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A BILL 1
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25-4 3
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IN THE COUNCIL OF THE DISTRICT OF COLUMBIA 5
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To authorize the issuance of general obligation bonds and general obligation bond anticipation 10
notes of the District of Columbia for the purposes of financing certain capital projects and 11
the refunding of certain capital indebtedness of the District of Columbia during fiscal years 12
2023 through 202 8. 13
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BE IT ENACTED BY THE COUNCIL OF THE DISTRICT OF COLUMBIA, That this act 15
may be cited as the "General Obligation Bonds and Bond Anticipation Notes for Fiscal Years 20 23-16
2028 Authorization Act of 202 3". 17
Sec. 2. Definitions. 18
For the purposes of this act, the term: 19
(1) "Additional Bonds" means District general obligation bonds that may be issued 20
pursuant to section 461 of the Home Rule Act and any act enacted subsequent to this act on a parity 21
with the bonds. 22
(2) "Additional Notes" means District general obligation bond anticipation notes 23
that may be issued pursuant to section 475 of the Home Rule Act and any act enacted subsequent to 24
this act on a parity with the notes. 25
(3) "Authorized Delegate"' means any officer or employee of the executive office of 26
the Mayor to whom the Mayor has delegated any of the Mayor's functions under this act pursuant to 27
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section 422(6) of the Home Rule Act, including, but not limited to, the Chief Financial Officer, the 28
City Administrator, and the Treasurer of the District of Columbia. 29
(4) "Bond Counsel" means a firm or firms of attorneys designated as bond 30
counsel or co-bond counsel from time to time by the Mayor or an Authorized Delegate. 31
(5) "Bonds" means District general obligation bonds authorized to be issued 32
pursuant to this act, including any refunding bonds. 33
(6) "Capital Projects" means the District capital projects as defined in section 34
103(8) of the Home Rule Act. 35
(7) "Deposit and Investment Act" means the Financial Institutions Deposit and 36
Investment Amendment Act of 1997, effective March 18, 1998 (D.C. Law 12-56; D.C. Official 37
Code § 47- 351.01 et seq.). 38
(8) "Escrow Agreement" means any agreement heretofore or hereafter entered into 39
by the Mayor or an Authorized Delegate to provide for the custody, investment, and disbursement 40
of revenues and funds pledged to, and in which a security interest is created for, the payment of 41
the principal of, and interest on, the bonds or notes. 42
(9) "Hedge Agreement" means any financial arrangement that is a cap, floor, or 43
collar; forward rate; future rate; swap, which swap may be based on an amount equal to either a 44
principal amount or a notional principal amount relating to all or a portion of the principal 45
amount of a series of bonds; asset, index, price, or market-linked transaction or agreement; other 46
interest rate exchange or rate protection transaction agreement; other similar transactions, 47 ENGROSSED ORIGINAL
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however designated; any combination thereof; any option with respect thereto; or any similar 48
arrangement, which is executed by the District for purposes of debt management, including 49
managing interest rate fluctuations on bonds, but not for purposes of speculation. 50
(10) "Home Rule Act" means the District of Columbia Home Rule Act, approved 51
December 24, 1973 (87 Stat. 774; D.C. Official Code § 1- 201.01 et seq.). 52
(11) "Notes" means District general obligation bond anticipation notes 53
authorized to be issued pursuant to this act, including any renewals of such notes. 54
(12) "Outstanding Debt" means the outstanding indebtedness at any time of the 55
District for capital project loans from the Treasury of the United States, any Treasury Advances, 56
any outstanding general obligation bonds issued pursuant to this or any prior act, any outstanding 57
general obligation bond anticipation notes issued pursuant to this or any prior act, and any 58
income tax secured revenue bonds issued pursuant to the Income T ax Secured Bond 59
Authorization Act of 2008, effective October 22, 2008 (D.C. Law 17- 254, D.C. Official Code 60
§47-340.26 et seq .). 61
(13) "Paying Agent" means the District or any bank, trust company, or national 62
banking association designated to serve in this capacity by the Mayor or an Authorized Delegate 63
pursuant to section 6. 64
(14) "Procurement Act" means the District of Columbia Procurement Practices 65
