§309-1.5  Authorization of corporation toacquire educational loan notes.  The governor is authorized to request theorganization of a private not-for-profit corporation to be affiliated withUnited Student Aid Funds, Inc., which corporation shall be established andoperated exclusively for the purpose of acquiring student loan notes under thefederal Higher Education Act of 1965, as amended.  The governor is authorizedto request that United Student Aid Funds organize a single privatenot-for-profit corporation known as the Secondary Market Services Corp.--Hawaiito be established and operated exclusively for the purpose of acquiring studentloan notes under the federal Higher Education Act of 1965, as amended.  Thecorporation:

(1)  Shall be a not-for-profit corporation organizedunder the laws of the State and authorized to do business within the State andshall be the only not-for-profit corporation organized within the Staterequested to conduct a program of acquiring student loan notes;

(2)  Shall be required by its articles ofincorporation and bylaws to devote any income (after payment of expenses, debtservice, and the creation of reserves for the same) to the purchase ofadditional student loan notes or to pay over any income to the United States; and

(3)  Is authorized to issue obligations pursuant tosection 103 of the Internal Revenue Code of 1986, as amended.  Thoseobligations shall be payable solely from the revenues and assets of thecorporation pledged thereto and shall not constitute a general, limited, ormoral obligation of the State, or any department, agency, or politicalsubdivision thereof under any constitutional, statutory, or other provision. Neither the full faith and credit of the State nor that of any department,agency, or political subdivision thereof shall be pledged to the payment of theprincipal of, or interest on, those obligations and those obligations shall sostate on their face.  Bonds, notes, and other obligations of the corporationare declared to be issued for a public purpose and to be publicinstrumentalities and, together with the income therefrom, shall be exempt fromall state, county, and municipal taxation, except inheritance, transfer, andestate taxes. [L 1984, c 144, §2; am L 1992, c 89, §1; am L 1995, c 59, §1; amL 2001, c 56, §1]