Section 4-231 - Contents of enabling resolution or ordinance.
§ 4-231. Contents of enabling resolution or ordinance.
(a) In general.- A resolution or ordinance that authorizes a local obligation shall contain:
(1) a statement of the public purpose for which the proceeds of the local obligation are to be spent;
(2) the form of the local obligation, including:
(i) each place and time of payment;
(ii) each interest rate or maximum interest rate;
(iii) the titles of the officials whose signatures shall be on it;
(iv) a reference to this part as the authority for issuing it; and
(v) the taxes or special revenues from which the principal and interest will be payable;
(3) a provision for the disposition of the proceeds of sale of the local obligation;
(4) a provision that the principal and interest shall be payable to the Administration or its designee;
(5) a provision for payment of the principal and interest that specifies each source of payment;
(6) a provision that the local obligation is a valid and binding obligation of the issuer in accordance with its terms even if an official whose signature appears on the local obligation:
(i) ceases to be an official before the local obligation is delivered; or
(ii) becomes an official after the date of the issue; and
(7) any other provision that is not inconsistent with this subsection and that the governing body of the issuer considers appropriate, including a provision that:
(i) the chief elected official of the issuer may modify the forms adopted by the resolution or ordinance without altering the substance of the forms;
(ii) the official signatures and seals to be affixed to a local obligation may be imprinted in facsimile, except for the signature of the clerk or secretary of the issuer, which shall be affixed manually;
(iii) subject to terms that the Administration specifies, if the local obligation contains a statement of redemption provisions that is acceptable to the Administration all or a portion of a local obligation is redeemable at the option of the issuer at any time before maturity at the price, at or above the par value of the local obligation, that is acceptable to the Administration and set in the enabling resolution or ordinance; and
(iv) a local obligation may be in any denomination that is acceptable to the Administration and shall be in fully registered form.
(b) Disposition provision as binding covenant.- A provision under subsection (a)(5) of this section is a covenant binding the issuer to provide the money from the specified source or sources when principal and interest become due and payable.
(c) Attributes and tax-exempt status.-
(1) A local obligation that an issuer issues under this part shall have all the attributes of a negotiable instrument under Article 31, § 8 of the Code.
(2) The principal of and interest on a local obligation in the hands of its owner are exempt from taxation by the State or a political subdivision.
[An. Code 1957, art. 83B, § 2-204(16)(iv)1, (vi); 2005, ch. 26, § 2.]