Chapter 367

2007 -- H 6540

Enacted 07/05/07

 

A N A C T

AUTHORIZING THE TOWN OF PORTSMOUTH TO ISSUE GENERAL OBLIGATION BONDS AND/OR NOTES IN AN AMOUNT NOT TO EXCEED $4,000,000 TO FINANCE THE ACQUISITION AND PRESERVATION OF OPEN SPACE AND ACQUIRING, PRESERVING, RESTORING OR IMPROVING OF RECREATIONAL AREAS IN THE TOWN

          

     Introduced By: Representatives Rice, Gallison, Loughlin, and Amaral

     Date Introduced: June 15, 2007

 

It is enacted by the General Assembly as follows:

 

     SECTION 1. The Town of Portsmouth is hereby empowered, in addition to authority

previously granted, to issue general obligation bonds and notes to an amount not exceeding four

million dollars ($4,000,000), from time to time, under its corporate name and seal. The bonds of

each issue may be issued in the form of 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. 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 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 shall be disregarded.

     SECTION 2. The bonds shall be signed by the Finance Director 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

Finance Director, and such proceeds, exclusive of premiums and accrued interest, shall be

expended as follows: (a) to finance the acquisition and preservation of open space and acquiring,

preserving, restoring or improving of recreational areas in the Town, (b) in payment of the

principal of and/or interest on temporary notes issued under section three, (c) in repayment of

advances made pursuant to section four, (d) in payment of costs of issuance associated with the

issuance of bonds or notes hereunder, and/or (e) to finance capitalized interest on the project. 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 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 the other moneys

referred to in section six and nine, shall be deemed appopriated for the purpose of this act without

further action than that required by this act. The bonds authorized by this act may be consolidated

for the purpose of issuance and sale with any other bonds 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 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, including Rule 15c2-12 of the Securities and Exchange Commission and to execute and

deliver a continuing disclosure agreement or certification in connection with the bonds or notes.

     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 Finance Director. Temporary notes

issued hereunder shall be signed by the Finance Director 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 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, moneys in the fund shall be invested for the

benefit of the Town by the paying agent at the direction of the 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 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 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 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 or more of the foregoing. The cost of preparing,

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

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 authorized but unissued authority to issue bonds

and notes under this act may be extinguished by ordinance of the Town 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 Town at a special or general election to be held on a date as shall be set by the Town

Council. The question shall be submitted in substantially the following form: "Shall an act,

passed at the 2007 session of he general assembly, entitled 'AN ACT AUTHORIZING THE

TOWN OF PORTSMOUTH TO ISSUE GENERAL OBLIGATION BONDS AND/OR NOTES

IN AN AMOUNT NOT TO EXCEED $4,000,000 TO FINANCE THE ACQUISITION AND

PRESERVATION OF OPEN SPACE AND ACQUIRING, PRESERVING, RESTORING OR

IMPROVING OF RECREATIONAL AREAS IN THE TOWN' be approved?" The warning for

the election shall contain the question to be submitted. Notwithstanding anything contained in

R.I.G.L. Section 17-19-7 to the contrary, the Portsmouth Board of Canvassers may certify the

question to the Secretary of State not later than thirty (30) days prior to the date set for any

special town election. 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 or her 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 Town Charter, this act shall prevail.

     SECTION 13. Sections 12 ands 13 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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LC03354

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