(a)The governing body, or any board or commission of a municipality having jurisdiction, control and management of the public works of a municipality, may borrow money in anticipation of the collection of revenues from such public works and issue negotiable notes to evidence such borrowing, the proceeds from the sale of such notes to be used for the purpose of paying the cost of construction of additions, betterments and improvements to and extensions of the public works, the revenues of which are pledged to the payment of such notes.
(b)Such notes must be payable not later than five (5) years from the date of the notes, and must be sold in such manner and upon such terms and conditions as may be determined by the governing body, board, or commission issuing the notes. The notes shall no
Free access — add to your briefcase to read the full text and ask questions with AI
(a) The governing body, or any board or commission of a municipality having jurisdiction, control and management of the public works of a municipality, may borrow money in anticipation of the collection of revenues from such public works and issue negotiable notes to evidence such borrowing, the proceeds from the sale of such notes to be used for the purpose of paying the cost of construction of additions, betterments and improvements to and extensions of the public works, the revenues of which are pledged to the payment of such notes. (b) Such notes must be payable not later than five (5) years from the date of the notes, and must be sold in such manner and upon such terms and conditions as may be determined by the governing body, board, or commission issuing the notes. The notes shall not be issued without first being approved by the comptroller of the treasury or the comptroller's designee. If the revenues of such system are insufficient to pay all such notes at maturity, any unpaid notes may be renewed one (1) time for a period not to exceed one (1) year or may be retired with funding bonds issued pursuant to the Cash Basis Law of 1937, compiled in title 9, chapter 11, or may be otherwise liquidated as approved by the comptroller of the treasury or the comptroller's designee. (c) The governing body may issue bonds in the manner provided by § 7-34-109 , for the funding of notes issued pursuant to subsection (a), and for the purpose of refunding at or prior to maturity bonds theretofore issued pursuant to § 7-34-109 . (d) The governing body, or any board or commission of a municipality having jurisdiction, control and management of an electric power distribution system or a natural gas distribution system, may borrow money in anticipation of the collection of revenues from such system and issue negotiable notes to evidence such borrowing for the purpose of financing electrical power or gas purchases, including storage costs and pipeline capacity costs. Any such notes shall be secured solely by a pledge of and lien on the revenues of such system. The principal amount of notes that may be issued during any twelve-month period shall not exceed sixty percent (60%) of total electrical power or gas purchases for the same period, and all notes issued during such period shall be retired and paid in full on or before the end of such period. The notes shall be sold in such manner, at such price and upon such terms and conditions as may be determined by the governing body, board or commission issuing such notes. No notes shall be issued under this subsection (d) unless the electric system or gas system for which the notes are to be issued has positive retained earnings as shown in the most recent audited financial statements of the system, and the system has produced positive net income in at least one (1) fiscal year out of the three (3) fiscal years next preceding the issuance of the notes as shown on the audited financial statements of the system. No notes shall be issued without first being approved by the comptroller of the treasury or the comptroller's designee. If the revenues of such system are insufficient to pay all such notes at maturity, any unpaid notes may be renewed one (1) time for a period not to exceed one (1) year or may be retired with funding bonds issued pursuant to the Cash Basis Law of 1937, or may be otherwise liquidated as approved by the comptroller of the treasury or the comptroller's designee. (e) This chapter for the payment and security of bonds issued pursuant to this chapter shall be equally applicable to notes issued pursuant to this section. (f) No holder or holders of any bonds or notes issued under this chapter shall have the right to compel any exercise of the taxing powers of the municipality to pay the bonds or notes, or the interest on the bonds or notes, and each bond or note issued under this chapter shall recite in substance that the bond or note, as the case may be, including the interest on the bond or note, is payable solely from the revenues pledged to the payment of the bond or note, and that the bond or note does not constitute a debt of the municipality within the meaning of any statutory limitation.