§ 64b - Revenue bonds authorized
§ 3-64b. Revenue bonds authorized
(a) The following terms when used in this section shall, unless the context otherwise requires, have the following meanings:
(1) The term "revenue producing facility" shall mean any building, activity, function or service which any executive officer or department of the city is authorized to construct, operate or carry out and for which the city receives revenue in the form of rent admission or use fees, concession fees or other consideration. Provided, the facilities and activities of the Burlington electric light department, the Burlington water resources department and the airport as herein defined shall be excluded from this definition of revenue producing facility.
(2) The term "airport" shall mean the entire airport now owned by the city, including without limitation, runways, hangars, loading facilities, repair shops, terminals, retail stores in such terminals, restaurants, parking areas and other facilities necessary or convenient for the operation of the airport, together with any improvements thereto hereafter constructed or acquired.
(3) The term "bonds" shall mean any bonds, notes or obligations of the city issued pursuant to this section.
(4) The term "city" shall mean the city of Burlington.
(5) The term "improvement" shall mean any improvement, expansion, betterment, addition, alteration, reconstruction, extraordinary repair, equipping or reequipping of the airport.
(6) The term "related laws" shall mean those Acts of the Vermont General Assembly which are specifically applicable to the city of Burlington and are set out in Part I, Subpart B of the Burlington Code of Ordinances but which do not specifically amend sections of the Burlington city charter.
(7) The term "revenues" shall mean all rates, fees, charges, rents and other income derived from the ownership or operation of a revenue producing facility or of the airport and may include, without limiting the generality of the foregoing, investment earnings and the proceeds of insurance, condemnation, sale or other disposition of revenue producing facility or airport assets and proceeds of borrowing hereunder.
(b) The city is hereby authorized and empowered to improve its revenue producing facilities and its airport for the purpose of providing expanded service and facilities to the users of such revenue producing facilities and airport.
(c)(1) The city is hereby authorized and empowered to issue bonds, from time to time, for the purpose of financing the costs of any improvement to a revenue producing facility or the airport; provided, however, that no bonds other than refunding bonds shall be issued under this section unless and until a majority of the legal voters of the city present and voting thereon at any annual or special city meeting duly warned for the purpose shall have first voted to authorize the issuance of such bonds. Said bonds and the interest thereon shall be payable solely and exclusively from the revenues of the revenue producing facility and/or the airport as the case may be and shall not constitute general indebtedness of the city nor be an obligation or liability upon the city to pay the same from any funds of the city other than the revenues of said revenue producing facility or airport. No airport revenues may be pledged or payable to support a revenue producing facility, nor may the revenues of a revenue producing facility be pledged or payable to support the airport. No owner or owners of any bonds issued under this section shall ever have the right to compel any exercise of the taxing power of the city to pay said bonds or the interest thereon. Said bonds shall not constitute an indebtedness within the meaning of any debt limitation or restriction and shall not be within any statutory limitation upon the power of the city to issue bonds. It shall be plainly stated on the face of each bond that it does not constitute an indebtedness of the city but is payable solely from the revenues of the revenue producing facility or of the airport.
(2) Bonds issued under this section may be issued in one or more series, may bear such date or dates, mature at such time or times both exceeding forty (40) years from their respective dates, bear interest at such rate or rates (whether variable or fixed), be in such denominations, be in registered form, have such rank or priority, be executed in such manner, be payable in such medium of payment, at such place or places, and be subject to such terms of redemption, with or without premium, be declared or become due before the maturity date thereof as may be determined or authorized by resolution of the city council. Said bonds may be sold at public or private sale for such price or prices as the city council shall determine.
(3) In case any officer of the city whose signature appears on any bond or coupon shall cease to be such officer before the delivery of such bond, such a signature shall, nevertheless, be valid and sufficient for all purposes, the same as if he had remained in office until such delivery. Any provision of any law to the contrary notwithstanding, any bonds issued pursuant to this section shall be deemed to be investment securities under the Uniform Commercial Code. Any bonds issued by the city pursuant to the provisions of this section are declared to be issued for an essential public and governmental purpose and to be public instrumentalities, and, together with interest and income thereon, shall be exempt from taxes. The resolution authorizing the issuance of said bonds may provide that the bonds shall contain a recital that they are issued pursuant to this section, which recital shall be conclusive evidence of their validity and of the regularity of their issuance.
