5-12-10. Transfer of state property to authority.

Any department, board, commission, agency, or officer of this state or the Board of Regents of the State of South Dakota, may transfer jurisdiction of or title to any property under its or his control to the Building Authority when such transfer is approved, in writing by the Governor as being advantageous to the state.

Source: SL 1967, ch 276, § 4.

5-12-11. Power of authority to acquire property--Methods of acquisition.

The Building Authority may acquire by purchase, condemnation (including the power of condemnation in accordance with chapter 21-35), gift or otherwise, construct, complete, remodel, maintain, and equip buildings and other facilities as the Legislature by law declares to be in the public interest. In the course of such activities, the authority may acquire property of any kind and description, whether real, personal or mixed, by gift, purchase or otherwise. It may also acquire real estate of the State of South Dakota controlled by any officer, department, board, commission, or other agency of the state, the jurisdiction of which is transferred by such officer, department, board, commission, or other agency, to the authority.

Source: SL 1967, ch 276, § 5; SL 1994, ch 50, § 2.

5-12-11.1. Standards and specifications to accommodate persons with disabilities.

The standards and specifications set forth in § 5-14-13 shall be adhered to by the Bureau of Human Resources and Administration during the construction phase and by the appropriate state agency thereafter in those buildings and facilities constructed by the South Dakota Building Authority or any subdivision thereof if the construction was commenced after January 26, 1992, and in all new construction thereafter.

Source: SL 1972, ch 30; SL 1994, ch 50, § 3; SL 1994, ch 52, § 3; SL 2024, ch 1 (Ex. Ord. 24-1), § 34, eff. Apr. 8, 2024.

5-12-12. Plans and specifications for projects to be undertaken.

The Board of Regents and the Bureau of Human Resources and Administration on behalf of the executive branch or other agency of state government shall prepare plans and specifications for, and have supervision over, any project to be undertaken by the Building Authority for their use. The Building Authority may only execute those project contracts which are recommended by the Board of Regents, or the Bureau of Human Resources and Administration on behalf of the executive branch, or other agency of state government. Plans and specifications shall be approved by the lessee provided for under § 5-12-13, except as indicated above.

Source: SL 1967, ch 276, § 5; SL 1989, ch 20, § 60; SL 1994, ch 50, § 4; SL 2024, ch 1 (Ex. Ord. 24-1), § 34, eff. Apr. 8, 2024.

5-12-13. Lease of facilities and sites to state agencies authorized--Commencement of payments under lease.

The Building Authority may execute leases of facilities and sites to, and charge for the use of any such facilities and sites by the Board of Regents, any officer, department, board, commission, or other agency of the State of South Dakota, or the commissioner of human resources and administration if the commissioner is requested to, by and on behalf of, or for the use of, any officer, department, board, commission, or other agency of the State of South Dakota. The leases may be entered into contemporaneously with any financing to be done by the authority and payments under the terms of the lease shall begin at any time after execution of any such lease.

Source: SL 1967, ch 276, § 5; SL 1989, ch 20, § 61; SL 1994, ch 50, § 5; SL 2024, ch 1 (Ex. Ord. 24-1), § 34, eff. Apr. 8, 2024.

5-12-14. Terms, conditions, and rental under leases--Annual extension provision.

Leases may be

(1)    Upon such terms, conditions, and rentals, subject to available appropriations, as in the judgment of the building authority are in the public interest, or

(2)    For a term of one year from the time the building is completed and ready for occupancy, with an option in the lessee to extend the term of the lease for a term of one year from the expiration of the original term of the lease and for one year from the expiration of each extended term of the lease, until the original term of the lease has been extended for a total number of years to be agreed upon by the parties at a rental which, if paid for the original term and for each of the full number of years for which the term of the lease may be extended, will amortize the total cost of the erection of the building and appurtenances.

The rental shall be paid at such times as the parties to the lease agree upon.

Source: SL 1967, ch 276, § 5.

5-12-15. Lessee's option to purchase--Conveyance on exercise of option.

The lease may provide that the lessee may, at the expiration of the original or any extended term, purchase the leased premises at a stated price, which shall be the balance of the total cost of the erection of the building and appurtenances not amortized by the payments of rents previously made by the lessee. The lease may provide that in the event of the exercise of the option to purchase the leased premises or in the event the lease has been extended for the full number of years which it is agreed the same may be extended, and all rents and payments provided for in the lease have been made, the lessor shall convey the premises to the lessee in fee simple with covenant of general warranty of title.

Source: SL 1967, ch 276, § 5; SL 1983, ch 32, § 4.

5-12-16. Taxes and insurance added to rental properties--Authorization to self-insure.

The lease may provide that the lessee shall, as additional rent for the leased premises, pay, or provide for the payment of, all taxes assessed against the leased premises if any, and the cost of insuring the building erected thereon against loss or damage by fire and windstorm in such sum as may be agreed by the parties thereto. Any lessee of a facility constructed, owned or leased by the authority is hereby authorized to self-insure the facility.

Source: SL 1967, ch 276, § 5; SL 1986, ch 50, § 1; SL 1988, ch 50, § 4.

5-12-17. Authority's power to use facilities for other purposes on nonpayment of rent--Appropriations and funds from which rent payable.

The Building Authority may, in the event of nonpayment of rents reserved in such leases, maintain and operate such facilities and sites or execute leases thereof to others for any suitable purposes. Such leases to the officers, departments, boards, commissions, other agencies, or the Board of Regents of the State of South Dakota shall contain the provision that rents under said leases shall be payable solely from appropriations to be made by the Legislature for the payment of such rent and any revenues derived by the authority from the operation of the leased premises; and, in the case of the Board of Regents, may contain an additional provision that rents under said leases may be payable from the educational facilities fund established by § 13-51-2.

Source: SL 1967, ch 276, § 5; SL 1975, ch 51, § 1; SL 1989, ch 20, § 62.

5-12-18. Costs and reserves to be covered by rent and charges.

The charges, fees, or rentals established by the Building Authority for the use of any facilities acquired, constructed, completed, remodeled, or equipped in whole or in part with the proceeds of the bonds issued as provided in this chapter shall be sufficient at all times to pay maintenance and operation costs for such facilities (unless under a lease maintenance and operation costs are otherwise provided for), principal of and interest on the bonds and a proportion of the administrative expenses of the authority as provided for by each lease, and such reserves as may be provided in the resolutions of issuance.

Source: SL 1967, ch 276, § 7.

5-12-19. Tax exemption of property owned or leased by authority--Exception.

