3/09/00 3618s

2000 SESSION

00-2607

08/10

SENATE BILL 365-LOCAL

AN ACT relative to the adoption of bonds or notes in school districts and municipalities.

COMMITTEE: Education

AMENDED ANALYSIS

This bill provides that a 3/5 majority vote shall be required to adopt bonds or notes in school districts and municipalities.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

3/09/00 3618s

00-2607

08/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand

AN ACT relative to the adoption of bonds or notes in school districts and municipalities.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Town or District Bonds or Notes; Vote Required for Adoption. Amend RSA 33:8 to read as follows:

33:8 Town or District Bonds or Notes. Except as otherwise specifically provided by law, the issue of bonds or notes by any municipal corporation, except a city or a town which has adopted a charter pursuant to RSA 49-B, without a budgetary town meeting, [and except a school district or municipality which has adopted official ballot voting procedures pursuant to RSA 40:13] shall be authorized by a vote by ballot of [2/3] 3/5, and the issue of tax anticipation notes, by a vote of a majority, of all the voters present and voting at an annual or special meeting of such corporation, called for the purpose. [The issue of notes or bonds by a school district or municipality which has adopted official ballot voting procedures pursuant to RSA 40:13 shall be authorized by a vote of 3/5.] No such action taken at any special meeting shall be valid unless a majority of all the legal voters are present and vote at such special meeting, unless the governing board of any municipality shall petition the superior court for permission to hold an emergency special meeting, which, if granted, shall give said special meeting the same authority as an annual meeting. The warrant for a special meeting shall be published once in a newspaper having a general circulation in the municipality within one week after the posting of such special meeting. The warrant for any such annual or special meeting shall be served or posted at least 14 days before the date of such special meeting. Every warrant shall be deemed to have been duly served or posted, if the return on the warrant shall so state, and it shall be certified by the officer or officers required to serve or post the same. All bonds or notes, authorized in accordance with this chapter, shall be signed by the governing board, or a majority of the governing board, and countersigned by the treasurer of the municipality, and shall have the corporate seal, if any, affixed to it. The discretion of fixing the date, maturities, denominations, the interest rate, or discount rate in the case of notes, the place of payment, the form and other details of said bonds or notes and of providing for the sale of such bonds or notes, may be delegated to the governing board or to the treasurer and shall, to the extent provision therefor shall not have been made in the vote authorizing the same, be deemed to have been delegated to the governing board.

2 Alternate Procedure for Authorizing Town or Village District Bonds or Notes for Municipal Small Scale Power Facilities; Vote Required for Adoption. Amend RSA 33:8-c, I to read as follows:

I. By a 2/3 vote, the governing board of a town or village district may call a special meeting for the purpose of authorizing the issuance of bonds or notes for the municipal financing of small scale power facilities, as such facilities are defined in RSA 374-D:1. A special meeting held under this section shall have the same authority as that of an annual town meeting. The issuance of such bonds or notes shall be authorized by a vote of [2/3] 3/5 of all the voters present and voting at the special meeting.

3 Procedures for Authorizing Bonds or Notes in Municipalities Adopting Charters Pursuant to RSA 49-B, Without a Budgetary Town Meeting; Vote Required for Adoption by Town Council. Amend RSA 33:8-d, I(c) to read as follows:

(c) A [2/3] 3/5 majority vote of the town council shall be required to authorize the issuance of bonds or notes.

4 Procedures for Authorizing Bonds or Notes in Municipalities Adopting Charters Pursuant to RSA 49-B, Without a Budgetary Town Meeting; Vote Required for Adoption by Referendum if Bonds or Notes in Excess of 10 Percent of Town's Operating Budget. Amend RSA 33:8-d, II(g) to read as follows:

(g) If a [2/3] 3/5 majority of the voters present and voting on the issuance of bonds or notes shall vote in the affirmative, the appropriation and issuance of bonds or notes in the amounts so stated in the question shall be declared to have been adopted.

5 City Bonds; Vote Required for Adoption. Amend RSA 33:9 to read as follows:

33:9 City Bonds. The issue of bonds or tax anticipation notes by a city shall be authorized by a resolution of the city councils, passed by at least [2/3] 3/5 of all the members of each branch thereof. All such bonds and notes shall be signed by the mayor and countersigned by the city treasurer, and shall have the city seal affixed thereto. The discretion of fixing the date, maturities, denominations, place of payment, interest rate, or discount rate in the case of notes, the form and other details of said bonds or notes, and of providing for the sale thereof, may be delegated to the city treasurer and shall, to the extent provision therefor shall not have been made in the vote authorizing the same, be deemed to have been delegated to the treasurer with approval of the mayor.

