2007 Regular Session
To: Local and Private; Finance
By: Senator(s) Ross, Kirby
AN ACT TO AUTHORIZE THE CITY OF FLOWOOD, MISSISSIPPI, TO ISSUE REVENUE BONDS FOR THE PURPOSE OF FINANCING AND/OR REFINANCING THE CONSTRUCTION, RECONSTRUCTION, REHABILITATION, REMODELING, REPAIRING, IMPROVING, EXPANDING, EQUIPPING AND FURNISHING OF HEALTH, FITNESS, SPORTS AND RECREATIONAL FACILITIES OWNED OR TO BE OWNED BY THE YOUNG MEN'S CHRISTIAN ASSOCIATION OF METROPOLITAN JACKSON; AND FOR RELATED PURPOSES
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. It is hereby determined and declared that for the benefit of the people of the City of Flowood, Mississippi, and the surrounding area, the increase of their welfare and prosperity, and the improvement and maintenance of their health and living conditions, that the Mayor and Board of Aldermen of the City of Flowood, Mississippi, be granted the authority to issue revenue bonds for the benefit of The Young Men's Christian Association of Metropolitan Jackson, as hereinafter in this act provided.
SECTION 2. As used in this act, the following words shall have the meanings ascribed herein unless the context clearly requires otherwise:
(a) "Bond" or "bonds" means bonds, notes or other obligations of the city issued, in one or more series, from time to time, pursuant to this act.
(b) "City" means the City of Flowood, Mississippi.
(c) "Company" means The Young Men's Christian Association of Metropolitan Jackson, a Mississippi nonprofit corporation which is an organization described in Section 501(c) (3) or any successor section of the Internal Revenue Code of 1986, as amended, and which is authorized under its corporate charter to own, operate and maintain the facilities.
(d) "Costs," as applied to the facilities, means any and all costs of financing or refinancing such facilities and, without limiting the generality of the foregoing, shall include the following:
(i) All costs of the establishment, demolition, site development of new and rehabilitated buildings, rehabilitation, reconstruction, repair, erection, building, construction, remodeling, expanding, improving, equipping and furnishing of the facilities and all costs incident or related thereto;
(ii) The cost of acquiring any property interest in the facilities, including the purchase thereof or the cost of any option to purchase;
(iii) The cost of architectural, engineering, legal and related services; the cost of the preparation of plans, specifications, studies, surveys and estimates of cost and of revenue; all other expenses necessary or incident to planning, providing or determining the need for, or the feasibility and practicability of, the facilities or the acquisition thereof;
(iv) The cost of financing charges, including premiums or prepayment penalties, if any, and interest accrued prior to the acquisition and completion or refinancing of the facilities and after such acquisition and completion or refinancing, and start-up costs related to new facilities; and
(v) Any and all costs paid or incurred in connection with the financing or refinancing of the facilities, including out-of-pocket expenses, the cost of financing, legal, accounting, financial advisory and consulting fees, expenses and disbursement; the cost of any policy of insurance; the cost of printing, engraving and reproduction services; the cost of providing or establishing a reasonable reserve fund for the payment of principal of and interest on bonds; and the cost of the initial or acceptance fee of any trustee or paying agent.
(e) "Counterparty" means the provider of or other party to an interest rate exchange or similar agreement.
(f) "Governing body" means the Mayor and Board of Aldermen of the city.
(g) "Facilities" means buildings and structures of any and all types used or useful, in the discretion of the company, for providing for the health, fitness, sports and recreational needs of the residents of the city and the surrounding area and shall include, without limiting the generality of the foregoing, health, fitness, recreation and sports buildings, parks, fields, administration buildings, office buildings, maintenance, storage or utility facilities, parking lots, and garages and all necessary, useful, or related equipment, furnishings and other personal property, and appurtenances and all lands necessary or convenient as a site for the foregoing, provided that any or all of the foregoing shall be owned by the company.
(h) "Interest rate exchange or similar agreement" means a written contract entered into by the city with a counterparty in connection with bonds to provide for an exchange of payments based upon fixed and/or variable rates, shall include interest rate caps, collars, floors and similar agreements and options on each of the foregoing, and shall be for exchanges in currency of the United States of America only with such terms determined by the governing body to be in the financial best interest of the city and the company.
(i) "Loan agreement" means an agreement providing for the city to loan the proceeds derived from the issuance of bonds pursuant to this act to the company to be used to pay costs associated with the financing or refinancing of the facilities and providing for the repayment of such loan by the company and which may provide for such loans to be secured or evidenced by one or more notes, debenture, bonds or other secured or unsecured debt obligations of the company, delivered to the city or to the trustee under the trust indenture pursuant to which the bonds were issued.
(j) "Project" means paying the costs of financing or refinancing the facilities.
(k) "State" means the State of Mississippi.
SECTION 3. The city is hereby authorized to issue its bonds to finance a project or projects and to loan the proceeds of such bonds to the company pursuant to a loan agreement.
SECTION 4. Bonds issued pursuant to the provisions of this act, exclusive of bonds issued to provide for the refunding of outstanding bonds, shall not exceed Fifteen Million Dollars ($15,000,000.00).
