2.__Declaration of purpose.__It is declared to be in the public interest and to be the policy of the State to authorize the bank to issue pension cost reduction bonds.

3.__Declaration of necessity.__It is declared that credit and municipal bond market conditions may require the exercise of state powers by authorizing, but not requiring, a state instrumentality to issue its bonds to finance all or a portion of the costs of pension cost reduction under this subchapter.

4.__Lending and borrowing powers.__The bank may assist the State by borrowing money to finance or refinance from time to time all or a portion of the costs of the pension obligation and make the proceeds of such borrowing available to the State as set out in this subchapter.__The principal of and interest on any pension cost reduction bonds issued by the bank and any ancillary obligation must be secured by the debt service fund and capital reserve fund established pursuant to subsection 6 in accordance with and as may be determined by resolution of the bank.__Bonds, ancillary obligations or other forms of debt or liability entered into or issued by the bank under this section are not in any way a debt or liability of the State and do not constitute a loan of the credit of the State or create any debt or debts, liability or liabilities on behalf of the State or constitute a pledge of the faith and credit of the State.__Each bond, ancillary obligation or other evidence of debt or liability entered into by the bank must contain a statement to the effect that the bank is obligated to pay the principal, interest, redemption premium, if any, and other amounts payable solely from the sources pledged for that purpose by the bank, and that neither the faith and credit nor the taxing power of the State is pledged to the payment of the principal, interest, premium, charge, fee or other amount on the bond, ancillary obligation or other form of indebtedness, as the case may be.

5.__Debt service fund.__The bank shall establish and maintain a debt service fund as a trust fund called "the Pension Cost Reduction Debt Service Fund" and referred to in this subsection as "the debt service fund," into which there must be deposited directly money received into funds established by Title 8, section 386; Title 8, section 1036, subsection 2, paragraphs B, C, D, H and I; Title 10, sections 1527-B and 1527-D; Title 13-B, sections 1402-A and 1405; Title 13-C, sections 124 and 143; Title 31, sections 414 and 416; Title 31, sections 613 and 615;