2021 -- S 0374

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LC001964

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2021

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A N   A C T

AUTHORIZING THE TOWN OF SOUTH KINGSTOWN TO ISSUE NOT TO EXCEED

$85,000,000 GENERAL OBLIGATION BONDS, NOTES AND OTHER EVIDENCES OF

INDEBTEDNESS TO FINANCE THE CONSTRUCTION, RENOVATION, IMPROVEMENT,

ALTERATION, REPAIR, LANDSCAPING, FURNISHING AND EQUIPPING OF SCHOOLS

AND SCHOOL FACILITIES THROUGHOUT THE TOWN, AND ALL ATTENDANT

EXPENSES INCLUDING, BUT NOT LIMITED TO, ENGINEERING AND

ARCHITECTURAL COSTS, PROVIDED THAT THE AUTHORIZATION SHALL BE

REDUCED BY THE AMOUNT OF CERTAIN GRANTS RECEIVED FROM STATE BOND

PROCEEDS, FROM THE RHODE ISLAND DEPARTMENT OF EDUCATION OR FROM

THE RHODE ISLAND SCHOOL BUILDING AUTHORITY

     Introduced By: Senators Sosnowski, Algiere, and Valverde

     Date Introduced: February 25, 2021

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. The town of South Kingstown is hereby empowered, in addition to authority

previously granted, to issue bonds, notes and other evidences of indebtedness (hereinafter “bonds”)

up to an amount not exceeding eighty-five million dollars ($85,000,000) from time to time under

its corporate name and seal or a facsimile of such 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 sinking fund installments 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. 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 town may be eligible for school housing aid reimbursement on debt

service pursuant to chapter ‎‎7 of title 16, or for a grant, loan or other financial assistance from

proceeds of bonds issued by the state of Rhode Island (the “state”), ‎from the Rhode Island

department of education (“RIDE”) or from the Rhode Island school building authority. The amount

of borrowing authorized ‎pursuant to this act shall be reduced by the amount of certain grants

actually received by the town from state bond proceeds, from RIDE or from the Rhode Island

school building authority.

     SECTION 3. 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 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 the resolutions 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 to the contrary, the town may enter into financing ‎agreements with the Rhode

Island health and educational building corporation pursuant to ‎chapter 7 of title 16 and chapter 38.1

of title 45 and, with respect to bonds or notes issued in ‎connection with such financing agreements,

if any, the town may elect to have the provisions of ‎chapter 38.1 of title 45 apply to the issuance of

the bonds or notes issued hereunder to the extent ‎the provisions of chapter 38.1 of title 45 are

inconsistent herewith. In addition, the town may enter ‎into financing agreements with the Rhode

Island Infrastructure Bank pursuant to the provisions ‎of chapter 12.2 of title 46 and, with respect to

bonds or notes issued in connection with such ‎financing agreements, if any, the town may elect to

have the provisions of chapter 12.2 of title 46 ‎apply to the issuance of the bonds or notes issued

hereunder to the extent the provisions of ‎chapter 12.2 of title 46 are inconsistent herewith. Such

election may be fixed by the proceedings ‎of the town council authorizing such issuance of 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 town director of finance, and such proceeds

exclusive of premiums and accrued interest shall be expended: (1) To finance the construction,

renovation, improvement, alteration, repair, landscaping, furnishing and equipping of schools and

school facilities throughout the town, and all attendant expenses including, but not limited to,

engineering and architectural costs; (2) In payment of the principal of or interest on temporary notes

issued under section 4; (3) In repayment of advances under section 5; (4) In payment of related

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costs of issuance of any bonds or notes; and/or (5) In payment of capitalized interest during

construction of the project (the “project”). 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 project shall be carried out and all contracts made therefor on behalf of the town by the town

council with due regard to any recommendation of the school building committee. The town

council and the school building committee and their agents are authorized to enter, without delay

and at reasonable times, any public school buildings and other public school property for the

purpose of accomplishing the project and to do all acts and deeds necessary or convenient in

connection with the project. The proceeds of bonds or notes issued under this act, any applicable

federal or state assistance and the other monies referred to in sections 7 and 10 shall be deemed

appropriated for the purposes of this act without further action than that required by this act. The

bonds authorized by this act may be consolidated for the purpose of issuance and sale with any

other bonds 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 4. 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 director of finance. Temporary notes

issued hereunder 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 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 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 trust in a separate fund established for the notes being refunded. Pending their

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use to pay the notes being refunded, monies in the fund shall be invested for the benefit of the town

by the paying agent at the direction of the town director of finance in any investment permitted

under section 6. The monies in the fund and any investments held as 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 monies 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 5. Pending any authorization or issue of bonds hereunder or pending or in lieu

of any authorization or issue of notes hereunder, the town 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 3, 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 6. 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 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 the town council or pursuant to an

investment policy of the town.