SECTION 5. The principal of, redemption premium, if any, and interest on the bonds shall be payable solely out of and shall be secured by a pledge of the revenues and income received by the company in connection with the facilities or other operations of the company as shall be designated in the proceedings of the governing body under which the bonds are authorized to be issued, including debt obligations of the company obtained from or in connection with the financing of a project or projects, and from such other sources available to the company as may be designated in the proceedings of the governing body under which the bonds are authorized to be issued.
SECTION 6. (1) The bonds shall be dated, shall bear interest at such rate or rates (which rate or rates may be fixed, adjustable or variable), shall mature at such time or times in either serial or term form or both not exceeding thirty (30) years from their date, and may be made redeemable prior to maturity at such price or prices and upon such terms and conditions as may be determined by the city; however, bonds issued to finance equipment shall mature at such time or times not exceeding one hundred twenty percent (120%) of the average useful life of such equipment. The bonds shall be in such form and denomination or denominations and payable at such place or places, either within the state or without the state, and may be authenticated in such manner, as the city may determine by resolution. The bonds shall be executed on behalf of the city by the manual or facsimile signature of the mayor and shall be countersigned by the manual or facsimile signature of the city clerk. In cases where any officer whose signature or a facsimile of whose signature shall appear on any bonds shall cease to be such officer before the delivery of and payment for such bonds, such signature or such facsimile shall nevertheless be valid and sufficient for all purposes the same as if such officer had remained in office until such delivery and payment. The bonds may be issued in book entry or in fully registered form, or any combination, or may be payable to a specific person, as the city may determine, and provision may be made for the conversion from one form to another. The duty of conversion may be imposed upon a trustee in a trust indenture.
(2) The city shall sell the bonds at such price or prices as it shall determine, at public or private sale.
(3) The bonds shall be issued under and subject to such terms, conditions and covenants providing for the payment of the principal, redemption premium, if any, and interest thereon and such other terms, conditions, covenants and protective provisions safeguarding such payment, not inconsistent with this act, as may be found to be necessary by the city for the most advantageous sale thereof, which may include, but not be limited to, covenants with the holders of the bonds as to:
(a) Pledging or creating a lien on all or any part of any monies held in trust or otherwise by others to secure the payment of such bonds;
(b) Otherwise providing for the custody, collection, securing, investment and payment of any money due to the city;
(c) The setting aside of reserves or sinking funds and the regulation or disposition thereof;
(d) Limitations on the purpose to which the proceeds of sale of any issue of such bonds then or thereafter to be issued may be applied;
(e) Limitations on the issuance of additional bonds and on the refunding of outstanding bonds;
(f) The procedure, if any, by which the terms of any contract with the holders of bonds may be amended or abrogated, the amount of bonds the holders of which must consent thereto and the manner in which such consent may be given;
(g) The creation of special funds into which the proceeds of the bonds may be deposited;
(h) Vesting in a trustee or trustees such properties, rights, powers and duties in trust as the city may determine, which may include any or all of the usual and customary rights, powers and duties of the trustee appointed for the holders of any issue of bonds as agreed upon by the city;
(i) Defining the acts or omissions to act which shall constitute a default in the obligations and duties of the city and/or the company and providing for the rights and remedies of the holders of bonds in the event of such default; provided, that such rights and remedies shall not be inconsistent with the general laws of the state and other provisions of this act;
(j) Entering into interest rate exchange or similar agreements with a counterparty under such terms and conditions as the governing body may determine, including, but not limited to, provisions as to default or early termination, and because of the complexity of such agreements, the governing body is authorized to solicit the provision of such agreements on a competitive or negotiated basis; and
(k) Any other matters of like or different character which in any way affect the security and protection of the bonds and the rights of the holders thereof.
(4) The city and/or the company may procure insurance, letters of credit or other credit enhancement with respect to bonds issued pursuant to this act.
SECTION 7. (1) The bonds may be secured by a trust indenture by and between the city and a corporate trustee which may be any bank having the power of a trust company or any trust company within or without the state. Such trust indenture may contain such provisions for protecting and enforcing the rights and remedies of the bondholders as may be reasonable and proper and not in violation of law, including covenants setting forth the duties of the city in relation to the exercise of its powers and the custody, safekeeping and application of all money. The city may provide by the trust indenture for the payment of the proceeds of the bonds and the revenue to the trustee under the trust indenture and for the method of disbursement thereof, with such safeguards and restrictions as the city may determine.
(2) The bonds may be additionally secured by a mortgage, deed of trust or other security interest upon the facilities, vesting in the trustee the power to sell the property subject thereto for payment of the bonds.