Except as hereinafter provided, all land, improvements, and capital equipment owned by the Building Authority, or being leased or acquired by the authority pursuant to a lease having a fixed term plus renewal options exceeding three years, or a lease-purchase or installment purchase contract, shall constitute a separate class of property which is exempt from taxation. Land owned by the authority, or being leased or acquired by the authority, to accomplish projects of the kind listed in § 5-12-8 is not exempt from taxation.

Source: SL 1967, ch 276, § 14; SL 1983, ch 32, § 5; SL 1988, ch 50, § 5.

5-12-20. Resolutions for revenue bonds authorized--Purpose--Legislative approval required.

The Building Authority may provide by resolution for the issuance of negotiable revenue bonds for the purpose of paying all or any part of the cost of one or a combination of projects. However, no project may be let for construction, nor any revenue bonds be sold to raise the funds for payment of such construction until after the Legislature by law declares the project to be in the public interest and no revenue bonds may be sold to raise funds for the accomplishment of any project of the kind listed in this chapter until after the Legislature by law declares the project to be in the public interest.

Source: SL 1967, ch 276, § 10; SL 1973, ch 38; SL 1988, ch 50, § 6; SL 1994, ch 50, § 7.

5-12-21. Purposes for which bonds issued--Refunding and refinancing--Pledge of income.

To accomplish projects of the kind authorized in this chapter, the Building Authority may borrow money and issue and sell bonds in such amount or amounts as the authority may determine for the purpose of acquiring, constructing, completing, or remodeling, maintaining or equipping any such facility; refund and refinance the same from time to time as often as advantageous and in the public interest to do so; and pledge any and all income of the authority, and any revenues derived by the authority from the facilities, or any combination thereof, to secure the payment of the bonds and to redeem the bonds. All such bonds are subject to the provisions of §§ 5-12-22 to 5-12-25, inclusive. Any construction project in the amount of one million five hundred thousand dollars or more which is funded by the Building Authority may, at the option of the Building Authority, have a representative of the Building Authority act as a member of the State Building Committee pursuant to § 5-14-3.

Source: SL 1967, ch 276, § 5; SL 1975, ch 51, § 2; SL 1994, ch 50, § 8.

5-12-22. Terms and interest rate of bonds.

All such bonds shall mature within twenty-five years from date and shall bear interest at a rate to be negotiated and may be sold by the Building Authority in such manner as it may deem to be in the best public interest.

Source: SL 1967, ch 276, § 6; SL 1970, ch 39; SL 1980, ch 47, § 5; SL 1983, ch 28, § 5; SL 1988, ch 50, § 7.

5-12-23. Revenues and income from which bonds payable--Use of educational facilities fund--Disposition of revenues.

Such bonds shall be payable solely and only from:

(1)    Revenues to be derived by the building authority from the operation of any such facilities acquired, constructed, completed, remodeled or equipped in whole or in part with the proceeds of the bonds;

(2)    Income to be derived from rental leases to state departments, boards, commissions or other agencies, or from leases to others as provided in §§ 5-12-13 to 5-12-18, inclusive;

(3)    In the case of leases involving institutions under the control of the board of regents, such funds in the educational facilities fund established by chapter 13-51, as are not otherwise appropriated, earmarked, or pledged;

(4)    Revenues to be derived by the authority from any department, agency or instrumentality of the United States for any purpose consistent with the provisions of this chapter; and

(5)    Revenues to be derived by the authority in connection with projects of the kind listed in this chapter from (a) the foreclosure of any mortgages, deeds of trust, notes, debentures, bonds, and other security interests held by it, or pledged and assigned by it in connection with bonds issued for such a project, either by action or by exercise of a power of sale, (b) the sale of the equity of redemption in said security interests in accordance with the terms of said instruments and applicable state law or (c) other actions to enforce any obligation held by it.

However, for any year in which the Legislature has appropriated funds for the payment of lease rentals with respect to a project of the kind described in this chapter, any revenues received by the authority, other than from the appropriation, as a result of such program shall be assigned to and deposited in the general fund.

Source: SL 1967, ch 276, § 6; SL 1975, ch 51, § 3; SL 1988, ch 50, § 8; SL 1991, ch 24, § 3; SL 1994, ch 50, § 9.

5-12-24. Execution and registration of bonds--Validity of signature by officers.

Such bonds shall be executed by such officers of the Building Authority as shall be designated by the authority, and shall be registered by the state auditor of the State of South Dakota. Any bonds bearing the signature of officers in office at the date of signing thereof shall be valid and binding for all purposes, notwithstanding that before delivery thereof any or all such persons whose signature appears thereon shall have ceased to be such officers.

Source: SL 1967, ch 276, § 6.

5-12-25. Restrictions on obligation stated on face of bonds.

Each such bond shall state upon its face that it is payable solely from revenues derived by the Building Authority from the operation of facilities acquired, constructed, completed, remodeled, or equipped in whole or in part with the proceeds of the sale of such bonds, including income to be derived from rental leases as provided in §§ 5-12-13 to 5-12-18, inclusive. Each such bond shall state upon its face that it does not constitute an obligation of the State of South Dakota within the meaning of any provisions of the Constitution or statutes of the State of South Dakota.

Source: SL 1967, ch 276, § 6; SL 1975, ch 51, § 4.

5-12-26. Creation of state obligation not authorized.

Nothing in this chapter shall be construed to authorize the Building Authority or any department, board, commission, or other agency to create an obligation of the State of South Dakota within the meaning of the Constitution or statutes of South Dakota.

Source: SL 1967, ch 276, § 13.

5-12-27. Contract with bondholders--Bondholders' remedies.

The provisions of this chapter and of any resolution or proceeding authorizing the issuance of bonds shall constitute a contract with the holders of such bonds. The provisions thereof shall be enforceable either in law or in equity, by suit, action, mandamus, or other proceeding in any court of competent jurisdiction to enforce and compel the performance of any duties required by this chapter or any resolution or proceeding authorizing the issuance of such bonds, including the establishment of sufficient charges, fees, or rentals and the application of the income from a project under this chapter, as provided in § 5-12-23.

Source: SL 1967, ch 276, § 12.

5-12-27.1. Refunding bonds authorized--Purposes.

The Building Authority may issue negotiable refunding bonds to refund:

(1)    Unpaid matured bonds;

(2)    Unpaid matured coupons evidencing interest upon its unpaid matured bonds; and

(3)    Interest at the coupon rate upon its unpaid matured bonds that has accrued since the maturity of these bonds.

Source: SL 1975, ch 50, § 1.

5-12-27.2. Amount of refunding bonds.

The Building Authority may issue negotiable refunding bonds under §§ 5-12-27.1 to 5-12-27.4, inclusive, to refund bonds at or prior to their maturity or which by their terms are subject to redemption before maturity, or both, in an amount necessary to refund:

(1)    The principal amount of the bonds to be refunded;

(2)    The interest to accrue up to and including the maturity date or dates, or to the next succeeding redemption date thereof; and

(3)    The applicable redemption premiums, if any.

