11-14-306 - Additional pledge for general obligation bonds -- Revenue bonds -- Resolution.
11-14-306. Additional pledge for general obligation bonds -- Revenue bonds --Resolution.
(1) To the extent constitutionally permissible, local political subdivisions may pledge asan additional source of payment for their general obligation bonds all or any part of revenues,fees, and charges attributable to the operation or availability of facilities or may issue bondspayable solely from such revenues, fees, or charges.
(2) (a) The governing body may issue bonds payable solely from revenues, fees, orcharges attributable to extensions and improvements to revenue-producing facilities.
(b) If the governing body issues bonds under Subsection (2)(a), the resolution authorizingthese bonds shall set forth as a finding of the governing body:
(i) the value of the then existing facility and the value of this facility after completion ofthe extensions or improvements proposed to be constructed; and
(ii) that portion of the revenues, fees, or charges derived from the entire facility when thecontemplated extensions and improvements are completed which the value of the existing facilitybears to the value of the facility after completion shall be considered to be revenue derived fromthe existing facility and the remainder may be set aside and pledged to the payment of theprincipal of and interest on the bonds and for the establishment of appropriate reserve fund orfunds, and such portion shall be considered to be revenue derived exclusively from theextensions and improvements.
(3) (a) Any resolution or trust indenture authorizing bonds to which such revenues, fees,or charges are pledged may contain such covenants with the future holder or holders of the bondsas to the management and operation of the affected facilities, the imposition, collection, anddisposition of rates, fees, and charges for commodities and services furnished thereby, theissuance of future bonds, the creation of future liens and encumbrances against the facilities, thecarrying of insurance, the keeping of books and records, the deposit and paying out of revenues,fees, or charges and bond proceeds, the appointment and duties of a trustee, and other pertinentmatters as may be considered proper by the governing body.
(b) If the revenue, fee, or charge so pledged involves either sewer or water revenues,fees, or charges or both sewer and water revenues, fees, or charges, provision may be made forcharges for sewer services and water services to be billed in a single bill and for the suspensionof water or sewer services, or both, to any customer who shall become delinquent in the paymentdue for either.
(c) Provision may be made for the securing of such bonds by a trust indenture, but nosuch indenture shall convey, mortgage, or create any lien upon property of the local politicalsubdivision.
(d) Either the bond resolution or such trust indenture may impose in the holders of thebonds full rights to enforce the provisions thereof, and may include terms and conditions uponwhich the holders of the bonds or any proportion of them, or a trustee therefor, shall be entitledto the appointment of a receiver who may enter and take possession of the facility or facilities,the revenues, fees, or charges of which are so pledged, and may operate and maintain them,prescribe charges and collect, receive, and apply all revenues, fees, or charges therefrom arisingin the same manner as the local political subdivision itself might do.
Amended by Chapter 83, 2006 General Session