Reform Act of 2010 , effective April 8, 2011 (D.C. Law 18-371; D.C. Official Code § 2-351.01 et 66
seq.). 67 ENGROSSED ORIGINAL
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(15) "Registrar" means the District or any bank, trust company, or national 68
banking association designated to serve in this capacity by the Mayor or an Authorized 69
Delegate pursuant to section 6. 70
(16) "Secretary" means the Secretary of the District of Columbia. 71
(17) "Special Tax Fund" means the debt service fund established pursuant to 72
section 9(a)(1). 73
(18) “Special Tax Funds” means the debt service funds established pursuant to 74
section 9(a)(1) and (2). 75
(19) “Special Tax Fund for Notes” means the debt service fund established 76
pursuant to section 9(a)(2). 77
(20) "Treasury Advances" means amounts advanced to the District from the 78
United States Treasury pursuant to Chapter 34 of Title 47 of the District of Columbia Official 79
Code. 80
Sec. 3. Findings. 81
The Council finds that: 82
(1) Section 461 of the Home Rule Act authorizes the District to incur indebtedness 83
by issuing general obligation bonds to refund Outstanding Debt of the District and to provide for 84
the payment of the cost of acquiring or undertaking its various capital projects. 85
(2) Section 475 of the Home Rule Act authorizes the District to incur indebtedness 86
by issuing general obligation bond anticipation notes, the proceeds of which shall be used for the 87 ENGROSSED ORIGINAL
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purposes for which general obligation bonds may be issued under section 461 of the Home Rule 88
Act. 89
(3) The cost of Outstanding Debt may be reduced by refunding a portion of it 90
through the issuance of the bonds, and the District's cost of borrowing may be reduced by the 91
issuance from time to time of notes in anticipation of the issuance of bonds. 92
(4) The issuance of the bonds and the notes in anticipation of the bonds is an 93
economical method of financing the costs of acquiring or undertaking the capital projects 94
described in section 5 and of refunding all or a portion of certain Outstanding Debt as is in the 95
public interest. 96
(5) To fund the capital needs of the District for fiscal years 2023 through 2028, it 97
will be necessary to issue bonds from time to time in one or more series in an aggregate principal 98
amount not to exceed $6,400,000,000 and to issue notes from time to time in one or more series 99
in anticipation of all or a portion of the bonds. 100
Sec. 4. Bond and note authorization. 101
(a) The District is authorized to incur indebtedness by issuing the bonds pursuant to 102
sections 461 through 467 of the Home Rule Act to provide for any of the following: 103
(1) The payment of the cost of acquiring, undertaking, or refinancing capital 104
projects described in section 5 for general governmental and enterprise purposes; 105
(2) The reimbursing of amounts temporarily advanced for the purposes authorized 106
by this act from the General Fund of the District of Columbia, any enterprise fund, or other fund or 107 ENGROSSED ORIGINAL
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account of the District; 108
(3) The refunding of Outstanding Debt; and 109
(4) The payment of the costs and expenses of preparation, execution, issuance, sale 110
or delivery of, or security for, the bonds and notes, including the payments of contracts or 111
agreements the Mayor or an Authorized Delegate may determine to be necessary and appropriate 112
as described in section 7(f), and the payment of other debt program related costs as provided in 113
the contracts or agreements related thereto. 114
(b) The Mayor or an Authorized D elegate is authorized to pay from the proceeds of the 115
bonds and other District funds, the costs and expenses referred to in subsection (a)(4) of this 116
section and to the extent necessary to establish or continue the tax exempt status of any of the 117
bonds issued on a tax exempt basis. 118
(c) The District is authorized pursuant to section 475 of the Home Rule Act to issue the 119
notes in anticipation of the issuance of general obligation bonds and to expend the proceeds of 120
the notes for any of the purposes for which bonds may be issued. 121
Sec. 5. Capital projects. 122
(a)(1) Bonds and notes may be issued from time to time to provide for the payment of 123
the cost of acquiring, undertaking, or refinancing capital projects of the District and 124
reimbursement of amounts advanced for such purposes, including, but not limited to, capital 125
projects for the following categories of facilities and equipment by project and project 126
description: 127 ENGROSSED ORIGINAL
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(A) Physical plant; 128