Source: SL 1975, ch 50, § 2.

5-12-27.3. Exchange or sale of refunding bonds--Proceeds of sale--Cancellation of bonds and coupons--Evidence of discharge of interest obligation.

Refunding bonds issued pursuant to §§ 5-12-27.1 to 5-12-27.4, inclusive, may be exchanged for the bonds to be refunded on a par for par basis of the bonds, interest coupons and interest not represented by coupons, if any, or may be sold at not less than par, or may be exchanged in part or sold in part, and the proceeds received at any such sale shall be used to pay the bonds, interest coupons and interest not represented by coupons, if any. Bonds and interest coupons which have been received in exchange or paid shall be canceled and the obligation for interest, not represented by coupons, which has been discharged, shall be evidenced by a written acknowledgment of the exchange or payment thereof.

Source: SL 1975, ch 50, § 1.

5-12-27.4. Exchange or sale of bonds--Disposition of proceeds of sale.

Refunding bonds issued pursuant to §§ 5-12-27.1 to 5-12-27.4, inclusive, may be exchanged for not less than an equal principal amount of bonds to be refunded or may be sold at not less than par, or may be exchanged in part and sold in part. All proceeds received at the sale thereof, excepting the accrued interest received, shall be used:

(1)    If the bonds to be refunded are then due, for the payment thereof;

(2)    If the bonds to be refunded are voluntarily surrendered with the consent of the holder or holders thereof, for the payment thereof;

(3)    If the bonds to be refunded are then subject to prior redemption by their terms, for the redemption thereof;

(4)    If the bonds to be refunded are not then subject to payment or redemption, to purchase direct obligations of, or those guaranteed by the United States of America so long as such obligations will mature at such time or times, with interest thereon or the proceeds received therefrom, to provide funds adequate to pay when due or called for redemption prior to maturity the bonds to be refunded, together with the interest accrued thereon and any redemption premium due thereon, and such proceeds or obligations of the United States of America shall, with all other funds legally available for such purpose, be deposited in escrow with a banking corporation, or national banking association, located in and doing business in the State of South Dakota, with the power to accept and execute trusts, or any successor thereto, which is also a member of the federal deposit insurance corporation and of the federal reserve system, to be held in an irrevocable trust solely for and until the payment and redemption of the bonds so to be refunded, and any balance remaining in said escrow after the payment and retirement of the bonds to be refunded shall be returned to said authority to be used and held for use as revenues pledged for the payment of said refunding bonds; or

(5)    For any combination of the foregoing subdivisions of this section.

Source: SL 1975, ch 50, § 3.

5-12-27.5. Assistance in conserving and improving soil and water resources of highly erodible cropland by means of loans--Revenue bonds and interim notes authorized.

It being declared to be in the public interest, the South Dakota Building Authority may, pursuant to chapter 5-12, finance loans to participants in a program of the United States to assist owners and operators of highly-erodible cropland in conserving and improving the soil and water resources of their farms or ranches within the state and may, for the purpose of financing such loans, issue revenue bonds or interim notes, pursuant to the powers vested in the authority.

Source: SL 1988, ch 52, § 1.

5-12-27.6. No indebtedness to be charged against state.

No indebtedness, bond, or obligation incurred or created under authority of §§ 5-12-27.5 to 5-12-27.8, inclusive, may be or become a lien, charge or liability against the State of South Dakota, nor against the property or funds of the State of South Dakota within the meaning of the Constitution or statutes of South Dakota.

Source: SL 1988, ch 52, § 2.

5-12-27.7. Acceptance and expenditure of gifts, contributions, etc., authorized.

The Building Authority and the State of South Dakota through any of its departments, agencies, or bureaus, may accept and expend for the purposes stated in § 5-12-27.5, any funds obtained for such purposes from gifts, contributions, or other sources, including any unit of government.

Source: SL 1988, ch 52, § 3.

5-12-27.8. Lease and sublease agreements with South Dakota Building Authority authorized to support purpose and payment of revenue bonds or interim notes.

The State of South Dakota through any of its departments, agencies, or bureaus, may make and enter into lease and sublease agreements with the South Dakota Building Authority and make rental payments under the terms thereof, pursuant to chapter 5-12, from appropriations to be made by the Legislature for the payment of such rent to support the purpose and the payment of revenue bonds or interim notes issued in connection therewith for the purposes in § 5-12-27.5.

Source: SL 1988, ch 52, § 4.

5-12-28. Interim notes authorized--Purposes of borrowing.

In addition to the permanent financing authorized by §§ 5-12-20 to 5-12-27, inclusive, the South Dakota Building Authority may borrow money and issue interim notes in evidence thereof for any of the projects, or to perform any of the duties authorized under this chapter, and in addition may borrow money and issue interim notes for planning, architectural, and engineering services, acquisition of land, purchase of equipment, movable or otherwise as set forth in §§ 5-12-29 to 5-12-33, inclusive.

Source: SL 1967, ch 276, § 5.

5-12-29. Resolution for issuance of interim notes--Interest rate--Maturity date.

Whenever the Building Authority deems it advisable and in the interests of the authority to borrow funds temporarily for any of the purposes enumerated in § 5-12-28, the authority may from time to time, and pursuant to appropriate resolution, issue interim notes to evidence the borrowings, including funds for the payment of interest on borrowings and funds for all necessary and incidental expenses in connection with any of the purposes provided for by this section and this chapter until the date of the permanent financing. Any resolution authorizing the issuance of these notes shall describe the project to be undertaken and shall specify the principal amount, rate of interest and maturity date, but not to exceed five years from date of issue, and other terms as may be specified in the resolution. However, the time of payment of any such notes may be extended for a period not exceeding three years from the maturity date thereof.

Source: SL 1967, ch 276, § 5; SL 1975, ch 52, § 1; SL 1980, ch 47, § 6; SL 1983, ch 28, § 6.

5-12-30. Terms and registration of interim notes--Redemption prior to maturity--Execution of notes--Pledge of income and revenue.

The Building Authority may provide for the registration of the notes in the name of the owner either as to principal alone, or as to both principal and interest, on such terms and conditions as the authority may determine by the resolution authorizing their issue. The notes shall be issued from time to time by the authority as funds are borrowed, in the manner the authority may determine. Interest on the notes may be made payable semiannually, annually, or at maturity. The notes may be made redeemable, prior to maturity, at the option of the authority, in the manner and upon the terms fixed by the resolution authorizing their issuance. The notes may be executed in the name of the authority by the chairman of the authority or by any other officer or officers of the authority as the authority by resolution may direct, shall be attested by the secretary or such other officer or officers of the authority as the authority may by resolution direct, and be sealed with the authority's corporate seal. All such notes and the interest thereon may be secured by a pledge of any income and revenue derived by the authority from the project to be undertaken with the proceeds of the notes, after deducting from such income and revenue any reasonable and necessary maintenance and operation expenses, and shall be payable solely from the proceeds to be derived from the sale of any revenue bonds for permanent financing authorized to be issued under §§ 5-12-20 to 5-12-27, inclusive, and from the property acquired with the proceeds of the notes.

