{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/22.1-167.1.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/22.1-167.1.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/22.1-167.1.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/22.1-167.1.html"}],"law_id":73854,"edition_id":1,"section_id":73854,"structure_id":14222,"section_number":"22.1-167.1","catch_line":"Refunding issues; pass-through of savings realized","history":"1994, c. 272; 2006, c. 223.","full_text":"A\n\nIn the event the Authority refunds any bonds previously issued to finance the purchase of local school bonds, the Authority shall pass-through to the issuers of such local school bonds, an allocable share of any savings realized. Such pass-through shall be accomplished, at the option of the Authority, by means of a debt service reduction over the remaining term of the local school bonds, by a lump sum payment of the present value of such allocable share of the savings, or by such other method as the Authority shall determine to be in the mutual best interests of the issuers of the local school bonds and the Authority.B\n\nFor the purposes of this section, “savings” means the net reduction in debt service, if any, to be realized by the Authority, after subtracting the total costs, expenses, and equity contributions associated with the refunding and with the pass-through of such savings to the issuers of the local school bonds and of any Authority funds transferred, or required to be transferred, by mandate of the General Assembly, other than to the issuers of the local school bonds.\n\t\t\tNotwithstanding the provisions of this section, no savings shall be passed-through to the issuers of local school bonds for which an interest rate subsidy has been paid or which were issued at below market interest rates. The savings in connection with the refunding of bonds issued by the Authority and allocable to local school bonds for which an interest rate subsidy has been paid, to the extent such subsidy was paid from the Literary Fund, shall be transferred to the Literary Fund and used exclusively for Literary Fund loans to local school boards pursuant to Chapter 10 (§ 22.1-142 et seq.) of Title 22.1.C\n\nThis section shall have no application if it conflicts with a preexisting trust indenture.D\n\nWhenever the Authority shall defease its bonds previously issued to finance the purchase of local school bonds, the Authority may, consistent with the provisions of this section respecting the return of savings to the issuers of the related local school bonds, designate to such issuers of local school bonds which issues, series and maturities with which interest rates shall be deemed by the Authority to have been paid. Immediately upon such designation, the local school bonds so designated shall likewise be deemed defeased and no longer outstanding, the same as if the defeasance had occurred in accordance with the provisions of § 15.2-2623. Such defeasance shall not require any action by the issuer of the affected local school bonds, shall be effective immediately, and shall be duly noted on the records of the Authority which shall no longer have any right to payment with respect to the issues, series and maturities so deemed by the Authority to have been paid. The elected officials and financial officers of the affected locality are hereby authorized to execute and deliver such federal tax forms, certificates, and other documents as the Authority may request in connection with the defeasance of its local school bonds and the bonds of the Authority.","order_by":null,"text":{"0":{"id":265575,"text":"In the event the Authority refunds any bonds previously issued to finance the purchase of local school bonds, the Authority shall pass-through to the issuers of such local school bonds, an allocable share of any savings realized. Such pass-through shall be accomplished, at the option of the Authority, by means of a debt service reduction over the remaining term of the local school bonds, by a lump sum payment of the present value of such allocable share of the savings, or by such other method as the Authority shall determine to be in the mutual best interests of the issuers of the local school bonds and the Authority.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":265576,"text":"For the purposes of this section, “savings” means the net reduction in debt service, if any, to be realized by the Authority, after subtracting the total costs, expenses, and equity contributions associated with the refunding and with the pass-through of such savings to the issuers of the local school bonds and of any Authority funds transferred, or required to be transferred, by mandate of the General Assembly, other than to the issuers of the local school bonds.