(a) The bond bank authority may create one or more subsidiary corporations for the following purposes:

(1) providing financial and other assistance to governmental employers to enable the governmental employers to reduce their costs of providing retirement and other benefits to their employees by prepaying all or a portion of their shares of the unfunded accrued actuarial liabilities of retirement systems;

(2) receiving payments and providing servicing for payments to or from participating governmental employers; and

(3) performing other duties and providing other services as the subsidiary corporation considers necessary or desirable to further the purposes set out in (1) and (2) of this subsection.

(b) The bond bank authority may incorporate under AS 10.20.146 - 10.20.166 a subsidiary corporation created under (a) of this section. The bond bank authority may transfer assets of the bond bank authority to the subsidiary corporation and may agree to secure bonds, notes, commercial paper, or other obligations of the subsidiary corporation with a reserve fund established under AS 44.85.270.

(c) A subsidiary corporation created under (a) of this section may, after submitting a proposal to the Legislative Budget and Audit Committee under (e) of this section, if the state bond rating is the equivalent of AA- or better, and subject to AS 37.15.903, borrow money and issue bonds, notes, commercial paper, or other obligations as evidence of that borrowing and may have all the powers of the bond bank authority that the bond bank authority grants to it. The provisions of AS 44.85.130 - 44.85.170 and 44.85.270 - 44.85.390 apply to the subsidiary corporation and to bonds, notes, commercial paper, or other obligations issued by the subsidiary corporation. Unless otherwise provided by the bond bank authority, the debts, liabilities, and obligations of the subsidiary corporation are not the debts, liabilities, or obligations of the bond bank authority.

(d) The staff of the bond bank authority serves as staff of a subsidiary corporation created under (a) of this section. The bond bank authority shall determine the membership or the process for selecting the membership of the board of directors of the subsidiary corporation. The bond bank authority may permit some or all of its directors to serve on the board of directors of the subsidiary corporation.

(e) Before the issuance of bonds, notes, commercial paper, or other obligations under this section or under AS 44.85.086, the subsidiary corporation shall submit a proposal to the Legislative Budget and Audit Committee for review, and 45 days shall elapse before bonds, notes, commercial paper, or other obligations are issued, unless the Legislative Budget and Audit Committee earlier recommends that the subsidiary corporation proceed with the issuance. Should the Legislative Budget and Audit Committee recommend within the 45-day period that the subsidiary corporation not proceed with the issuance of bonds, notes, commercial paper, or other obligations, the subsidiary corporation shall again review the proposal, and, if the subsidiary corporation decides to issue the bonds, notes, commercial paper, or other obligations, the subsidiary corporation shall provide the Legislative Budget and Audit Committee with a statement of the subsidiary corporation's reasons for doing so before issuance under this section.