(B) Technology; 129
(C) Mass transportation; 130
(D) Roads and bridges; 131
(E) Housing and economic development; 132
(F) Environmental protection; 133
(G) Major equipment; and 134
(H) 6. 135
(2) The Council shall specify and determine from time to time, by resolution, the 136
capital projects for which the issuance of bonds shall be authorized. 137
(b) The maximum principal amount of indebtedness that may be incurred through the 138
issuance of bonds or notes for the capital projects, exclusive of the costs and expenses of issuing 139
and delivering the bonds or notes and any other costs referred to in section 4(a)(4), which may 140
be funded with proceeds of the bonds or notes, shall not exceed $ 6,400,000,000; 141
provided, that the principal amount of any notes or bonds issued to refund prior notes or bonds 142
issued for any capital project shall not be included in the determination of the principal amount of 143
indebtedness issued for such project, and provided that the aggregate amount of any refunded notes 144
or additional notes refinanced with bonds or additional bonds shall be returned to the maximum 145
principal amount of indebtedness for use in future issuance s. 146
(c) The maximum total principal amount to be financed through the bonds and notes 147 ENGROSSED ORIGINAL
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provided for the capital projects listed in subsection (a)(1) of this section shall include amounts 148
requested by the District government and approved by Congress in the District's Fiscal Year 149
2023-2028 Capital Improvements Plan or other capital projects approved by the Council, as it 150
may be modified from time to time by appropriations legislation, or by the Council . 151
(d) The costs of the capital projects approved for financing pursuant to this act and prior 152
bond acts that have become law, which are paid originally from the General Fund of the District of 153
Columbia or General Capital Improvements Fund of the District of Columbia, are reasonably 154
expected to be reimbursed in whole or in part with the proceeds of the bonds or notes in the 155
maximum amount set forth in subsection (b) of this section. The adoption of this act by the 156
Council declares the intent of the District under Treas. Reg. § 1.150- 2, issued under the Internal 157
Revenue Code of 1986, approved October 22, 1986 (100 Stat. 2085; 26 U.S.C. § 1 et seq.), to 158
reimburse the General Fund of the District of Columbia and General Capital Improvement Fund of 159
the District of Columbia or to refinance Treasury Advances or loans from the Treasury of the 160
United States for capital projects, in either case, with the proceeds of the bonds and notes. 161
(e) Funds pursuant to this act shall not be used to pay for personnel of the District, 162
except in positions working on authorized capital projects that create assets or extend the useful 163
life of the assets. 164
Sec. 6. Bond and note details. 165
(a) The Mayor or an Authorized D elegate is authorized to take any action necessary or 166
appropriate in accordance with this act in connection with the preparation, execution, issuance, 167 ENGROSSED ORIGINAL
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sale, delivery, security for, and payment of the bonds and notes, including, but not limited to, 168
determinations of: 169
(1) Whether the bonds or notes are to be issued in one or more series and the 170
principal amount of each series; 171
(2) For each series of the bonds or notes, the date of issuance, sale, and delivery of 172
the bonds or notes, the maturity date or dates of the bonds (provided that the maximum maturity of 173
any bond shall not exceed 30 years from the date of issuance) or notes (provided that the maximum 174
maturity date of any note, including any renewal note issued to refund such note, shall not be later 175
than the last day of the 3
rd
fiscal year following the fiscal year during which such note was 176
originally issued), the dates for payment of principal and interest on the bonds or notes, and the 177
amount of each installment or sinking fund payment of principal (provided that the principal 178
installments on each series of the bonds shall begin no later than 3 years from the date of issuance 179
of the series); 180
(3) The rate or rates of interest or the method for determining the rate or rates of 181
interest on each series of the bonds and notes; provided, that the interest rate or rates borne by 182
the bonds of any series with fixed interest rates shall not exceed 15% per year ( calculated on the 183
basis of a 360-day year consisting of twelve 30-day months) in any event and that the interest rate 184