\n\t\t\tNotwithstanding the provisions of this section, no savings shall be passed-through to the issuers of local school bonds for which an interest rate subsidy has been paid or which were issued at below market interest rates. The savings in connection with the refunding of bonds issued by the Authority and allocable to local school bonds for which an interest rate subsidy has been paid, to the extent such subsidy was paid from the Literary Fund, shall be transferred to the Literary Fund and used exclusively for Literary Fund loans to local school boards pursuant to Chapter 10 (§ 22.1-142 et seq.) of Title 22.1.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"C"},"2":{"id":265577,"text":"This section shall have no application if it conflicts with a preexisting trust indenture.","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B","next_prefix":"D"},"3":{"id":265578,"text":"Whenever the Authority shall defease its bonds previously issued to finance the purchase of local school bonds, the Authority may, consistent with the provisions of this section respecting the return of savings to the issuers of the related local school bonds, designate to such issuers of local school bonds which issues, series and maturities with which interest rates shall be deemed by the Authority to have been paid. Immediately upon such designation, the local school bonds so designated shall likewise be deemed defeased and no longer outstanding, the same as if the defeasance had occurred in accordance with the provisions of § 15.2-2623. Such defeasance shall not require any action by the issuer of the affected local school bonds, shall be effective immediately, and shall be duly noted on the records of the Authority which shall no longer have any right to payment with respect to the issues, series and maturities so deemed by the Authority to have been paid. The elected officials and financial officers of the affected locality are hereby authorized to execute and deliver such federal tax forms, certificates, and other documents as the Authority may request in connection with the defeasance of its local school bonds and the bonds of the Authority.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C"}},"ancestry":[{"id":14222,"edition_id":1,"name":"Virginia Public School Authority","identifier":"11","label":"chapter","depth":2,"order_by":1,"parent_id":12823,"metadata":{},"date_created":"2026-06-26 03:47:21","date_modified":"2026-06-26 03:47:21","permalink":{"id":181141,"object_type":"structure","relational_id":14222,"identifier":"11","token":"22.1\/11","url":"\/22.1\/11\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12823,"edition_id":1,"name":"Education","identifier":"22.1","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:55","date_modified":"2026-06-26 03:43:55","permalink":{"id":180949,"object_type":"structure","relational_id":12823,"identifier":"22.1","token":"22.1","url":"\/22.1\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":60646,"structure_id":14222,"section_number":"22.1-162","catch_line":"Definitions","url":"\/22.1-162\/","token":"22.1\/11\/22.1-162","metadata":false},{"id":55683,"structure_id":14222,"section_number":"22.1-163","catch_line":"Authority created; public body corporate and agency of Commonwealth","url":"\/22.1-163\/","token":"22.1\/11\/22.1-163","metadata":false},{"id":68781,"structure_id":14222,"section_number":"22.1-164","catch_line":"Board of Commissioners; membership; terms; compensation and expenses; chairman and vice-chairman; quorum; employees, agents, etc","url":"\/22.1-164\/","token":"22.1\/11\/22.1-164","metadata":false},{"id":79420,"structure_id":14222,"section_number":"22.1-165","catch_line":"Management and administration of moneys, etc., transferred from Literary Fund","url":"\/22.1-165\/","token":"22.1\/11\/22.1-165","metadata":false},{"id":69519,"structure_id":14222,"section_number":"22.1-166","catch_line":"Purchase and sale of local school bonds","url":"\/22.1-166\/","token":"22.1\/11\/22.1-166","metadata":false},{"id":61249,"structure_id":14222,"section_number":"22.1-166.1","catch_line":"Loans to local school boards","url":"\/22.1-166.1\/","token":"22.1\/11\/22.1-166.1","metadata":false},{"id":71860,"structure_id":14222,"section_number":"22.1-166.2","catch_line":"Grants to local school boards","url":"\/22.1-166.2\/","token":"22.1\/11\/22.1-166.2","metadata":false},{"id":78885,"structure_id":14222,"section_number":"22.1-167","catch_line":"Issuance of bonds of Authority","url":"\/22.1-167\/","token":"22.1\/11\/22.1-167","metadata":false},{"id":73854,"structure_id":14222,"section_number":"22.1-167.1","catch_line":"Refunding issues; pass-through of savings realized","url":"\/22.1-167.1\/","token":"22.1\/11\/22.1-167.1","metadata":false},{"id":85235,"structure_id":14222,"section_number":"22.1-167.2","catch_line":"Security for payment; appropriations","url":"\/22.1-167.2\/","token":"22.1\/11\/22.1-167.2","metadata":false},{"id":68625,"structure_id":14222,"section_number":"22.1-167.3","catch_line":"Bonds or notes issued for the purpose of making grants; security for payment; appropriations","url":"\/22.1-167.3\/","token":"22.1\/11\/22.1-167.3","metadata":false},{"id":73276,"structure_id":14222,"section_number":"22.1-168","catch_line":"Security