks and organizations of health institutions, whether such networks and organizations are located within the state of Colorado or have facilities located both within and outside the state of Colorado; (c) It is a benefit to the people of the state of Colorado to serve such multistate institutions, as such service will create health-care-related employment opportunities; (d) It is essential that health institutions that have headquarters in Colorado or that operate or manage health facilities in Colorado, and affiliates of such health institutions, be provided with appropriate additional means to assist in the development and maintenance of public health, health care, hospitals, and related facilities wherever such health institutions are located in order that they can provide more adequate medical care and health facilities to the people of Colorado; (e) It is the purpose of this article to provide a measure of assistance to enable health institutions in the state to refund or refinance outstanding indebtedness incurred for health facilities and to provide additional facilities and structures that are greatly needed to accomplish the purposes of this article; and (f) The exemption of bonds and notes issued pursuant to this article from all taxation and assessments in the state of Colorado benefit only the residents of the state of Colorado. (2) It is the intent of the general assembly to create the Colorado health facilities authority to lend money to health institutions and to authorize the authority to acquire, construct, reconstruct, repair, alter, improve, extend, own, lease, and dispose of properties so that the authority may be able to promote the health and welfare of the people of this state and develop health-care-related employment opportunities for the people of this state. In enacting this article, it is the intent of the general assembly to vest the authority with the powers necessary to accomplish these purposes. However, it is not the intent of the general assembly to authorize the authority to operate a health facility. (3) This article shall be liberally construed to accomplish the intentions expressed in this section.

C.R.S. § 25-25-103 Definitions

25-25-103. Definitions. As used in this article, unless the context otherwise requires: (1) "Authority" means the Colorado health facilities authority created by this article. (2) "Board" means the board of directors of the authority. (3) "Bond", "note", "bond anticipation note", or "other obligation" means any bond, note, debenture, interim certificate, or other evidence of financial indebtedness issued by the authority pursuant to this article, including refunding bonds. (4) "Bond resolution" means the resolution authorizing the issuance of, or providing terms and conditions related to, bonds issued under the provisions of this article and includes any trust agreement, trust indenture, indenture of mortgage, or deed of trust providing terms and conditions for such bonds. (5) "Costs", as applied to facilities financed in whole or in part under the provisions of this article, means and includes the sum total of all reasonable or necessary costs incidental to: (a) The acquisition, construction, reconstruction, repair, alteration, equipment, enlargement, improvement, and extension of such facilities; and (b) The acquisition of all lands, structures, real or personal property, rights, rights-of-way, franchises, easements, and interest acquired, necessary, or used for, or useful for or in connection with, a facility; and (c) All other undertakings that the authority deems reasonable or necessary for the development of a facility, including, without limitation, the cost of or for: (I) Studies and surveys; (II) Land title and mortgage guaranty policies; (III) Plans, specifications, and architectural and engineering services; (IV) Legal, accounting, organization, marketing, or other special services; (V) Financing, acquisition, demolition, construction, equipment, and site development of new and rehabilitated buildings; (VI) Rehabilitation, reconstruction, repair, or remodeling of existing buildings; and (VII) All other necessary and incidental expenses, including working capital and an initial bond and interest reserve funds, together with interest on bonds issued to finance such facilities to the extent permitted under applicable federal tax law. (6) (a) "Health facility" or "facility", in the case of a participating health institution, means any structure or building, whether such structure or building is located within the state or whether such structure or building is located outside the state if an out-of-state health institution that operates or manages such structure or building, or an affiliate of such institution, also operates or manages a health facility within this state, suitable for use as a hospital, clinic, nursing home, home for the aged or infirm, or other health-care facility; laboratory; pharmacy; laundry; nurses', doctors', or interns' residences; administration building; research facility; maintenance, storage, or utility facility; auditorium; dining hall; food service and preparation facility; mental or physical health-care facility; dental care facility; nursing school; medical or dental teaching facility; mental or physical health facilities related to any such structure or facility; or any other structure or facility required or useful for the operation of a health institution, including but not limited to offices, parking lots and garages, and other supporting service structures; and any equipment, furnishings, appurtenances, or other assets, tangible or intangible, including but not limited to assets related to the medical practice of a health-care professional, that are necessary or useful in the development, establishment, or operation of a participating health institution; and the acquisition, preparation, and development of all real and personal property necessary or convenient as a site or sites for any such structure or facility. angible or intangible, including but not limited to assets related to the medical practice of a health-care professional, that are necessary or useful in the development, establishment, or operation of a participating health institution; and the acquisition, preparation, and development of all real and personal property necessary or convenient as a site or sites for any such structure or facility. (b) "Health facility" or "facility" does not include the following: (I) Food, fuel, supplies, or other items that are customarily considered as a current operating expense or charges; (II) Property used or to be used primarily for sectarian instruction or study or as a place for devotional activities or religious worship; or (III) Property used or to be used primarily in connection with any part of a program of a school or department of divinity of any religious denomination. (7) (a) "Health institution" means a limited liability company controlled directly or indirectly by one or more nonprofit entities, a private nonprofit hospital, corporation, association, or institution, or a public hospital or institution authorized or permitted by law, whether directly or indirectly through one or more affiliates, to provide, operate, or manage one or more health facilities in this state or outside this state if such entity, or an affiliate of such entity, also operates or manages a health facility within this state. (b) "Health institution" also includes a cooperative hospital service organization, as described in section 501 (e) of the "Internal Revenue Code of 1986", as amended, or a similar corporation, whether or not such corporation is exempt from federal income taxation pursuant to said section 501 (e). (c) (I) "Health institution" also includes a network of health-care providers, however organized; an integrated health-care delivery system; a joint venture or partnership between or among health-care providers; a health-care purchasing alliance; health insurers and third-party administrators that are participants in a system, network, joint venture, or partnership that provides health services; an organization whose primary purpose is to provide supporting services to one or more health institutions; or a health-care provider or such other health-care-related organization, or an affiliate of such organization, whose regional or national headquarters are located in this state. (II) In order to be a health institution, a network, system, joint venture, partnership, alliance, provider, or organization described in subparagraph (I) of this paragraph (c) shall be a nonprofit entity or controlled by one or more nonprofit entities. (7.5) "Participating health institution" means a health institution that undertakes the financing and construction or acquisition of health facilities or undertakes the refunding or refinancing of outstanding obligations in accordance with this article. (8) "Refinancing of outstanding obligations" means liquidation, with the proceeds of bonds or notes issued by the authority, of any indebtedness of a participating health institution incurred prior to, on, or after July 1, 1977, to finance or aid in financing a lawful purpose of such health institution not financed pursuant to this article which would constitute a facility had it been undertaken and financed by the authority, or consolidation of such indebtedness with indebtedness of the authority incurred for a facility related to the purpose for which the indebtedness of the health institution was initially incurred. (9) "Revenues" means, with respect to facilities, the rents, fees, charges, interest, principal repayments, and other income received or to be received by the authority from any source on account of such facilities.

