Chapter
274
2003
-- S 1161
Enacted
07/17/03
AN ACT
AUTHORIZING THE TOWN OF
MIDDLETOWN TO BORROW UP TO $2,500,000 FOR THE PURPOSE OF FINANCING THE
CONSTRUCTION OF SEWERS AND SEWERAGE SYSTEMS THROUGH THE ISSUANCE OF ITS GENERAL
OBLIGATION BONDS OR NOTES INCLUDING BUT NOT LIMITED TO, ANY BONDS OR NOTES
ISSUED PURSUANT TO FINANCING AGREEMENTS WITH THE RHODE ISLAND CLEAN WATER
FINANCE AGENCY
Introduced By: Senator June N. Gibbs
Date
Introduced: June 24, 2003
It is enacted by the General
Assembly as follows:
SECTION
1. The town of Middletown is hereby empowered, in addition to authority
previously granted, to issue bonds
to an amount not exceeding two million five hundred thousand
dollars ($2,500,000) from time to
time under its corporate name and seal. The bonds of each issue
may be issued in the form of
serial bonds or term bonds or a combination thereof and shall be
payable either by maturity of
principal in the case of serial bonds or by mandatory serial
redemption in the case of term
bonds, in annual installments of principal, the first installment to
be not later than five (5) years
and the last installment not later than thirty (30) years after the date
of the bonds. For each issue the
amounts payable annually for principal and interest combined
either shall be as nearly equal
from year to year as is practicable in the opinion of the officers
authorized to issue the bonds, or
shall be arranged in accordance with a schedule providing for a
more rapid amortization of
principal.
SECTION
2. The bonds shall be signed by the town finance director and by the president
of the town council and shall be
issued and sold 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.
Notwithstanding anything contained in this act, the city may enter into
financing agreements with the
Rhode Island Clean Water Finance Agency pursuant to title 46,
Chapter 12.2 of the general laws
and, with respect to notes or bonds issued in connection with
such financing agreements, if any,
the city may elect to have the provisions of title 46, Chapter
12.2 of the general laws apply to
the issuance of the bonds or notes issued hereunder to the extent
the provisions of title 46,
chapter 12.2 of the general laws are inconsistent herewith. Such election
may be fixed by the proceedings of
the city council authorizing such issuance or by separate
resolution of the city 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. The proceeds derived from the
sale of the bonds shall be
delivered to the finance director, and such proceeds exclusive of
premiums and accrued interest
shall be expended (a) for the construction of sewers and sewerage
systems, (b) in payment of the
principal of or interest on temporary notes issued under section
three, (c) in payment of
capitalized interest on bonds or notes, (d) in repayment of advances under
section four, or (e) in payment of
related costs of issuance of any bonds or notes. 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 sales
thereof. The project shall be carried out and all contracts made
therefor on behalf of the town by
the town council. The proceeds of bonds or notes issued under
this act, any applicable federal
or state assistance and other moneys referred to in section six shall
be deemed appropriated for the
purposes of this act without further action than that required by
this act.
SECTION
3. 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 or 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 finance director. Temporary notes
issued hereunder shall be signed
by the finance director and by the president of the town council
and shall be payable within five
(5) years from their respective dates, but the principal of and
interest on notes issued for a shorter
period may be renewed or paid from time to time by the
issue of other notes thereunder,
providing the period from the date of an original note to the
maturity or any note issued to
renew or pay the same debt or the interest thereon shall not exceed
five (5) years. The town may pay
the principal of and interest on notes in full from other than the
issuance of refunding notes prior
to the issuance of bonds pursuant to Section 1 hereof. In such
case, the town’s authority to
issue bonds or notes in anticipation of bonds under this act shall
continue provided that 1) the town
council passes a resolution evidencing the town’s intent to pay
off the notes without
extinguishing the authority to issue bonds or notes and 2) that the period
from the date of an original note
to the maturity date of any other note shall not exceed five (5)
years.
SECTION
4. Pending any authorization or issue of bonds hereunder or pending or in lieu
of any authorization or issue of
notes hereunder, the finance director, with the approval of the
town council, may, to the extent
that bonds or notes may be issued hereunder, apply funds in the
treasury of the town to the
purposes specified in section two, 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
5. 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 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 of
Rhode Island.
SECTION
6. 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
and any earnings or net profit realized from the deposit or
investment of funds hereunder
shall, in the discretion of the 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 project, to the payment of the principal of or interest
on bonds or notes issued hereunder
or to any one (1) or more of the foregoing. The cost of
preparing, issuing and marketing
bonds or notes hereunder may also, in the discretion of the
finance director, be met from bond
or note proceeds exclusive of accrued interest or from other
moneys available therefor. Any
balance of bond or note proceeds remaining after payment of the
cost of the projects and the cost
of preparing, issuing and marketing bonds or notes hereunder
shall be applied to the payment of
the principal of or interest on bonds or notes issued hereunder.
In exercising any discretion under
this section, the finance director shall be governed by any
instructions adopted by resolution
of the town council.
SECTION
7. 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 section 45-12-2 of the general laws.
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 moneys 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
8. Any bonds or notes issued under the provisions of this act, 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
9. The town, acting by resolution of its town council is 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
moneys 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 two.
SECTION
10. 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
11. All or any portion of the authority to issue bonds and notes under this act
may be extinguished by resolution
of the town council, without further action by the general
assembly.
SECTION
12. The town finance director and the president of the town council, on behalf
of the town, are hereby authorized
to execute such documents or other papers as either of them
deem necessary or desirable to
carry out the intent of this act and are also authorized to take all
actions and execute all documents
or agreements necessary to comply with federal tax and
securities laws, which documents
or agreements may have a term coextensive with the maturity
of the bonds authorized hereby,
including Rule 15c2-12 of the Securities and Exchange
Commission (the Rule) and to
execute and deliver a continuing disclosure agreement or
certificate in connection with the
bonds or notes in the form as shall be deemed advisable by such
officers in order to comply with
the Rule.
SECTION
13. The question of the approval of this act shall be submitted to the electors
of the town at a general or
special election (other than a primary) to be held prior to December 31,
2003, as shall be designated by
the town council. The question shall be submitted in substantially
the following form: “Shall an act,
passed at the 2003 session of the general assembly, entitled
‘AN ACT AUTHORIZING THE TOWN OF
MIDDLETOWN TO BORROW UP TO
$2,500,000 FOR THE PURPOSE OF
FINANCING THE CONSTRUCTION OF SEWERS AND
SEWERAGE SYSTEMS THROUGH THE
ISSUANCE OF ITS GENERAL OBLIGATION
BONDS OR NOTES INCLUDING BUT NOT LIMITED
TO, ANY BONDS OR NOTES
ISSUED PURSUANT TO FINANCING
AGREEMENTS WITH THE RHODE ISLAND
CLEAN WATER FINANCE AGENCY’ 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 his office for public
inspection, but the validity of
the election shall not be affected by this requirement.
SECTION
14. 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.
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LC03476
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