§ 1773 - Temporary loans - Vermont Statutes

§ 1773. Temporary loans

(a) If a municipal corporation votes to issue bonds in accordance with law, the officers authorized to issue the same, upon resolution of the legislative branch of the municipal corporation, may make a temporary loan, in the name of such municipal corporation, for a period of not more than one year in anticipation of the money to be derived from the sale of such bonds and may issue notes therefore. Temporary notes issued under this subsection for a shorter period than one year may be renewed or refunded by the issue of other notes maturing not more than one year from the date of the original loan except as stated in subsection (b) of this section. The maximum maturity date of the authorized bond issue need not be reduced because of a temporary loan hereunder except as stated in subsection (b) of this section.

(b) A temporary note issued under subsection (a) of this section may be renewed or refunded to mature more than one year from the date of the original temporary loan. In such a case, the authorized amount of the bond issue shall be reduced each year or portion thereof after the first year during which the temporary loan remains outstanding by a factor at least equal to the amount which will reduce the authorized amount of bonds to zero through equal annual payments over the maximum maturity allowed by law for such bonds, or such lesser maturity as may be determined by the legislative branch of the municipality. The amount of the temporary loan outstanding at any time shall not exceed the current authorized amount of the bond issue. The legislative branch of the municipal corporation shall, in each year in excess of any one year period, include in the next annual apportionment or assessment of taxes an amount equal to the amount of the reduction to be used either for the purpose of the original authorized bond issue or to satisfy the temporary note. With the approval of the voters, the period after which the authorized amount of the bond issue shall begin to be reduced may be extended to no more than three years. Temporary notes issued under this subsection shall mature no later than one year from their original date and any renewal or refunding thereof shall mature no later than ten years from the date of the original loan. The maximum maturity date of the authorized bond issue shall be reduced by a period equal to the period of temporary borrowing in excess of one year from the date of the original temporary note and for so long as the notes remain unsatisfied or outstanding.

(c) Pending the receipt of revenue in the form of grants-in-aid from any source, a municipal corporation through its legislative branch, by resolution or ordinance, may issue revenue anticipation notes in anticipation of the grants-in-aid to be received. The notes may be issued on such terms and conditions and at such times as the legislative branch shall determine. The proceeds of the notes may be used only for the purpose for which the grants-in-aid are anticipated, and no note may mature more than one year from its date; provided, however, that a note issued under this subsection may be refunded or renewed from time to time by the issuance of a note or notes dated before the date upon which the total grant-in-aid is received. (Amended 1967, No. 242 (Adj. Sess.), § 1, eff. Feb. 13, 1968; 1969, No. 285 (Adj. Sess.), § 12, eff. April 9, 1970; 1975, No. 165 (Adj. Sess.); 1979, No. 94 (Adj. Sess.), § 1, eff. March 7, 1980; 1991, No. 51.)