Sec. 7-264a. Temporary notes for financing capital projects. Methods of payment.
Sec. 7-264a. Temporary notes for financing capital projects. Methods of payment. (a) In addition to its other powers described under this chapter, any municipality
operating a sewerage system may issue temporary notes for purposes of financing any
capital project related to such system, and such municipality may renew such notes for
not more than fifteen years, provided in the first year immediately following completion
of such project, or if more than one project is financed by any issue of such notes, in
the first year immediately following completion of the last of such projects, or in the
sixth year following the date of issue of such notes, whichever is sooner, and in each
year thereafter, not less than one-fifteenth of the total of the notes so issued shall be
retired using funds derived from the sources of payment set forth below. Payment of
principal and interest on such notes may be secured by a pledge of (1) the full faith and
credit of the municipality, (2) revenues to be derived from sewerage system use charges,
(3) revenues to be derived from sewerage system connection charges, (4) revenues to
be derived from sewerage system benefit assessments, (5) any other revenues which
are collected by the municipal water pollution control authority or (6) any combination
of the aforementioned sources of payment. Any temporary notes which are secured by
a pledge of the full faith and credit of the municipality shall be obligatory upon the
municipality and the inhabitants and property thereof according to the tenor and purport
of such pledge, whether or not such notes are also secured by one or more additional
sources of payment as herein provided. In each year during which such notes secured
by a pledge of the full faith and credit of the municipality are outstanding, the municipality shall appropriate and there shall be available on or before the date when any principal,
interest or mandatory annual retirement payment on such notes is required to be paid,
an amount of money which, together with all revenues from other sources available for
such purpose, shall be sufficient to pay such principal, interest or mandatory annual
retirement payment on such payment date. There shall be included in the tax levy for
each such year an amount which, together with other revenues available for such purpose, shall be sufficient to provide for such appropriations.
(b) The legislative body of any municipality issuing temporary notes as provided
in this section shall determine the maximum authorized amount of such notes to be
issued and may determine or may authorize an officer or officers of such municipality
to determine the form of such notes, their date, the dates of principal and interest payments on such notes, provisions for protecting and enforcing the rights and remedies of
the holders of such notes and all other terms, conditions and particular matters regarding
the issuing and securing of and the payment of debt service on such notes. Such legislative body may determine the rate or rates of interest for each issue of such notes or may
provide that such rate or rates of interest shall be determined subsequently by an officer
or officers of such municipality, which determination may be based upon the receipt of
bids to purchase such notes. Each note issued in accordance with this section shall be
exempt, both as to principal and interest, from taxation.
(c) Any powers granted under this section shall be in addition to, and not in derogation of, any powers granted to any municipality under the provisions of its municipal
charter or of any general statute or special act.
(d) Notwithstanding the provisions of subsection (c) of this section, to the extent
payment of principal and interest on such notes is not secured in whole or in part by a
pledge of the full faith and credit of the municipality, any limitations on the powers
granted to any municipality under the provisions of its municipal charter or of any
general statute or special act regarding renewal of such notes or the total amount of such
notes outstanding shall not be applicable to those notes issued pursuant to this section.
(P.A. 86-309, S. 4.)