Chapter 041

2010 -- H 8144

Enacted 06/12/10

 

A N A C T

AUTHORIZING THE CITY OF WOONSOCKET TO FUND THE CITY'S ACCUMULATED GENERAL FUND DEFICIT BY THE ISSUANCE OF NOT MORE THAN $12,000,000 BONDS AND NOTES THEREFOR

          

     Introduced By: Representatives Fierro, Brien, and Baldelli-Hunt

     Date Introduced: May 18, 2010

     

It is enacted by the General Assembly as follows:

 

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

previously granted, to issue bonds to an amount not exceeding Twelve Million Dollars

($12,000,000) 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 three (3) years and the last installment not later than seven (7) 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, 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, the treasurer and the mayor and shall be issued and sold in such amounts as

the city 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 the proceedings of the city council authorizing the issue or by separate 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 and the city treasurer. 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 (a) to fund the city’s accumulated general fund

deficit (the "Project"), or (b) in payment of the principal of or interest on temporary notes issued

under section three, or (c) in repayment of advances under section four, and/or (d) in payment of

costs of issuance associated with the issuance of bonds or notes hereunder. 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 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. 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, the city treasurer and the Mayor, on behalf of the city, are hereby authorized

to execute such instruments, documents or other papers as they 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 resolution authorizing the bonds or by separate

resolution, authorize the issuance from time to time of interest bearing or discounted notes in

anticipation of the issue of bonds under section two 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 by 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 or the city treasurer. Temporary notes

issued hereunder shall be signed by the manual or facsimile signatures of the director of finance

and the city treasurer and 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 (1) 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 (1) 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

city by the paying agent at the direction of the city treasurer 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 city. The city 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 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 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 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, 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 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.

     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 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 city treasurer, be met from

bond or note proceeds exclusive of premium and 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 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. Notwithstanding the foregoing, 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

section 45-12-2 of the general laws. No such obligation shall at any time be included in the debt

of the city for the purpose of ascertaining its borrowing capacity. In addition, 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 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 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 therefor any or all of the officers shall for any reason have ceased to hold office.

     SECTION 9. The city 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 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 of this act.

     SECTION 10. Except for the approval required by Section 45-12-22.4 of the general

laws with respect to deficit funding bonds, 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

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

occurrence of such action. Chapter III, Section 3 of the Woonsocket City Charter shall not apply

to bonds or notes issued pursuant to this act.

     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 city council, without further

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

     SECTION 12. To the extent of any inconsistency between this act and any private,

public, general, or any other law, and the City Charter, this act shall prevail. This act shall take

effect upon passage without voter approval notwithstanding Chapter VII, Article 8, §1 of the

Woonsocket City Charter in conformity with the reserved powers of the General Assembly

pursuant to Article XIII, Section 5 of the Constitution of the State of Rhode Island and

Providence Plantations.

     SECTION 13. The provisions of this act are severable, and if any of its provisions are

held unconstitutional or invalid for any reason by any court of competent jurisdiction, the

decision of the court shall not affect or impair any of the remaining provisions.

     

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LC02655

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