Chapter
404
2008 -- H 8414
Enacted 07/05/08
A N A C T
AUTHORIZING THE TOWN
OF CUMBERLAND TO FINANCE ROAD IMPROVEMENTS IN THE TOWN BY THE ISSUANCE OF NOT
MORE THAN $2,500,000 BONDS AND/OR NOTES THEREFOR
Introduced By: Representatives Vaudreuil, Singleton, and Menard
Date Introduced: June 19,
2008
It is
enacted by the General Assembly as follows:
SECTION
1. The Town of Cumberland is hereby empowered, in addition to authority
previously
granted, to issue bonds to an amount not exceeding two million, five hundred
thousand
dollars
($2,500,000) 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 three (3) 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. 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 manual or facsimile signatures of the town
director
of finance and the mayor and shall be issued and sold in such amounts as the
town
council
may authorize by resolution. 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 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
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 as follows: (a) for the purpose of financing road
improvements
in the
town (the "Project"); or (b) in payment of the principal of or
interest on temporary notes
issued
under Section 3; (c) in repayment of advances under Section 4; (d) in payment
of the costs
of
issuance of bonds or notes hereunder and/or (e) in payment of capitalized
interest during
construction
of 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 by the mayor and the school
committee on
behalf
of the town, provided that no Project shall be commenced without the approval
of the
school
committee. The proceeds of bonds or notes issued under this act, any applicable
federal or
state
assistance and the other moneys 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.
This 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.
SECTION
3. The town council may by resolution authorize the issuance 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 and 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. 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 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. 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 director of finance in any investment permitted under Section
5. 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.
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
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 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
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
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 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
not
withstanding
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 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. The director of finance and the mayor, on behalf of the town are hereby
authorized
to execute such instruments, documents or other papers as either of the
foregoing
deem
necessary or desirable to carry out the intent of this act and are also
authorized to take all
actions
and execute all documents necessary to comply with federal tax and securities
laws
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
12. The question of the approval of this act shall be submitted to the electors
of the
town at a general or special election which is not a primary to be held on
November 4,
2008 or
such other 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 2008 session
of the
general
assembly, entitled ‘AN ACT AUTHORIZING THE TOWN OF CUMBERLAND TO
FINANCE
ROAD IMPROVEMENTS IN THE TOWN BY THE ISSUANCE OF NOT MORE
THAN
$2,500,000 BONDS AND/OR NOTES THEREFOR’ be approved?” 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/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. 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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LC03168
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