or rates borne by the bonds of any series with non- fixed interest rates shall not exceed 15% per 185
year (calculated on the basis of the actual number of days elapsed over a year of 365 or 366 days 186
and based on the total amount of interest paid in any fiscal year), and the interest rate or rates borne 187 ENGROSSED ORIGINAL
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by the notes of any series shall not exceed in the aggregate 10% per year ( calculated on the basis of 188
a 360-day year consisting of twelve 30-day months or on the basis of the actual number of days 189
elapsed over a year of 365 or 366 days), as determined by the Mayor or the Authorized Delegate; 190
provided further, that if the notes are not paid at maturity, the notes may provide for an interest rate 191
or rates after maturity not to exceed in the aggregate 15% per year ( calculated on the basis of a 360-192
day year consisting of twelve 30-day months or on the basis of the actual number of days elapsed 193
over a year of 365 or 366 days), as determined by the Mayor or the Authorized Delegate; 194
(4) For each series of the bonds or notes, the maximum debt service payable in 195
any fiscal year in accordance with the amount permitted under section 11(a)(3); 196
(5) The designation of any series of the bonds or notes and their denominations, 197
lettering, and numbering or the manner of determining the designations and denominations, 198
lettering, and numbering; 199
(6) The price and terms under which any series of the bonds or notes may be 200
paid, optionally or mandatorily redeemed, accelerated, tendered, called, or put for redemption, 201
repurchase, or remarketing before their stated maturities; 202
(7) The final form, content, and terms of each series of the bonds and notes, 203
including a determination that any series of the bonds or notes may be issued in book- entry 204
form; 205
(8) The designation of a registrar, if other than the District, for any series of the 206
bonds or notes and the execution and delivery of any necessary agreements relating to the 207 ENGROSSED ORIGINAL
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appointment; 208
(9) The designation of a Paying Agent for any series of the bonds or notes and the 209
execution and delivery of any necessary agreements relating to the appointment; 210
(10) Provisions for the registration, transfer, and exchange of the bonds or notes and 211
the replacement of mutilated, lost, stolen, or destroyed bonds or notes; and 212
(11) Provisions for the security of holders of the bonds or notes, including, but not 213
limited to, bond insurance or other credit enhancement . 214
(b) The bonds and notes shall be executed in the name of the District and on its behalf by 215
the manual signature of the Mayor or an Authorized Delegate. To t he extent required by the 216
Home Rule Act, the official seal of the District or a facsimile of it shall be impressed, printed, or 217
otherwise reproduced on
the bonds and notes. 218
(c) The registrar shall manually authenticate each bond or note and maintain the books of 219
registration for the payment of the principal of, and interest on, the bonds or notes and perform 220
other ministerial responsibilities as specifically provided in its appointment as registrar, and the 221
securities depository, if the bonds or notes are issued in book-entry form, shall maintain or cause to 222
be maintained books of registration of owners of beneficial interests in the bonds or notes. 223
Sec. 7. Sale of the bonds and notes. 224
(a) The bonds of any series may be sold by the Mayor or an Authorized Delegate at a 225
public sale upon receipt of sealed proposals (including electronic bids), or at a private sale on a 226
negotiated basis in a manner as the Mayor or an Authorized Delegate may determine to be in the 227 ENGROSSED ORIGINAL
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public interest, all pursuant to and in accordance with section 466 of the Home Rule Act. The 228
notes of any series may be sold by the Mayor or an Authorized Delegate by competitive bid or 229
negotiated sale as may be determined by the Mayor or an Authorized Delegate to be in the best 230
interest of the District. 231
(b) The Mayor or an Authorized Delegate may prepare, or cause to be prepared, and may 232
execute, for each sale of the bonds or notes, offering documents on behalf of the District and may 233
authorize the distribu tion of the offering documents for the bonds or notes. 234
(c) The Mayor or an Authorized Delegate shall take actions and execute and deliver 235
agreements, documents, and instruments (including any amendment of or supplement to any 236
such agreement, document, or instrument) as required by or incidental to: 237
