§ 45-12-5 - Sale of evidences of indebtedness – Annual payments – Terms.
SECTION 45-12-5
§ 45-12-5 Sale of evidences ofindebtedness – Annual payments – Terms. – (a) A city or town which has authorized the borrowing of money under theprovisions of this chapter may sell the bonds, notes, or other evidence of theindebtedness authorized at public or private sale, or may use these in paymentof its debts. The bonds of each issue may be issued in the form of serialbonds or term bonds or a combination thereof and shall be payable either bymaturity of principal in the case of serial bonds or by mandatory serialredemption in the case of term bonds, in annual installments of principal, thefirst installment to be not later than five (5) years and the last installmentnot later than thirty (30) years, after the dated date of the bonds. All suchbonds of a particular issue may be issued in the form of zero coupon bonds,capital appreciation bonds, serial bonds or term bonds or a combinationthereof. Annual installments of principal may be provided for by maturity ofprincipal in the case of serial bonds or by mandatory serial redemption in thecase of term bonds. The amount of principal appreciation each year on anybonds, after the date of original issuance, shall not be considered to beprincipal indebtedness for the purposes of any constitutional or statutory debtlimit or any other limitation. The appreciation of principal after the date oforiginal issue shall be considered interest. Only the original principal amountshall be counted in determining the principal amount so issued and any interestcomponent shall be disregarded.
(b) The manner of sale, denominations, maturities, interestrates and the uses of the proceeds thereof (including, but not limited to, thecosts of issuance and capitalized interest) and other terms, conditions, anddetails of any bonds, notes or other evidence of indebtedness issued under thissection may be fixed by the ordinance or resolution of the city or town councilauthorizing the issue or by separate resolution of the city or town council or,to the extent provisions for these matters are not so made, they may be fixedby the officers authorized to sign the bonds, notes or other evidence ofindebtedness. The officers authorized to sign the bonds, notes or otherevidence of indebtedness on behalf of the city or town are authorized toexecute such instruments, documents or other papers as they deem necessary ordesirable to effectuate the issuance of the bonds, notes or other evidence ofindebtedness and are also authorized to take all actions and execute alldocuments or agreements necessary to comply with federal tax and securitieslaws, including rule 15c2-12 of the Securities and Exchange Commission or anysimilar rule or regulation now or hereafter adopted by the Securities andExchange Commission, which documents or agreements may have a term coextensivewith the maturity of the bonds, notes or other evidence of indebtednessauthorized hereby and to execute and deliver a continuing disclosure agreementor certificate in connection with the bonds, notes or other evidence ofindebtedness.
(c) Pending any authorization or issue of bonds hereunder orpending or in lieu of any authorization or issue of notes hereunder, the cityor town council, to the extent that bonds or notes may be issued hereunder,may, by resolution apply funds in the treasury of the city or town to thepurposes for which bonds or notes will be issued, such advances to be repaidwithout interest from the proceeds of bonds or notes subsequently issued orfrom the proceeds of applicable federal or state assistance or from otheravailable funds.
(d) Any accrued interest received upon the sale of bonds ornotes hereunder shall be applied to the payment of the first interest duethereon. Any premium arising from the sale of bonds or notes hereunder shall,in the discretion of the finance director or treasurer, be applied to the costof preparing, issuing and marketing bonds or notes hereunder to the extent nototherwise provided, to the payment of project costs, to the payment of theprincipal of or interest on bonds or notes issued hereunder or to any one ormore of the foregoing. The cost of preparing, issuing and marketing bonds ornotes hereunder may also, in the discretion of the finance director ortreasurer, be met from bond or note proceeds exclusive of premium and accruedinterest or from other moneys available therefor. Any balance of bond or noteproceeds remaining after payment of the cost of the project and the cost ofpreparing, issuing and marketing bonds or notes hereunder shall be applied tothe payment of the principal of or interest on bonds or notes issued hereunder.To the extent permitted by applicable federal laws, any earnings or net profitrealized from the deposit or investment of funds may, upon receipt, be added toand dealt with as part of the revenues of the city or town from property taxes.In exercising any discretion under this section, the finance director ortreasurer shall be governed by any instructions adopted by resolution of thecity or town council.