MISSISSIPPI LEGISLATURE

1999 Regular Session

To: Education

By: Senator(s) Ferris

AN ACT TO AMEND SECTION 37-59-111, MISSISSIPPI CODE OF 1972, TO INCREASE THE AUTHORIZED TERM TO MATURITY OF NOTES OR CERTIFICATES OF INDEBTEDNESS ISSUED BY SCHOOL DISTRICTS FOR CAPITAL IMPROVEMENT AND TRANSPORTATION PURPOSES; TO AMEND SECTIONS 37-59-101, 37-59-103, 37-59-105, 37-59-107, 37-59-109 AND 37-59-115, MISSISSIPPI CODE OF 1972, TO AUTHORIZE SCHOOL DISTRICTS TO EXPEND THE AVAILS OF THE MILLAGE LEVIED FOR SUCH SHORT-TERM INDEBTEDNESS WITHOUT THE NECESSITY OF ISSUING NOTES OR CERTIFICATES; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 37-59-111, Mississippi Code of 1972, is amended as follows:

37-59-111. All indebtedness incurred under the provisions of this article shall be evidenced by the negotiable notes or certificates of indebtedness of the school district on whose behalf the money is borrowed. Said notes or certificates of indebtedness shall be signed by the president of the school board and superintendent of schools of such school district. Such notes or certificates of indebtedness shall not bear a greater overall maximum interest rate to maturity than the rates now or hereafter authorized under the provisions of Section 19-9-19. No such notes or certificates of indebtedness shall be issued and sold for less than par and accrued interest. All notes or certificates of indebtedness shall mature in approximately equal annual installments of principal and interest over a period not to exceed twenty (20) years from the dates of the issuance thereof. Provided, however, if negotiable notes are outstanding from not more than one (1) previous issue authorized under the provisions of this article, then the schedule of payments for a new or supplementary issue may be so adjusted that the schedule of maturities of all notes or series of notes hereunder shall, when combined, mature in approximately equal installments of principal and interest over a period of twenty (20) years from the date of the new or supplementary issue, or if a lower interest rate will thereby be secured on notes previously issued and outstanding, a portion of the proceeds of any issue authorized hereunder may be used to refund the balance of the indebtedness previously issued under the authority of this article. Such notes or certificates of indebtedness shall be issued in such form and in such denominations as may be determined by the school board, and same may be made payable at the office of any bank or trust company selected by the school board, and, in such case, funds for the payment of principal and interest due thereon shall be provided in the same manner provided by law for the payment of the principal and interest due on bonds issued by the taxing districts of this state.

SECTION 2. Section 37-59-101, Mississippi Code of 1972, is amended as follows:

37-59-101. (1) The school board of any school district in the county is authorized and empowered, in its discretion, to borrow money under the terms and conditions specified in this article for the purpose of making repairs, alterations and additions to school buildings of such school districts, for the purpose of erecting school buildings and other buildings used for school purposes, for the purpose of purchasing heating plants, air conditioning, fixtures and equipment for such buildings, for the purpose of purchasing land for school purposes, school buses and transportation equipment, and for the purpose of improving and equipping such lands for school recreational and athletic purposes.

(2) The school board of any school district is also authorized, in its discretion, to determine and declare that it is in the best interest of the school district to expend the avails of the ad valorem millage provided under this article for the purposes authorized under this section without the necessity of issuing negotiable notes or certificates of indebtedness.

SECTION 3. Section 37-59-103, Mississippi Code of 1972, is amended as follows:

37-59-103. Before any money shall be borrowed or expended under the provisions of this article, the school board of the school district shall adopt a resolution declaring the necessity for and its intention of borrowing or expending such money, specifying the amount to be so borrowed or expended, the date or dates of the maturity thereof, and how such indebtedness is to be evidenced. Such resolution shall also set forth the nature and approximate cost of the alterations, additions, and repairs to be made, or of the erections contemplated, or of the heating plant, fixtures and equipment necessary to be purchased, or of the land to be purchased, improved or equipped, or of the school buses and transportation equipment to be purchased, as the case may be, and shall declare in said resolution that no funds are available in the school funds of the district or from any other source with which to make such repairs, alterations, additions, purchases, erections or improvements.

SECTION 4. Section 37-59-105, Mississippi Code of 1972, is amended as follows:

37-59-105. The said resolution adopted by the school board pursuant to Section 37-59-103 shall be published once each week for two (2) consecutive weeks in a newspaper having a general circulation in the school district involved, with the first publication thereof to be made not less than fifteen (15) days prior to the date upon which the school board is to take final action upon the question of authorizing the borrowing or expenditure of said money. If no petition requesting an election is filed prior to such meeting, then the school board shall, at said meeting, by resolution spread upon its minutes, give final approval to the borrowing or expenditure of said money and shall authorize the issuance of negotiable notes or certificates of indebtedness of the school district or the expenditure therefor in accordance with the provisions of this article.