(1) The issuance of the bonds or notes; 238
(2) If and to the extent the bonds or notes are issued on a tax-exempt basis, the 239
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exclusion from gross income for federal income tax purposes of interest on the bonds or notes, the 240
treatment of interest on the bonds or notes as not an item of tax preference for purposes of the 241
federal alternative minimum tax, and the exemption from District taxation of interest on the 242
bonds or notes; 243
(3) The performance of any covenants contained in this act or any purchase 244
contract for the bonds or notes; and 245
(4) The execution, delivery, and performance of any financing documents in 246
connection with the sale of the bonds or notes, including but not limited to, any Escrow 247 ENGROSSED ORIGINAL
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Agreement, trust agreement, bond or note purchase agreement, or paying agent agreement. 248
(d) The bonds or notes shall not be issued until the Mayor or an Authorized Delegate 249
receives an approving opinion from Bond Counsel as to the validity of the bonds or notes and, if 250
and to the extent the bonds or notes are issued on a tax- exempt basis, the treatment of the interest 251
on the bonds or notes for purposes of federal and District income taxation. 252
(e) The Mayor shall execute a bond issuance certificate or note issuance certificate, as the 253
case may be, evidencing the determinations made and other actions taken by the Mayor for each 254
series of the bonds or notes issued and shall designate in such certificate the amount of the bonds 255
or notes to be used to finance capital projects or to refund or refinance Outstanding Debt, the 256
amount of principal and interest on that amount of bonds or notes to be paid through sinking fund 257
payments, redemptions, or otherwise, in each fiscal year, the date of the bonds or notes, the series 258
designation, the authorized denominations, the Paying Agent or Agents, and any other matters 259
pertaining to the bonds or notes, including any matters applicable under section 6(a). A copy of the 260
bond issuance certificate or note issuance certificate, as the case may be, shall be filed with the 261
Secretary to the Council not more than 3 days after the delivery of the bonds or notes covered by 262
the certificate. Any bond issuance certificate or note issuance certificate shall be conclusive 263
evidence of the actions or determinations taken or made as stated in the certificate. 264
(f) The Procurement Act and the Deposit and Investment Act shall not apply to whatever 265
contract the Mayor or an Authorized Delegate may from time to time enter into for purposes of 266 ENGROSSED ORIGINAL
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this act or the Mayor or an Authorized Delegate may determine to be necessary or appropriate for 267
purposes of this act to place, in whole or in part , including, but not limited to: 268
(1) An investment or obligation of the District as represented by the bonds or 269
notes; 270
(2) A contract or contracts for bond insurance or other credit enhancement 271
(including, but not limited to, a letter or line of credits), or liquidity agreements, or 272
placement of any investment or obligation or program of investment including any offering 273
document, contract based on interest rate, currency, cash flow, or other basis, including, 274
without limitation, interest rate swap agreements; currency swap agreements; insurance agreements; 275
forward payment conversion agreements; futures contracts providing for payments based on levels 276
of, or changes in, interest rates, currency exchange rates, or stock or other indices; contracts to 277
exchange cash flows or a series of payments; and contracts to hedge payment, currency, rate, 278
spread, or similar exposure, including, without limitation, interest rate floors, or caps, options, 279
puts, and calls, Hedge Agreements, and any required supplements to any such documents. 280
The contracts or other arrangements may also be entered into by the District in connection with, or 281
incidental to, entering into or maintaining any agreement that secures the bonds or notes. The 282
contracts or other arrangements entered into pursuant to this section shall contain whatever payment 283
security, terms, and conditions as the Mayor or an Authorized Deleg ate may consider appropriate 284
and shall be entered into with whatever party or parties the Mayor or an Authorized Delegate may 285
select, after giving due consideration, where applicable, to the creditworthiness of the counterparty 286 ENGROSSED ORIGINAL
