§ 33:4545.9 — Purchase of capacity and output by a municipality

Louisiana § 33:4545.9

• Jurisdiction: Louisiana
• Title 33: Municipalities and Parishes

Text

Any municipality may contract to buy from the Authority power and energy required for its present or future requirements, including the capacity and output of one or more specified projects. Any such contract may provide that the municipality so contracting shall be obligated to make payments required by the contract whether or not a project is completed, operable or operating and notwithstanding the suspension, interruption, interference, reduction or curtailment of the output of a project or the power and energy contracted for, and that such payments under the contract shall not be subject to any reduction, whether by offset or otherwise, and shall not be conditioned upon the performance or nonperformance by the Authority or any other municipality under the contract or any other instrument. Such contracts with respect to any project may also provide, in the event of default by any municipality which is a party to any such contract for such project in the performance of its obligations thereunder, for other participating municipalities which are parties to any such contract for such project to succeed to the rights and interests and assume the obligations of the defaulting party, pro rata or otherwise as may be agreed upon in such contracts.
Notwithstanding the provisions of any other law or local charter provision to the contrary, any such contracts with respect to the sale or purchase of capacity, output, power or energy from a project may extend for a period not exceeding fifty years from the date a project is estimated to be placed in normal continuous operation; and the execution and effectiveness thereof shall not be subject to any authorizations or approvals by the state or any agency, commission or instrumentality or political subdivision thereof except as in this Chapter specifically required and provided.
Payments by a municipality under any contract for the purchase of capacity and output from the Authority shall be made solely from, and may be secured by a pledge of and lien upon, the revenues derived by such municipality from the ownership and operation of its electric system or its combined utilities system in the discretion of such municipality, and such payments may be made as an operating expense of such electric system or combined utilities system, as the case may be. No obligation under such contract shall constitute an indebtedness of the municipality for the purpose of any constitutional or statutory limitation or a legal or equitable pledge, charge, lien or encumbrance upon any property of the government unit or upon any of its income, receipts or revenues, except the revenues of its electric system or its combined utilities system, as the case may be, under the terms of the contract, and neither the faith and credit nor the taxing power of the municipality are, or may be, pledged for the payment of any obligation under any such contract. A municipality shall be obligated to fix, charge and collect rents, rates, fees and charges for electric power and energy and other services, facilities and commodities sold, furnished or supplied through its electric system or its combined utilities system sufficient to provide revenues adequate to meet its obligations under any such contract and to pay any and all other amounts payable from or constituting a charge and lien upon such revenues, including amounts sufficient to pay the principal of and interest on bonds of such municipality heretofore or hereafter issued for purposes related to its electric system or its combined utilities system, as the case may be. Any pledge made by a municipality pursuant to this Paragraph shall be valid and binding from the date the pledge is made. The revenues, securities, and other moneys so pledged and then held or thereafter received by such municipality or any fiduciary may by resolution be set aside in whole or in part into appropriate separate funds and the municipality may enter into such covenants and agreements constituting a contract between the municipality and the holder or holders of bonds as may be necessary to preserve the security of said funds. Any such agreements or covenants shall be included in an appropriate resolution of the governing body of said municipality, which resolution is to be maintained as part of the official public records of said municipality. Any revenues so pledged shall be payable to the Authority to discharge the obligations of a municipality under any contract for the purchase of capacity and output from the Authority subject only to the prior payment of reasonable and necessary expenses of operating and maintaining the municipality's electric utility system. The Authority may, either at law or in equity, by suit, action, mandamus or other proceedings, enforce and compel the performance of the covenants or obligations of the municipality under such contract to be performed by the municipality or any officer thereof, including the fixing, charging and collection of rents, rates, fees and other charges.
Prior to any municipality finally executing and delivering a contract with the Authority for the purchase of capacity and output of one or more specified projects in compliance with the provisions of this Section and other relevant portions of this Chapter, the governing authority of the municipality shall adopt an appropriate resolution giving notice of its intention to enter into such contract which shall have been reduced to writing and published one time in the official journal of the municipality not less than thirty days before the date of the public hearing hereinafter required. The proposed contract shall be attached to said resolution as an exhibit or set forth in its entirety within said resolution. The resolution shall establish the date, time and place for the holding of a public hearing on the proposed contract and shall require the publication of a notice of intention which shall give notice of the hearing and the matters to be considered at such hearing, including the designation of the particular issue of the official journal in which the proposed contract has been or will be published. This notice of intention must be published in said official journal once a week for four weeks with the first publication being at least thirty days before the public meeting of the governing authority of the municipality at which said governing authority will meet in open and public session to receive any petitions and to hear any objections to the proposed contract. If at such hearing a petition duly signed by electors of the governmental unit in a number not less than five percent of the electors voting in the last special or general election shall be filed objecting to the proposed contract, then said contract shall not be executed or delivered by the municipality until approved by a majority vote of the qualified electors of the municipality who vote in a special election held for this purpose in the manner generally provided by Chapter 6A of Title 18 of the Louisiana Revised Statutes of 1950. After complying with these procedural requirements, the municipality may proceed with the execution and delivery of the contract which shall then become binding in accordance with its terms. Such contract may not be amended or terminated without mutual agreement of the parties thereto.
Any municipality may furnish the Authority with money derived solely from the ownership and operation of its electric system or its combined utilities system and provide the Authority with personnel, equipment and property, both real and personal. Any municipality may also provide any services to the Authority. Any municipality may contract for, advance or contribute funds derived solely from the ownership and operation of its electric system or its combined utilities system to the Authority as may be agreed upon by the Authority and the municipality and the Authority shall repay such advances or contributions from proceeds of bonds, from operating revenues or from any other funds of the Authority, together with interest thereon as may be agreed upon by the municipality and the Authority.

Legislative History

Added by Acts 1979, No. 772, §1, eff. July 20, 1979.