2020 -- H 8088

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LC005468

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2020

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A N   A C T

AUTHORIZING THE CITY OF CRANSTON TO FINANCE THE ACQUISITION,

IMPROVEMENT, RENOVATION AND REPAIR OF FIRE AND PUBLIC SAFETY

EQUIPMENT BY THE ISSUANCE OF NOT MORE THAN $2,000,000 GENERAL

OBLIGATION BONDS AND NOTES THEREFOR

     Introduced By: Representatives Mattiello, Lima, Millea, and Handy

     Date Introduced: July 02, 2020

     Referred To: House Municipal Government

     It is enacted by the General Assembly as follows:

     SECTION 1. The city of Cranston is hereby empowered, in addition to authority previously

granted, to issue bonds to an amount not exceeding two million dollars ($2,000,000) from time to

time under its corporate name and seal or a facsimile of such seal. The bonds of each issue shall

mature 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. Annual installments of principal may be

provided for by maturity of principal in the case of serial bonds or by mandatory sinking fund

installments 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, statutory, or charter 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 bonds shall be signed by the manual or facsimile signatures of the

director of finance and the mayor and shall be issued and sold in such amounts as the city 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 city council authorizing the issue or by separate order or resolution of the city 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. Interest coupons (if any) shall bear the facsimile signature of the director

of finance. The proceeds derived from the sale of the bonds shall be delivered to the city treasurer,

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

the acquisition, improvement, renovation and repair of fire and public safety equipment in the city;

or (2) In payment of the principal of or interest on temporary notes issued under section 3; or (3)

In repayment of advances under section 4; (4) In payment of costs of issuance associated with the

issuance of bonds or notes hereunder; and/or (5) To finance capitalized interest on the projects. 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 proceeds of bonds or notes issued

under this act, any applicable federal or state assistance and the 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. In addition to such funds, there may be expended for the purposes of this act

such other sums as may be appropriated therefor. The bonds authorized by this act may be

consolidated for the purposes of issuance and sale with any other bonds of the city 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 and the mayor, on behalf of the city, 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.

     SECTION 3. The city council may, by order or resolution authorizing the bonds or by

separate order or resolution, authorize the issuance from time to time of interest bearing or

discounted notes in anticipation of the issue of bonds under section 2 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 signature of the director of finance and

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countersigned by the manual or facsimile signature of the mayor 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 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 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 city by the paying agent at the direction of the city

treasurer 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 city. The city may pay the principal of and interest on notes in full from sources other than the

issuance of refunding notes prior to the issuance of bonds pursuant to section 1 hereof. In such

case, the city’s authority to issue bonds or notes in anticipation of bonds under this act shall continue

provided that: (1) The city council passes a resolution evidencing the city’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 city treasurer, with the approval of the city

council given by an order or resolution, may, to the extent that bonds or notes may be issued

hereunder, apply funds in the treasury of the city 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, and may be deposited or invested by the city treasurer

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

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America or by any agency or instrumentality thereof or as may be provided in any other applicable

laws of the state of Rhode Island and by ordinance or resolution of the city council or pursuant to

an investment policy of the city.

     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 net earnings or profits realized from

the investment of funds hereunder and any premiums arising from the sale of bonds or notes

hereunder shall, in the discretion of the city treasurer, 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 projects or the cost of additional improvements coming within the description of the

projects in section 2 of this act, 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 city treasurer, be met from

bond or note proceeds exclusive of premium and 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 additional improvements coming within the description of the projects in section 2

of this act, 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 law, 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 city from property taxes. In exercising any discretion under this section, the city treasurer

shall be governed by any instructions adopted by any order or resolution of the city council.

     SECTION 7. All bonds and notes issued under this act and the debts evidenced thereby

shall be obligatory on the city 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 city for the purpose of ascertaining its borrowing capacity.

The city 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 city shall be subject to ad valorem taxation by the city

without limitation as to rate or amount.

     SECTION 8. Any bonds or notes issued under the provisions of this act, and coupons, if

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

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

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

     SECTION 9. The city, acting by order or resolution of its city council is authorized to apply

for, contract for and expend any federal or state advances or other grants of 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 projects costs under section 2 of this act.

     SECTION 10. Bonds and notes may be issued under this act without obtaining 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 projects 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 projects, 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 or notes issued

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

     SECTION 11. All or any portion of the authorized but unissued authority to issue bonds

and notes under this act may be extinguished by resolution or order of the city council, without

further action by the general assembly, seven (7) years after the effective date of this act.

     SECTION 12. The question of the approval of this act shall be submitted to the electors of

the city at the general election to be held on November 3, 2020 or, if so determined by the city

council, at a special city-wide election, other than a primary, held on a date to be determined by

resolution or order of the city council: The question shall be submitted in substantially the

following form: "Shall an act, passed at the 2020 session of the general assembly, entitled 'AN ACT

AUTHORIZING THE CITY OF CRANSTON TO FINANCE THE ACQUISITION,

IMPROVEMENT, RENOVATION AND REPAIR OF FIRE AND PUBLIC SAFETY

EQUIPMENT BY THE ISSUANCE OF NOT MORE THAN $2,000,000 GENERAL

OBLIGATION BONDS AND NOTES THEREFOR‎' 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 city clerk to keep a copy of the act available at the city 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 city charter, this act shall prevail.

     SECTION 13. This section 13 and section 12 shall take effect upon passage. The remainder

of this act shall take effect upon the approval of this act by a majority of those voting on the question

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at the election prescribed by section 12.

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EXPLANATION

OF

A N   A C T

AUTHORIZING THE CITY OF CRANSTON TO FINANCE THE ACQUISITION,

IMPROVEMENT, RENOVATION AND REPAIR OF FIRE AND PUBLIC SAFETY

EQUIPMENT BY THE ISSUANCE OF NOT MORE THAN $2,000,000 GENERAL

OBLIGATION BONDS AND NOTES THEREFOR

***

     This act would authorize the city of Cranston to issue not more than two million dollars

($2,000,000) general obligation bonds and temporary notes for the acquisition, improvement,

renovation and repair of fire and public safety equipment in the city.

     Sections 12 and 13 of the act would take effect upon passage. The remainder of the act

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

12.

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LC005468

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