§37D-6  Federal tax-exempt status;preference; protection.  (a)  To the extent practicable, financingagreements issued pursuant to this chapter shall be issued to comply withrequirements imposed by applicable federal law providing that the interest on financingagreements shall be excluded from gross income for federal income tax purposes,except as certain minimum taxes or environmental taxes may apply.  The directorand, with the approval of the director, the head of an agency may:

(1)  Enter into agreements;

(2)  Establish funds or accounts;

(3)  Make rebate payments to the federal government;and

(4)  Take any action required to comply withapplicable federal tax law.

Nothing in this chapter shall prohibit the issuanceof financing agreements, the interest on which may be included in gross incomefor federal income tax purposes.

(b)  To ensure that interest on a financingagreement issued pursuant to this chapter that is excluded from gross incomefor federal income tax purposes, except as provided in subsection (a), on thedate of issuance shall continue to be excluded, no state officer or employeeshall authorize or allow any change, amendment, or modification to a financingagreement that would affect the exclusion of interest on the financing agreementfrom gross income for federal income tax purposes unless the change, amendment,or modification shall have received the prior approval of the director. Failure to receive the approval of the director shall render any change,amendment, or modification void. [L 1996, c 119, pt of §2; am L 2001, c 200, ptof §3; am L 2007, c 126, pt of §1]