Chapter 270

2010 -- H 8211

Enacted 06/25/10

 

A N A C T

AUTHORIZING THE CITY OF EAST PROVIDENCE TO REPAIR AND IMPROVE PUBLIC SCHOOL BUILDINGS IN THE CITY OF EAST PROVIDENCE AND AUTHORIZING THE FINANCING THEREOF, INCLUDING THE ISSUE OF NOT MORE THAN $15,000,000 BONDS, NOTES AND OTHER EVIDENCES OF INDEBTEDNESS THEREFOR, INCLUDING BUT NOT LIMITED TO ANY BONDS OR NOTES ISSUED PURSUANT TO FINANCING AGREEMENTS WITH THE RHODE ISLAND HEALTH AND EDUCATIONAL BUILDING CORPORATION

          

     Introduced By: Representatives Melo, DaSilva, Savage, Messier, and Hearn

     Date Introduced: June 02, 2010

 

It is enacted by the General Assembly as follows:

 

     SECTION 1. The city of East Providence is hereby authorized, in addition to authority

previously granted, to issue bonds and other evidences of indebtedness (hereinafter “bonds”) up

to an amount not exceeding fifteen million dollars ($15,000,000) from time to time under its

corporate name and seal or a facsimile of such. 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 sinking fund installments 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. 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 and the mayor and be issued and sold in such amounts as the city council may

determine 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. Notwithstanding anything contained in this act to the

contrary, the city may enter into financing agreements with the Rhode Island Health and

Educational Building Corporation pursuant to title 16, chapter 7 and title 45, chapter 38.1 of the

general laws and, with respect to bonds or notes issued in connection with such financing

agreements, if any, the city may elect to have the provisions of title 45, chapter 38.1 of the

general laws apply to the issuance of the bonds or notes issued hereunder to the extent the

provisions of title 45, chapter 38.1 of the general laws are inconsistent herewith. Such election

may be fixed by the proceedings of the city council authorizing such issuance 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. 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: (a) to repair and improve public school

buildings in the city of East Providence (the “project”); (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 related costs of issuance of any bonds or notes; 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 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.

     SECTION 3. The city council may by 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 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, moneys in the fund shall be invested for the

benefit of the city 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

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 director of finance, with the approval of

the city council may, to the extent that bonds or notes may be issued hereunder, apply funds in the

general 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 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 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 premiums arising from the

sale of bonds or notes hereunder and, to the extent permitted by applicable federal laws, any net

earnings or profits realized from the deposit or investment of funds 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, to the

revenues of the city and dealt with as part of the revenues of the city from property taxes to the

extent permitted by federal law, 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 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 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 city 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

city council.

     SECTION 7. All bonds and notes issued under this act and the debt evidenced hereby

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

and any provision of the city charter. 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, 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 such officers shall for any reason have ceased to hold office.

     SECTION 9. The city, acting by 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 a cost of the project under section 2.

     SECTION 10. Notwithstanding anything contained in the city charter to the contrary,

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 city 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,

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

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

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

     SECTION 13. The question of the approval of this act shall be submitted to the electors

of the city at the next general election but if a special city-wide election or special state election,

in either case other than a primary, is called for a date earlier than the date of such general

election, the mayor may direct that the question of the approval of this act be submitted at such

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

passed at the 2010 session of the general assembly entitled 'An act authorizing the city of East

Providence to repair and improve public school buildings in the city of East Providence and

authorizing the financing thereof, including the issue of not more than $15,000,000 bonds, notes

and other evidences of indebtedness therefor, including but not limited to any bonds or notes

issued pursuant to financing agreements with the Rhode Island Health and Educational Building

Corporation’ 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 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 city charter or any law of special applicability to the city, this act shall

prevail.

     SECTION 14. This act shall constitute an enabling act of the general assembly that is

required pursuant to section 16-7-44 of chapter 7 of title 16 of the general laws.

     SECTION 15. This section and sections 13 and 14 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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LC02803

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