C.R.S. § 25-25-104 Colorado health facilities authority - creation - membership - appointment - terms - vacancies - removal

25-25-104. Colorado health facilities authority - creation - membership - appointment - terms - vacancies - removal. (1) There is hereby created an independent public body politic and corporate to be known as the Colorado health facilities authority. Said authority is constituted a public instrumentality, and its exercise of the powers conferred by this article shall be deemed and held to be the performance of an essential public function. The authority shall be a body corporate and a political subdivision of the state and shall not be an agency of state government and shall not be subject to administrative direction by any department, commission, board, or agency of the state. (2) The governing body of the authority is a board of directors, which consists of seven members appointed by the governor, with the consent of the senate. The members shall be residents of the state. No more than four of the members may be affiliated with the same political party. Members of the board shall be appointed for terms of four years; except that the terms shall be staggered so that no more than three members' terms expire in the same year. Each member shall serve until the member's resignation or, in the case of a member whose term has expired, until a successor has been appointed. Any member shall be eligible for reappointment. The governor shall fill any vacancy by appointment for the remainder of an unexpired term. (3) (a) Any member of the board may be removed by the governor for misfeasance, malfeasance, willful neglect of duty, or other cause. (b) Notwithstanding the provisions of paragraph (a) of this subsection (3), a member shall be removed by the governor if such member fails, for reasons other than temporary mental or physical disability or illness, to attend three regular meetings of the board during any twelve-month period without the board having entered upon its minutes an approval for any of such absences.

C.R.S. § 25-25-105 Organization meeting - chair - executive director - surety bond - conflict of interest

25-25-105. Organization meeting - chair - executive director - surety bond - conflict of interest. (1) A member of the board, designated by the governor, shall call and convene the initial organizational meeting of the board and shall serve as its chair pro tempore. At such meeting, appropriate bylaws shall be presented for adoption. The board's bylaws may provide for the election or appointment of officers, the delegation of certain powers and duties, and such other matters as the authority deems proper. At such meeting and annually thereafter, the board shall elect one of its members as chair and one as vice-chair. It shall appoint an executive director and, if desired, an associate executive director and any other officer designated by the board, who shall not be members of the board and who shall serve at its pleasure. They shall receive such compensation for their services as shall be fixed by the board. (2) The executive director, the associate executive director, or any other person designated by the board shall keep a record of the board's proceedings and shall be custodian of all books, documents, and papers filed with the board, the minute books or journal, and the official seal of the authority. This person may make copies of the minutes and other records and documents of the board and may certify under the official seal of the authority that such copies are true copies. All persons dealing with the authority may rely on such certifications. (3) The board may delegate, by resolution, to one or more of its members or to its executive director, associate executive director, or any other officer designated by the board, such powers and duties as it may deem proper. (4) (a) Before the issuance of any bonds under this article, the executive director, associate executive director, and any other officer designated by the board shall each execute a surety bond in the penal sum of one hundred thousand dollars, and each member of the board shall execute a surety bond in the penal sum of fifty thousand dollars. (b) In lieu of the surety bonds required by paragraph (a) of this subsection (4), the chair of the board may execute a blanket bond covering each member, the executive director, the associate executive director, and the employees or other officers of the authority. (c) Each surety bond shall be conditioned upon the faithful performance of the duties of the office or offices covered and shall be executed by a surety authorized to transact business in this state as surety. The cost of each such bond shall be paid by the authority. (5) Notwithstanding any other law to the contrary, it shall not constitute a conflict of interest for a trustee, director, officer, or employee of any health institution, financial institution, investment banking firm, brokerage firm, commercial bank or trust company, architecture firm, insurance company, or other firm, person, or corporation to serve as a member of the board; except that such trustee, director, officer, or employee shall disclose such interest to the board and shall abstain from deliberation, action, and voting by the board in each instance where the business affiliation of any such trustee, director, officer, or employee is involved.

C.R.S. § 25-25-106 Meetings of board - quorum - expenses

25-25-106. Meetings of board - quorum - expenses. (1) Four members of the board shall constitute a quorum for the purpose of conducting business and exercising its powers. Action may be taken by the board upon the affirmative vote of at least four of its members. A vacancy in the membership of the board shall not impair the right of a quorum of the board to exercise all the rights and perform all the duties of the board. (2) Each meeting of the board for any purpose whatsoever shall be open to the public. Notice of meetings shall be as provided in the bylaws of the authority. One or more members of the board may participate in a meeting of the board or a committee of the board and may vote on resolutions presented at the meeting through the use of telecommunications devices, including, but not limited to, a conference telephone or similar communications equipment. Participation through telecommunications devices shall constitute presence in person at the meeting. The use of telecommunications devices shall not supersede any requirements for public hearing otherwise provided by law. Resolutions need not be published or posted, but resolutions and all proceedings and other acts of the board shall be a public record. (3) Members of the board shall receive no compensation for services but shall be entitled to the necessary expenses, including traveling and lodging expenses, incurred in the discharge of their official duties. Any payments for expenses shall be paid from funds of the authority.