If at any time prior to said meeting a petition signed by not less than twenty percent (20%) of the qualified electors of the school district involved shall be filed with the school board requesting that an election be called on the question of incurring said indebtedness or authorizing said expenditure, then the school board shall, not later than the next regular meeting, adopt a resolution calling an election to be held within such school district upon the question of the incurring of said indebtedness or authorizing said expenditure for the purposes and in the amount requested. Such election shall be called and held, and notice thereof shall be given, in the same manner provided in Article 1 of this chapter for elections upon the question of the issuance of the bonds of school districts, and the results thereof shall be certified to the school board. If three-fifths (3/5) of the qualified electors voting in said election shall vote in favor of incurring said indebtedness or authorizing said expenditure, then the school board shall proceed to issue said negotiable notes or certificates of indebtedness or requesting the levying authority to provide such expenditure as prayed for in the original resolution of the school board; however, if less than three-fifths (3/5) of the qualified electors voting in said election vote in favor of incurring said indebtedness or authorizing said expenditure, then said notes or certificates of indebtedness shall not be issued and said expenditure shall not be authorized.

Money may be borrowed and an expenditure authorized under the provisions of this article and the negotiable notes or certificates of indebtedness evidencing same may be issued as provided in this article (1) without the necessity of being authorized in an election called for that purpose, except where a petition requesting an election is filed as provided herein, and (2) without the necessity of giving notice thereof except as specifically provided herein, and specifically without the necessity of complying with the requirements of Section 31-19-25.

SECTION 5. Section 37-59-107, Mississippi Code of 1972, is amended as follows:

37-59-107. The levying authority for the school district shall annually levy a special tax on all of the taxable property of the school district on whose behalf the notes or certificates of indebtedness are issued or the expenditure is to be made in an amount which shall be sufficient to pay the principal of and interest upon such negotiable notes or certificates of indebtedness as the same shall respectively mature and accrue, or as is requested by the local school board. Said tax shall be levied and collected at the same time and in the same manner as other taxes are collected and said tax shall be in addition to all other taxes authorized by law. It is expressly provided, however, that such annual tax levy shall not exceed three (3) mills on the dollar for the payment of all notes issued or the payment of all expenditures under the provisions of this article and all notes previously issued under the statutes hereby repealed. The special tax so levied shall be collected by the tax collector of the county at the same time and in the same manner as other taxes are collected, and the proceeds thereof shall be paid to the school district and shall be used exclusively for the payment of principal of and interest upon such negotiable notes or certificates of indebtedness, or the payment of expenditures authorized herein. In the event the school district is expending funds for the purposes authorized under this article and is not issuing negotiable notes or certificates of indebtedness, the three-mill levy provided under this section shall be authorized for a period not to exceed one (1) year.

SECTION 6. Section 37-59-109, Mississippi Code of 1972, is amended as follows:

37-59-109. If the school district on whose behalf money is to be borrowed or expended under the provisions of this article shall lie in two (2) or more counties, said school board shall take all steps required by this article in the issuance of the negotiable notes or certificates of indebtedness of the district or the expenditure of funds authorized herein without regard to county lines. The negotiable notes or certificates of indebtedness shall be general obligations of the entire school district without regard to county lines and shall constitute a lien upon all of the taxable property thereof.

The board of supervisors of the county which furnishes the largest assessed valuation of the property in the district shall annually certify to the board of supervisors of each county in which the district is located the amount of the annual tax levy required for the payment of the principal of and interest upon said notes or certificates of indebtedness or for the payment of funds authorized herein, and each such board of supervisors shall annually levy such tax at the same time and in the same manner as other taxes are levied by such board in the amount so fixed. The taxes so levied shall be collected by the tax collector of each county in the same manner as other taxes are collected and shall be remitted to the school district depository. Such school district depository shall deposit said funds to the credit of the special fund provided for in Section 37-59-107 for the payment of the principal of and interest upon such notes or certificates of indebtedness or the payment of expenditures authorized herein.

SECTION 7. Section 37-59-115, Mississippi Code of 1972, is amended as follows:

37-59-115. The indebtedness incurred or expenditures made under the authority of this article shall not be included in computing the statutory limitation upon the indebtedness or expenditures which may be incurred by school districts as provided in Article 1 of this chapter, or any other statute, but shall be in addition thereto. The only limitation upon the amount of indebtedness or expenditures which may be incurred or expended under the provisions of this article shall be that provided in Section 37-59-107.

SECTION 8. This act shall take effect and be in force from and after July 1, 1999.