LA 034
2023 -- H 6126
Enacted 06/14/2023

A N   A C T
AMENDING CHAPTERS 106 AND 107 OF THE LOCAL ACTS OF 2021 BOTH ENTITLED "AN ACT RELATING TO SCHOOL CONSTRUCTION AND FINANCING IN THE CITY OF CENTRAL FALLS AND AUTHORIZING THE CITY OF CENTRAL FALLS TO ISSUE NOT TO EXCEED $5,760,000 GENERAL OBLIGATION BONDS, NOTES AND OTHER EVIDENCES OF INDEBTEDNESS TO FINANCE THE CONSTRUCTION, RENOVATION, IMPROVEMENT, ALTERATION, REPAIR, FURNISHING AND EQUIPPING OF SCHOOLS AND SCHOOL FACILITIES IN THE CITY"

Introduced By: Representative Joshua J. Giraldo

Date Introduced: March 03, 2023

It is enacted by the General Assembly as follows:
     WHEREAS, In 2021, the General Assembly passed as companion bills Local Acts
Chapters 106 and 107 relating to school construction and financing in the city of Central Falls (the
“Prior Acts”); and
     WHEREAS, The Prior Acts authorized the State, acting through the general treasurer to
execute a Financing Agreement and any other agreements necessary to effectuate the purposes of
the Prior Acts and the Prior Acts served as the joint resolution required pursuant to Rhode Island
General Laws §35-18-1, et seq (the “Rhode Island Public Corporation Debt Management Act”);
     WHEREAS, The Prior Acts were silent on the use of premium generated from the sale of
bonds or notes issued by the Rhode Island Heath and Educational Building Corporation payable
from annual appropriations by the State; and
     WHEREAS, It is desirable that premium on the sale of bonds and notes be permitted to be
used to pay costs of the Central Falls School Project as defined in the Prior Acts.
     NOW THEREFORE, It is enacted and resolved by the General Assembly as follows:
     SECTION 1. Section 2 of Local Acts of 2021 Chapters 106 and 107 are hereby each
amended as follows:
     SECTION 2. City of Central Falls School Project.
     WHEREAS, The WHEREAS clauses in paragraphs 1 through 5 hereof are hereby
incorporated herein by reference.
     WHEREAS, The City of Central Falls is proposing a project consisting of the construction,
renovation, improvement, alteration, repair, furnishing and equipping of schools and school
facilities in the city; and
     WHEREAS, The Project will be financed through the Rhode Island Health and Educational
Building Corporation (the “Corporation”) under its school financing revenue bond program, with
an expected term of not to exceed thirty (30) years and it is anticipated that the State will be a
signatory to the Financing Agreement with the Rhode Island Health and Educational Building
Corporation; and
     WHEREAS, It is anticipated that the State’s obligations under the Financing Agreement
will be subject to appropriation therefor by the General Assembly in each budget year; and
     WHEREAS, The Rhode Island Public Corporation Debt Management Act requires the
General Assembly to provide its consent to the issuance or incurring by the State of Rhode Island
of certain obligations, including financing guarantees or other agreements; and
     WHEREAS, The principal amount of bonds which will finance the project costs and costs
of financing covered by the Financing Agreement is not expected to exceed $144,000,000. Any
premium received from the sale of any bonds or notes shall be used toward project costs and shall
not reduce the principal amount of bonds or notes. Debt service payments will be supported by
revenues received by the Corporation under the Financing Agreement which include annual
appropriations for debt service made by the State, state school construction aid payments and state
school operations aid payments if any, pursuant to chapter 16-7 of the Rhode Island general laws
and payments from the City of Central Falls under the Financing Agreement. Total debt service on
the bonds in not expected to exceed $9,400,000 annually and $281,000,000 in the aggregate based
on an average interest rate of five percent (5.00%);
     Now therefor be it resolved
     RESOLVED, That this General Assembly hereby approves the issuance of bonds or notes
to finance the Central Falls School Project in a principal amount up to $144,000,000 plus any
original issue premium, such bonds or notes not to be reduced by any premium received on the sale
of any bonds or notes which premium shall be used for project costs for the Central Falls School
Project; and be it further
     RESOLVED, That the State, acting through the general treasurer may execute the
Financing Agreement as contemplated herein and any other agreements necessary to effectuate the
purposes of this act; and be it further
     RESOLVED, That the bonds will be special obligations of the Corporation payable from
funds received by the Corporation under the Financing Agreement and other revenues received by
the Corporation, in any combination or priority as may be designated in the proceedings of the
Corporation authorizing the issuance of such debt. The total debt service on the bonds is estimated
to average approximately nine million four hundred thousand dollars ($9,400,000) per year or
approximately two hundred eighty-one million dollars ($281,000,000) in the aggregate, at an
average interest rate of approximately five percent (5%) and an approximately thirty (30) year
maturity; and be it further
     RESOLVED, That the bonds will not constitute indebtedness of the State or any of its
subdivisions or a debt for which the full faith and credit of the State or any of its subdivisions is
pledged. This act shall constitute an enabling act of the general assembly that is required pursuant
to § 16-7-44.
     RESOLVED, That the State’s authority to incur the obligations set forth herein will expire
within five (5) years of the date of passage of this act if such financing transaction is not executed
prior to that date.
     SECTION 3. This act shall take effect upon passage.
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LC002032
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