§ 42-64-18 - Reserve funds and appropriations.
SECTION 42-64-18
§ 42-64-18 Reserve funds andappropriations. – To assure the continued operation and solvency of the Rhode Island economicdevelopment corporation for the carrying out of its corporate purposes:
(1) The corporation may create and establish one or morespecial funds, "capital reserve funds", and may pay into each capital reservefund: (i) any moneys appropriated and made available by the state for thepurpose of the fund; (ii) proceeds from the sale of notes or bonds to theextent provided in the resolution or resolutions of the corporation authorizingthe issuance thereof; and (iii) any other moneys that may be made available tothe corporation for the purpose of that fund from any other source. All moneysheld in a capital reserve fund, except as provided, shall be used solely forthe payment of the principal of bonds secured in whole or in part by that fundor of the sinking fund payments hereinafter mentioned with respect to thebonds, the purchase or redemption of the bonds, the payment of interest on thebonds or the payment of any redemption premium required to be paid when thebonds are redeemed prior to maturity; provided, that moneys in the fund shallnot be withdrawn (except for the purpose of making (with respect to bondssecured in whole or in part by the fund) payment when due of principal,interest, redemption premiums, and the sinking fund payments hereinaftermentioned, for the payment of which other moneys of the corporation are notavailable) if the withdrawal would reduce the amount of the fund to less thanthe minimum capital reserve requirement established for the fund as provided inthis section. Any income or interest earned by, or incremental to, any capitalreserve fund due to the investment of the funds may be transferred by thecorporation to other funds or accounts of the corporation if the transfer wouldnot reduce the amount of the capital reserve fund below the minimum capitalreserve fund requirement for the fund;
(2) The corporation shall not at any time issue bonds securedin whole or in part by a capital reserve fund if, upon the issuance of thebonds, the outstanding principal balance of such bonds would exceed the sum oftwo hundred fifty million dollars ($250,000,000), or the amount of the capitalreserve fund would be less than the minimum capital reserve required for thefund, unless the corporation, at the time of issuance of the bonds, shalldeposit in the fund from the proceeds of the bonds to be issued, or from othersources, an amount that, together with the amount then in the fund, is not lessthan the minimum capital reserve fund requirement for the fund. For the purposeof this section, the term "minimum capital reserve fund requirement" means, asof any particular date of computation, an amount of money, as provided in theresolution or resolutions of the corporation authorizing the bonds or noteswith respect to which the fund is established, equal to not more than thegreatest of the respective amounts, for the current or any future fiscal yearof the corporation, of annual debt service on the bonds of the corporationsecured in whole or in part by the fund, the annual debt service for any fiscalyear being the amount of money equal to the sum of: (i) the interest payableduring the fiscal year on all bonds secured in whole or in part by the fundoutstanding on the date of computation plus; (ii) the principal amount of allthe bonds and bond anticipation notes outstanding on the date of computationthat mature during the fiscal year; plus (iii) all amounts specified in anyresolution of the corporation authorizing the bonds as payable during thefiscal year as a sinking fund payment with respect to any of the bonds thatmature after the fiscal year, all calculated on the assumption that the bondswill after the date of computation cease to be outstanding by reason, but onlyby reason, of the payment of bonds when due and application in accordance withthe resolution authorizing those bonds of all of the sinking fund paymentspayable at or after the date of computation;
(3) In computing the amount of the capital reserve funds forthe purpose of this section, securities in which all or a portion of the fundsshall be invested, shall be valued as provided in the proceedings under whichthe bonds are authorized but in no event shall be valued at a value greaterthan par;
(4) In order further to assure the continued operation andsolvency of the corporation for the carrying out of its corporate purposes, theexecutive director shall annually, on or before December first, make anddeliver to the governor a certificate stating the sum, if any, required torestore each capital reserve fund to the minimum capital reserve fundrequirement for the fund. During each January session of the general assembly,the governor shall submit to the general assembly printed copies of a budgetincluding the total of the sums, if any, as part of the governor's budgetrequired to restore each capital reserve fund to the minimum capital reservefund requirement for the fund. All sums appropriated by the general assemblyfor this purpose, and paid to the corporation, if any, shall be deposited bythe corporation in the applicable capital reserve fund;
(5) All amounts paid over to the corporation by the statepursuant to the provisions of this section shall constitute and be accountedfor as advances by the state to the corporation and, subject to the rights ofthe holders of any bonds or notes of the corporation issued before or after,shall be repaid to the state without interest from all available operatingrevenues of the corporation in excess of amounts required for the payment ofbonds, notes, or other obligations of the corporation, the capital reservefunds and operating expenses;
(6) The corporation may create and establish any other fundor funds as may be necessary or desirable for its corporate purposes;
(7) The corporation may by resolution permit the issuance ofbonds and notes to carry out the purposes of this chapter without establishinga capital reserve fund pursuant to this section and without complying with thelimitations set forth in this section. Bonds and notes issued pursuant to thissubdivision may be secured by any other funds or methods as the corporation mayin its discretion determine by resolution.
(8) On or before January 1 of each year, the Rhode Islandeconomic development corporation shall issue a report on all such bonds issuedby the corporations. The report shall include at a minimum the following: alist of each bond issued; the purpose of each bond issued; the amount of eachbond issued; the amount of principal and interest of each bond issued paid todate; the outstanding principal balance of each bond issued; and the totaloutstanding principal balance of all such bonds issued subject to this section.The report shall be transmitted to the chairpersons of the house and senatefinance committees, with copies to the house and senate fiscal advisors.