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or counterparties, including any rating by a nationally recognized rating agency or any other 287
criteria as may be appropriate. 288
(3) A contract or contracts for an escrow agent, paying agent, disclosure agent, 289
trustee, collection agent, registrar, underwriting, legal services, accounting, financial advisory 290
services, rating agency services, printing, and any other contracts for services of professionals or 291
advisors or for disclosure services as the Mayor or an Authorized Delegate may deem to be 292
necessary or appropriate. 293
Sec. 8. Payment and security of the bonds and notes. 294
(a) The full faith and credit of the District is pledged for the payment of the principal of, 295
and interest on, the bonds and notes as they become due and payable through required sinking fund 296
payments, redemptions, or otherwise. 297
(b) The Council shall, in the full exercise of the authority granted in section 483 of the 298
Home Rule Act and under any other law, provide in each annual budget for a fiscal year of the 299
District sufficient funds to pay the principal of, and interest on, the bonds and notes becoming 300
due and payable for any reason during that fiscal year. 301
(c) The Mayor shall, in the full exercise of the authority granted to the Mayor under the 302
Home Rule Act and under any other law, take such actions as may be necessary or appropriate to 303
ensure that the principal of, and interest on, the bonds and notes are paid when due for any reason, 304
including the payment of principal and interest from any funds or accounts of the District not 305
otherwise legally committed. 306 ENGROSSED ORIGINAL
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(d) The bonds and notes shall evidence continuing obligations of the District until paid in 307
accordance with their terms. 308
(e) Any Paying Agent shall pay the principal of, and interest on, the bonds and notes 309
and may perform other ministerial responsibilities as specifically provided in its appointment as 310
paying agent. 311
(f) Proceeds of the bonds or notes and any money set aside for any security for the bonds 312
or notes or any contract or other arrangement entered into pursuant to this section , may be pledged to 313
and used to service any contract or other arrangement providing for payment of principal of and 314
interest on the bonds or notes. 315
Sec. 9. Special tax; establishment of rates; collection. 316
(a) (1) The Council determines that a special tax is necessary in conjunction with the 317
authorization and issuance of the bonds and any Additional Bonds. Pursuant to section 481 of the 318
Home Rule Act and notwithstanding the provisions of Chapter 5 of Title 47 of the District of 319
Columbia Official Code, there is levied, for each real property tax year in which bonds or 320
Additional Bonds are outstanding, a special tax on the real property in the District subject to 321
taxation, in amounts that will be sufficient to pay the principal of, and interest on, the bonds and 322
Additional Bonds coming due in each year. This special tax is levied, without limitation as to rate 323
or amount, on all classes of real property subject to taxation in the District. The special tax shall be 324
collected and apportioned among classes of real property in the same manner as other District real 325
property taxes and, when collected, shall be set aside in a Special Tax Fu nd maintained separate 326 ENGROSSED ORIGINAL
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from other funds of the District. The collection and custody of the s pecial tax payment may be 327
pursuant to an agreement with an agent for such purposes and the Special Tax Fund may be 328
maintained under an Escrow Agreement. When deposited, the funds in the fund and all investment 329
income or earnings on these funds shall be irrevocably dedicated and pledged to the payment of 330
principal, and interest on, the bonds and any Additional Bonds. Any Escrow Agreement providing 331
for holding funds for the benefit of the holders of the bonds shall be maintained so long as any of 332
the bonds is outstanding under this act. 333
(2) In addition to the special tax levied pursuant to paragraph (1) of this subsection, the 334
Council determines that a separate tax levy is necessary in conjunction with the authorization and 335
issuance of notes and any Additional Notes. Pursuant to section 467(a) of the Home Rule Act, and 336
notwithstanding the provisions of Chapter 5 of Title 47 of the District of Columbia Official Code, 337
there is levied, for each real property tax year in which notes or Additional Notes are outstanding, a 338
special tax for notes on the real property in the District subject to taxation, which shall be separate 339
