18-2461. Power project agency; restrictions on sale or mortgage of certain property; revenue; pledge; alienation to private power producers, prohibited; indebtedness; default; possession by creditors; agreements authorized.

No power plant, system, or works owned by an agency shall be sold, alienated, or mortgaged by such agency. Nothing in sections 18-2401 to 18-2485 shall prevent an agency from assigning, pledging, or otherwise hypothecating, its revenue, incomes, receipts, or profits to secure the payment of indebtedness, but the credit or funds of the State of Nebraska or any subdivision thereof shall never be pledged for the payment or settlement of any indebtedness or obligation whatever of any agency created pursuant to sections 18-2426 to 18-2434. Neither by sale under foreclosure, receivership, or bankruptcy proceedings, nor by alienation in any other manner, may the property of such an agency become the property of or come under the control of any private person, firm, or corporation engaged in the business of generating, transmitting, or distributing electricity for profit. In order to protect and safeguard the security and the rights of the purchasers or holders of revenue debentures, notes, bonds, warrants, or other evidences of indebtedness, issued by any agency created pursuant to sections 18-2426 to 18-2434, such agency may agree with the purchasers or holders that in the event of default in the payment on, or principal of, any such evidences of indebtedness or in the event of default in performance of any duty or obligation of such agency in connection therewith, such purchasers or holders, or trustees selected by them, may take possession and control of the business and property of the agency and proceed to operate the same, and to collect and receive the income thereof, and after paying all necessary and proper operating expenses and all other proper disbursements or liabilities made or incurred, use the surplus, if any, of the revenue of the agency as follows: (1) In the payment of all outstanding past-due interest on each issue of revenue debentures, notes, warrants, bonds, or other evidences of indebtedness, so far as such net revenue will go, and paying pro rata the interest due on each issue thereof when there is not enough to pay in full all of the interest; and (2) if any sums shall remain after the payment of interest, then in the payment of the revenue debentures, notes, warrants, bonds, or other evidences of indebtedness, which, by the terms thereof, shall be due and payable on each outstanding issue in accordance with the terms thereof, and paying pro rata when the money available is not sufficient to pay in full. When all legal taxes and charges, all arrears of interest, and all matured revenue debentures, notes, warrants, bonds, or other evidences of indebtedness, have been paid in full, the control of the business and the possession of the property of the agency shall then be restored to such agency. The privilege granted in this section shall be a continuing one as often as the occasion therefor may arise.

Source:Laws 1981, LB 132, ยง 61.