(3) Any trust indenture, bond resolution or related indenture of mortgage or deed of trust may contain provisions, which shall be a part of the contract with the holders of the bonds as to:
(a) Pledging or assigning the revenues generated by the company and/or one or more of the facilities, or pledging or assigning the notes, mortgage or other security given by the company in connection with the issuance of the bonds, or other specified revenues or property of the company;
(b) Setting aside any reserves or sinking funds, and the regulation, investment and disposition thereof;
(c) Limitations on the use of the facilities;
(d) Limitations on the purpose to which or the investments in which the proceeds of sale of any issue or bonds then or thereafter to be issued may be applied;
(e) Limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured and the terms upon which additional bonds may rank on a parity with, or subordinate or superior to, other bonds;
(f) The refunding of outstanding bonds;
(g) The procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amounts of bonds the holders of which must consent thereto, the manner in which such consent may be given and restrictions on the individual rights of action by bondholders;
(h) Acts or omissions which shall constitute a default in the duties of the city to holders of its bonds and providing the rights and remedies of such holders in the event of default; and
(i) Any other matters relating to the bonds which the city deems desirable.
SECTION 8. (1) Any bonds of the city at any time outstanding under this act may, at any time and from time to time, be refunded by the city by the issuance of its refunding bonds in such amount as the governing body may deem necessary, but not exceeding:
(a) The principal amount of the bonds being refunded;
(b) Applicable redemption premiums, if any, thereon;
(c) Unpaid interest on such bonds to be refunded to the date or delivery or exchange of the refunding bonds;
(d) In the event the proceeds from the sale of the refunding bonds are to be deposited in trust as hereafter provided, interest to accrue on such bonds to be refunded from the date of delivery of the refunding bonds to the date of maturity or to a redemption date of the bonds to be refunded; and
(e) Expenses, premiums and commissions deemed by the governing body to be necessary in connection with the issuance of the refunding bonds.
(2) Any such refunding may be effected, whether the bonds to be refunded shall have then matured or shall thereafter mature, either by exchange of the refunding bonds for the bonds to be refunded thereby with the consent of the holders of the bonds to be so refunded, or by sale of the refunding bonds and application of the proceeds thereof to the payment of the bonds to be refunded thereby, and regardless of whether the bonds to be refunded were issued in connection with the same projects or separate projects, and regardless of whether the bonds proposed to be refunded shall be payable on the same date or on different dates or shall be due serially or otherwise.
(3) The principal proceeds from the sale of any refunding bonds shall be applied only as follows:
(a) To the immediate payment and retirement of the bonds being refunded; or
(b) To the extent not required for the immediate payment of the bonds being refunded, then such proceeds shall be deposited in trust to provide for the payment and retirement of the bonds being refunded and to pay any expenses incurred in connection with such refunding, but may also be used to pay interest on the refunding bonds prior to the retirement of the bonds being refunded. Money in any such trust fund may be invested in direct obligations of, or obligations the principal of and interest on which are guaranteed by, the United States of America, or in certificates of deposit issued by a bank or trust company located in the state if such certificates shall be secured by a pledge of any of such obligations having an aggregate market value, exclusive of accrued interest, equal at least to the principal amount of the certificates so secured. Nothing herein shall be construed as a limitation on the duration of any deposit in trust for the retirement of bonds being refunded but which shall not have matured and which shall not be presently redeemable.
SECTION 9. Prior to the issuance of any bonds under the provisions of this act, the governing body shall adopt a resolution declaring its intention so to do, stating the amount of bonds proposed to be issued, and the date upon which the governing body proposes to direct the issuance of such bonds. Such resolution shall be published once a week for at least three (3) consecutive weeks in a newspaper published in the city. The first publication of such resolution shall be made not less than twenty-one (21) days prior to the date fixed in such resolution to direct the issuance of the bonds and the last publication shall be made not more than seven (7) days prior to such date.
SECTION 10. All bonds issued by the city under authority of this act shall be limited obligations of the city, the principal of, redemption premium, if any, and interest on which shall be payable solely from the revenues of the facilities financed with proceeds of bonds and from such other funds as may be made available to the city for such purpose by the company. Bonds issued under the authority of this act shall never constitute an indebtedness of the city within the meaning of any state constitutional provision or statutory limitation, and shall never constitute nor give rise to a pecuniary liability of the city or a charge against its general credit or taxing powers, and such fact shall be plainly stated on the face of each such bond. All bonds issued under the authority of this act shall be construed to be negotiable instruments, despite the fact that they are payable solely from a specified source.
SECTION 11. Bonds issued under the provisions of this act shall be legal investments for commercial banks, savings and loan associations and insurance companies organized under the laws of the state.
SECTION 12. Bonds issued under the provisions of this act may be validated in the manner provided by law.
SECTION 13. The bonds authorized by this act and the income therefrom, all loan agreements made pursuant to the provisions hereof, and all purchases required to establish projects acquired and constructed with bond proceeds shall be exempt from all taxation in the state except the contractor's tax imposed by section 27-65-21, Mississippi Code of 1972.
SECTION 14. This act, without reference to any other statute, shall be deemed to be full and complete authority for the issuance of the aforesaid bonds, and shall be construed as an additional and alternative method therefore, and none of the present restrictions, requirements, conditions or limitations of law applicable to the issuance or sale of bonds, notes or other obligations by municipalities in this state shall apply to the issuance and sale of bonds under this act, and no proceedings shall be required for the issuance of such bonds other than those provided for and required herein, and all powers necessary to be exercised in order to carry out the provisions of this act, are hereby conferred.
SECTION 15. This act shall take effect and be in force from and after its passage.