§ 205-15 — Revenue and refunding bonds; issuance and terms

(a) To pay the cost of the construction, purchase, and improvement or extension from time to time of any system under this Article, including engineering, legal, and other expenses, together with interest, to a date 6 months after the estimated date of completion, the township board may appropriate township funds, including Federal Revenue Sharing funds, and issue and sell revenue bonds of the township payable solely from the income and revenue derived from the operation of the system. The board may also from time to time issue revenue bonds to refund any bonds at maturity or pursuant to redemption provisions or at any time before maturity with the consent of the holders of the bonds. All bonds shall be authorized by an ordinance adopted by the township board, shall bear a date or dates, may mature at a time or times not exceeding 40 years from their respective dates, may bear interest (i) at a rate not exceeding the maximum rate authorized by the Bond Authorization Act as amended at the time of the making of the contract (if issued within one year after July 18, 1972) and (ii) at the maximum rate authorized by the Bond Authorization Act as amended at the time of the making of the contract (if issued after that date), payable semi-annually, may be in a form, may carry registration privileges, may be payable at a place or places, may be subject to redemption in a manner and upon terms with or without premium as is stated on the face of the bonds, may be executed in a manner by officers of the township, and may contain terms and covenants, all as provided by the ordinance authorizing their issue. (b) Bonds shall be sold in the manner determined by the township board and, if issued to bear interest (i) at the rate of the maximum rate authorized by the Bond Authorization Act, as amended at the time of the making of the contract, or (ii) the maximum rate authorized by the Bond Authorization Act as amended at the time of the making of the contract (if issued after a one year period following July 18, 1972), shall be sold for not less than par and accrued interest. The selling price of any bonds bearing less than (i) the maximum interest rate authorized by the Bond Authorization Act as amended at the time of the making of the contract, or (ii) the maximum rate authorized by the Bond Authorization Act as amended at the time of the making of the contract (if issued after a one year period following July 18, 1972), however, shall be such that the interest cost of the money received from the sale of the bonds does not exceed (i) the maximum rate authorized by the Bond Authorization Act as amended at the time of the making of the contract, or (ii) the maximum rate authorized by the Bond Authorization Act as amended at the time of the making of the contract (if issued after a one year period following July 18, 1972), computed to absolute maturity, according to standard tables of bond value. The bonds shall be payable solely from the income and revenues to be derived from the operation of the system. (c) Notwithstanding the form or tenor of the bonds, and in the absence of expressed recitals on the face of the bonds that the bonds are non-negotiable, all bonds issued under this Article shall be negotiable instruments. (d) To secure payment of any or all of the bonds, the ordinance shall set forth the covenants and undertakings of the township in connection with (i) the issuance of the bonds and the issuance of additional bonds payable from the revenue or income to be derived from the operation of the system and (ii) the use and operation of the system. The ordinance may also provide that the bonds, or those that are specified, shall, to the extent and in the manner prescribed, be subordinated and be junior in standing with respect to the payment of principal and interest and the security of payment to other bonds designated in the ordinance. (e) If any officer whose signature appears on the bonds or coupons attached to the bonds ceases to be an officer before the delivery of the bonds to the purchaser, his or her signature shall nevertheless be valid and sufficient for all purposes to the same effect as if he or she had remained in office until the delivery of the bonds. (f) Under no circumstances shall any bonds issued or any other obligation incurred under this Article by a township be or become an indebtedness or an obligation of the township payable from taxes, nor shall they in any event constitute an indebtedness of the township within the meaning of any constitutional or statutory provision or limitation. This fact shall be plainly stated on the face of each bond. (g) With respect to instruments for the payment of money issued under this Section either before, on, or after June 6, 1989, it is and always has been the intention of the General Assembly (i) that the Omnibus Bond Acts are and always have been supplementary grants of power to issue instruments in accordance with the Omnibus Bond Acts, regardless of any provision of this Article that may appear to be or to have been more restrictive than those Acts, (ii) that the provisions of this Section are not a limitation on the supplementary authority granted by the Omnibus Bond Acts, and (iii) that instruments issued under this Section within the supplementary authority granted by the Omnibus Bond Acts are not invalid because of any provision of this Article that may appear to be or to have been more restrictive than those Acts.

Legislative History

(Source: P.A. 86-4; 88-62.)