§ 419.3 — Bonds as limited obligations

Iowa § 419.3

• Jurisdiction: Iowa
• Title IX: LOCAL GOVERNMENT
• Ch. 419: MUNICIPAL SUPPORT OF PROJECTS

Text

1. All bonds issued by a municipality, under the authority of this chapter, shall be limited
obligations of the municipality. The principal of and interest on such bonds shall be payable
solely out of the revenues derived from the project to be financed by the bonds so issued
under the provisions of this chapter including debt obligations of the lessee or contracting
party obtained from or in connection with the financing of a project. Bonds and interest
coupons issued under authority of this chapter shall never constitute an indebtedness of the
municipality, within the meaning of any state constitutional provision or statutory limitation,
and shall not constitute nor give rise to a pecuniary liability of the municipality or a charge
against its general credit or taxing powers. Such limitation shall be plainly stated on the face
of each such bond.
2. The bonds referred to in subsection 1 of this section may be executed and delivered
at any time and from time to time; be in such form and denominations; without limitation
as to the denomination of any bond, any other law to the contrary notwithstanding; be of
such tenor; be fully registered, registrable as to principal or in bearer form; be transferable;
be payable in such installments and at such time or times, not exceeding thirty years from
their date; be payable at such place or places in or out of the state of Iowa; bear interest at
such rate or rates, payable at such place or places in or out of the state of Iowa; be evidenced
in such manner and may contain other provisions not inconsistent with this chapter; all as
shall be provided in the proceedings of the governing body where the bonds are authorized
to be issued. The governing body may provide for the exchange of coupon bonds for fully
registered bonds and of fully registered bonds for coupon bonds and for the exchange of any
such bonds after issuance for bonds of larger or smaller denominations, all in the manner as
maybeprovidedintheproceedingsauthorizingtheirissuance,providedthebondsinchanged
form or denominations shall be exchanged for the surrendered bonds in the same aggregate
principal amounts and in such manner that no overlapping interest is paid, and the bonds in
changed form or denominations shall bear interest at the same rate or rates and shall mature
on the same date or dates as the bonds for which they are exchanged. If an exchange is made
under this section, the bonds surrendered by the holders at the time of the exchange shall be
canceled or held by a trustee for subsequent exchanges in accordance with this section. The
exchange shall be made only at the request of the holders of the bonds to be surrendered, and
the governing body may require all expenses incurred in connection with the exchange to be
paid by the holders. If any of the officers whose signatures appear on the bonds or coupons
cease to be officers before the delivery of the bonds, such signatures are, nevertheless, valid
and sufficient for all purposes, the same as if the officers had remained in office until delivery.
3. Unless otherwise provided in the proceedings of the governing body whereunder the
bonds are authorized to be issued, bonds issued under the provisions of this chapter shall be
subject to the general provisions of law, presently existing or that may hereafter be enacted,

respecting the execution and delivery of the bonds of a municipality and respecting the
retaining of options of redemption in proceedings authorizing the issuance of municipal
securities.
4. Any bonds, issued under the authority of this chapter, may be sold at public sale in
such manner, at such price and at such time or times as may be determined by the governing
body to be most advantageous. The municipality may pay all expenses, premiums and
commissions which the governing body may deem necessary or advantageous in connection
with the authorization, sale and issuance thereof.
5. All bonds, issued under the authority of this chapter and all interest coupons applicable
thereto, shall be construed to be negotiable instruments, even though they are payable solely
from a specified source.

Legislative History

[C66, 71, 73, 75, 77, 79, 81, §419.3]