2016 -- H 8152

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LC005854

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2016

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A N   A C T

AUTHORIZING THE TOWN OF NORTH PROVIDENCE TO ISSUE BONDS AND NOTES

IN AN AMOUNT NOT EXCEEDING $75,000,000 TO FINANCE THE CONSTRUCTION,

RENOVATION, REHABILITATION, REPAIR, IMPROVEMENTS, FURNISHING AND

EQUIPPING OF AND/OR ADDITIONS TO SCHOOLS AND SCHOOL FACILITIES IN THE

TOWN INCLUDING, BUT NOT LIMITED TO, THE CONSTRUCTION OF TWO NEW

ELEMENTARY SCHOOLS AND HEALTH AND SAFETY IMPROVEMENTS TO

ELEMENTARY SCHOOLS, MIDDLE SCHOOLS AND THE HIGH SCHOOL

     Introduced By: Representatives Corvese, O'Brien, and Hull

     Date Introduced: May 04, 2016

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

     SECTION 1. The town of North Providence is hereby empowered, in addition to

authority previously granted, to issue bonds in an amount not exceeding seventy-five million

dollars ($75,000,000) from time to time under its corporate name and seal. The bonds of each

issue may be issued in the form of zero coupon bonds, capital appreciation bonds, 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 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 the bonds are issued. 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, and may bear interest at a fixed rate or rates or at a variable or

auction rate or rates. The bonds may be sold by a negotiated sale or by competitive bid and may

be issued pursuant to a resolution or an indenture of trust. 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 or premium shall be disregarded.

     SECTION 2. The bonds shall be signed by the town director of finance, the mayor 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. 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: (1) For the construction, renovation, rehabilitation, repair, improvements, furnishing

and equipping of and/or additions to schools and school facilities in the town including, but not

limited to, the construction of two (2) new elementary schools and health and safety

improvements to elementary schools, middle schools and the high school; (2) For payment of the

principal or interest on temporary notes issued under section 3; (3) In payment of capitalized

interest on bonds or notes; (4) In repayment of advances under section 4; or (5) 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 monies referred to in sections 6 and 9, 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 director of finance, the mayor 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.

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     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,

the mayor 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 issue of other notes thereunder, provided 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. 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, monies 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 5. The monies 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 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 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

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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 2, 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 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 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 or more of the foregoing. The cost of preparing,

issuing and marketing bonds or notes hereunder may also, in the discretion of the 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 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

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 §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

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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 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

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 2.

     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 be extinguished by resolution of the town council, without further action by the general

assembly.

     SECTION 12. The director of finance and the mayor 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

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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 the next general or special election (other than a primary), or at an election 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 2016 session of the General Assembly, entitled,

'AN ACT AUTHORIZING THE TOWN OF NORTH PROVIDENCE TO ISSUE GENERAL

OBLIGATION BONDS AND NOTES IN AN AMOUNT NOT TO EXCEED $75,000,000 FOR

THE PURPOSE OF FINANCING THE CONSTRUCTION, RENOVATION,

REHABILITATION, REPAIR, IMPROVEMENTS, FURNISHING AND EQUIPPING OF

AND/OR ADDITIONS TO SCHOOLS AND SCHOOL FACILITIES IN THE TOWN

INCLUDING, BUT NOT LIMITED TO, THE CONSTRUCTION OF TWO NEW

ELEMENTARY SCHOOLS AND HEALTH AND SAFETY IMPROVEMENTS TO

ELEMENTARY SCHOOLS, MIDDLE SCHOOLS AND THE HIGH SCHOOL' 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 the

act available at the clerk's office for public inspection, but the validity of the election shall not be

affected by this requirement.

     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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LC005854

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EXPLANATION

OF

A N   A C T

AUTHORIZING THE TOWN OF NORTH PROVIDENCE TO ISSUE BONDS AND NOTES

IN AN AMOUNT NOT EXCEEDING $75,000,000 TO FINANCE THE CONSTRUCTION,

RENOVATION, REHABILITATION, REPAIR, IMPROVEMENTS, FURNISHING AND

EQUIPPING OF AND/OR ADDITIONS TO SCHOOLS AND SCHOOL FACILITIES IN THE

TOWN INCLUDING, BUT NOT LIMITED TO, THE CONSTRUCTION OF TWO NEW

ELEMENTARY SCHOOLS AND HEALTH AND SAFETY IMPROVEMENTS TO

ELEMENTARY SCHOOLS, MIDDLE SCHOOLS AND THE HIGH SCHOOL

***

     This act would authorize the Town of North Providence to issue bonds and notes in an

amount not exceeding $75,000,000 to finance the construction, renovation, rehabilitation, repair,

improvements, furnishing and equipping of and/or additions to schools and school facilities in the

town including, but not limited to, the construction of two (2) new elementary schools and health

and safety improvements to elementary schools, middle schools and the high school.

     Sections 13 and 14 would take effect upon the passage of this act. The remainder of this

act would 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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LC005854

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