and distinct from the collection and pledge of the special tax in paragraph (1) of this subsection, in 340
amounts that will be sufficient to pay the principal of, and interest on, the notes and Additional Notes 341
coming due in each year. This special tax for notes is levied, without limitation as to rate or amount, 342
on all classes of real property subject to taxation in the District. The special tax for notes shall be 343
collected and apportioned among classes of real property in the same manner as other District real 344
property taxes and, when collected, shall be set aside in a Special Tax Fund for Notes maintained 345
separate from other funds of the District, including the Special Tax Fund maintained under 346 ENGROSSED ORIGINAL
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paragraph (1) of this subsection. The collection and custody of the revenue pledge payment may be 347
pursuant to an agreement with an agent for such purposes and the Special Tax Fund for Notes may 348
be maintained under an Escrow Agreement. When deposited, the revenues in the fund and all 349
investment income or earnings on these funds shall be irrevocably dedicated and pledged to the 350
payment of principal, and interest on, the notes and any Additional Notes. Any Escrow Agreement 351
providing for holding funds for the benefit of the holders of the notes or Additional Notes shall be 352
maintained so long as any of the notes or Additional Notes is outstanding under this act. 353
(3) The special taxes authorized pursuant to subsection (a)(1) and (2) of this section 354
shall be levied and collected ratably and on a parity with each other, and in the event there are 355
insufficient collections of real property taxes, the amounts collected shall be allocated to each of 356
the Special Tax Funds in proportion of the amounts of bonds and Additional Bonds and notes and 357
Additional Notes outstanding. 358
(b) The District irrevocably pledges for and on behalf of the owners of the bonds or notes 359
as further security for the due and punctual payment of the principal and redemption price, if any, 360
of, and interest on, the bonds or notes as they shall become due and payable for any reason, all of 361
its right, title, and interest now owned or later acquired in and to the revenue from the applicable 362
special taxes levied by this section, whether to be received, or held at the time, by a collection 363
agent, custodian, or escrow agent for the District, or by District officials. This pledge creates and 364
grants a parity security interest, which is created and perfected as contemplated in section 467 of 365
the Home Rule Act, subject to the terms, conditions, and limitations in this act, including the 366 ENGROSSED ORIGINAL
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provisions of subsections (e) and (i) of this section and the provisions setting forth conditions and 367
limitations applicable to the issuance of Additional Bonds or Additional Notes secured, equally 368
and ratably with the bonds or notes, respectively by a pledge of and security interest in the special 369
tax revenue or special tax for notes revenue. 370
(c) The security interests created in the revenues from the special tax es levied by this 371
section shall be valid, binding, and perfected from the time of the delivery of the first bonds or 372
notes with or without the physical delivery or allocation of any special tax revenue or special tax 373
for notes revenue and with or without any further action. The security interest shall be valid, 374
binding, and perfected whether or not any statement, document, or instrument relating to the 375
security interest is recorded or filed. The pledge and lien created by the security interest shall be 376
valid, binding, and perfected with respect to any individual or legal entity having claims against 377
the District, whether or not the individual or legal entity has notice of the pledge and lien. 378
(d) If the District pays or, pursuant to section 15, makes provisions to pay to the owners of 379
all bonds and Additional Bonds or notes and Additional Notes the principal or redemption price, 380
if any, and the interest due or to become due, at the time and in the manner stipulated, the security 381
interest created in the revenue from the special tax es levied under this section shall be terminated. 382
(e)(1) In any real property tax year, if the amount expected to be on deposit in the Special 383
Tax Fund on the first day of the next succeeding real property tax year exceeds the greater of the 384
earnings on the Special Tax Fund for the current real property tax year or 1/12 of the amount that 385
