§ 25-20-510 - Improvements -- Financing with bonds.
25-20-510. Improvements -- Financing with bonds.
(a) If a public body under this subchapter owns or operates a consolidated wastewater system and desires to construct improvements, betterments, and extensions thereto, it may issue revenue bonds under this section for the payment thereof.
(b) The issuance of bonds shall be authorized by resolution of the board of commissioners.
(c) The bonds may be issued as registered bonds and may be exchangeable for bonds of another denomination or in another form.
(d) The bonds may be in such form and denominations, may have such date or dates, may be stated to mature at such time or times, may bear interest payable at such times and at such rate or rates, may be payable at such places within or without the state, may be subject to such terms of redemption in advance of maturity at such prices, and may contain such terms and conditions as the board of commissioners determines.
(e) The bonds shall have all the qualities of and shall be negotiable instruments under the laws of the State of Arkansas, subject to provisions as to registration under this section.
(f) The authorizing resolution may contain other terms, covenants, and conditions that the board of commissioners finds reasonable and desirable, including without limitation conditions concerning the maintenance of various funds and reserves, the nature and extent of any security for payment of the bonds, the custody and application of the proceeds of the bonds, the collection and disposition of revenues, the investing for authorized purposes, and the rights, duties, and obligations of the public body and the holders and registered owners of the bonds.
(g) (1) The authorizing resolution may provide for the execution of a trust indenture between the public body and any financial institution within or without the State of Arkansas.
(2) The trust indenture may contain any terms, covenants, and conditions found desirable by the board of commissioners, including without limitation conditions concerning the maintenance of various funds and reserves, the nature and extent of any security for the payment of the bonds, the custody and application of the proceeds of the bonds, the collection and disposition of revenues, the investing and reinvesting of any moneys during periods not needed for authorized purposes, and the rights, duties, and obligations of the public body and the holders and registered owners of the bonds.
(h) An authorizing resolution and trust indenture relating to the issuance and security of the bonds shall constitute a contract between the public body and holders and registered owners of the bonds, which contract and all covenants, agreements, and obligations therein shall be promptly performed in strict compliance with the terms and provisions of the contract, and the covenants, agreements, and obligations of the public body may be enforced by mandamus or other appropriate proceeding in a court of proper jurisdiction.
(i) (1) The resolution shall fix the minimum rate or rates for the use of and the service rendered by the consolidated wastewater system to be collected prior to the payment of all of the bonds, with exceptions as may be provided in the resolution, and shall pledge the revenues derived from the consolidated wastewater system or any specified portion of the consolidated wastewater system for the purpose of paying the bonds and interest thereon.
(2) The rates to be charged for the services of the consolidated wastewater system or the specified portion of the consolidated wastewater system with revenues pledged to the payment of the bonds shall be sufficient to provide for the payment of all principal of and interest on all bonds when due, to provide for the operation and maintenance of the consolidated wastewater system or the specified portion of the consolidated wastewater system with revenues pledged to the payment of the bonds, and to provide an adequate depreciation account for the consolidated wastewater system or the specified portion of the consolidated wastewater system with revenues pledged to the payment of the bonds.
(j) (1) The proceeds derived from the sale of the bonds shall be used solely for the purpose of making betterments, improvements, and extensions to the consolidated wastewater system owned and operated by the public body, paying interest on the bonds during the period of construction of the betterments, improvements, and extensions, establishing any necessary reserves for the bonds, paying the costs of issuing the bonds, and paying any other costs and expenditures of whatever nature incidental to the accomplishment of the betterments, improvements, and extensions.
(2) The terms "betterments", "improvements", and "extensions" include a wastewater and collection system, including land, mains, interceptors, collector lines, manholes, force mains, valves, pumping stations, pumps, treatment and pretreatment plants and units thereof, as well as all other real and personal property, buildings, structures, or other improvements or facilities that may be necessary or advisable for the proper and efficient operation of the public body's consolidated wastewater system.
(k) (1) Bonds issued under this section shall be payable solely from revenues derived from the consolidated wastewater system or any specified portion of the consolidated wastewater system.
(2) The bonds shall not constitute in any event an indebtedness of nor pledge the faith and credit of the State of Arkansas or the participating public agencies within the meaning of any constitutional provisions or limitations.
(3) It shall be plainly stated on the face of each bond that it is issued under this subchapter, that it does not constitute an indebtedness of the State of Arkansas or the participating public agencies within any constitutional provisions or limitations, and that it is not backed by the full faith and credit of the State of Arkansas or the participating public agencies.
(4) The bonds and the interest thereon shall be exempt from all state, county, and municipal taxation, including income taxation and inheritance taxation.
(l) (1) The bonds may be sold in such manner, either at public or private sale, and upon such terms as the board of commissioners finds reasonable and expedient for effectuating the purposes of the public body.
(2) The bonds shall be sold at a price the board of commissioners accepts, including sale at discount.
(m) (1) The bonds shall be executed by manual or facsimile signature of the chair of the board of commissioners and the manual or facsimile signature of the secretary of the board of commissioners or any other officer of the public body authorized to do so by resolution of the board of commissioners.
(2) In case any of the officers whose signatures appear on the bonds cease to be such officers before delivery of the bonds, their signatures shall be valid and sufficient for all purposes.
(3) Each bond shall be impressed or imprinted with the seal of the public body.