C.R.S. § 25-25-107 General powers of authority

25-25-107. General powers of authority. (1) In addition to any other powers granted to the authority by this article, the authority shall have the following powers: (a) To have perpetual existence and succession as a body politic and corporate; (b) To adopt and from time to time amend or repeal bylaws for the regulation of its affairs and the conduct of its business, consistent with the provisions of this article; (c) To sue and be sued; (d) To have and to use a seal and to alter the same at pleasure; (e) To maintain an office at such place or places as it may designate; (f) To determine, in accordance with the provisions of this article, the location and character of any facility to be financed under the provisions of this article; to acquire, construct, reconstruct, renovate, improve, alter, replace, maintain, repair, operate, and lease as lessee or lessor; to enter into contracts for any and all of such purposes and for the management and operation of a facility; and to designate a participating health institution as its agent to determine the location and character of a facility undertaken by such participating health institution under the provisions of this article and, as agent of the authority, to acquire, construct, reconstruct, renovate, replace, alter, improve, maintain, repair, operate, lease as lessee or lessor, and regulate the same, and, as agent of the authority, to enter into contracts for any and all of such purposes including contracts for the management and operation of such facility; (g) To lease to a participating health institution any or all of the facilities upon such terms and conditions as the authority shall deem proper; to charge and collect rent therefor and to terminate any such lease upon the failure of the lessee to comply with any of the obligations thereof; and to include in any such lease, if desired, provisions that the lessee thereof shall have options to renew the term of the lease for such period or periods, at such rent, and upon such terms or conditions as shall be determined by the authority or to purchase any or all of the facilities, or provisions that, upon payment of all of the indebtedness incurred by the authority for the financing of such facilities, the authority will convey any or all of the facilities to the lessee or lessees thereof with or without consideration; (h) To borrow money and to issue bonds, notes, bond anticipation notes, or other obligations for any of its corporate purposes and to fund or refund the same, all as provided for in this article; (i) To establish rules and regulations and to designate a participating health institution as its agent to establish such rules and regulations, for the use of the facilities undertaken or operated by such participating health institution; to employ or contract for consulting engineers, architects, attorneys, accountants, construction and financial experts, superintendents, managers, and such other employees and agents as may be necessary in its judgment and to fix their compensation; (j) To receive and accept from the federal government, the state of Colorado, or any other public agency loans, grants, or contributions for or in aid of the construction of facilities or any portion thereof, or for equipping the same, and to receive and accept grants, gifts, or other contributions from any source; and to use such funds only for the purposes for which they were loaned, contributed, or granted; (k) To mortgage or pledge all or any portion of the facilities and the site or sites thereof, whether then owned or thereafter acquired, for the benefit of the holders of bonds issued to finance such facilities or any portion thereof; e and accept grants, gifts, or other contributions from any source; and to use such funds only for the purposes for which they were loaned, contributed, or granted; (k) To mortgage or pledge all or any portion of the facilities and the site or sites thereof, whether then owned or thereafter acquired, for the benefit of the holders of bonds issued to finance such facilities or any portion thereof; (l) To make mortgage or other secured or unsecured loans to any participating health institution for the cost of the facilities in accordance with an agreement between the authority and such participating health institution; but no such loan shall exceed the total cost of such facilities as determined by such participating health institution and approved by the authority; (m) To make mortgage loans or other secured or unsecured loans to a participating health institution; to refund outstanding obligations, mortgages, or advances issued, made, or given by such institution for the cost of its facilities, including the issuance of bonds and the making of loans to a participating health institution; and to refinance outstanding obligations and indebtedness incurred for facilities undertaken and completed prior to, on, or after July 1, 1977, when the authority makes a finding consistent with section 25-25-115 (1); (n) To obtain, or aid in obtaining, from any department or agency of the United States or of this state or any private company, any insurance or guarantee as to, or of, or for the payment or repayment of interest or principal, or both, or any part thereof, on any loan, lease, or obligation or any instrument evidencing or securing the same, made or entered into pursuant to the provisions of this article; and, notwithstanding any other provisions of this article, to enter into any agreement, contract, or any other instrument whatsoever with respect to any such insurance or guarantee, to accept payment in such manner and form as provided therein in the event of default by a participating health institution, and to assign any such insurance or guarantee as security for the authority's bonds; (o) To do all things necessary and convenient to carry out the purposes of this article; (p) To charge to and equitably apportion among participating health institutions its administrative costs and expenses incurred in the exercise of the powers granted and duties conferred by this article; (q) To make and execute contracts and all other instruments necessary or convenient for the exercise of its powers and functions under this article; (r) To assist, coordinate, and participate with other issuers of tax-exempt bonds and public officials in other states in connection with financing on behalf of a multistate health institution; (s) In connection with financing on behalf of a multistate health institution: (I) To determine or agree upon who will be assisting, coordinating, or participating issuers of tax-exempt bonds in other states; (II) To determine or agree upon what the terms or conditions of the financing will be with assisting, coordinating, or participating issuers of tax-exempt bonds in other states; and (III) To charge fees to, apportion fees among, or agree upon fees with assisting, coordinating, or participating issuers of tax-exempt bonds in other states. (2) The authority shall not have the power to operate the facilities as a business other than as a lessee or lessor. Notwithstanding anything contained in this subsection (2) to the contrary, the authority shall have the power to enter into leases which are annually renewable with a public hospital or institution. Any lease of the facilities entered into pursuant to the provisions of this article shall provide for rentals adequate to pay principal and interest on any bonds issued to finance such facilities as the same fall due and to create and maintain such reserves and accounts for depreciation as the authority shall determine to be necessary.

C.R.S. § 25-25-108 Acquisition of property

25-25-108. Acquisition of property. The authority may, directly or by or through a participating health institution as its agent, acquire by purchase, lease, gift, devise, or otherwise such lands, structures, real or personal property, rights-of-way, franchises, easements, and other interests in lands, including lands lying under water and riparian rights which are located within or without the state, as it may deem necessary or convenient for the construction, acquisition, or operation of facilities, upon such terms as may be considered by the authority to be reasonable, and may take title thereto in the name of the authority or in the name of such participating health institution as its agent.