     SECTION 7. 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 premium arising from the sale of

bonds or notes hereunder shall, in the discretion of the town 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 project costs, 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, in the discretion of the town director of finance,

be met from bond or note proceeds exclusive of accrued interest or from other monies available

therefor. Any balance of bond or note proceeds remaining after payment of the cost of the projects

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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 director of finance

shall be governed by any instructions adopted by resolution of the town council.

     SECTION 8. 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 § 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 9. 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 10. 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 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 3.

     SECTION 11. 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

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issued hereunder shall in no way depend upon the validity or occurrence of such action.

     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 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 instruments, documents or agreements necessary to comply with

federal tax and securities laws, which instruments, 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. 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 after seven (7) years

shall have passed from the approval of this act provided for in section 14, without further action by

the general assembly.

     SECTION 14. The question of the approval of this act shall be submitted to the electors of

the town, at a local election, other than a primary, held on a date to be determined by resolution of

the town council. The question shall be submitted in substantially the following form: “Shall an

act passed at the 2021 session of the general assembly entitled ‘AN ACT AUTHORIZING THE

TOWN OF SOUTH KINGSTOWN TO ISSUE NOT TO EXCEED $85,000,000 GENERAL

OBLIGATION BONDS, NOTES AND OTHER EVIDENCES OF INDEBTEDNESS TO

FINANCE THE CONSTRUCTION, RENOVATION, IMPROVEMENT, ALTERATION,

REPAIR, LANDSCAPING, FURNISHING AND EQUIPPING OF SCHOOLS AND SCHOOL

FACILITIES THROUGHOUT THE TOWN, AND ALL ATTENDANT EXPENSES

INCLUDING, BUT NOT LIMITED TO, ENGINEERING AND ARCHITECTURAL COSTS,

PROVIDED THAT THE AUTHORIZATION SHALL BE REDUCED BY THE AMOUNT OF

CERTAIN GRANTS RECEIVED FROM STATE BOND PROCEEDS, FROM THE RHODE

ISLAND DEPARTMENT OF EDUCATION OR FROM THE RHODE ISLAND SCHOOL

BUILDING AUTHORITY’ 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 at the clerk’s office 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 15. This section and section 14 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

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on the question at the election prescribed by section 14.

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LC001964

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EXPLANATION

OF

A N   A C T

AUTHORIZING THE TOWN OF SOUTH KINGSTOWN TO ISSUE NOT TO EXCEED

$85,000,000 GENERAL OBLIGATION BONDS, NOTES AND OTHER EVIDENCES OF

INDEBTEDNESS TO FINANCE THE CONSTRUCTION, RENOVATION, IMPROVEMENT,

ALTERATION, REPAIR, LANDSCAPING, FURNISHING AND EQUIPPING OF SCHOOLS

AND SCHOOL FACILITIES THROUGHOUT THE TOWN, AND ALL ATTENDANT

EXPENSES INCLUDING, BUT NOT LIMITED TO, ENGINEERING AND

ARCHITECTURAL COSTS, PROVIDED THAT THE AUTHORIZATION SHALL BE

REDUCED BY THE AMOUNT OF CERTAIN GRANTS RECEIVED FROM STATE BOND

PROCEEDS, FROM THE RHODE ISLAND DEPARTMENT OF EDUCATION OR FROM

THE RHODE ISLAND SCHOOL BUILDING AUTHORITY

***

     This act authorizes the town of South Kingstown to issue not more than $85,000,000 bonds

and notes to finance the construction, renovation, improvement, alteration, repair, landscaping,

furnishing and equipping of schools and school facilities throughout the town, and all attendant

expenses including, but not limited to, engineering and architectural costs.

     Sections 14 and 15 of this act shall take effect upon passage. The remainder of the act

would take effect upon approval by the electors of the town of the question provided for in section

14. The amount of borrowing authorized ‎pursuant to this act shall be reduced by the amount of

certain grants actually received by the town from State bond proceeds, from RIDE or from the

Rhode Island School Building Authority.

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LC001964

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