Source: SL 1967, ch 276, § 5.

5-12-31. Additional provisions to secure payment of interim notes.

The Building Authority, in order further to secure the payment of the interim notes, is, in addition to the foregoing, authorized and empowered to make any other or additional covenants, terms, and conditions not inconsistent with the provisions of §§ 5-12-11 and 5-12-12, and do any and all acts and things as may be necessary or convenient or desirable in order to secure payment of its interim notes, or, in the discretion of the authority, as will tend to make the interim notes more acceptable to lenders, notwithstanding that the covenants, acts or things may not be enumerated herein; provided, however, that nothing contained in this section shall authorize the authority to secure the payment of the interim notes out of property or facilities, other than the facilities acquired with the proceeds of the interim notes, and any net income and revenue derived from the facilities and the proceeds of revenue bonds as hereinabove provided.

Source: SL 1967, ch 276, § 5.

5-12-32. Debt limitations not applicable to interim notes--Personal liability not created by execution of notes.

The interim notes shall not constitute an indebtedness within the meaning of any constitutional or statutory debt limitation or restriction.

No member, officer, agent, or employee of the authority, nor any other person who executes interim notes, shall be liable personally by reason of the issuance thereof.

Source: SL 1967, ch 276, § 5.

5-12-33. Payment of interim notes or purchase of government obligations with proceeds from sale of revenue bonds.

Contemporaneously with the issue of revenue bonds as provided by this chapter, all interim notes, even though they may not then have matured, shall be paid, both principal and interest to date of payment, from the funds derived from the sale of revenue bonds for the permanent financing and such interim notes shall be surrendered and canceled, or the proceeds at the sale of said bonds (excepting the accrued interest received) shall be used to purchase direct obligations of the United States of America so long as such obligations will mature at such time or times, with interest thereon or the proceeds received therefrom, to provide funds adequate to pay when due or called for redemption prior to maturity the notes to be refunded, together with the interest accrued thereon and any redemption premium due thereon, and such proceeds or obligations of the United States of America shall, with all other funds legally available for such purpose, be deposited in escrow with a banking corporation, or national banking association, located in and doing business in the State of South Dakota, with power to accept and execute trusts, or any successor thereto, which is also a member of the federal deposit insurance corporation and of the federal reserve system, to be held in an irrevocable trust solely for and until the payment and redemption of the notes so to be refunded, and any balance remaining in said escrow after the payment and retirement of the notes to be refunded shall be returned to said authority to be used and held for use as revenues pledged for the payment of said refunding bonds.

Source: SL 1967, ch 276, § 5; SL 1975, ch 52, § 2.

5-12-34. Disposition of income under chapter--Public building fund.

The gross total income from:

(1)    The sale of bonds;

(2)    Charges, fees, or rentals; and

(3)    All other revenue derived from any project undertaken pursuant to this chapter

shall be paid to the treasurer of the State of South Dakota. Said income shall be held by him in trust for the purposes of this chapter, in a special fund known as "the public building fund." The state treasurer shall be ex officio custodian of such fund. Disbursements shall be made from such fund upon the order of the Building Authority.

Source: SL 1967, ch 276, § 8.

5-12-35. Accounts maintained by authority--Purpose of disbursements from public building fund.

The Building Authority shall keep account of the gross total income derived from each separate project or any combination thereof undertaken pursuant to this chapter. Disbursements from a given account in the public building fund shall be ordered by the authority only for the payment of:

(1)    The cost of maintenance and operation of the facility or facilities, unless otherwise provided for;

(2)    The principal of and interest on the bonds issued for each project, or combination thereof; and

(3)    Any other purposes set forth in the resolution authorizing the issuance of said bonds.

Source: SL 1967, ch 276, § 9.

5-12-36. Authority to convey property to state when debt paid or payment provided for--Reversion to authority.

To accomplish projects of the kind listed in this chapter, the Building Authority may convey property, without charge, to the State of South Dakota, if all debts which have been secured by the income from the property have been paid. The authority may transfer title and jurisdiction to the State of South Dakota of facilities, for which bonds have been issued and payment for the bonds has been provided for by an escrow. The facility shall revert to the authority if the lessee fails to make lease payments in connection with the facility until the bonds are paid.

Source: SL 1967, ch 276, § 5; SL 1986, ch 50, § 2; SL 1994, ch 50, § 10.

5-12-37. Record of rental payments under lease--Conveyance to lessee after amortization of debt.

An accurate record shall be kept of the rental payments under each lease entered into by the Building Authority and any officer, department, board, commission, or other agency of the State of South Dakota, or the commissioner of human resources and administration when requested to enter into such leases as provided in §§ 5-12-13 to 5-12-16, inclusive, and when the rentals applicable to each project or facility, or any combination thereof, acquired, constructed, completed, remodeled, maintained, and equipped have been paid, in amounts sufficient to amortize and pay the principal of and interest upon the total principal amounts of bonds of the authority issued to pay the cost of each project or facility, including maintenance and operation expenses and that proportion of the administrative expense of the authority as provided for by each lease, the property shall be conveyed without charge to the lessee.

Source: SL 1967, ch 276, § 10; SL 1988, ch 50, § 9; SL 2024, ch 1 (Ex. Ord. 24-1), § 34, eff. Apr. 8, 2024.

5-12-38. Annual audit.

The Building Authority shall be audited annually in accordance with chapter 4-11.

Source: SL 1967, ch 276, § 11; SL 1989, ch 51.

5-12-38.1. Informational budget required.

Notwithstanding any other provisions of law, all funds received by the Building Authority shall be set forth in an informational budget as described in § 4-7-7.2 and be annually reviewed by the Legislature.

Source: SL 1984, ch 4, § 2.

5-12-39. Contractual power of authority.

The Building Authority shall possess the power to enter into contracts regarding any matter connected with any corporate purpose within the objects and purposes of this chapter.

Source: SL 1967, ch 276, § 5.

5-12-40. Bylaws, rules, and regulations of authority.

To accomplish projects of the kind listed in this chapter, the authority may adopt all necessary bylaws, rules, and regulations for the conduct of the business and affairs of the authority, and for the management and use of facilities and sites acquired under the powers granted by this chapter.