C.R.S. § 25-25-109 Notes

25-25-109. Notes. The authority may issue from time to time its negotiable notes for any corporate purpose, including the payment of all or any part of the cost of any facility, and may renew from time to time any notes by the issuance of new notes, whether the notes to be renewed have or have not matured. The authority may issue notes partly to renew notes or to discharge other obligations then outstanding and partly for any other purpose. The notes may be authorized, sold, executed, and delivered in the same manner as bonds. Any resolution or resolutions authorizing notes of the authority or any issue thereof may contain any provisions which the authority is authorized to include in any resolution or resolutions authorizing bonds of the authority or any issue thereof, and the authority may include in any notes any terms, covenants, or conditions which it is authorized to include in any bonds. All such notes shall be payable from the proceeds of bonds or renewal notes or from the revenues of the authority or other moneys available therefor and not otherwise pledged, subject only to any contractual rights of the holders of any of its notes or other obligations then outstanding.

C.R.S. § 25-25-110 Bonds

25-25-110. Bonds. (1) The authority may issue from time to time its bonds in such principal amount as the authority shall determine for the purpose of financing all or a part of the cost of any health institutions or any facilities authorized by this article or for the refinancing of outstanding obligations. In anticipation of the sale of such bonds, the authority may issue bond anticipation notes and may renew the same from time to time. Such notes shall be paid from any revenues of the authority or other moneys available therefor and not otherwise pledged, or from the proceeds of the sale of the bonds of the authority in anticipation of which they were issued. The notes shall be issued in the same manner as bonds. Such notes and the resolution or resolutions authorizing them may contain any provisions, conditions, or limitations which a bond resolution of the authority may contain. (2) The bonds may be issued as serial bonds, as term bonds, or as a combination of both types. All bonds issued by the authority shall be payable solely out of the revenues and receipts derived from the leasing, mortgaging, or sale by the authority of the facilities concerned or of any part thereof as designated in the resolutions of the authority under which the bonds are authorized to be issued or as designated in a trust indenture authorized by the authority, which trust indenture shall name a bank or trust company in Colorado, or outside of Colorado if it is determined by the authority to be in the best interests of the financing, such determination to be conclusive, as trustee, or out of other moneys available therefor and not otherwise pledged. Such bonds may be issued and delivered by the authority at such times and in such manner, may be in such form and denominations and include such terms and maturities, may be in fully registered form or in bearer form registerable either as to principal or interest or both, may bear such conversion privileges, may be payable in such installments and at such time or times not exceeding forty years after the date thereof, may be payable at such place or places whether within or without the state of Colorado, may bear interest at such rate or rates per annum as shall be determined by the authority or as shall be determined by any formula prescribed by the authority or as may be determined from time to time by a designated agent of the authority in accordance with specified standards and procedures and without regard to any interest rate limitation appearing in any other law, may be evidenced in such manner, may be in the form of coupon bonds that have attached thereto interest coupons bearing the facsimile signature of an authorized officer of the authority, and may contain such provisions not inconsistent with this article, all as shall be provided in the resolutions of the authority under which the bonds are authorized to be issued or as is provided in a trust indenture authorized by the authority. Notwithstanding anything in this subsection (2) to the contrary, in the case of short-term notes or other obligations maturing not later than one year after the date of issuance thereof, the board may authorize the executive director, associate executive director, or any officer of the board to fix principal amounts, maturity dates, interest rates, and purchase prices of any particular issue of such short-term notes or obligations, subject to such limitations as to maximum term, maximum principal amount outstanding, and maximum net effective interest rates as the board shall prescribe by resolution, and such authorization shall remain effective for the period of time designated in the initial resolution regardless of whether the composition of the board changes in the interim unless sooner rescinded by the board. bligations, subject to such limitations as to maximum term, maximum principal amount outstanding, and maximum net effective interest rates as the board shall prescribe by resolution, and such authorization shall remain effective for the period of time designated in the initial resolution regardless of whether the composition of the board changes in the interim unless sooner rescinded by the board. (3) If deemed advisable by the authority, there may be retained in the resolutions or the trust indenture under which any bonds of the authority are authorized to be issued an option to redeem all or any part thereof as may be specified in such resolutions or in such trust indenture, at such price or prices, after such notice or notices, and on such terms and conditions as may be set forth in such resolutions or in such trust indenture and as may be briefly recited on the face of the bonds; but nothing in this article shall be construed to confer on the authority the right or option to redeem any bonds except as may be provided in the resolutions or in such trust indenture under which they are issued. (4) The bonds or notes of the authority may be sold at public or private sale for such price or prices, in such manner, and at such times as may be determined by the authority, and the authority may pay all expenses, premiums, and commissions that it may deem necessary or advantageous in connection with the issuance thereof. The power to fix the date of sale of bonds and notes, to receive bids or proposals, to award and sell bonds and notes, and to take all other necessary action to sell and issue bonds and notes may be delegated to the executive director, associate executive director, or any officer of the board of the authority by resolution of the authority. Pending preparation of the definitive bonds, the authority may issue interim receipts or certificates, which shall be exchanged for the definitive bonds. (5) (a) Issuance by the authority of one or more series of bonds for one or more purposes shall not preclude it from issuing other bonds in connection with the same facilities, any other facilities, or any other purpose under this article, but the resolutions or trust indenture under which any subsequent bonds may be issued shall recognize the terms and provisions of any prior pledge or mortgage made for any prior issue of bonds and the terms upon which such additional bonds may be issued and secured. Any outstanding bonds of the authority may at any time and from time to time be refunded or advance refunded by the authority by the issuance of its bonds for such purpose and in a principal amount as may be determined by the authority, which may include interest accrued or to accrue thereon with or without giving effect to investment income thereon and other expenses necessary to be paid in connection therewith. If deemed advisable by the authority, such bonds may be refunded or advance refunded for the additional purpose of paying all or any part of the cost of constructing and acquiring additions, improvements, extensions, or enlargements of a facility or any portion thereof. ereon with or without giving effect to investment income thereon and other expenses necessary to be paid in connection therewith. If deemed advisable by the authority, such bonds may be refunded or advance refunded for the additional purpose of paying all or any part of the cost of constructing and acquiring additions, improvements, extensions, or enlargements of a facility or any portion thereof. (b) Any such refunding may be effected whether the bonds to be refunded shall have then matured or shall thereafter mature either by sale of the refunding bonds and the application of the proceeds thereof for the payment of the bonds to be refunded thereby or by the exchange of the refunding bonds for the bonds to be refunded thereby with the consent of the holders of the bonds to be so refunded, regardless of whether or not the bonds to be refunded were issued in connection with the same facilities or separate facilities or for any other purpose under this article and regardless of whether or not the bonds proposed to be refunded shall be payable on the same date or different dates or shall be due serially or otherwise. The proceeds of any such bonds issued for the purpose of refunding outstanding bonds may, in the discretion of the authority, be applied to the purchase or retirement at maturity or redemption of such outstanding bonds either on their earliest or any subsequent redemption date or upon the purchase or at the maturity thereof and may, pending such application, be placed in escrow to be applied to such purchase or retirement at maturity or redemption on such date as may be determined by the authority. Any such escrowed proceeds, pending such use, may be invested or deposited in securities or depositories meeting the requirements established in part 6 of article 75 of title 24, C.R.S. The interest, income, and profit, if any, earned or realized on any such investment may also, in the discretion of the authority, be applied to the payment of the outstanding bonds or notes to be so refunded or to the payment of principal and interest on the refunding bonds or for any other purpose under this article. After the terms of the escrow have been fully satisfied and carried out, any balance of such proceeds and interest, income, and profits, if any, earned or realized on the investments thereof may be returned to the authority for use by it in any lawful manner. The portion of the proceeds of any such bonds issued for the additional purpose of paying all or any part of the cost of constructing and acquiring additions, improvements, extensions, or enlargements of a facility may be invested or deposited in securities or depositories meeting the requirements established in part 6 of article 75 of title 24, C.R.S. The interest, income, and profits, if any, earned or realized on such investment may be applied to the payment of all or any part of such cost or may be used by the authority in any lawful manner. All such bonds shall be subject to the provisions of this article in the same manner and to the same extent as other bonds issued pursuant to this article.

