LA 049
2022 -- H 8274
Enacted 06/30/2022

A N   A C T
AUTHORIZING THE CITY OF EAST PROVIDENCE TO FINANCE THE CONSTRUCTION, RENOVATION, IMPROVEMENT, ALTERATION, REPAIR, FURNISHING AND EQUIPPING OF SCHOOLS AND SCHOOL FACILITIES IN THE CITY BY THE ISSUANCE OF NOT MORE THAN $148,000,000 BONDS, NOTES AND/OR OTHER EVIDENCES OF INDEBTEDNESS THEREFOR, SUBJECT TO APPROVAL OF STATE HOUSING AID AT A REIMBURSEMENT RATE OR STATE SHARE RATIO OF NOT LESS THAN 48.5% FOR EXPENDITURES ELIGIBLE FOR STATE AID AND PROVIDED THAT THE AUTHORIZATION SHALL BE REDUCED BY ANY GRANT RECEIVED FROM THE SCHOOL BUILDING AUTHORITY CAPITAL FUND

Introduced By: Representatives Amore, Kazarian, Henries, and Cassar

Date Introduced: May 20, 2022

It is enacted by the General Assembly as follows:
     SECTION 1. The city of East Providence is hereby empowered, in addition to authority
previously granted, to issue bonds and other evidences of indebtedness (hereinafter "bonds") up to
an amount not exceeding one hundred forty-eight million dollars ($148,000,000) from time to time
under its corporate name and seal or a facsimile of such seal; provided, however, that bonds shall
not be issued unless the conditions of section 2 hereof as to the level of state aid are met. 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 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. 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 city may be eligible for school housing aid reimbursement on debt
service pursuant to chapter 7 of title 16, or for a grant, loan or other "financial assistance" as defined
in § 45-38.2-1, from the school building authority capital fund under chapter 38.2 of title 45. The
amount of borrowing authorized pursuant to this act shall be reduced by the amount of any grant
received by the city from the school building authority capital fund. Bonds, notes or other evidences
of indebtedness shall not be issued under this act unless the city has received preliminary indication
from the Rhode Island department of education ("RIDE") confirming that the then-current school
housing aid reimbursement rate under chapter 7 of title 16, as amended from time to time, or
financial assistance from the school building authority capital fund, or pursuant to any other law
hereafter enacted providing for funds to municipalities for school housing purposes, is not less than
fifty percent (50%) of debt service for those expenditures which are eligible for state aid.
     SECTION 3. The bonds shall be signed by the manual or facsimile signatures of the city
director of finance 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. 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 chapter 7 of title 16 and chapter 38.1 of title 45 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 chapter 38.1 of title 45 apply to the issuance of the bonds or notes issued hereunder
to the extent the provisions of chapter 38.1 of title 45 are inconsistent herewith. In addition, the city
may enter into financing agreements with the Rhode Island infrastructure bank pursuant to the
provisions of chapter 12.2 of title 46 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 chapter 12.2 of title
46 apply to the issuance of the bonds or notes issued hereunder to the extent the provisions of
chapter 12.2 of title 46 are inconsistent herewith. Such election may be fixed by the proceedings of
the city council authorizing such issuance of 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
city director of finance, and such proceeds, exclusive of premiums and accrued interest shall be
expended: (1) For the construction, renovation, improvement, alteration, repair, furnishing and
equipping of schools and school facilities in the city and all costs related thereto; (2) In payment of
the principal of or interest on temporary notes issued under section 4; (3) In repayment of advances
under section 5; (4) In payment of related costs of issuance of any bonds or notes; and/or (5) In
payment of capitalized interest during construction of the project (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 city by the city school building committee. The proceeds of bonds or notes
issued under this act, any applicable federal or state assistance and the other monies referred to in
sections 7 and 10 shall be deemed appropriated for the purposes 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 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.
     SECTION 4. The city council may by resolution authorize the issuance from time to time
of interest bearing or discounted notes in anticipation of the issuance 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
(without any reduction for any grant to be received from the school building authority capital fund),
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 city 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 issuance 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 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, monies in the fund shall be invested for the benefit of the city by the
paying agent at the direction of the city director of finance in any investment permitted under
section 6. The monies in the fund and any investments held as 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 monies 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 5. Pending any authorization or issue of bonds hereunder or pending or in lieu
of any authorization or issue of notes hereunder, the city 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
treasury of the city to the purposes specified in section 3, 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 6. 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 city 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 7. 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 premium arising from the sale of
bonds or notes hereunder shall, in the discretion of the city 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 project costs, 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 city director of finance,
be met from bond or note proceeds exclusive of 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 city director of finance shall
be governed by any instructions adopted by resolution of the city council.
     SECTION 8. 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 § 45-12-2. 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 9. Any bonds or notes issued under the provisions of this act, and coupons, if
any, if properly executed by 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 10. 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 or assistance which may be
available for the purposes of this act, and any such expenditures may be in addition to the 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 project costs under section 3.
     SECTION 11. 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 12. The city 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 them deem necessary
or desirable to carry out the intent of this act and are also authorized to take all actions and execute
all instruments, documents or agreements necessary to comply with federal tax and securities laws,
which instruments, 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. 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 after seven (7) years
shall have passed from the approval of this act provided for in section 14, without further action by
the general assembly.
     SECTION 14. At the general election to be held on November 8, 2022 or at a local election,
other than a primary, to be held on a date designated by the city council, there shall be submitted
to electors of the city a question in substantially the following form: "Shall An Act passed at the
January, 2022 Session of the General Assembly Entitled 'AN ACT AUTHORIZING THE CITY
OF EAST PROVIDENCE TO FINANCE THE CONSTRUCTION, RENOVATION,
IMPROVEMENT, ALTERATION, REPAIR, FURNISHING AND EQUIPPING OF SCHOOLS
AND SCHOOL FACILITIES IN THE CITY AND ALL COSTS RELATED THERETO BY THE
ISSUANCE OF NOT MORE THAN $148,000,000 BONDS, NOTES AND/OR OTHER
EVIDENCES OF INDEBTEDNESS THEREFOR, SUBJECT TO APPROVAL OF STATE
HOUSING AID AT A REIMBURSEMENT RATE OR STATE SHARE RATIO OF NOT LESS
THAN 48.5% FOR EXPENDITURES ELIGIBLE FOR STATE AID AND PROVIDED THAT
THE AUTHORIZATION SHALL BE REDUCED BY ANY GRANT RECEIVED FROM THE
SCHOOL BUILDING AUTHORITY CAPITAL FUND' 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 this act available at the clerk's 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, this act shall prevail.
     SECTION 15. This act shall constitute an enabling act of the general assembly that is
required pursuant to § 16-7-44. Any bonds, notes or other evidences of indebtedness issued under
this act for school projects shall not be eligible for state housing aid reimbursement pursuant to §
16-7-44 unless the school projects described herein have been approved by RIDE.
     SECTION 16. Sections 14 and 16 shall take effect upon the passage. 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 section 14.
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LC006008
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