Source: SL 1967, ch 276, § 5; SL 1994, ch 50, § 11.

5-12-41. Severability of provisions.

If any clause or other portion of this chapter shall be held invalid, that decision shall not affect the validity of the remaining portions of this chapter. It is hereby declared that all such remaining portions of this chapter are severable, and that the Legislature would have enacted such remaining portions if the portions that may be so held to be invalid had not been included in this chapter.

Source: SL 1967, ch 276, § 15.

5-12-42. Sale and lease-back arrangements--Sales and land leases authorized--Use of proceeds.

Improved or unimproved land held by or transferred to the Building Authority pursuant to § 5-12-10, may be leased and the improvements thereon sold to a person, partnership, association, limited liability company, or corporation. The improvements may be sold only at their fair market value as determined by the authority, but consideration for a land lease may be nominal. The authority shall obtain and consider when determining the fair market value of improvements to be sold, at least one independent appraisal. The proceeds of sale shall be paid to the Building Authority trust account and shall be applied to such purpose, if any, as may be required by the State Constitution or any contract of the state. If no specific disposition of the proceeds, including any investment income thereon, or any portion thereof is required by the Constitution or any state contract, the proceeds, including any investment income thereon, shall be used in or expended for the acquisition of land, buildings, water development, or other improvements of a capital nature as the Legislature or the special committee created in § 4-8A-2 and Governor may specifically direct. Contracts of the state shall include any contract now in existence and any contract entered into in connection with any sale hereunder and the lease-back of the improvements sold pursuant to § 5-12-43. Except as provided in chapters 5-6 to 5-8, inclusive, all leases and sales of land and improvements may be made without reservation of timber, mineral, or other similar rights.

Source: SL 1983, ch 32, § 1; SL 1989, ch 212, § 2; SL 1994, ch 351, § 4.

5-12-43. Sale and lease-back arrangements--Contracts to acquire use or ownership authorized--Terms.

The Building Authority may enter into any contract necessary to acquire the right to use or the ownership, or both, of land leased and improvements sold by it under § 5-12-42, and any other improvements made upon such land, and capital equipment needed for the operation of the improvements or property to be acquired by it pursuant to § 5-12-11, including lease, lease-purchase, and, subject to compliance with the provisions of S.D. Const., Art. XIII, § 1, installment purchase contracts. No term of an installment purchase contract may exceed thirty years. The authority may establish the terms of the contracts, subject to the approval of the Governor. The authority may include in such contracts the following provisions:

(1)    In lease contracts, options to purchase the property subject to the lease or the lessor's interest therein, and provisions for the payment by lessee to lessor of rent net of all other costs and expenses of ownership, operation, maintenance, and insurance of the leased property by the authority as agent of the lessor, subject only to the laws, rules and regulations as are applicable to the lessor;

(2)    In lease-purchase contracts, provisions of the type specified in subdivision (1), and provisions for designating a portion of the periodic payments to be made thereunder as interest, for prepayment, and for acquisition of unencumbered title or fee title to the property subject to the contract.

Source: SL 1983, ch 32, § 2.

5-12-44. Provisions applicable to contracts to acquire use or ownership.

The provisions of §§ 5-12-13 to 5-12-18, inclusive, apply to all land, improvements and capital equipment which the Building Authority may occupy or use pursuant to any contract described in § 5-12-43.

Source: SL 1983, ch 32, § 3.

5-12-45. Revenue bonds to finance sale and lease-back arrangements--Lending proceeds--Refund or refinance of obligations.

The Building Authority may provide, by resolution, for the issuance and sale of revenue bonds to finance all or any part of the capital cost of any land, buildings, or other improvements or equipment of a capital nature to be acquired by any person, partnership, association, limited liability company, or corporation and leased or acquired by the authority pursuant to § 5-12-43, and may loan the proceeds thereof to such person, partnership, association, or corporation. The issuance of the bonds is declared to be for a public purpose, and in selling, securing, and issuing the bonds and applying the proceeds thereof the authority may exercise all powers conferred on any municipality under chapter 9-54, and may pay from the proceeds the cost of any letter of credit, bond insurance, bond guarantee, put option, or other contractual right deemed necessary or desirable to secure the payment of or reduce the net interest cost on the bonds. The provisions of § 5-12-21, except the last sentence thereof, and §§ 5-12-23 to 5-12-27, inclusive, are applicable to the bonds only to the extent they are not inconsistent with the provisions of chapter 9-54. The authority shall also have the powers specified in §§ 5-12-27.1 to 5-12-39, inclusive, with respect to projects and bonds of the type herein described.

The Building Authority may provide, by resolution, for the issuance and sale of revenue obligations to refund or refinance obligations issued pursuant to §§ 5-12-42 and 5-12-43. In connection with such refunding or refinancing, the authority need not determine the fair market value of the improvements to be sold as otherwise required by § 5-12-42. For sufficient consideration received by the authority, as determined by the authority, the authority may enter into contracts with banks, investment bankers, or other purchasers for the sale and issuance of such revenue obligations to refund or refinance obligations issued pursuant to §§ 5-12-42 and 5-12-43, which contracts of sale shall be binding on the authority for the period stated therein, but not exceeding three years.

Source: SL 1983, ch 32, § 6; SL 1994, ch 50, § 13; SL 1994, ch 351, § 5.

5-12-46. Legislative approval required for sale and lease-back arrangements.

No sale or lease-back of any land or improvements as described in §§ 5-12-42 and 5-12-43 shall be initiated later than July 1, 1984, without prior legislative approval.

Source: SL 1983, ch 32, § 8.

5-12-47. Revenue obligations--Issuance--Purpose--Funds for payment.

The authority, with the approval of the Governor, may by resolution provide for the issuance and sale of revenue obligations to finance all or any part of the capital cost of acquiring, constructing, furnishing, equipping, or repairing any state building owned or to be owned by it and for this purpose may exercise all powers conferred upon it by this chapter. Revenue obligations issued pursuant to this section shall be payable solely from moneys, including investment income, derived by the authority from transactions described in §§ 5-12-42 and 5-12-43, transactions authorized by the Legislature and transactions initiated by resolutions of the authority adopted prior to July 1, 1984. Such moneys may be pledged for this purpose.

Source: SL 1985, ch 40, § 1.

5-12-47.1. Payment of lease rental obligations to South Dakota Building Authority by Bureau of Finance and Management.

