2016 -- S 3009

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LC006010

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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 BARRINGTON TO FINANCE THE ACQUISITION,

CONSTRUCTION, FURNISHING AND EQUIPPING OF A NEW MIDDLE SCHOOL AND

ALL EXPENSES INCIDENT THERETO, INCLUDING, BUT NOT LIMITED TO, COSTS OF

DESIGN, DEMOLITION, ATHLETIC FIELDS, LANDSCAPING AND PARKING BY THE

ISSUANCE OF NOT MORE THAN $68,400,000 BONDS, NOTES AND/OR OTHER

EVIDENCES OF INDEBTEDNESS THEREFOR, SUBJECT TO APPROVAL OF STATE

HOUSING AID AT A REIMBURSEMENT RATE OF NOT LESS THAN 35% FOR

EXPENDITURES ELIGIBLE FOR REIMBURSEMENT

     

     Introduced By: Senator Cynthia Armour Coyne

     Date Introduced: May 19, 2016

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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

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previously granted, to issue bonds and other evidences of indebtedness (hereinafter "bonds") up

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to an amount not exceeding sixty-eight million four hundred thousand dollars ($68,400,000) from

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time to time under its corporate name and seal or a facsimile of such; provided, however, that

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bonds shall not be issued unless the conditions of section 4 hereof as to the level of state school

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housing aid are met. The bonds of each issue may be issued in the form of serial bonds or term

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bonds or a combination thereof and shall be payable either by maturity of principal in the case of

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serial bonds or by mandatory sinking fund installments in the case of term bonds, in annual

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installments of principal, the first installment to be not later than five (5) years and the last

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installment not later than thirty (30) years after the date of the bonds. All such bonds of a

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particular issue may be issued in the form of zero coupon bonds, capital appreciation bonds, serial

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bonds or term bonds or a combination thereof. The amount of principal appreciation each year on

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any bonds, after the date of original issuance, shall not be considered to be principal indebtedness

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for the purposes of any constitutional or statutory debt limit or any other limitation. The

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appreciation of principal after the date of original issue shall be considered interest. Only the

 

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original principal amount shall be counted in determining the principal amount so issued and any

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interest component shall be disregarded.

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

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finance director and the president of the town council and shall be issued and sold in such

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amounts as the town council may authorize by resolution. The manner of sale, denominations,

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maturities, interest rates and other terms, conditions and details of any bonds or notes issued

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under this act may be fixed by the proceedings of the town council authorizing the issue or by

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separate resolution of the town council or, to the extent provisions for these matters are not so

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made, they may be fixed by the officers authorized to sign the bonds. Notwithstanding anything

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contained in this act to the contrary, the town may enter into financing agreements with the

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Rhode Island Health and Educational Building Corporation pursuant to title 16 chapter 7 and title

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45 chapter 38.1 of the general laws and, with respect to notes or bonds issued in connection with

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such financing agreements, if any, the town may elect to have the provisions of title 45, chapter

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38.1 of the general laws apply to the issuance of the bonds or notes issued hereunder to the extent

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the provisions of title 45, chapter 38.1 of the general laws are inconsistent herewith. Such election

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may be fixed by the proceedings of the town council authorizing such issuance of by separate

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resolution of the town council, or, to the extent provisions for these matters are not so made, they

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may be fixed by the officers authorized to sign the bonds or notes. The proceeds derived from the

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sale of the bonds shall be delivered to the town finance director, and such proceeds exclusive of

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premiums and accrued interest shall be expended: (1) For the acquisition, construction, furnishing

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and equipping of a new middle school in the town and all expenses incident thereto, including,

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but not limited to, costs of design, demolition, athletic fields, landscaping and parking; (2) In

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

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repayment of advances under section 5; (4) In payment of related costs of issuance of any bonds

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or notes; and/or (5) In payment of capitalized interest during construction of the project (the

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"project"). No purchaser of any bonds or notes under this act shall be in any way responsible for

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the proper application of the proceeds derived from the sale thereof. The project shall be carried