6 Municipal Revenue Bonds; Issuance of Revenue Bonds. Amend RSA 33-B:2 to read as follows:

33-B:2 Issuance of Revenue Bonds. A municipality may issue bonds or notes under this chapter for construction of revenue-producing facilities. Bonds issued by a municipality under this chapter shall not be deemed to be a pledge of the faith and credit of the state or of the municipality. Except as otherwise provided in this chapter, the principal of, premium, if any, and interest on all bonds shall be payable solely from the particular funds provided therefor under this chapter. The bonds shall be issued in such amounts as the legislative body may authorize by a [2/3] 3/5 vote as required under RSA 33:8, 33:8-d, or 33:9, as applicable. Bonds of each issue shall be dated, shall bear interest at such rate or rates, including rates variable from time to time as determined by such index, banker's loan rate or other method as may be determined by the authorized officers, and shall mature at such time or times as may be determined by the authorized officers, except that no bond shall mature more than 40 years from the date of its issue or beyond the expiration of the expected useful life of the facilities being financed by the bonds as determined by the authorized officers. Bonds may be made redeemable before maturity at the option of the municipality at such price or prices and under such terms and conditions as may be fixed by the authorized officers prior to the issue of bonds. The authorized officers shall determine the form and details and the manner of execution of bonds. The municipality may sell its bonds in such manner, either at public or private sale, for such price, at such rate or rates of interest, or at such discount in lieu of interest, as the authorized officers may determine. The provisions of RSA 33:11-a, 14 and 15 shall apply to bonds issued under this chapter.

7 Municipal Electric Revenue Bonds; Authorization and Issuance of Bonds. Amend RSA 374-B:2, I to read as follows:

I. Any municipality, when authorized by a [2/3] 3/5 vote as defined in RSA 33:8 for bonds or notes not in excess of $100,000, or in RSA 33:8-a for other bonds or notes for towns and village districts or in RSA 33:9 for cities or RSA 33:8-d for towns which have adopted a charter pursuant to RSA 49-B, without a budgetary town meeting, may, subject to the approval of the commission under RSA 369:1, borrow money through the issue of revenue bonds to finance project costs, or its share of project costs, of electric power facilities. The commission in rendering its decision shall, in addition to the other requirements of said RSA 369:1, approve only such issue as the commission finds, after notice and opportunity for hearing, is appropriate to finance an electric power facility which is both consistent with the power needs of the state and necessary to supply the load plus reserve requirements created by the municipality's retail customers, and by such wholesale customers as may have existed on the day of the vote of the municipality, said load plus reserve requirements to be forecast by the municipality at a time 3 years beyond the scheduled date for commencement of commercial operation of the facility; in evaluating the ability of the municipality to supply its load plus reserve requirements at said time, the commission shall deduct from these requirements all capacity in other generating units to which the municipality will then be entitled by ownership or contract, including any contracts for the purchase of electricity to be in force at said time. The project costs to be financed may include finance charges, interest prior to and during the carrying out of any project and for a reasonable period thereafter, prepayments under contracts made pursuant to RSA 374-A:2, the funding of notes issued for project costs as hereinafter provided, such reserves for debt service (including a common reserve for debt service established pursuant to an agreement for consolidation of indebtedness under paragraph VI) or other capital or current expenses as may be required by a trust agreement or resolution securing notes or bonds, and all other expenses incidental to the determination of the feasibility of any project or to carrying out the project or to placing the project in operation.

8 Municipal Electric Revenue Bonds; Revenue Refunding Bonds. Amend RSA 374-B:12 to read as follows:

374-B:12 Revenue Refunding Bonds. Any municipality having bonds outstanding under this chapter, when authorized by a [2/3] 3/5 vote as defined in RSA 33:8 for towns and village districts and in RSA 33:9 for cities or RSA 33:8-d for towns which have adopted a charter pursuant to RSA 49-B, without a budgetary town meeting, may issue refunding bonds for the purpose of paying bonds issued by or on its behalf, at maturity or upon acceleration or redemption, subject to the approval of the commission under RSA 369:1. 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 (including a common reserve for debt service established pursuant to an agreement for consolidation of indebtedness under RSA 374-B:2, VI) or other capital or current expenses from the proceeds of such refunding bonds as may be required by a trust agreement or resolution securing bonds or notes. The refunding bonds may be issued not more than 5 years prior to the maturity or redemption date of bonds being refunded. The issue of refunding bonds, the maturities and other details thereof, the security therefor, the rights of the holders thereof, and the rights, duties and obligations of the municipality in respect of the same shall be governed by the provisions of this chapter relating to the issue of bonds other than refunding bonds insofar as the same may be applicable, but no bonds shall be refunded to a date later than the refunded bonds could have matured hereunder.

9 Effective Date. This act shall take effect 60 days after its passage.