Chapter 354

2007 -- H 6453

Enacted 07/05/07

A N A C T

AUTHORIZING THE TOWN OF NORTH SMITHFIELD TO BORROW UP TO $21,000,000 FOR THE PURPOSE OF FINANCING THE CONSTRUCTION AND EXTENSION OF SEWERS AND SEWER LINES AND THE ACQUISITION, CONSTRUCTION AND INSTALLATION OF PUMPING STATIONS AND RELATED FACILITIES AND EQUIPMENT WITHIN THE TOWN 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: Representative Raymond C. Church

Date Introduced: May 30, 2007

It is enacted by the General Assembly as follows:

     SECTION 1. The Town of North Smithfield is hereby empowered, in addition to

authority previously granted, to issue bonds to an amount not exceeding twenty-one million

dollars ($21,000,000) 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, or shall be arranged as required pursuant to Financing

Agreements with the Rhode Island Clean Water Finance Agency.

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

director of finance and 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 town 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 town 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 town

council authorizing such issuance 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. The proceeds derived from the sale of the bonds shall be delivered to the

director of finance, and such proceeds exclusive of premiums and accrued interest shall be

expended (a) for the construction and extensions of sewers and sewer lines and the acquisition,

construction and installation of pumping stations and related facilities and equipment within the

town, (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. This 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.

     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 director of finance,. Temporary notes

issued hereunder shall be signed by the manual or facsimile signatures of the director of finance

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 at shall continue provide 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. 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

director of finance 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 an interest on the notes, any excess moneys in the

fund shall be distributed to the town.

     SECTION 4. Pending any authorization or issue of bonds hereunder or pending or in lieu

of any authorization or issue of notes hereunder, the director of finance, 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 director

of finance 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 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 and any earnings or net profit realized from the deposit or

investment of funds hereunder shall, in the discretion of the director of finance, 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 any also, in the discretion of the

director of finance, 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 earning 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 director of finance 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 extinguished by resolution of the town council without further action by the general

assembly.

     SECTION 12. The town director of finance 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 to be held on a date as shall be designated by the town

council or, in lieu thereof, the town administrator. The questions shall be submitted in

substantially the following form: "Shall an act, passed at the 2007 session of the general

assembly, entitled 'AN ACT AUTHORIZING THE TOWN OF NORTH SMITHFIELD TO

BORROW UP TO $21,000,000 FOR THE PURPOSE OF FINANCING THE CONSTRUCTION

AND EXTENSION OF SEWERS AND SEWER LINES AND THE ACQUISITION,

CONSTRUCTION AND INSTALLATION OF PUMPING STATIONS AND RELATED

FACILITIES AND EQUIPMENT WITHIN THE TOWN 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 for

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 elections shall not be affected by this

requirement. To the extent of any inconsistency between this act and the town charter, this act

shall prevail. Any contest questioning the time, place, manner, notice and timeliness of notice of

the election held must be commenced in superior court against the town not later than twenty (20)

calendar days from the date such election is held; otherwise, the validity of the election shall be

conclusively presumed and such election shall be deemed legally compliant notwithstanding any

irregularities, omissions or defects with respect to such matters.

     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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LC03149

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