22.1-166.1 - Loans to local school boards. - Virginia Statutes

§ 22.1-166.1. Loans to local school boards.

The Authority is authorized to make loans or loan interest rate subsidypayments, from any of the funds of the Authority available for such purpose,to local school boards for the purpose of acquiring and installing capitalprojects for school purposes for which loans from the Literary Fund are notimmediately available. For the purpose of this section and § 22.1-166.2,capital projects for school purposes shall mean motor vehicles andeducational technology equipment.

A. No loan from the Authority shall exceed 100 percent of the cost of thecapital project for school purposes for which such loan is made.

B. A loan from the Authority shall be evidenced by notes payable to theAuthority, executed or signed by the chairman of the school board, with theapproval of the local governing body, attested by the clerk thereof anddeposited with the State Treasurer. Payments of interest and principal onsuch notes shall be made to the State Treasurer. Any loan from the Authorityshall be repayable in installments as shall be approved by the local schoolboard, as appropriate, with the final installment being due not more thanthirty years after the date of such loan. The time of payment may beextended in the discretion of the Authority.

C. The local governing bodies and the local school boards of the severalschool divisions are authorized to borrow money from the Authority, at suchrate or rates, fixed or variable, as shall be approved by the local schoolboard; any local school board to borrow from the Authority shall first makewritten application to the Authority for such loan on a form to be prescribedby the Authority.

D. The governing body of any county, city, or town, if the town constitutesthe school division, in which the local school board has borrowed money fromthe Authority shall include in its levies, and appropriate to the localschool board, a fund sufficient to meet the liabilities of the local schoolboard on such loan if and to the extent such liabilities are not otherwiseprovided for by the General Assembly. The governing body of any county inwhich the local school board has borrowed money from the Authority forcapital projects located in a town in such county constituting a separateschool division shall have authority to include, in its levies for such town,a levy sufficient to meet the liabilities of the local school board on suchloan if and to the extent such liabilities are not otherwise provided for bythe General Assembly and shall levy a separate tax in the rest of the countyto meet its liabilities on any contract for capital projects outside suchtown. In the event that such local school board shall fail to pay anyinstallment of interest or principal promptly, upon notice in writing to thateffect from the State Treasurer, the county, city, or town treasurer shallpay to the State Treasurer any such past due installment of interest orprincipal out of the funds in his hands belonging to such county, city, ortown. The failure of such governing body to provide for the payment of suchloan or the interest thereon when and as due shall be deemed a cause forremoval of the members thereof from office on motion before the circuit courthaving jurisdiction in such county, city, or town, instituted by the attorneyfor the Commonwealth of such county or city or by the Attorney General wherethe attorney for the Commonwealth refuses or neglects to act after demand onhim to proceed.

E. The local school board of any school division composed of part or all of acounty, with the approval of the governing body of the county, is authorizedto borrow from the Authority for the purpose of financing capital projects insuch county to serve a portion of such county. Taxes on property in themagisterial districts served by such capital projects shall be levied by thegoverning body of the county and collected for the purpose of repaying suchloan; for the purposes of this section, a magisterial district shall notinclude a town constituting a separate school division but the governing bodyof the county may levy a separate tax on property in a town in such countyconstituting a separate school division to repay money borrowed by suchcounty from the Authority for the purpose of financing capital projects insuch town. Except as otherwise provided by this subsection, all otherprovisions of law relating to loans from the Authority shall apply to a loanauthorized by this subsection.

F. Any local school board which is indebted for any money borrowed from theAuthority may anticipate the payment of the principal amount of any suchloans, or any part thereof, by the payment of such principal amount withinterest thereon to the date of such anticipated payment and may borrow moneyand issue bonds for the purpose of raising funds to pay any notes or otherobligations of the local school board now and hereafter held by the Authority.

(1990, c. 909.)