C.R.S. § 25-25-111 Negotiability of bonds

25-25-111. Negotiability of bonds. All bonds and the interest coupons applicable thereto are hereby declared and shall be construed to be negotiable instruments.

C.R.S. § 25-25-112 Security for bonds and notes

25-25-112. Security for bonds and notes. (1) The principal of and interest on any bonds or notes issued by the authority may be secured by a pledge of, or security interest in, the revenues, rentals, and receipts out of which the same may be made payable or from other moneys available therefor and not otherwise pledged or used as security and may be secured by a trust indenture, mortgage, or deed of trust (including assignment of leases or other contract rights of the authority thereunder) covering all or any part of the facilities from which the revenues, rentals, or receipts so pledged or used as security may be derived, including any enlargements of and additions to any such facility thereafter made. The resolution under which the bonds are authorized to be issued and any such trust indenture, mortgage, or deed of trust may contain any agreements and provisions which shall be a part of the contract with the holders of the bonds or notes to be authorized as to: (a) Pledging or providing a security interest in all or any part of the revenues of a facility or any revenue-producing contract or contracts made by the authority with any individual, partnership, corporation, or association or other body, public or private, to secure the payment of the bonds or notes or of any particular issue of bonds, subject to such agreements with noteholders or bondholders as may then exist; (b) Maintenance of the properties covered thereby; (c) Fixing and collection of mortgage payments, rents, fees, and other charges to be charged and the amounts to be raised in each year thereby, and the use and disposition of the revenues; (d) Setting aside, creation, and maintenance of special and reserve funds and sinking funds and the use and disposition of the revenues; (e) Limitations on the right of the authority or its agent to restrict and regulate the use of the facilities; (f) Limitations on the purpose to which the proceeds of sale of any issue of bonds or notes then or thereafter to be issued may be applied, and pledging or providing a security interest in such proceeds to secure the payment of the bonds or notes or any issue of the bonds or notes; (g) Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured, and the refunding of outstanding bonds; (h) The procedure, if any, by which the terms of any contract with bondholders or noteholders may be amended or abrogated, the amount of bonds or notes the holders of which must consent thereto, and the manner in which such consent may be given; (i) Limitations on the amount of moneys derived from a facility to be expended for operating, administrative, or other expenses of the authority; (j) Defining the acts or omissions to act which shall constitute a default in the duties of the authority to holders of its obligations and providing the rights and remedies of such holders in the event of a default; (k) Mortgaging of a facility and the site thereof for the purpose of securing the bondholders or noteholders; nded for operating, administrative, or other expenses of the authority; (j) Defining the acts or omissions to act which shall constitute a default in the duties of the authority to holders of its obligations and providing the rights and remedies of such holders in the event of a default; (k) Mortgaging of a facility and the site thereof for the purpose of securing the bondholders or noteholders; (l) Such other additional covenants, agreements, and provisions as are judged advisable or necessary by the authority for the security of the holders of such bonds or notes. (2) Any pledge made by the authority shall be valid and binding from the time when the pledge is made. The revenues, moneys, or property so pledged and thereafter received by the authority shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract, or otherwise against the authority, irrespective of whether such parties have notice thereof. Neither the resolution nor any other instrument by which a pledge is created need be recorded. Each pledge, agreement, lease, indenture, mortgage, and deed of trust made for the benefit or security of any of the bonds of the authority shall continue to be effective until the principal of and interest on the bonds for the benefit of which the same were made shall have been fully paid or provision for such payment duly made. In the event of default in such payment or in any agreements of the authority made as a part of the contract under which the bonds were issued, whether contained in the resolutions authorizing the bonds or in any trust indenture, mortgage, or deed of trust executed as security therefor, said payment or agreement may be enforced by suit, mandamus, the appointment of a receiver in equity, foreclosure of any mortgage and deed of trust, or any one or more of said remedies. (3) In addition to the provisions of subsections (1) and (2) of this section, bonds of the authority may be secured by a pooling of leases, loans, or mortgages whereby the authority may assign its rights, as lessor, lender, or mortgagee, and pledge rents, loan payments, or mortgage payments under two or more leases, loans, or mortgages, with two or more participating health institutions as lessees, borrowers, or mortgagors, respectively, upon such terms as may be provided for in the resolutions of the authority or as may be provided for in a trust indenture or mortgage or deed of trust authorized by the authority.