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out and all contracts made therefor on behalf of the town by the town council, or the town council

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may delegate such authority to the town school committee. The proceeds of bonds or notes issued

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under this act, any applicable federal or state assistance and the other monies referred to in

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sections 7 and 10 shall be deemed appropriated for the purposes of this act without further action

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than that required by this act. The bonds authorized by this act may be consolidated for the

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purpose of issuance and sale with any other bonds of the town heretofore or hereafter authorized,

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provided that, notwithstanding any such consolidation, the proceeds from the sale of the bonds

 

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authorized by this act shall be expended for the purposes set forth above.

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     SECTION 3. The town council may by resolution authorize the issuance from time to

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time of interest bearing or discounted notes in anticipation of the issuance of bonds or in

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anticipation of the receipt of federal or state aid for the purposes of this act. The amount of

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original notes issued in anticipation of bonds may not exceed the amount of bonds which may be

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issued under this act and the amount of original notes issued in anticipation of federal or state aid

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may not exceed the amount of available federal or state aid as estimated by the finance director.

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Temporary notes issued hereunder shall be signed by the manual or facsimile signatures of the

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town finance director and the president of the town council and shall be payable within five (5)

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years from their respective dates, but the principal of and interest on notes issued for a shorter

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period may be renewed or paid from time to time by the issuance of other notes hereunder,

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provided the period from the date of an original note to the maturity of any note issued to renew

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or pay the same debt or interest thereon shall not exceed five (5) years. Any temporary notes in

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anticipation of bonds issued under this section may be refunded prior to the maturity of the notes

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by the issuance of additional temporary notes, provided that no such refunding shall result in any

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amount of such temporary notes outstanding at any one time in excess of two hundred percent

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(200%) of the amount of bonds which may be issued under this act, and provided further that if

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the issuance of any such refunding notes results in any amount of such temporary notes

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outstanding at any one time in excess of the amount of bonds which may be issued under this act,

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the proceeds of such refunding notes shall be deposited in a separate fund established with the

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bank which is paying agent for the notes being refunded. Pending their use to pay the notes being

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refunded, moneys in the fund shall be invested for the benefit of the town by the paying agent at

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the direction of the town finance director in any investment permitted under section 6. The

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moneys in the fund and any investments held as part of the fund shall be held in trust and shall be

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applied by the paying agent solely to the payment or prepayment of the principal of and interest

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on the notes being refunded. Upon payment of all principal of and interest on the notes, any

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excess moneys in the fund shall be distributed to the town. The town may pay the principal of and

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interest on notes in full from other than the issuance of refunding notes prior to the issuance of

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bonds pursuant to section 1 hereof. In such case, the town’s authority to issue bonds or notes in

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anticipation of bonds under this act shall continue provided that: (1) The town council passes a

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resolution evidencing the town's intent to pay off the notes without extinguishing the authority to

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issue bonds or notes; and (2) That the period from the date of an original note to the maturity date

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of any other note shall not exceed five (5) years.

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     SECTION 4. Bonds and notes shall not be issued unless the town has received a letter

 

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from the Rhode Island Department of Elementary and Secondary Education confirming that the

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then-current reimbursement rate pursuant to §§16-7-35 through 16-7-47 of the general laws, as

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amended from time to time, or pursuant to any other law hereafter enacted providing for funds to

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municipalities for school housing aid purposes, is not less than thirty-five percent (35%) of debt

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service for those costs which are eligible for state school housing aid.

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     SECTION 5. Pending any authorization or issue of bonds hereunder or pending or in lieu

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of any authorization or issue of notes hereunder, the town finance director, with the approval of

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the town council, may, to the extent that bonds or notes may be issued hereunder, apply funds in

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the treasury of the town to the purposes specified in section 2, such advances to be repaid without

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interest from the proceeds of bonds or notes subsequently issued or from the proceeds of

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applicable federal or state assistance or from other available funds.