(d) In order to secure the payment of any of the bonds issued pursuant to this section, the interest thereon, or in connection with such bonds, the city shall have power as to such bonds, to the extent not inconsistent with the mandatory provisions of this section:
(1) To pledge all or any part of the revenues derived from the revenue producing facility to secure payment of bonds issued for a revenue producing facility or from the airport to secure payment of bonds issued for the airport;
(2) To provide for the terms, forms, registration, exchange execution and authentication of such bonds;
(3) To provide for the replacement of lost, destroyed or mutilated bonds;
(4) To covenant as to the use and disposition of the proceeds from the sale of such bonds and as to the use and disposition of revenues, including, without limiting the generality of the foregoing, the establishment of reserves for debt service of other capital or current expenses from bond proceeds or revenues or both;
(5) To covenant as to the rates, charges and rents of the revenue producing facility or airport, provided that the city shall always collect revenues adequate at all times to provide for the proper operation and maintenance of the revenue producing facility or airport and for the payment of the principal of and interest on all bonds payable from said revenues and all other required payments in connection therewith;
(6) To redeem such bonds, and to covenant for their redemption, and to provide the terms and conditions thereof;
(7) To covenant and prescribe as to what happenings or occurrences shall constitute "events of default" and the terms and conditions upon which such declaration and its consequences may be waived;
(8) To covenant as to the rights, liabilities, powers and duties arising upon the breach by it of any covenant, conditions or obligations;
(9) To vest in a trustee or trustees the right to receive all or any part of the income and revenue pledged and assigned to, or for the benefit of, the owner or owners of bonds issued hereunder, and to hold, apply and dispose of the same and the right to enforce any covenant made to secure or pay the bonds or made in relation to the bonds; to execute and deliver a trust agreement or trust agreements which may set forth the powers and duties and the remedies available to such trustee or trustees and limiting the liabilities thereof and describing what occurrences shall constitute "events of default" and prescribing the terms and conditions upon which such trustee or trustees or the owner or owners of bonds of any specified amount of percentage of such bonds may exercise such rights and enforce any and all such covenants and resort to such remedies as may be appropriate;
(10) To make covenants other than, and in addition to, the covenants herein authorized, of like or different character, necessary or advisable to effectuate the purposes of this section;
(11) To execute all instruments necessary or convenient in the exercise of the powers herein granted or in the performance of its covenants or duties.
(e)(1) Any pledge hereunder shall be valid and binding and shall be deemed continuously perfected from time to time when the pledge is made; unless otherwise provided in the resolution making the pledge, the pledge of revenues shall include any contract or other rights to receive the same, whether then existing or thereafter coming into existence and whether then held or thereafter acquired by the city, and the proceeds thereof; the revenues, rights and proceeds so pledged and then held or thereafter acquired by the city shall immediately be subject to the lien of such pledge without any physical delivery or segregation thereof or further act; and the lien of any such pledge shall be valid and binding as against the city, irrespective of whether such parties have notice thereof. The resolution by which a pledge is made need not be filed or recorded except in the records of the proceedings of the city council and no filing need be made under the Uniform Commercial Code.
(2) A resolution pledging revenues hereunder may provide for priorities among payments to be made from such revenues, whether required by statute, the city charter, such resolution or otherwise. The pledge may include revenues otherwise accruing to particular funds established by statute or the city charter. In the event bonds are issued junior and subordinate to other bonds, revenues remaining from time to time which are permitted by the terms of the senior bonds to be used to pay or secure the junior bonds may be pledged for that purpose by the resolution under which the junior bonds are issued. A pledge of revenues under this section shall constitute a sufficient appropriation thereof for the purpose of any provision for appropriation and such revenues may be applied as required by the pledge without further appropriation.
(f) The city may issue refunding bonds for the purpose of paying any of its bonds issued hereunder at maturity or upon acceleration or redemption. The refunding bonds may be issued at such time prior to the maturity or redemption of the refunded bonds as the city deems to be in the public interest. The refunding bonds may be issued in sufficient amounts to pay or provide the principal of the bonds being refunded, together with any redemption premium thereon, any interest accrued or to accrue to the date of payment of such bonds, the expenses of issue of the refunding bonds, the expenses of redeeming the bonds being refunded, and such reserves for debt service or other capital or current expenses from the proceeds of such refunding bonds as may be required by a resolution under which bonds are issued. The issue of refunding bonds, the maturities and other details thereof, the security therefor, the rights of the owners thereof, and the rights, duties and obligations of the city with respect thereto shall be governed by the provisions of this section relating to the issue of bonds other than refunding bonds insofar as the same may be applicable.
(g) Unless otherwise provided in the authorizing proceedings, if bonds are authorized under this section, temporary notes may be issued in anticipation thereof. The city council may delegate the sale (but not the authorization) of temporary notes to an officer or officers of the city. The principal of and interest on notes may be renewed or paid from time to time by the issue of other notes. Except as otherwise provided, notes issued under this subsection shall be governed by the provisions of this section relating to bonds insofar as the same may be applicable.