C.R.S. § 25-25-113 Personal liability

25-25-113. Personal liability. Neither the members of the authority nor any person executing the bonds or notes shall be liable personally on bonds or notes or be subject to any personal liability or accountability by reason of the issuance thereof.

C.R.S. § 25-25-114 Purchase

25-25-114. Purchase. The authority may purchase its bonds or notes out of any funds available therefor. The authority may hold, pledge, cancel, or resell such bonds or notes, subject to and in accordance with agreements with bondholders or noteholders.

C.R.S. § 25-25-115 Procedure concerning issuance of bonds

25-25-115. Procedure concerning issuance of bonds. (1) Notwithstanding any other provisions of this article, the authority may not undertake any facility authorized by this article unless, prior to the issuance of any bonds or notes, the board finds that the facility will enable or assist a health institution to fulfill its obligation to provide health facilities. (2) (Deleted by amendment, L. 2007, p. 416, § 7, effective August 3, 2007.)

C.R.S. § 25-25-116 Trust agreement to secure bonds

25-25-116. Trust agreement to secure bonds. (1) In the discretion of the authority, any bonds issued under this article may be secured by a trust agreement between the authority and a corporate trustee or trustees. A corporate trustee may be any trust company or bank in Colorado. If the authority determines it to be in the best interests of the financing, a trust company or bank outside of Colorado may be a corporate trustee. The trust agreement or the resolution providing for the issuance of the bonds may pledge or assign the revenues to be received or the proceeds of any contract or contracts pledged and may convey or mortgage the facilities or any portion of the facilities. The trust agreement or resolution providing for the issuance of the bonds may contain provisions for protecting and enforcing the rights and remedies of the bondholders that are reasonable, proper, and not in violation of law, including provisions that have been specifically authorized to be included in any resolution or resolutions of the authority authorizing the bonds. (2) Any bank or trust company incorporated under the laws of this state that may act as depository of the proceeds of bonds or of revenues or other moneys may furnish such indemnifying bonds or pledge such securities as may be required by the authority. A trust agreement may set forth the rights and remedies of the bondholders and of the trustee or trustees and may restrict the individual right of action by bondholders. In addition, the trust agreement or resolution may contain such other provisions as the authority may deem reasonable and proper for the security of the bondholders. All expenses incurred in carrying out such trust agreement or resolution may be treated as a part of the cost of the operation of a facility.

C.R.S. § 25-25-117 Payment of bonds - nonliability of state

25-25-117. Payment of bonds - nonliability of state. Bonds and notes issued by the authority shall not constitute or become an indebtedness, a debt, or a liability of the state, the general assembly, or any county, city, city and county, town, school district, or other subdivision of the state, or of any other political subdivision or body corporate and politic within the state, and neither the state, the general assembly, nor any county, city, city and county, town, school district, or other subdivision of the state shall be liable thereon; nor shall such bonds or notes constitute the giving, pledging, or loaning of the faith and credit of the state, the general assembly, or any county, city, city and county, town, school district, or other subdivision of the state, or of any other political subdivision or body corporate and politic within the state but shall be payable solely from the funds provided for in this article. The issuance of bonds or notes under the provisions of this article shall not, directly, indirectly, or contingently, obligate the state or any subdivision thereof nor empower the authority to levy or collect any form of taxes or assessments therefor, or to create any indebtedness payable out of taxes or assessments therefor or make any appropriation for their payment, and such appropriation or levy is prohibited. Nothing in this section shall prevent or be construed to prevent the authority from pledging its full faith and credit or the full faith and credit of a participating health institution to the payment of bonds or notes authorized pursuant to this article. Nothing in this article shall be construed to authorize the authority to create a debt of the state within the meaning of the constitution or statutes of Colorado or to authorize the authority to levy or collect taxes or assessments; and all bonds issued by the authority pursuant to the provisions of this article are payable and shall state that they are payable solely from the funds pledged for their payment in accordance with the resolution authorizing their issuance or with any trust indenture, mortgage, or deed of trust executed as security therefor and are not a debt or liability of the state of Colorado. The state shall not in any event be liable for the payment of the principal of or interest on any bonds of the authority or for the performance of any pledge, mortgage, obligation, or agreement of any kind whatsoever which may be undertaken by the authority. No breach of any such pledge, mortgage, obligation, or agreement shall impose any pecuniary liability upon the state or any charge upon its general credit or against its taxing power.

C.R.S. § 25-25-118 Exemption from taxation - securities law

25-25-118. Exemption from taxation - securities law. The authority is hereby declared to be a public instrumentality of the state, performing a public function for the benefit of the people of the state for the improvement of their health and living conditions. Accordingly, the income or other revenues of the authority, all properties at any time owned by the authority, any bonds, notes, or other obligations issued under this article, the transfer thereof and the income therefrom, including any profit made on the sale thereof, and all mortgages, leases, trust indentures, and other documents issued in connection therewith shall be exempt at all times from all taxation and assessments in the state of Colorado. Bonds issued by the authority shall also be exempt from the "Colorado Securities Act", article 51 of title 11, C.R.S.

