Chapter 431

2004 -- S 3176 AS AMENDED

Enacted 07/03/04

A N A C T

AUTHORIZING THE TOWN OF EAST GREENWICH TO FINANCE THE

CONSTRUCTION, RENOVATION, ALTERATION, REPAIR, IMPROVEMENT,

EQUIPPING AND FURNISHING OF, AND/OR ADDITIONS TO, PUBLIC SCHOOLS AND SCHOOL FACILITIES IN THE TOWN AND TO ISSUE NOT MORE THAN $42,800,000 BONDS AND/OR NOTES THEREFOR

Introduced By: Senator J. Michael Lenihan

Date Introduced: June 09, 2004

It is enacted by the General Assembly as follows:

     SECTION 1. The town of East Greenwich is hereby empowered, in addition to authority

previously granted, to issue bonds to an amount not exceeding forty-two million eight hundred

thousand dollars ($42,800,000), 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. All such bonds of a particular issue may be issued in the form

of zero coupon bonds, capital appreciation bonds, serial bonds or term bonds or a combination

thereof. Annual installments of principal may be provided for by maturity of principal in the case

of serial bonds or by mandatory serial redemption in the case of term bonds. The amount of

principal appreciation each year on any bonds, after the date of original issuance, shall not be

considered to be principal indebtedness for the purposes of any constitutional or statutory debt

limit or any other limitation. The appreciation of principal after the date of original issue shall be

considered interest. Only the original principal amount shall be counted in determining the

principal amount so issued and any interest component shall be disregarded.

     SECTION 2. The bonds shall be signed by the manual or facsimile signatures of the town

finance director and the president of the town council and shall be issued and sold in such

amounts as the town council may authorize by resolution. 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 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 manual or 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) to finance the

construction, renovation, alteration, repair, improvement, equipping and furnishing of, and/or

additions to, public schools and school facilities in the town and all attendant expenses including,

but not limited to, engineering and architectural costs (all of which shall be hereinafter referred to

as the "projects"), (b) in payment of the principal of or interest on temporary notes issued under

section three, (c) in repayment of advances under section four, (d) in payment of related costs of

issuance of any bonds or notes, and/or (e) to finance capitalized interest on the projects. 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 projects shall be carried out and all

contracts made therefore on behalf of the town by the town council or as otherwise may be

directed by the town council. The proceeds of bonds or notes issued under this act, any

applicable federal or state assistance and the other moneys referred to in sections six and nine

shall be deemed appropriated for the purposes of this act without further action than that required

by this act. The bond issue authorized by this act may be consolidated for the purposes of

issuance and sale with any other bond issue of the town heretofore or hereafter authorized,

provided that, notwithstanding any such consolidation, the proceeds from the sale of the bonds

authorized by this act shall be expended for the purposes set forth above. The town finance

director and the president of the town council, on behalf of the town, are hereby authorized to

execute such instruments, 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 and to execute and

deliver a continuing disclosure agreement or certificate in connection with the bonds or notes.

     SECTION 3. The town council may by resolution authorize the issuance from time to

time of interest bearing or discounted notes in anticipation of the issuance 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 town finance

director. Temporary notes issued hereunder shall be signed by the manual or facsimile signatures

of the town finance director and 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 issuance 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 five (5) years. Any temporary notes

in anticipation of bonds issued under this section may be refunded prior to the maturity of the

notes by the issuance of additional temporary notes, provided that no such refunding shall result

in any amount of such temporary notes outstanding at any one time in excess of two hundred

percent (200%) of the amount of bonds which may be issued under this act, and provided further

that if the issuance of any such refunding notes results in any amount of such temporary notes

outstanding at any one time in excess of the amount of bonds which may be issued under this act,

the proceeds of such refunding notes shall be deposited in a separate fund established with the

bank which is paying agent for the notes being refunded. Pending their use to pay the notes being

refunded, moneys in the fund shall be invested for the benefit of the town by the paying agent at

the direction of the town finance director in any investment permitted under section five. The

moneys in the fund and any investments held as a part of the fund shall be held in trust and shall

be applied by the paying agent solely to the payment or prepayment of the principal of and

interest on the notes being refunded. Upon payment of all principal of and interest on the notes,

any excess moneys in the fund shall be distributed to the town. 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 town 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 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 of Rhode Island or resolution of the town council or

pursuant to an investment policy of the town.

     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 shall, in 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 project costs, 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 town

finance director, be met from bond or note proceeds exclusive of premium and accrued interest or

from other moneys available therefor. Any balance of bond or note proceeds remaining after

payment of the cost of the project 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. To the extent permitted by applicable federal laws, any earnings or net profit realized

from the deposit or investment of funds hereunder may, upon receipt, be added to and dealt with

as part of the revenues of the town from property taxes. 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 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

and any provision of the town charter. 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 the 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, and coupons, if

any, 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 the

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 authorized but unissued authority to issue bonds

and notes under this act may be extinguished by ordinance of the town council, without further

action by the general assembly.

     SECTION 12. The question of the approval of this act shall be submitted to the electors

of the town at a general or local election to be held on a date as shall be designated by the town

council. The question shall be submitted in substantially the following form: "Shall an act,

passed at the 2004 session of the General Assembly, entitled 'An act authorizing the Town of East

Greenwich to finance the construction, renovation, alteration, repair, improvement, equipping and

furnishing of, and/or additions to, public schools and school facilities in the town and to issue not

more than $42,800,000 bonds and/or notes therefor' 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 this act available for public

inspection, but the validity of the election shall not be affected by this requirement. To the extent

of any inconsistency between this act and the town charter, this act shall prevail.

     SECTION 13. 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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LC03630

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