The funds appropriated in SL 2014, ch 35, § 1 shall be used to pay or prepay lease rental and associated fees in the amounts specified below to the South Dakota Building Authority relating to the leases between the South Dakota Building Authority and the departments or offices and the related real or personal property financed by the South Dakota Building Authority all as described below:

(1)    Lease rentals and fees in an estimated amount of eleven million eighteen thousand eight hundred fifty-three dollars in connection with the lease between the South Dakota Building Authority and the Department of Human Services relating to the George S. Mickelson Center for the Neurosciences financed with the proceeds of a sale by the South Dakota Building Authority of series 1992 bonds and refinanced with proceeds of series 1993A lease revenue trust certificates;

(2)    Lease rentals and fees in an estimated amount of six million forty thousand two hundred ninety-three dollars in connection with the lease between the South Dakota Building Authority and the Office of Attorney General and Department of Public Safety relating to the George S. Mickelson Criminal Justice Center financed with proceeds of the South Dakota Building Authority's series 2005B bonds;

(3)    Lease rentals and fees in an estimated amount of thirty-two million four hundred sixty-five thousand five hundred forty dollars in connection with a lease between the South Dakota Building Authority and the Board of Regents relating to the portion of the costs of the science facilities and laboratories at various public universities supported by rent paid from general fund appropriations by the Legislature and financed by proceeds of the South Dakota Building Authority's series 2008 bonds; and

(4)    Lease rentals and fees in an estimated amount of six million seven hundred thirty-two thousand five hundred sixty-five dollars in connection with a lease between the South Dakota Building Authority and the Department of Human Services relating to the George S. Mickelson Center for the Neurosciences dietary wing financed with the proceeds of the South Dakota Building Authority's series 2010B bonds.

Source: SL 2014, ch 35, § 2, eff. Mar. 28, 2014.

5-12-47.2. Irrevocable escrow agreement for defeasance and payment of lease revenue trust certificates and bonds--Arrangements to pay governmental expenses.

The South Dakota Building Authority may enter into an irrevocable escrow agreement to provide for the defeasance and payment of the series 1993A lease revenue trust certificates, the series 2005B bonds and the series 2008 bonds issued to finance the costs of the buildings and other real or personal property described in subdivisions 5-12-47.1(1), (2) and (3). The authority may enter into such other arrangements to pay or prepay, from time to time, any governmental expenses permissible under chapter 5-12, including payment or prepayment of debt service and associated fees and expenses relating to series 2010B bonds issued to finance the costs of the buildings and other real or personal property described in subdivision 5-12-47.1(4). The authority may contract with a third party for any of the purposes of this section. Upon determination by the authority of the amounts necessary for payment or prepayment of the bonds and other governmental expenses described in this section, and any associated fees and expenses, any remaining funds shall be transferred to the general fund at the end of the fiscal year in which SL 2014, ch 35 was enacted. Thereafter, as of the end of each fiscal year to and including the fiscal year ending June 30, 2021, the South Dakota Building Authority shall file an annual report with the Bureau of Finance and Management specifying any lease rentals, any fees received pursuant to § 5-12-47.1 and this section, and any interest earnings thereon, which the authority has determined are no longer expected to be required for the purposes set forth in § 5-12-47.1. Any such amounts not then expected to be required shall be deposited into the general fund with thirty days of the filing of the annual report. Any lease rentals and fees received by the authority pursuant to § 5-12-47.1 and this section, or interest earnings thereon, which are not applied by June 2, 2021, to pay or prepay amounts described in this section, shall be deposited into the general fund by June 30, 2021.

Source: SL 2014, ch 35, § 3, eff. Mar. 28, 2014.

5-12-48. Definition of terms.

Terms used in §§ 5-12-48 to 5-12-61, inclusive, mean:

(1)    "Authority," the South Dakota Building Authority, a body corporate and politic, organized and existing under chapter 5-12;

(2)    "Bonds," bonds, bond anticipation notes, notes, certificates of ownership or indebtedness, or other obligations issued, incurred, or otherwise created under the authority of §§ 5-12-48 to 5-12-61, inclusive, and payable directly or indirectly out of or representing an interest in tobacco settlement revenues or other rights under or with respect to the master settlement agreement;

(3)    "Corporation," the special purpose body corporate and politic established by the authority by resolution as provided in § 5-12-50;

(4)    Repealed by SL 2013, ch 28, § 1;

(5)    "Master settlement agreement," the master settlement agreement entered into on November 23, 1998, by attorneys general from the several states (including the State of South Dakota) and various tobacco companies, as now or hereafter amended, supplemented, or restated;

(6)    "Master settlement escrow agent," the escrow agent under the master settlement agreement;

(7)    "Net proceeds of bonds," the original proceeds of bonds issued under §§ 5-12-48 to 5-12-61, inclusive, less any amounts applied or to be applied to pay transaction and administrative expenses and to fund any reserves deemed necessary or appropriate by the corporation, but does not include any investment earnings realized thereon;

(8)    "Net proceeds of sale of tobacco settlement revenues," the net proceeds of bonds plus any residual interest in tobacco settlement revenues received or to be received by the State of South Dakota from time to time as a result of any sale, conveyance, or other transfer authorized in § 5-12-49, but does not include any investment earnings realized thereon;

(9)    Repealed by SL 2013, ch 28, § 1;

(10)    "Permitted investments," any investment authorized by §§ 4-5-23 and 4-5-26 together with noncollateralized direct obligations of any bank or savings institution, insurance company, or bank or insurance holding company if the institution or holding company is rated in the highest four classifications by at least one standard rating service and any bond, note, or other obligation of any state or any agency, authority, or other instrumentality of any state or political subdivision thereof if the bond, note, or other obligation is rated in the four highest classifications established by at least one standard rating service;

(11)    "Residual interest in tobacco settlement revenues," any tobacco settlement revenues not required to pay principal or interest on bonds or administrative or transaction expenses of the corporation or authority or to fund reserves or other requirements relating to bonds issued, incurred, or otherwise created under §§ 5-12-48 to 5-12-61, inclusive;

(12)    Repealed by SL 2013, ch 28, § 1;

(13)    "Tobacco settlement revenues," all of the amounts now or hereafter payable to the State of South Dakota under or in connection with the master settlement agreement.

Source: SL 2001, ch 27, § 1; SL 2013, ch 28, § 1.

5-12-48.1. Authority may invest funds in certain permitted investments.

In addition to all other powers established pursuant to chapter 5-12, the building authority may invest its funds or the funds under its control or direction in permitted investments as defined in subdivision 5-12-48(10).

Source: SL 2002, ch 31, § 1.

5-12-49. Transfer and sale of state's right to tobacco settlement revenues--Disposition of funds--Written agreement--Filing of agreement.