C.R.S. § 25-25-119 Rents and charges

25-25-119. Rents and charges. A sufficient amount of the revenues derived in respect of a facility, except such part of such revenues as may be necessary to pay the cost of maintenance, repair, and operation and to provide reserves and for renewals, replacements, extensions, enlargements, and improvements as may be provided for in the resolution authorizing the issuance of any bonds or notes of the authority or in the trust agreement securing the same, shall be set aside at such regular intervals as may be provided in such resolution or trust agreement in a sinking or other similar fund, which is hereby pledged to and charged with the payment of the principal of and the interest on such bonds or notes as the same shall become due and the redemption price or the purchase price of bonds retired by call or purchase as therein provided. Such pledge shall be valid and binding from the time when the pledge is made; and the rates, rents, fees, charges, and other revenues or other moneys so pledged and thereafter received by the authority shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of any such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract, or otherwise against the authority, irrespective of whether such parties have notice thereof. Neither the resolution, any trust agreement, any other agreement, nor any lease by which a pledge is created need be filed or recorded except in the records of the authority. The use and disposition of moneys to the credit of such sinking or other similar fund shall be subject to the resolution authorizing the issuance of such bonds or notes or of such trust agreement. Except as may otherwise be provided in such resolution or such trust agreement, such sinking or other similar fund may be a fund for all such bonds or notes issued to finance facilities at a particular health institution without distinction or priority of one over another; except that the authority in any such resolution or trust agreement may provide that such sinking or other similar fund shall be the fund for a particular facility at a health institution and for the bonds issued to finance a particular facility and may, additionally, permit and provide for the issuance of bonds having a lien in respect of the security authorized which is subordinate to other bonds of the authority, and, in such case, the authority may create separate sinking or other similar funds in respect of such subordinate lien bonds.

C.R.S. § 25-25-120 Fees

25-25-120. Fees. (1) All expenses of the authority incurred in carrying out the provisions of this article shall be payable solely from funds provided under the authority of this article, and no liability shall be incurred by the authority beyond the moneys which are provided pursuant to this article; except that, for the purposes of meeting the necessary expenses of initial organization and operation until such date as the authority derives moneys from funds provided pursuant to this article, the authority may borrow such moneys as may be required for the necessary expenses of organization and operation. Such borrowed moneys shall be repaid within a reasonable time after the authority receives funds provided pursuant to this article. (2) An initial planning service fee in an amount determined by the authority shall be paid to the authority by each health institution that applies for financial assistance to provide for its facilities. Such initial planning service fees shall be included in the cost of the facilities to be financed and shall not be refundable by the authority, whether or not any such application is approved, or, if approved, whether or not such financial assistance is accomplished. In addition to such initial fee, an annual planning service fee shall be paid to the authority by each participating health institution in an amount determined by the authority. Such fees shall be paid on dates or in installments as may be satisfactory to the authority. Such fees may be used for: (a) (Deleted by amendment, L. 2007, p. 417, § 9, effective August 3, 2007.) (b) Necessary administrative and operating expenses; and (c) Reserves for anticipated future expenses. (3) In addition, the authority may retain the services of any other public or private person, firm, partnership, association, or corporation to furnish services and data to be used by the authority in determining the financial feasibility of any facilities for which application is being made or for such other services or surveys as the authority deems necessary to carry out the purposes of this article. The authority may negotiate the fee to be paid to a person or entity that provides these services to the authority.

C.R.S. § 25-25-121 Conveyance of title - release of lien

25-25-121. Conveyance of title - release of lien. When the principal of and interest on bonds issued by the authority to finance the cost of facilities or to refinance outstanding indebtedness of one or more participating health institutions, including any refunding bonds issued to refund and refinance such bonds, have been fully paid and retired or when adequate provision has been made to fully pay and retire the same, and all other conditions of the resolution, the lease, the trust indenture, and the mortgage, deed of trust, or other form of security arrangement, if any, authorizing and securing the same have been satisfied, the authority shall promptly do all things and execute such deeds, conveyances, and other documents as are necessary and required to release the lien of such mortgage, deed of trust, or other form of security arrangement in accordance with the provisions thereof and to convey its right, title, and interest in such facilities so financed, and any other facilities leased or mortgaged or subject to deed of trust or any other form of security arrangement to secure the bonds, to such participating health institution or institutions.

C.R.S. § 25-25-122 Investment of funds

25-25-122. Investment of funds. (1) The authority may invest the proceeds from the sale of a series of bonds or any funds related to the series in securities and other investments as may be provided in the proceedings under which the series of bonds are authorized to be issued, whether or not the investment or reinvestment is authorized under any other provision of law. Such investment or reinvestment may include, but is not limited to, the following: (a) Bonds or other obligations of the United States; (b) Bonds or other obligations, the payment of the principal and interest of which is unconditionally guaranteed by the United States; (c) Obligations issued or guaranteed as to principal and interest by any agency or person controlled or supervised by and acting as an instrumentality of the United States pursuant to authority granted by the congress of the United States; (d) Obligations issued or guaranteed by any state of the United States or any political subdivision of any such state; (e) Prime commercial paper; (f) Prime finance company paper; (g) Bankers acceptances drawn on and accepted by commercial banks; (h) Repurchase agreements fully secured by obligations issued or guaranteed as to principal and interest by the United States or by any person controlled or supervised by and acting as an instrumentality of the United States pursuant to authority granted by the congress of the United States; (i) Certificates of deposit or time deposits issued by commercial banks or savings and loan associations that are insured by the federal deposit insurance corporation or its successor; or (j) Such other securities and investments as may be authorized by resolution of the board if such securities and investments are rated within one of the three highest rating categories by a nationally recognized rating agency. (2) The authority may invest any other funds in the securities as provided in this section and with such maturities as the authority shall determine if such maturities are on a date or dates prior to the time that, in the judgment of the authority, the funds so invested will be required for expenditure. The express judgment of the authority as to the time that any funds will be required for expenditure or be redeemable is final and conclusive.

