(1) consider the ability of the credit or liquidity enhancement provider to make required payments as and when due under the terms of the appropriate governing instruments;

(2) consider the business reputation of the credit or liquidity enhancement provider;

(3) consider the maximum term of the credit or liquidity enhancement relative to the maturity of the bonds, notes or other obligations being credit or liquidity enhanced;

(4) provide for the right of substitution for the credit or liquidity enhancement provider in all agreements, including a provision permitting such substitution when the rating of the credit or liquidity enhancement provider falls below the probable credit rating of the issue without considering the credit or liquidity enhancer; and

(5) consider the cost of the credit or liquidity enhancement relative to the savings or other benefit likely to be achieved through the utilization of the credit or liquidity enhancement. d. Where the credit or liquidity enhancement procured is an irrevocable letter of credit or an acquisition arrangement with a banking organization, such instrument shall be:

(1) issued or confirmed by a bank holding company or its direct subsidiaries, a federally chartered bank or its subsidiaries, or a state chartered bank or its subsidiaries, licensed or authorized to do business in this state or

(2) issued or confirmed by an agency or branch of a foreign banking institution licensed to do business in this state with total worldwide assets in excess of five billion dollars. e. Any such issuing banking organization referred to in paragraph d of this section shall meet the regulatory guidelines for capital adequacy as promulgated by the appropriate federal banking agency as defined in the Federal Deposit Insurance Act, 12 U.S.C. 1813(q). f. (1) Where the credit or liquidity enhancement procured is provided by an insurance company, such insurer shall be licensed to write financial guarantee insurance in this state.

(2) Where the credit or liquidity enhancement procured is from other than an entity described in paragraph d of this section or subdivision one of this paragraph, the provider shall be a financially responsible party, incorporated or authorized to do business in this state and having total assets in excess of ten billion dollars. g. The failure of a public body to comply with paragraphs c through f of this section shall not invalidate or impair any credit or liquidity enhancement contract or instrument. h. The finance board may, by resolution, delegate its authority under this section to the chief fiscal officer of such public body in which event the chief fiscal officer shall exercise such power until the finance board, by resolution, shall elect to reassume the same.