for payment and bonds; provisions of trust indenture or resolution of Board","url":"\/22.1-168\/","token":"22.1\/11\/22.1-168","metadata":false},{"id":80085,"structure_id":14222,"section_number":"22.1-168.1","catch_line":"Reserve fund; limitations","url":"\/22.1-168.1\/","token":"22.1\/11\/22.1-168.1","metadata":false},{"id":59087,"structure_id":14222,"section_number":"22.1-169","catch_line":"Investment of funds","url":"\/22.1-169\/","token":"22.1\/11\/22.1-169","metadata":false},{"id":69727,"structure_id":14222,"section_number":"22.1-170","catch_line":"Repayments to Literary Fund","url":"\/22.1-170\/","token":"22.1\/11\/22.1-170","metadata":false},{"id":74494,"structure_id":14222,"section_number":"22.1-171","catch_line":"Powers of Authority enumerated","url":"\/22.1-171\/","token":"22.1\/11\/22.1-171","metadata":false},{"id":72150,"structure_id":14222,"section_number":"22.1-172","catch_line":"Bonds exempt from taxation","url":"\/22.1-172\/","token":"22.1\/11\/22.1-172","metadata":false},{"id":72965,"structure_id":14222,"section_number":"22.1-173","catch_line":"Bonds legal investments","url":"\/22.1-173\/","token":"22.1\/11\/22.1-173","metadata":false},{"id":77783,"structure_id":14222,"section_number":"22.1-174","catch_line":"Jurisdiction of suits against Authority; service of process","url":"\/22.1-174\/","token":"22.1\/11\/22.1-174","metadata":false},{"id":55435,"structure_id":14222,"section_number":"22.1-175","catch_line":"Transfers from Literary Fund to Authority","url":"\/22.1-175\/","token":"22.1\/11\/22.1-175","metadata":false}],"previous_section":{"id":78885,"structure_id":14222,"section_number":"22.1-167","catch_line":"Issuance of bonds of Authority","url":"\/22.1-167\/","token":"22.1\/11\/22.1-167","metadata":false},"next_section":{"id":85235,"structure_id":14222,"section_number":"22.1-167.2","catch_line":"Security for payment; appropriations","url":"\/22.1-167.2\/","token":"22.1\/11\/22.1-167.2","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/22.1-167.1\/","history_text":"

This law was first created in 1994. The record of its establishment is cataloged in chapter 272<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. It has been modified 1 time. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. That modification is as follows: in 2006, chapter 223<\/a>.<\/p>","references":false,"refers_to":[{"id":85499,"section_number":"15.2-2623","catch_line":"Defeasance of indebtedness; rights of owners","order_by":null,"url":"\/15.2-2623\/"},{"id":57272,"section_number":"22.1-142","catch_line":"How Fund constituted; management","order_by":null,"url":"\/22.1-142\/"}],"permalink":{"id":181175,"object_type":"law","relational_id":73854,"identifier":"22.1-167.1","token":"22.1\/11\/22.1-167.1","url":"\/22.1-167.1\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/22.1-167.1\/","token":"22.1\/11\/22.1-167.1","dublin_core":{"Title":"Refunding issues; pass-through of savings realized","Type":"Text","Format":"text\/html","Identifier":"\u00a7 22.1-167.1","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> In the event the Authority<\/span> refunds any bonds previously issued to finance the purchase of local school bonds<\/span>, the Authority<\/span> shall pass-through to the issuers of such local school bonds<\/span>, an allocable share of any savings<\/span> realized. Such pass-through shall be accomplished, at the option of the Authority<\/span>, by means of a debt service reduction over the remaining term of the local school bonds<\/span>, by a lump sum payment of the present value of such allocable share of the savings<\/span>, or by such other method as the Authority<\/span> shall determine to be in the mutual best interests of the issuers of the local school bonds<\/span> and the Authority<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> For the purposes of this section, “savings<\/span>” means the net reduction in debt service, if any, to be realized by the Authority<\/span>, after subtracting the total costs, expenses, and equity<\/span> contributions associated with the refunding and with the pass-through of such savings<\/span> to the issuers of the local school bonds<\/span> and of any Authority<\/span> funds transferred, or required to be transferred, by mandate<\/span> of the General Assembly, other than to the issuers of the local school bonds<\/span>.\n\t\t\tNotwithstanding the provisions of this section, no savings<\/span> shall be passed-through to the issuers of local school bonds<\/span> for which an interest rate subsidy has been paid or which were issued at below market interest rates. The savings<\/span> in connection with the refunding of bonds issued by the Authority<\/span> and allocable to local school bonds<\/span> for which an interest rate subsidy has been paid, to the extent such subsidy was paid from the Literary Fund, shall be transferred to the Literary Fund and used exclusively for Literary Fund loans to local school boards<\/span> pursuant to Chapter 10 (§ 22.1-142<\/a> et seq.) of Title 22.1. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> This section shall have no application if it conflicts with a preexisting trust indenture. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> Whenever the Authority shall defease its bonds previously issued to finance the purchase of local school bonds<\/span>, the Authority may, consistent with the provisions of this section respecting the return of savings<\/span> to the issuers of the related local school bonds<\/span>, designate to such issuers of local school bonds<\/span> which issues<\/span>, series and maturities with which interest rates shall be deemed by the Authority to have been paid. Immediately upon such designation, the local school bonds<\/span> so designated shall likewise be deemed defeased and no longer outstanding, the same as if the defeasance had occurred in accordance with the provisions of § 15.2-2623<\/a>. Such defeasance shall not require any action by the issuer of the affected local school bonds<\/span>, shall be effective immediately, and shall be duly noted on the records of the Authority which shall no longer have any right to payment with respect to the issues<\/span>, series and maturities so deemed by the Authority to have been paid. The elected officials and financial officers of the affected locality are hereby authorized to execute and deliver such federal tax forms, certificates, and other documents as the Authority may request in connection with the defeasance of its local school bonds<\/span> and the bonds of the Authority<\/span>. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nREFUNDING ISSUES; PASS-THROUGH OF SAVINGS REALIZED (\u00a7 22.1-167.1)\n\nA. In the event the Authority refunds any bonds previously issued to finance the\npurchase of local school bonds, the Authority shall pass-through to the issuers\nof such local school bonds, an allocable share of any savings realized. Such\npass-through shall be accomplished, at the option of the Authority, by means of\na debt service reduction over the remaining term of the local school bonds, by a\nlump sum payment of the present value of such allocable share of the savings, or\nby such other method as the Authority shall determine to be in the mutual best\ninterests of the issuers of the local school bonds and the Authority.\n\nB. For the purposes of this section, “savings” means the net\nreduction in debt service, if any, to be realized by the Authority, after\nsubtracting the total costs, expenses, and equity contributions associated with\nthe refunding and with the pass-through of such savings to the issuers of the\nlocal school bonds and of any Authority funds transferred, or required to be\ntransferred, by mandate of the General Assembly, other than to the issuers of\nthe local school bonds.\n\t\t\tNotwithstanding the provisions of this section, no savings shall be\npassed-through to the issuers of local school bonds for which an interest rate\nsubsidy has been paid or which were issued at below market interest rates. The\nsavings in connection with the refunding of bonds issued by the Authority and\nallocable to local school bonds for which an interest rate subsidy has been\npaid, to the extent such subsidy was paid from the Literary Fund, shall be\ntransferred to the Literary Fund and used exclusively for Literary Fund loans to\nlocal school boards pursuant to Chapter 10 (§ 22.1-142 et seq.) of Title\n22.1.\n\nC. This section shall have no application if it conflicts with a preexisting\ntrust indenture.\n\nD. Whenever the Authority shall defease its bonds previously issued to finance\nthe purchase of local school bonds, the Authority may, consistent with the\nprovisions of this section respecting the return of savings to the issuers of\nthe related local school bonds, designate to such issuers of local school bonds\nwhich issues, series and maturities with which interest rates shall be deemed by\nthe Authority to have been paid. Immediately upon such designation, the local\nschool bonds so designated shall likewise be deemed defeased and no longer\noutstanding, the same as if the defeasance had occurred in accordance with the\nprovisions of § 15.2-2623. Such defeasance shall not require any action by\nthe issuer of the affected local school bonds, shall be effective immediately,\nand shall be duly noted on the records of the Authority which shall no longer\nhave any right to payment with respect to the issues, series and maturities so\ndeemed by the Authority to have been paid. The elected officials and financial\nofficers of the affected locality are hereby authorized to execute and deliver\nsuch federal tax forms, certificates, and other documents as the Authority may\nrequest in connection with the defeasance of its local school bonds and the\nbonds of the Authority.\n\nHISTORY: 1994, c. 272; 2006, c. 223.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}