2014 -- S 2399 SUBSTITUTE A

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LC004651/SUB A

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO TOWNS AND CITIES - INDEBTEDNESS OF TOWNS AND CITIES

     Introduced By: Senators DaPonte, Goodwin, Nesselbush, Satchell, and Bates

     Date Introduced: February 12, 2014

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. Chapter 45-12 of the General Laws entitled "Indebtedness of Towns and

Cities" is hereby amended by adding thereto the following section:

     45-12-33. Borrowing for road and bridge projects financed through the "municipal

road and bridge revolving fund. -- (a) A city or town may authorize the issuance of bonds,

notes, or other evidences of indebtedness to evidence loans from the municipal road and bridge

revolving fund administered by the Rhode Island clean water finance agency in accordance with

chapter 24-18 of the general laws; provided, however, that the outstanding principal amount, in

aggregate, shall not exceed five percent (5%) of the total amount of the city or town's most

recently adopted municipal budget.

     (b) These bonds, notes, or other evidences of indebtedness are subject to the maximum

aggregate indebtedness permitted to be issued by any city or town under § 45-12-2.

     (c) The denominations, maturities, interest rates, methods of sale, and other terms,

conditions, and details of any bonds or notes issued under the provisions of this section may be

fixed by resolution of the city or town council authorizing them, or if no provision is made in the

resolution, by the treasurer or other officer authorized to issue the bonds, notes or evidences of

indebtedness; provided, that the payment of principal shall be by sufficient annual payments that

will extinguish the debt at maturity, the first of these annual payments to be made not later than

three (3) years, and the last payment not later than twenty (20) years after the date of the bonds.

     The bonds, notes, or other evidences of indebtedness may be issued under this section by

any political subdivision without obtaining the approval of its electors, notwithstanding the

provisions of §§ 45-12-19 and 45-12-20 and notwithstanding any provision of its charter to the

contrary.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TOWNS AND CITIES - INDEBTEDNESS OF TOWNS AND CITIES

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     This act would permit cities and towns to authorize, without charter or referendum

approval, the issuance of bonds, notes or other evidences of indebtedness for road and bridge

projects financed through the municipal road and bridge revolving fund established pursuant to

chapter 24-18 of the general laws.

     This act would take effect upon passage.

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