SECTION 1. The town of Middletown is hereby authorized to plan, construct, operate, maintain, extend and improve a water supply system for the town or any part or parts thereof. Such system may include facilities for the treating and supplying of potable water. The town of Middletown, acting by its town council, may enter into agreements for periods with the state, or any other municipal or quasi-municipal corporation, or any private party for the treatment of water by one party or the other and the state; such other municipal or quasi-municipal corporations and private parties are authorized to enter into such agreements with the town. Such agreements may be for a period of years or of permanent duration and may provide for the arbitration of disputes arising thereunder.

SECTION 2. The town council may employ and fix the compensation of attorneys, engineers, surveyors, draftsmen, clerks and other employees and agents. The town council may appoint a superintendent of the water supply system and contract for his or her services, but no such contract shall be for a term of more than three (3) years.

SECTION 3. Any contract of the town involving more than ten thousand dollars ($10,000) for construction or five thousand dollars ($5,000) for the purchase of materials or equipment shall be publicly advertised pursuant to section 45-55-9.

In carrying out the purposes of this act, the town may lease property or acquire the same by purchase or gift or by eminent domain as hereinafter provided, may make contracts, and shall have such further powers as shall be necessary or incidental to the purposes and powers set forth in this act. Any lease, purchase, or taking of real property shall be subject to the prior authorization or approval of the town council.

SECTION 4. The initial cost of any project or projects for the construction, completion, extension, enlargement or improvement of the water supply system may be shared between the abutting property owners and all the taxpayers of the town of Middletown in the following manner:

The town council shall to the extent described herein, assess the cost of any project or projects for the construction, completion, extension, enlargement or improvement of the water supply system upon the owners of the estates which abut that portion of any street, highway, or right-of-way in or along which any water project or projects may be located or which otherwise specifically benefit from such project or projects. Such assessment may be made separately for each project or for several projects taken together as the town council may deem equitable. The cost to be assessed shall be that which is determined by the town council to provide particular rather than general benefit.

Such assessments shall be just and equitable and may be based upon frontage or area within a specified reasonable distance from the street or highway, or on assessed valuations, or on any other factor affording a reasonable measure of benefits, or upon any combinations of the foregoing. However, absent cause shown, the same method shall be used as to all properties. The town council shall not make any particular assessment in excess of the benefit conferred and may make reasonable adjustments of such assessments against estates having frontage upon more than one street or against estates which for any reason are unable to derive the normal benefits from the system.

Such assessments shall name the owners assessed, describe their estates, and state the amounts of the assessments, but no error or omission in the name or description shall invalidate the assessment as long as either the owner or the estate is substantially identified.

A copy of such assessment shall be recorded with the collector of taxes as public record. From the date of delivery to the collector of taxes, the assessments and interest and other charges accruing thereon shall constitute a lien upon the respective estate on a parity with the lien for the town taxes until paid in full, but such lien shall not be subject to termination under RIGL section 44-9-1. The collector of taxes of the town shall have the same rights to enforce such liens against the estates and to collect such assessments and interest from the owners, whether residents of this state or not, as he or she has in the case of town taxes assessed against residents of this state.

Prior to or forthwith after the delivery to the collector of taxes of a copy of such assessment, he or she shall cause notice to be sent to the owners of each estate assessed. The notice shall substantially identify the estate assessed, state the amount of the assessment, and refer to the remedy available under this section. The notice shall be mailed postpaid and directed to the last known address of the addressee. If there are owners whose addresses are unknown, a similar notice covering the assessments against their estates shall be published in newspaper of general circulation in the town and such published notice may be a single collective notice for all such owners. No irregularity in carrying out the provisions of this section shall excuse the nonpayment of the assessment or affect the validity or any proceedings for the collection thereof as long as there is substantial compliance with the provisions hereof. No deficiency in the notice to the owner of an estate assessed shall excuse the nonpayment by others of the assessments against their estates or affect the validity thereof or any proceedings for the collection thereof.

Any person aggrieved by any such assessments may within ninety (90) days after the mailing or publication of notice to him or her, file a petition for relief against the town as respondent in the superior court, and the clerk shall thereupon issue a citation to summon the town to the provisions of RIGL section 44-5-29. If the court finds such assessment invalid in whole or in part, it shall give judgment reducing the amount thereof or for a refund accordingly. The filing of such a petition shall not relieve the estate involved from the lien hereinabove provided, or prevent the assessment from becoming due as provided in this section, but the final judgment of the court reducing such assessment in whole or in part shall reduce such lien and the amount due accordingly. The remedy provided in this section shall be exclusive and no action or proceeding questioning the validity of any such assessment shall be begun after the expiration of said ninety (90) day period.

In the event an assessment is partially or wholly invalid, the town council may make a corrected assessment to replace the invalid assessment or portion. The corrected assessment shall be made in the same manner as an original assessment. The first installment of a corrected assessment shall be sufficient to compensate without interest for all installments which would have become due then or theretofore, and subsequent installments shall be payable when they would have been payable, if the corrected assessment had been made at the time of the original assessment. The corrected assessment shall bear interest from the date notice of the corrected assessment was delivered to the collector of taxes.