C.R.S. § 25-25-123 Proceeds as trust funds

25-25-123. Proceeds as trust funds. All moneys received pursuant to this article, whether as proceeds from the sale of bonds, notes, or other obligations or as revenues or receipts, shall be deemed to be trust funds to be held and applied solely as provided in this article. Any officer, bank, or trust company with which such moneys are deposited shall act as trustee of such moneys and shall hold and apply the same for the purposes of this article, subject to such regulations as this article and the resolution authorizing the bonds, notes, or other obligations of any issue or the trust agreement securing such obligations shall provide.

C.R.S. § 25-25-124 Agreement of state not to limit or alter rights of obligees

25-25-124. Agreement of state not to limit or alter rights of obligees. The state hereby pledges to and agrees with the holders of any bonds, notes, or other obligations issued under this article, and with those parties who may enter into contracts with the authority pursuant to the provisions of this article, that the state will not limit, alter, restrict, or impair the rights hereby vested in the authority to acquire, construct, reconstruct, maintain, and operate any facility or to establish, revise, charge, and collect rates, rents, fees, and other charges as may be convenient or necessary to produce sufficient revenues to meet the expenses of maintenance and operation thereof and to fulfill the terms of any agreements made with the holders of bonds, notes, or other obligations authorized and issued pursuant to this article and with the parties who may enter into contracts with the authority pursuant to this article. The state further agrees that it will not in any way impair the rights or remedies of the holders of such bonds, notes, or other obligations of such parties until such bonds, notes, and other obligations, together with interest thereon, with interest on any unpaid installment of interest and all costs and expenses in connection with any action or proceeding by or on behalf of such holders, are fully met and discharged and such contracts are fully performed on the part of the authority. Nothing in this article precludes such limitation or alteration if and when adequate provision is made by law for the protection of the holders of such bonds, notes, or other obligations of the authority or those entering into such contracts with the authority. The authority may include this pledge and undertaking for the state in such bonds, notes, or other obligations and in such contracts.

C.R.S. § 25-25-125 Enforcement of rights of bondholders

25-25-125. Enforcement of rights of bondholders. Any holder of bonds issued pursuant to this article or any trustee under a trust agreement, trust indenture, indenture of mortgage, or deed of trust entered into pursuant to this article, except to the extent that their rights are restricted by any bond resolution, may, by any suitable form of legal proceedings, protect and enforce any rights under the laws of this state or granted by the bond resolution. Such rights include the right to compel the performance of all duties of the authority required by this article or the bond resolution; to enjoin unlawful activities; and, in the event of default with respect to the payment of any principal of, premium on, if any, and interest on any bond or in the performance of any covenant or agreement on the part of the authority in the bond resolution, to apply to a court having jurisdiction of the cause to appoint a receiver to administer and operate the project or projects, the revenues of which are pledged to the payment of principal of, premium on, if any, and interest on such bonds, with full power to pay, and to provide for payment of, principal of, premium on, if any, and interest on such bonds, and with such powers, subject to the direction of the court, as are permitted by law and are accorded receivers in general equity cases, but excluding any power to pledge additional revenues of the authority to the payment of such principal, premium, and interest.

C.R.S. § 25-25-126 Bonds eligible for investment

25-25-126. Bonds eligible for investment. All banks, bankers, trust companies, savings and loan associations, investment companies, and insurance companies and associations 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 pursuant to this article. Public entities, as defined in section 24-75-601 (1), C.R.S., may invest public funds in such bonds only if said bonds satisfy the investment requirements established in part 6 of article 75 of title 24, C.R.S.

C.R.S. § 25-25-127 Account of activities - receipts for expenditures - report - audit

25-25-127. Account of activities - receipts for expenditures - report - audit. (1) The authority shall keep an accurate account of its activities, receipts, and expenditures and shall annually make a report of its activities, receipts, and expenditures to the board, the governor, and the state auditor. The report shall be submitted within six months after the close of the authority's fiscal year and shall be in a form prescribed by the recipients of the report. (2) The state auditor may investigate the affairs of the authority, severally examine the properties and records of the authority, and prescribe methods of accounting and the rendering of periodical reports in relation to facilities undertaken by the authority. This article and the expenditures of the authority shall be reviewed by the legislative audit committee every odd-numbered year.

C.R.S. § 25-25-128 Federal social security act

25-25-128. Federal social security act. The authority may take such action as it deems appropriate to enable its employees to come within the provisions and obtain the benefits of the federal "Social Security Act", as from time to time amended.

C.R.S. § 25-25-129 Powers of authority not restricted - law complete in itself

25-25-129. Powers of authority not restricted - law complete in itself. This article shall not be construed as a restriction or limitation upon any powers which the authority might otherwise have under any laws of this state but shall be construed as cumulative of any such powers. No proceedings, referendum, notice, or approval shall be required for the creation of the authority or the issuance of any bonds or any instrument as security therefor, except as provided in this article; but nothing in this article shall be construed to deprive the state and its political subdivisions of their respective police powers over properties of the authority or to impair any power thereover of any official or agency of the state and its governmental subdivisions which may be otherwise provided by law.

C.R.S. § 25-25-130 Powers in addition to those granted by other laws

25-25-130. Powers in addition to those granted by other laws. The powers conferred by this article are in addition and supplementary to, and the limitations imposed by this article do not affect the powers conferred by, any other law, except as provided in this article. Facilities may be acquired, purchased, constructed, reconstructed, improved, bettered, and extended, and bonds may be issued under this article for said purposes notwithstanding that any other law may provide for the acquisition, purchase, construction, reconstruction, improvement, betterment, and extensions of like facilities or the issuance of bonds for like purposes, and without regard to the requirements, restrictions, limitations, or other provisions contained in any other law.

C.R.S. § 25-25-131 Annual report

25-25-131. Annual report. The authority shall submit to the governor within six months after the end of the fiscal year a report which shall set forth a complete and detailed operating and financial statement of the authority during such year. Also included in the report shall be any recommendations with reference to additional legislation or other action that may be necessary to carry out the purposes of the authority.
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://leg.colorado.gov/sites/default/files/images/olls/crs2024-title-25.docxFetched: 10/6/2026

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