(h) Except as otherwise permitted by this section, all moneys received from the issue of bonds for improvements to revenue producing facilities or for airport improvements (other than refunding bonds) shall be used solely to defray the cost of improving the revenue producing facility or the airport of the city as the case may be. The cost of improving shall include all costs of improvement, including all preliminary expenses, the cost of acquiring all property, franchises, easements, and rights necessary or convenient therefor, engineering and legal expenses, expenses for estimates of costs and revenues, expenses for plans, specifications and surveys, other expenses incident or necessary to determining the feasibility or practicability of a project, administrative expenses, interest prior to and during the carrying out of any project and for a reasonable period thereafter, such reserves for debt service or other capital or current expenses as may be required by the resolution under which the bonds are issued, and such other expenses as may be incurred in the financing herein authorized, the improvement of the revenue producing facility or the airport, the placing of an improvement in operation, including the creation of cash working funds, and the performance of the things herein required or permitted in connection therewith.
(i) Any owner or owners of bonds, and a trustee or trustees for holders of such bonds shall have the right in addition to all other rights.
(1) By mandamus or other suit, action or proceedings in any court of competent jurisdiction to enforce his or their rights against the city, the city council and any other proper officer, agent or employee of any of them, including, but without limitation, the right to require the city, the city council and any proper officer, agent or employee of any of them, to fix and collect rates, charges and rents adequate to carry out any agreement as to, or pledge of revenues, and to require the city, the city council and any officer, agent or employee of any of them to carry out any other covenants or agreements and to perform its and their duties under this section;
(2) By actions or suit in equity to enjoin any acts or things which may be unlawful or a violation of the rights of such holder of bonds.
(j) The city shall have power by resolution of its city council to confer upon any owner or owners of a specified amount or percentage of bonds, including a trustee or trustees for such owners, the right in the event of an "event of default" as defined in such resolution or as may be defined in any agreement with the owner or owners of such bonds or the trustee or trustees therefor:
(1) By suit, action or proceedings in any court of competent jurisdiction to obtain the appointment of a receiver of the revenue facility or the airport as applicable or any part or parts thereof If such receiver be appointed he may enter and take possession of such revenue producing facility or airport or any part or parts thereof and operate and maintain the same, and collect and receive all revenues thereafter arising therefrom in the same manner as the city itself might do and shall deposit such moneys in a separate account or accounts and apply the same in accordance with the obligations of the city as the court shall direct.
(2) By suit, action or proceeding in any court of competent jurisdiction to require the city to account as if it were the trustee of an express trust. Any such resolution shall constitute a contract between the city and the owners of bonds of such issue.
(k) The powers conferred by this section shall be in addition and supplemental to the power conferred by any other law or by any other section of this city charter or the related laws of the city. Bonds may be issued hereunder for the improvement of a revenue producing facility and/or the airport notwithstanding that any other law may provide for the issuance of bonds for the like purpose and without regard to the requirements, restrictions or procedural provisions contained in any other law. Nothing in this section shall be construed to preclude the city from issuing general obligation bonds or notes in accordance with applicable law to finance improvements to a revenue producing facility or to the airport. Such financing shall not be governed by the provisions of this section. It shall not be necessary for the city proceeding under this charter to obtain a certificate of convenience or necessity, franchise, license, permit or other authorization or approval from any bureau, board, commission or other instrumentality of the state of Vermont or the city for the issuance of bonds hereunder except as expressly provided in this section.
(l) This section is remedial in nature and the powers hereby granted shall be liberally construed to effectuate the purposes hereof, and to this and the city shall have power to do all things necessary or convenient to carry out the purposes hereof in addition to the powers expressly conferred in this section.
(m) It is hereby declared that the subsections, clauses, sentences and parts of this section are severable, are not matters of mutual essential inducement, and any of them shall be exscinded if this section would otherwise be unconstitutional or ineffective; it is the intention to confer upon the city the whole or any part of the powers in this charter provided for, and if any one or more subsections clauses, sentences and parts of this section shall for any reason be questioned in any court, and shall be adjudged unconstitutional or invalid, such judgment shall not affect, impair or invalidate the remaining provisions thereof, but shall be confined in its operation to the specific provision or provisions so held unconstitutional or invalid, and the inapplicability or invalidity of such subsection, clause, sentence or part of this section in any one or more instances shall not be taken to affect or prejudice in any way its applicability or validity in any other instance.
(n) The powers granted to the city hereunder shall be exercised by its city council. No provisions hereof shall be deemed to permit the exercise or any power in violation of the rights of bonds or note owners.