Chapter
488
2006 -- H 8222
Enacted 07/06/06
A N A C T
AUTHORIZING THE TOWN
OF MIDDLETOWN TO FINANCE THE ACQUISITION AND PRESERVATION OF OPEN SPACE AND
ACQUIRING, PRESERVING, RESTORING OR IMPROVING OR OF RECREATIONAL AREAS IN THE TOWN BY THE ISSUANCE OF NOT MORE
THAN $2,000,000 BONDS AND/OR NOTES THEREFOR
Introduced By: Representatives Rice, Long, and Jackson
Date Introduced: June 08,
2006
It is
enacted by the General Assembly as follows:
SECTION 1. The
town of Middletown 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. 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 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. 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 shall be disregarded. For
each issue the amounts payable annually for
principal and interest combined either shall
be as nearly equal from year to year as is practicable
in the opinion of the officers authorized to
issue the bonds, or shall be arranged in accordance
with a schedule providing for a more rapid
amortization of principal.
SECTION 2. The bonds shall be signed by the town finance director and by 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. Interest coupons (if any) shall bear the manual or
facsimile signature
of
the town finance director. The proceeds derived from the sale of the bonds
shall be delivered to
the
town finance director, and such proceeds exclusive of premiums and accrued
interest shall be
expended
(a) for the acquisition and preservation of open space and acquiring,
preserving,
restoring
or improving of recreational areas in the town, (b) for payment of the
principal or
interest
on temporary notes issued under section three, (c) in payment of capitalized
interest on
bonds
or notes (d) in repayment of advances under section four, or (e) 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 moneys referred to in sections six and nine, 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 town finance director 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.
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 town finance director.
Temporary
notes
issued hereunder shall be signed by the manual or facsimile signatures of the
town finance
director
and by 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, moneys in
the
fund shall be invested for the benefit of the town by the paying agent at the
direction of the
town
finance director in any investment permitted under section five. The moneys 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 moneys
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 town finance director, with
the approval of
the
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 two, 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 town
finance
director 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 finance director, 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 (1) or more of the foregoing. The
cost of
preparing,
issuing and marketing bonds or notes hereunder may also, in the discretion of
the town
finance
director, be met from bond or note proceeds exclusive of accrued interest or
from other
moneys
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
town
finance director 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 section 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
extent
that moneys 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
moneys
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 two.
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 town finance director 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 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 election to be held on November 7, 2006 or such other general
or special
election
(other than a primary) to be held prior to December 31, 2006, as shall be
designated by
the
town council. The question shall be submitted in substantially the following
form: "Shall an
act,
passed at the 2006 session of the general assembly, entitled 'AN ACT
AUTHORIZING THE
TOWN
OF MIDDLETOWN TO FINANCE THE ACQUISITION AND PRESERVATION OF
OPEN
SPACE AND ACQUIRING, PRESERVING, RESTORING OR IMPROVING OF
RECREATIONAL
AREAS IN THE TOWN BY THE ISSUANCE OF NOT MORE THAN
$2,000,000
BONDS AND/OR 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 town clerk to keep a copy of the act
available at his 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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LC03448
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