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     SECTION 6. Any proceeds of bonds or notes issued hereunder or of any applicable

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federal or state assistance, pending their expenditure may be deposited or invested by the town

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finance director in demand deposits, time deposits or savings deposits in banks which are

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members of the Federal Deposit Insurance Corporation or in obligations issued or guaranteed by

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the United States of America or by any agency or instrumentality thereof or as may be provided

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in any other applicable law of the state of Rhode Island or resolution of the town council or

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pursuant to an investment policy of the town.

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     SECTION 7. Any accrued interest received upon the sale of bonds or notes hereunder

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shall be applied to the payment of the first interest due thereon. Any premium arising from the

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sale of bonds or notes hereunder shall, in the discretion of the town finance director, be applied to

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the cost of preparing, issuing and marketing bonds or notes hereunder to the extent not otherwise

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provided, to the payment of the project costs, to the payment of the principal of or interest on

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bonds or notes issued hereunder or to any one or more of the foregoing. The cost of preparing,

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

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director, be met from bond or note proceeds exclusive of accrued interest or from other moneys

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

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the projects and the cost of preparing, issuing and marketing bonds or notes hereunder, shall be

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applied to the payment of the principal of or interest on bonds or notes issued hereunder. To the

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extent permitted by applicable federal laws, any earnings or net profit realized from the deposit or

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investment of funds hereunder may, upon receipt, be added to and dealt with as part of the

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revenues of the town from property taxes. In exercising any discretion under this section, the

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town finance director shall be governed by any instructions adopted by resolution of the town

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council.

 

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     SECTION 8. All bonds and notes issued under this act and the debts evidenced thereby

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shall be obligatory on the town in the same manner and to the same extent as other debts lawfully

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contracted by it and shall be excepted from the operation of §45-12-2 of the general laws. No

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such obligation shall at any time be included in the debt of the town for the purpose of

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ascertaining its borrowing capacity. The town shall annually appropriate a sum sufficient to pay

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the principal and interest coming due within the year on bonds and notes issued hereunder to the

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extent that moneys therefor are not otherwise provided. If such sum is not appropriated, it shall

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nevertheless be added to the annual tax levy. In order to provide such sum in each year and

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notwithstanding any provision of law to the contrary, all taxable property in the town shall be

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subject to ad valorem taxation by the town without limitation as to rate or amount.

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     SECTION 9. Any bonds or notes issued under the provisions of this act, and coupons, if

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any, if properly executed by officers of the town in office on the date of execution, shall be valid

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and binding according to their terms notwithstanding that before the delivery thereof and payment

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therefor any or all of such officers shall for any reason have ceased to hold office.

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     SECTION 10. The town, acting by resolution of its town council, is authorized to apply

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for, contract for and expend any federal or state advances or other grants or assistance which may

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be available for the purposes of this act, and any such expenditures may be in addition to the

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moneys provided in this act. To the extent of any inconsistency between any law of this state and

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any applicable federal law or regulation, the latter shall prevail. Federal and state advances, with

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interest where applicable, whether contracted for prior to or after the effective date of this act,

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may be repaid as project costs under section 2.

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     SECTION 11. Bonds and notes may be issued under this act without obtaining the

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approval of any governmental agency or the taking of any proceedings or the happening of any

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conditions except as specifically required by this act for such issue. In carrying out any project

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financed in whole or in part under this act, including where applicable the condemnation of any

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land or interest in land, and in the levy and collection of assessments or other charges permitted

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by law on account of any such project, all action shall be taken which is necessary to meet

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constitutional requirements whether or not such action is otherwise required by statute, but the

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validity of bonds and notes issued hereunder shall in no way depend upon the validity or

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occurrence of such action.

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     SECTION 12. The town finance director and the president of the town council, on behalf

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of the town, are hereby authorized to execute such instruments, documents or other papers as

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either of them deem necessary or desirable to carry out the intent of this act and are also

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authorized to take all actions and execute all instruments, documents or agreements necessary to

 

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comply with federal tax and securities laws, which instruments, documents or agreements may

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have a term coextensive with the maturity of the bonds authorized hereby, including Rule 15c2-

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12 of the Securities and Exchange Commission (the "Rule") and to execute and deliver a

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continuing disclosure agreement or certificate in connection with the bonds or notes in the form

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as shall be deemed advisable by such officers in order to comply with the Rule.