At any one time or from time to time, all or any portion of the right, title, and interest of the State of South Dakota in, to, and under the master settlement agreement, including the right to receive and collect tobacco settlement revenues, may be sold, conveyed, or otherwise transferred by the state to the authority or to a corporation established by the authority under §§ 5-12-48 to 5-12-61, inclusive, in exchange for the net proceeds of bonds and a right to the residual interest in tobacco settlement revenues. The net proceeds of bonds and the residual interest in tobacco settlement revenues shall be deposited to the education enhancement trust fund established pursuant to S.D. Const., Art. XII, § 6. Any sale, conveyance, or other transfer authorized by this section shall be evidenced by an instrument or agreement in writing signed on behalf of the state by the Governor. The Governor shall file a certified copy of the instrument or agreement with the Legislature promptly upon execution and delivery thereof. The instrument or agreement may include an irrevocable direction to the master settlement escrow agent to pay all or a specified portion of amounts otherwise due to the State of South Dakota under or in connection with the master settlement agreement, including, without limitation, all or any portion of tobacco settlement revenues directly to or upon the order of the authority or corporation, as the case may be, or to any escrow agent or any trustee under an indenture or other agreement securing any bonds issued, incurred, or created under §§ 5-12-48 to 5-12-61, inclusive. The irrevocable direction to the master settlement escrow agent may include the direction to pay any residual interest in tobacco settlement revenues initially to or upon the order of the authority or corporation or to any escrow agent or any trustee under an indenture or other agreement securing any bonds. Upon the filing of a certified copy of the instrument or agreement by the Governor, the sale, conveyance, or other transfer of rights under or with respect to the master settlement agreement, including the right to receive the tobacco settlement revenues, shall, for all purposes, be a true sale and absolute conveyance of all right, title, and interest therein described in accordance with the terms thereof, valid, binding, and enforceable in accordance with the terms thereof and such instrument or agreements and any related instrument, agreement, or other arrangement, including any pledge, grant of security interest, or other encumbrance made by the corporation or the authority to secure any bonds issued, incurred, or created by the corporation or the authority, are not subject to disavowal, disaffirmance, cancellation, or avoidance by reason of insolvency of any party, lack of consideration, or any other fact, occurrence, or rule of law. The procedures and requirements set forth in this section shall be the sole procedures and requirements applicable to the sale of the state's rights under the master settlement agreement, including the sale of tobacco settlement revenues, and it is not necessary to satisfy or comply with any other existing law which would otherwise apply to the sale of assets of the state or impose procedures or restrictions with respect thereto.

Source: SL 2001, ch 27, § 2; SL 2013, ch 28, § 2.

5-12-50. Establishment of special purpose corporation--Limitations--Board membership--Powers of corporation.

The authority may establish by resolution a special purpose corporation which shall be body corporate and politic and instrumentality of, but having a legal existence independent and separate from, the State of South Dakota and the authority. The corporation shall be established for the express limited public purposes set forth in §§ 5-12-48 to 5-12-59, inclusive, and no part of the net earnings of the corporation shall inure to any private individual.

The corporation shall be governed by a board consisting of the members of the authority and two additional persons appointed by the Governor, which two additional members shall be independent from the state. The resolution establishing the corporation shall serve as the charter of the corporation and may be amended from time to time by the authority, but the resolution shall at all times provide that the power and the authority of the corporation shall be subject to the terms, conditions, and limitations of §§ 5-12-48 to 5-12-59, inclusive, and any applicable covenants or agreements of the corporation in any indenture or other agreement relating to any then outstanding bonds. The corporation may enter into contracts regarding any matter connected with any corporate purpose within the objects and purposes of §§ 5-12-48 to 5-12-59, inclusive.

The authority and corporation may delegate by resolution to one or more officers or employees of the authority or corporation such powers and duties as it may deem proper.

The corporation may issue bonds and secure repayment of the bonds with amounts payable out of tobacco settlement revenues or any other property or funds of the corporation. Bonds issued by the corporation shall be accompanied by an opinion of nationally recognized bond counsel substantially to the effect that the bonds are valid and legal obligations of the corporation.

The corporation may pledge as security for any bonds any rights under the master settlement agreement held by the corporation, including the right to receive or collect tobacco settlement revenues, moneys, or other funds deposited with, payable to or held by or on behalf of the corporation, and the proceeds of the foregoing and any proceeds of bonds. Any right of the state to the residual interest in tobacco settlement revenues shall be, in all respects, junior and subordinate to any such pledge if and to the extent so provided by the terms of any instrument or agreement described in 5-12-49 and signed on behalf of the state by the Governor. Any such pledge made by the corporation shall be valid and binding from the time the pledge is made. The property, revenues, moneys, and other funds so pledged and thereafter held or received by or on behalf of the corporation shall immediately be subject to the lien of the pledge without any physical delivery thereof or further act; and, subject only to the provisions of prior pledges or agreements of the corporation, the lien of the pledge shall be valid and binding as against the state and all parties having claims of any kind in tort, contract, or otherwise against the corporation irrespective of whether such parties have notice thereof. No ordinance, resolution, trust agreement, or other instrument by which such pledge is created need be filed or recorded except in the records of the corporation.

In connection with the issuance of bonds or, at any time with respect to bonds, the corporation may enter into arrangements to provide additional security and liquidity for bonds. The arrangements may include, without limitation, bond insurance, letters of credit, and lines of credit by which the corporation may borrow funds to pay or redeem its bonds and purchase or remarketing arrangements for assuring the ability of owners of the bonds to sell or have redeemed their bonds. The corporation may enter into contracts and may agree to pay fees to persons providing the arrangements, including from bond proceeds.

The resolution authorizing the issuance of bonds or the indenture or other agreement approved by the resolution may provide that interest rates may vary from time to time depending upon criteria established by the corporation, which may include, without limitation, a variation in interest rates as may be necessary to cause bonds to be remarketable from time to time at a price equal to their principal amount, and may provide for appointment of a national banking association, bank, trust company, investment banking firm, or other financial institution to serve as a remarketing agent in that connection. The indenture or other agreement with respect to bonds may provide that alternative interest rates or provisions will apply during such times as bonds are held by a person providing a letter of credit or other credit enhancement arrangement for bonds.

In connection with bonds under §§ 5-12-48 to 5-12-59, inclusive, or the investment of proceeds, bonds, or other funds of the corporation, the corporation may enter into contracts that it determines necessary or appropriate to permit it to manage payment or interest rate risk. These contracts may include, but are not limited to, interest rate exchange agreements; contracts providing for payment or receipt of funds based on levels of or changes in interest rates; contracts to exchange cash flows or series of payments; and contracts incorporating interest rate caps, collars, floors, or locks.

The corporation may not file a voluntary petition under or be or become a debtor or bankrupt under the federal bankruptcy code or any other federal or state bankruptcy, insolvency, or moratorium law or statute as may, from time to time, be in effect and neither any public officer nor any organization, entity, or other person shall authorize the corporation to be or become a debtor or bankrupt under the federal bankruptcy code or any other federal or state bankruptcy, insolvency, or moratorium law or statute, as may, from time to time be in effect.