Except as provided in section 4, each assessment under this act shall be payable in not more than twenty (20) equal annual installments. The town council by resolution may, from time to time, determine the number of annual installments in which assessments thereafter made under this act shall be paid, but in the absence of any such resolution the number of such installments shall be twenty (20). The unpaid balance of each assessment shall bear interest from the date a copy of the assessment is delivered to the collectors of taxes. The rate of interest shall be determined by the town council prior to or forthwith after the delivery of the copy of the assessment to the collector of taxes. If any part of the project or projects with respect to which the assessment was made was permanently financed by borrowing, such rate shall, to the nearest higher one-tenth of one percent, be equal to the actual rate of interest paid by the town with respect to funds borrowed by it to finance such project or projects. The annual payments of each assessment, with the appropriate amount of interest then payable, shall become due commencing with the date on which the regular town taxes are due and payable which next follows the date on which a copy of the assessment was delivered to the collector of taxes, provided that the whole assessment against any owner or estate may be paid without interest at any time prior to the due date of the first installment thereof, and provided further that the whole unpaid balance of any such assessment together with the interest accrued thereon to the date of payment may be paid at any time.

In the event of the subdivision of any estate subject to any such assessment by the conveyance of any part or parts thereof to a different owner, the town council may apportion the assessment of the unpaid part thereof among the new estates so created upon any basis which might then be used under this section for a new assessment and such basis need not be the same as that used for the assessment being apportioned. The apportioned assessments shall be payable at the same times and in the same amounts pro rata as the original assessment or unpaid part thereof. In all other respects, the apportioned assessments shall be governed by the provisions of this section which would then apply to a new assessment. Upon the recording of the apportioned assessments, the original assessment shall be discharged.

In the event that the town has not authorized sufficient borrowing or provided sufficient other funds to undertake a requested water extension, or the town council determines that higher priority exists for the use of the proceeds of borrowing or other funds, the town council may, in lieu of levying all or part of an assessment under this act, require the person or persons requesting such extension to contribute all or part of the cost thereof before the project is commenced.

SECTION 5. The town of Middletown shall have the power and is hereby authorized, from time to time, to issue bonds in an aggregate principal amount not to exceed $5,000,000 under its corporate name and seal or a facsimile of such seal. The bonds of each issue shall mature in annual installments or principal, the first installment to be not later than three (3) years and the last installment not later than thirty (30) years after the date of the bonds.

SECTION 6. The bonds shall be signed by the town finance director and by the manual signature of the president of the town council and shall be issued and sold at not less than par, and shall accrue interest in such amounts as the town council may authorize. The manner of sale, denominations, maturities, interest rates and other terms, conditions and details of any bonds or notes issued under this act may be fixed by the proceedings of the town council authorizing the issue or by separate resolution of the town council or, to the extent provisions for these matters are not so made, they may be fixed by the officers authorized to sign the bonds or notes. Interest coupons (if any) shall bear the facsimile signature of the town finance director. The proceeds derived from the sale of the bonds shall be delivered to the town finance director, and such proceeds, exclusive of premiums and accrued interest shall be expended: (a) for the purposes set forth in section one of this act other than current expenses, or (b) for capitalized interest, or (c) in payment of the principal of or interest on temporary notes issued under section 7, or (d) in repayment of advances under section 8. No purchaser of any bonds or notes under this act shall be in any way responsible for the proper application of the proceeds derived from the sale thereof. The proceeds of bonds or notes issued under this act, any applicable federal or state assistance and the other monies referred to in sections fourteen shall be deemed appropriated for the purposes of this act without further action than that required by this act.

SECTION 7. The town council may, by resolution, authorize the issue, from time to time, of interest bearing or discounted notes in anticipation of the issue of bonds under section 5 in anticipation of the receipt of federal or state aid for the purposes of this act. The amount of original notes issued in anticipation of bonds may not exceed the amount of bonds which may be issued under this act, and the amount of original notes issued in anticipation of federal or state aid may not exceed the amount of available federal or state aid as estimated by the town finance director. Temporary notes issued thereunder shall be signed by the town finance director and by the president of the town council and shall be payable within six (6) years from their respective dates, but the principal and interest on notes issued for a shorter period may be renewed or paid from time to time by the issue of other notes hereunder, provided the period from the date of an original note to the maturity of any note issued to renew or pay the same debt or the interest thereon shall not exceed six (6) years.

SECTION 8. Pending any authorization or issue of bonds hereunder or pending or in lieu of any authorization or issue of notes hereunder, the town finance director, with the approval of the town council may, apply funds in the general treasury of the town to the purposes specified in section 6. Such advances to be repaid without interest from the proceeds of bonds or notes subsequently issued or from the proceeds of applicable federal or state assistance or from other available funds.

