7-86-114 - Bond issues. - Tennessee Statutes

7-86-114. Bond issues.

(a)  Subject to the approval of the legislative body of a county or municipality in which a district is established, each district has the power and is hereby authorized, from time to time, to issue negotiable bonds, notes and debt obligations for lease or lease purchases in anticipation of the collection of revenues for the purpose of constructing, acquiring, reconstructing, improving, bettering or expanding any facility or service authorized by this part, or any combination of facility or service, and to pledge to the payment of the principal of and interest on such bonds, notes or debt obligations all or any part of the revenues derived from the operation of such facility, service or combination of facility or service. There may be included in the costs for which bonds or notes are to be issued, reasonable allowances for legal, engineering and fiscal services, interest during construction, and for six (6) months after the estimated date of completion of construction, and other preliminary expenses, including the expenses of incorporation of the district.

(b)  No bond, note or debt obligation authorized in this section may be issued until the resolution authorizing the issuance of the bonds, notes or debt obligations, together with a statement, shall show in detail the total outstanding bonds, notes, warrants, refunding bonds, and other evidences of indebtedness of the district, together with the maturity dates of the bonds, notes, warrants, refunding bonds, and other evidences of indebtedness, interest rates, special provisions for payment, the project to be funded by the bonds, notes or debt obligation, the current operating financial statement of the district and any other pertinent financial information, is submitted to the state director of local finance for review, and the state director of local finance may report on the financial information to the district within fifteen (15) days from the date the plan was received by the state director of local finance, and the state director of local finance shall immediately acknowledge receipt in writing of the proposed issue statement and information. The report thus received by the district shall be published once in a newspaper of general circulation in the county of the principal office of the district, during the week following its receipt. After receiving the report of the state director of local finance, and after publication of such report, or after the expiration of fifteen (15) days from the date the statement and information are received by the state director of local finance, whichever date is earlier, the district may take such action with reference to the proposed issue as it deems advisable. Such report of the state director of local finance shall also be made a part of the bond, note or debt obligation transcript.

(c)  The bonds may be issued in one (1) or more series, may bear such date or dates, shall mature at such time or times, not exceeding forty (40) years from their respective dates, may bear interest at such rate or rates payable semi-annually, may be in such denomination, may be in such form, either coupon or registered, may be payable at such place or places, may carry such registration and conversion privileges, may be executed in such manner, may be payable in such medium of payment at such place or places, may be subject to such terms of redemption, with or without premium, all as may be provided by resolution of the legislative body of the county. The bonds shall be fully negotiable for all purposes.

(d)  If any issue of such bonds or notes is to be sold to an agency of the federal government or an agency of the state of Tennessee, such bond or note issue may, at the request of such agency, be delivered as an installment bond or note payable as to principal and interest in equal or approximately equal installments for the term of such bond or note issue in accordance with the resolution authorizing such bond or note issue. Such authorizing resolution shall stipulate the annual principal and interest requirements during the full term of the bond or note issue.

(e)  Nothing in this section shall prohibit or limit the authority of the board of directors from entering into leases or lease purchases, so long as the term of the lease or leases does not exceed five (5) years, and no other approvals of the lease or leases shall be required.

(f)  Notes may be issued in the same manner as bonds, but shall mature at such time or times, not exceeding five (5) years.

(g)  (1)  The lease/lease purchase agreements authorized under this section shall be issued in the manner prescribed by chapter 51, part 9 of this title. For the purposes of applying chapter 51, part 9 of this title, the district board of directors is deemed to be the governing body except that, all lease/lease purchase agreements exceeding five (5) years shall be subject to the approval of the appropriate county or municipal governing body.

     (2)  For the purposes of this section, and in the provisions of §§ 7-86-115 7-86-117, “bond” or “bonds” are deemed to include notes.

     (3)  For the purposes of this section, in the provisions of §§ 7-86-116 and 7-86-117, “bond” or “bonds” includes debt obligations for lease/lease purchases.

[Acts 1984, ch. 867, §§ 14, 15; 1992, ch. 891, §§ 4-8.]