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14-235-215. Issuance of revenue bonds and notes generally.
Arkansas Code — all titles (historical 2020) · legal_authorities
14-235-215. Issuance of revenue bonds and notes generally.
(a)(1) Nothing contained in this subchapter shall be so construed as to authorize or permit any municipality to make any contract or to incur any obligation of any kind or nature except such as shall be payable solely from the funds provided under the authority of this subchapter.
(2)(A)(i) Funds for the payment of the entire cost of the works and for the payment of any extraordinary expenses or liabilities arising from the ownership and operation of the works including, without limitation, liabilities to customers of the works relating to rates charged by the municipality for use of the works shall be provided by funds derived from the operation of the works, by funds of the municipality appropriated for that purpose, and by the issuance of municipal revenue bonds, the principal and interest of which shall be payable solely from the special fund provided in § 14-235-221 for payment.
(ii) The bonds shall not, in any respect, be a corporate indebtedness of the municipality within the meaning of any statutory or constitutional limitations on them.
(B) All the details of the bonds shall be determined by ordinance of the municipality.
(b)(1)(A) Any municipality owning or operating a sewage system, however constructed or acquired, and desiring to construct improvements and betterments to it, may borrow money to be used for these purposes, to refinance or retire existing indebtedness related to the sewage system, or to provide funds for preliminary expense prior to the issuance of revenue bonds or to provide interim financing pending receipt of federal or state grant-in-aid of loan disbursements.
(B) Such a loan shall be evidenced by revenue promissory notes as set out in this section.
(2) The money so b
Source: Arkansas Code — historical release 78 (November 6, 2020) · 14-235-215
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. A text match is a research starting point; applicability is not established.
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Stable record: arkansas_code:legal_authorities:14-235-215
Source file: gov.ar.code.title.14.odt
Pages: Not recorded – Not recorded
Passage SHA-256: 4cde6a5a46f1780b6353084e2d3866be2f71cab29c5f85834a98bf46d99907a2
Source location: content.xml paragraph 49404
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14-235-215. Issuance of revenue bonds and notes generally.
(a)(1) Nothing contained in this subchapter shall be so construed as to authorize or permit any municipality to make any contract or to incur any obligation of any kind or nature except such as shall be payable solely from the funds provided under the authority of this subchapter.
(2)(A)(i) Funds for the payment of the entire cost of the works and for the payment of any extraordinary expenses or liabilities arising from the ownership and operation of the works including, without limitation, liabilities to customers of the works relating to rates charged by the municipality for use of the works shall be provided by funds derived from the operation of the works, by funds of the municipality appropriated for that purpose, and by the issuance of municipal revenue bonds, the principal and interest of which shall be payable solely from the special fund provided in § 14-235-221 for payment.
(ii) The bonds shall not, in any respect, be a corporate indebtedness of the municipality within the meaning of any statutory or constitutional limitations on them.
(B) All the details of the bonds shall be determined by ordinance of the municipality.
(b)(1)(A) Any municipality owning or operating a sewage system, however constructed or acquired, and desiring to construct improvements and betterments to it, may borrow money to be used for these purposes, to refinance or retire existing indebtedness related to the sewage system, or to provide funds for preliminary expense prior to the issuance of revenue bonds or to provide interim financing pending receipt of federal or state grant-in-aid of loan disbursements.
(B) Such a loan shall be evidenced by revenue promissory notes as set out in this section.
(2) The money so borrowed shall be deposited in a revenue note fund and shall be used solely for the purposes authorized in this section.
(3) The notes evidencing the loan shall be authorized by the legislative body of the municipality and shall be due in not exceeding five (5) years from date and shall bear interest at such rate or rates as provided in the ordinance authorizing their issuance, interest being payable semiannually.
(4)(A) The note or notes shall be payable solely from the revenues derived from the sewage system and shall not, in any event, constitute an indebtedness of the municipality within the meaning of the constitutional provisions or limitations.
(B) It shall be plainly stated on the face of each note that the same has been issued under the provisions of this subchapter and that it does not constitute an indebtedness of the municipality within any constitutional or statutory limitations.
(5) The notes shall be subordinate to any outstanding revenue bonds theretofore issued by the municipality.
(6)(A) It shall be no objection to the subsequent issue of any revenue bonds that a portion of the proceeds received from the sale of the revenue bonds is to be used to retire the indebtedness permitted by this section.
(B) If the proceeds of the bonds are so used, then the improvements constructed or purchased with the proceeds of the loan authorized by this section shall be considered to be a portion of improvements constructed or purchased with the revenue bonds subsequently issued.
(7) All interest paid on the revenue bonds shall be exempt from State of Arkansas income tax.
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Arkansas Code — all titles (historical 2020) · legal_authorities
14-235-221. Sinking fund to pay bonds and interest.
(a)(1) At or before the issuance of any bonds under this subchapter, the municipal council shall, by ordinance, create a sinking fund for the payment of the bonds and the interest on them and the payment of the charges of banks or trust companies for making payment of the bonds or interest and shall set aside and pledge a sufficient amount of the net revenues of the works, meaning the revenues of the works remaining after the payment of the reasonable expense of operation, repair, and maintenance.
(2)(A) This amount shall be paid by the sewer committee into the sinking fund at intervals to be determined by ordinance prior to issuance of the bonds, for:
(i) The interest upon the bonds as interest shall fall due;
(ii) The necessary fiscal agency charges for paying bonds and interest;
(iii) The payment of the bonds as they fall due, or, if all bonds mature at one time, the proper maintenance of a sinking fund sufficient for the payment of them at such time; and
(iv) A margin for safety and for the payment of premiums upon bonds retired by call or purchase as provided in this subchapter, which margin, together with any unused surplus of such margin carried forward from the preceding year, shall equal ten percent (10%) of all other amounts so required to be paid into the sinking fund.
(B) Required payments shall constitute a first charge upon all the net revenues of the works.
(b)(1) Prior to the issuance of the bonds, the committee, by ordinance, may be given the right to use or direct the trustee to use the sinking fund, or any part of it, in the purchase of any of the outstanding bonds payable from it at the market price of them but not exceeding the price, if any, at which they shall, in the same year, b
Source: Arkansas Code — historical release 78 (November 6, 2020) · 14-235-221
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 14-235-221. This identifies an authority to review, not proof of applicability.