SECTION 9. Any proceeds of bonds or notes issued hereunder or of any applicable federal or state assistance, pending their expenditure may be deposited or invested by the town finance director, in demand deposits, time deposits or savings deposits in banks which are members of the Federal Deposit Insurance Corporation or in obligations issued or guaranteed by the United States of America or by any agency or instrumentality thereof or as may be provided in any other applicable law of the state.

SECTION 10. Any accrued interest received upon the sale of bonds or notes hereunder shall be applied to the payment of the first interest due thereon. Any premiums arising from the sale of bonds or notes hereunder, any net earnings or profits realized from the deposit or investment of funds hereunder, and any balance of bond or note proceeds remaining after completion of the projects shall, at the discretion of the town finance director, be applied to the cost of preparing, issuing and marketing bonds or notes hereunder to the extent not otherwise provided, to the payment of the cost of the projects or the cost of additional improvements coming within the description of the projects in section 6 to the payment of the principal of or interest on bonds or notes issued hereunder, or to any one or more of the foregoing. The cost of preparing, issuing and marketing bonds or notes hereunder may also, at the discretion of the town finance director, be met from bond or note proceeds exclusive of premium and accrued interest or from other monies available therefor. In exercising any discretion under this section, the town finance director shall be governed by any instructions adopted by resolution of the town council.

SECTION 11. All bonds and notes issued under this act and the debts evidenced thereby shall be obligatory on the town in the same manner and to the same extent as other debts lawfully contracted by it and shall be excepted from the operation of RIGL section 45-12-2. No such obligation shall at any time be included in the debt of the town for the purpose of ascertaining its borrowing capacity. The town shall annually appropriate a sum sufficient to pay the principal and interest coming due within the year on bonds and notes issued hereunder to the extent that monies therefor are not otherwise provided. If such sum is not appropriated, it shall nevertheless be added to the annual tax levy. In order to provide such sum in each year and notwithstanding any provision of law to the contrary, all taxable property in the town shall be subject to ad valorem taxation by the town without limitation as to rate or amount.

SECTION 12. Any bonds or notes issued under the provisions of this act, and coupons on any bonds if properly executed by officers of the town in office on the date of execution, shall be valid and binding according to their terms notwithstanding that before the delivery thereof and payment therefor any or all of such officers shall for any reason have ceased to hold office.

SECTION 13. The town, acting by resolution of its town council, is hereby authorized to apply for, contract for and expend any federal or state advances or other grants or assistance which may be available for the purposes of this act, and any such expenditures may be in addition to other monies provided in this act. To the extent of any inconsistency between any law of this state and any applicable federal law or regulation, the latter shall prevail. Federal and state advances, with interest where applicable, whether contracted for prior to or after the effective date of this act, may be repaid as project costs under section 6.

SECTION 14. Bonds and notes may be issued under this act without obtaining the approval of any governmental agency or the taking of any proceedings or the happening of any conditions except as specifically required by this act for such issue. In carrying out any project financed in whole or in part under this act, including where applicable the condemnation of any land or interest in land, and in the levy and collection of assessments or other charges permitted by law on account of any such project, all action shall be taken which is necessary to meet constitutional requirements whether or not such action is otherwise required by statute; but the validity of bonds and notes issued hereunder shall in no way depend upon the validity or occurrence of such action.

SECTION 15. For the purpose of this act, the town may acquire land or other real property, or any interest, estate or right therein, by eminent domain in the manner prescribed by chapter 1 of title 24, provided that no property or interest, estate or right therein belonging to the state, or any political subdivision shall be acquired without its consent, and that no property or interest, estate, or right therein, belonging to or used by a public utility, shall be acquired without the consent of the division of public utilities and carriers. Any damages which may be agreed upon or determined pursuant to this chapter, including any interest and other applicable charges, shall constitute a general obligation of the town, but such obligation shall not at any time be included in the debt of the town for the purpose of ascertaining its borrowing capacity.

SECTION 16. The question of approval of this act shall be submitted to the electors of the town of Middletown at a general election or at a special local election to be held at a date to be set by the Middletown town council. The question shall be submitted in substantially the following form: "Shall an act passed at the 2002 session of the general assembly entitled 'An Act Authorizing the Town of Middletown to Plan, Construct, Operate, and Maintain a Water Supply System and Authorizing the Financing Therefor Through the Issuance of General Obligation Bonds and/or Notes in an Amount Not to Exceed $5,000,000' be approved?" and the warning for the election shall contain the question to be submitted. From the time the election is warned and until it is held, it shall be the duty of the town clerk to keep a copy of the act available at their office for public inspection, but any failure of the clerk to perform this duty shall not affect the validity of the election.

SECTION 17. This section and the foregoing section shall take effect upon the passage of this act. The remainder of this act shall take effect upon the approval of this act by a majority of those voting on the question at the election prescribed by the foregoing section.