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     SECTION 13. All or any portion of the authorized but unissued authority to issue bonds

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and notes under this act may be extinguished by resolution of the town council after seven (7)

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

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action by the general assembly.

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     SECTION 14. At the general election to be held on November 8, 2016, there shall be

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submitted to electors of the town a question in substantially the following form: "Shall An Act

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Passed at the 2016 Session of the General Assembly Entitled 'AN ACT AUTHORIZING THE

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TOWN OF BARRINGTON TO FINANCE THE ACQUISITION, CONSTRUCTION,

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FURNISHING AND EQUIPPING OF A NEW MIDDLE SCHOOL AND ALL EXPENSES

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INCIDENT THERETO, INCLUDING, BUT NOT LIMITED TO, COSTS OF DESIGN,

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DEMOLITION, ATHLETIC FIELDS, LANDSCAPING AND PARKING BY THE ISSUANCE

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OF NOT MORE THAN $68,400,000 BONDS, NOTES AND/OR OTHER EVIDENCES OF

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INDEBTEDNESS THEREFOR, SUBJECT TO APPROVAL OF STATE HOUSING AID AT A

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REIMBURSEMENT RATE OF NOT LESS THAN 35% FOR EXPENDITURES ELIGIBLE

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FOR REIMBURSEMENT' be approved?" and the warning for the election shall contain the

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question to be submitted. From the time the election is warned and until it is held, it shall be the

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duty of the town clerk to keep a copy of this act available at the clerk's office for public

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inspection, but the validity of the election shall not be affected by this requirement. To the extent

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of any inconsistency between this act and the town charter, this act shall prevail.

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     SECTION 15. This act shall constitute an enabling act of the general assembly that is

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required pursuant to §16-7-44. Bonds or other evidences of indebtedness issued under this act for

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school projects shall not be eligible for state aid reimbursement pursuant to §16-7-44 unless the

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school projects have been approved by the Rhode Island Department of Education.

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     SECTION 16. Sections 14 and 16 shall take effect upon the passage of this act. The

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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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EXPLANATION

OF

A N   A C T

AUTHORIZING THE TOWN OF BARRINGTON TO FINANCE THE ACQUISITION,

CONSTRUCTION, FURNISHING AND EQUIPPING OF A NEW MIDDLE SCHOOL AND

ALL EXPENSES INCIDENT THERETO, INCLUDING, BUT NOT LIMITED TO, COSTS OF

DESIGN, DEMOLITION, ATHLETIC FIELDS, LANDSCAPING AND PARKING BY THE

ISSUANCE OF NOT MORE THAN $68,400,000 BONDS, NOTES AND/OR OTHER

EVIDENCES OF INDEBTEDNESS THEREFOR, SUBJECT TO APPROVAL OF STATE

HOUSING AID AT A REIMBURSEMENT RATE OF NOT LESS THAN 35% FOR

EXPENDITURES ELIGIBLE FOR REIMBURSEMENT

***

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     This act authorizes the town of Barrington to issue not more than $68,400,000 bonds,

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notes and other evidences of indebtedness to finance the acquisition, construction, furnishing and

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equipping of a new middle school and all expenses incident thereto, including, but not limited to,

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costs of design, demolition, athletic fields, landscaping and parking, subject to approval of State

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Housing Aid at a reimbursement rate of not less than 35% for expenditures eligible for

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reimbursement. Bonds or other evidences of indebtedness issued under this act shall not be

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eligible for state aid reimbursement pursuant to §16-7-44 unless the school projects have been

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approved by the Rhode Island Department of Education.

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     Sections 14 and 16 of this act shall take effect upon passage. The remainder of the act

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

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section 14.

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