The corporation may not guarantee the debts of another.

The corporation may not be required to file any reports with the state other than those required to be filed with the Legislature by authorities which issue bonds.

Except for debts incurred directly by the corporation, no indebtedness, bonds, or obligation, issued, incurred, or created by the State of South Dakota or any state agency or instrumentality may be or become a lien, charge, or liability against the corporation or the property or funds of the corporation.

Source: SL 2001, ch 27, § 3; SL 2002, ch 31, § 2.

5-12-50.1. Bond transactions to be public records subject to disclosure.

The particulars of any bond transactions made pursuant to §§ 5-12-48.1, 5-12-50, and 5-12-50.1, inclusive, including legal fees and the costs of underwriting the bonds, shall be of public record subject to disclosure pursuant to § 1-27-1.

Source: SL 2002, ch 31, § 3.

5-12-51. Purposes of special purpose corporation.

The purposes of the corporation established by the authority pursuant to §§ 5-12-48 to 5-12-61, inclusive, are:

(1)    To purchase, acquire, own, pledge, encumber, or otherwise transfer all right, title, and interest of the state in, to, and under the master settlement agreement, including, without limitation, all right, title, and interest to receive or collect tobacco settlement revenues;

(2)    To raise funds through the issuance of bonds or other obligations or evidences of indebtedness or ownership or through the sale, transfer, pledge, encumbrance, securitization, factoring, or other conveyance of the rights described above in subdivision (1) of this section for the purposes of depositing net proceeds of bonds in the education enhancement trust fund and as otherwise described in §§ 5-12-48 to 5-12-61, inclusive;

(3)    To serve the Legislature by making reports concerning the foregoing;

(4)    To sue and be sued and to prosecute and defend, at law or in equity, in any court having jurisdiction of the subject matter and of the parties;

(5)    To have and to use a corporate seal and to alter the same at pleasure;

(6)    To maintain an office at such place or places as the authority by resolution may designate;

(7)    To receive funds transferred to it by the authority, the state, or others; and

(8)    To do all things necessary and convenient to carry out the purposes of this chapter.

The corporation shall also be vested with the same power and authority, and shall be subject to the same limitations and conditions, as are applicable to the authority pursuant to §§ 5-12-1.1, 5-12-4, 5-12-5, 5-12-8.1, 5-12-22, 5-12-24, 5-12-26, 5-12-27, 5-12-27.1, 5-12-27.2, 5-12-27.3, 5-12-27.4, 5-12-27.6, 5-12-28, 5-12-38, 5-12-38.1, and 5-12-40, except such power and authority shall be exercised with respect to and shall be limited to the purposes of the corporation set forth in this section, the final maturity date of any bonds issued, incurred, or created hereunder may not be in excess of forty years for the date of delivery thereof, and the corporation may not engage in any unrelated activities. In addition, the corporation may invest any of its funds in permitted investments.

Source: SL 2001, ch 27, § 4; SL 2013, ch 28, § 3.

5-12-52. Bonds of corporation not a lien, charge or liability against the state--Pledge of education enhancement trust funds prohibited.

No bond of the corporation issued, incurred, or created under §§ 5-12-48 to 5-12-61, inclusive, may be or become a lien, charge, or liability against the State of South Dakota or the authority, nor against the property or funds of the State of South Dakota or the authority within the meaning of the Constitution or statutes of South Dakota. In no event may any of the funds deposited into the education enhancement trust fund be pledged to secure payment of any bonds issued under the authority of §§ 5-12-48 to 5-12-61, inclusive.

Source: SL 2001, ch 27, § 5; SL 2013, ch 28, § 4.

5-12-53. Pledge of non-interference by state to impair terms of bonds--Liability of state on bonds.

The State of South Dakota pledges to and agrees with the holders of bonds issued, incurred, or created under §§ 5-12-48 to 5-12-59, inclusive, that the state will not limit or alter the rights and powers vested in the corporation and the authority by §§ 5-12-48 to 5-12-59, inclusive, so as to impair the terms of any contract made by the corporation or the authority with those holders or in any way impair the rights and remedies of those holders until such bonds, together with interest thereon, interest on any unpaid installments of interest, and all costs and expenses in connection with any action or proceedings by or on behalf of those holders are fully met or discharged. In addition, the state pledges to and agrees with the holders of bonds issued, incurred, or created under §§ 5-12-48 to 5-12-59, inclusive, that the state will not limit or alter the basis on which tobacco settlement revenues that have been sold pursuant to §§ 5-12-48 to 5-12-59, inclusive, are to be paid to the corporation or the authority so as to impair the terms of any such contract. The corporation and authority each may include these pledges and agreements of the state in any contract with the holders of bonds issued, incurred, or created under §§ 5-12-48 to 5-12-59, inclusive.

Neither the State of South Dakota nor the authority is liable on bonds issued, incurred, or created under §§ 5-12-48 to 5-12-59, inclusive, those bonds may not be a debt of the state or the authority, and §§ 5-12-48 to 5-12-59, inclusive, may not be construed as a guarantee by the state or the authority of the debts of the corporation. The bonds shall contain a statement to this effect on the face of the bonds.

Source: SL 2001, ch 27, § 6.

5-12-54. Liability of authority and special purpose corporation.

The authority is not liable for any bond issued, incurred, or created by the corporation under §§ 5-12-48 to 5-12-59, inclusive, or for any act or failure to act of the corporation. The corporation may not be liable for any obligation of the South Dakota Building Authority or for any act or failure to act by the building authority.

Source: SL 2001, ch 27, § 7.

5-12-55. Special purpose corporation treated as public instrumentality of state--Income of authority and corporation not taxed--Obligations of corporation deemed public securities.

The corporation is hereby declared to be performing a public function on behalf of the state and to be a public instrumentality of the state. The income of the authority and the corporation, and all properties at any time owned by the authority and the corporation, are exempt from all taxation in the State of South Dakota. In addition, the corporation is exempt from all filing, reporting, and similar requirements otherwise applicable to nonprofit and other corporations.

For purposes of chapter 47-31B, bonds, notes, certificates, or other obligations issued, incurred or created by the corporation under §§ 5-12-48 to 5-12-59, inclusive, are deemed to be securities issued by a public instrumentality of the State of South Dakota.

Source: SL 2001, ch 27, § 8; SL 2004, ch 278, § 56.

5-12-56. Employees of special purpose corporation.

The corporation may employ attorneys, accountants, tobacco industry consultants, and financial experts, managers, and such other employees and agents as may be necessary in its judgment and to fix their compensation.

Source: SL 2001, ch 27, § 9.