the Mayor certifies as required to pay the principal of, and interest on, the bonds and any 386 ENGROSSED ORIGINAL
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Additional Bonds coming due in the next succeeding real property tax year, the Mayor shall either 387
cause the transfer of that excess amount to the General Fund of the District of Columbia or the 388
use of that excess amount to purchase, for cancellation, Outstanding Debt. That excess amount 389
shall be released from the lien on and security interest in the special tax revenue created under this 390
section. 391
(2) In any real property tax year, if the amount expected to be on deposit the 392
Special Tax Fund for Notes on the first day of the next succeeding real property tax year exceeds 393
the greater of the earnings on the Special Tax Fund for Notes for the current real property tax 394
year or 1/12 of the amount that the Mayor certifies as required to pay the principal of, and interest 395
on, the notes and any Additional Notes coming due in the next succeeding real property tax year, 396
the Mayor shall either cause the transfer of that excess amount to the General Fund of the District 397
of Columbia or the use of that excess amount to purchase, for cancellation, Outstanding Debt. 398
That excess amount shall be released from the lien on and security interest in the special tax for 399
notes revenue created under this section. 400
(3) On or before the date upon which the Mayor is required by law to submit to 401
the Council proposed real property tax rates for a real property tax year of the District (but not 402
later than the first day of that real property tax year), the Mayor shall certify to the Council the 403
amount required in that real property tax year to pay the principal of, and interest on, the bonds 404
and any Additional Bonds or notes and any Additional Notes coming due for any reason during 405
that real property tax year. The amount certified, less any funds then on deposit in the Special 406 ENGROSSED ORIGINAL
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Tax Funds after application of paragraphs (1) and (2) of this subsection, shall be called the 407
special tax requirement. 408
(f) On or before the date upon which the Mayor is required by law to submit to the Council 409
proposed tax rates for a real property tax year of the District (but not later than the first day of that 410
real property tax year), the Mayor shall calculate and submit to the Council proposed real property 411
special tax rates to be applied during the real property tax year to all real property subject to 412
taxation in the District. The real property special tax rates shall be calculated to yield the special tax 413
requirement, as that amount is certified by the Mayor pursuant to subsection (e) of this section. 414
(g) The Council, in the same manner as provided for the establishment of other real 415
property tax rates, shall, by act, establish real property special tax rates for the real pr operty tax 416
year calculated to yield the special tax requirement, as that amount is certified by the Mayor 417
pursuant to subsection (e) of this section. If the Council fails to enact special real property tax 418
rates for the real property tax year within the time provided by law, the real property special tax 419
rates submitted by the Mayor pursuant to subsection (f) of this section shall be the real property 420
special tax rates to be applied during that real property tax year. 421
(h) Real property special taxes shall be collected in the same manner as other District real 422
property taxes and the Mayor shall promptly deposit in the Special Tax Funds all real property 423
special taxes collected, including collection through a collection agent and deposit under an 424
Escrow Agreement. If the law of the District relating to the levy or collection of real property 425
taxes or the calculation or establishment of real property tax rates is changed in a manner that 426 ENGROSSED ORIGINAL
22
renders any of the provisions of subsections (e) through (h) of this section incapable of 427
performance in accordance with their respective terms, the Mayor and the Council shall take 428
actions that result in the collection of real property special taxes, in the same manner as other 429
District real property taxes, in the amounts required by this section. 430
(i) The District and the Mayor reserve the right to satisfy all or a portion of the special tax 431
pledge requirements by setting aside and depositing into the Special Tax Funds, equally and ratably, 432
at any time any funds of the District not otherwise legally committed, which shall irrevocably 433
dedicate and pledge those deposits to the payment of principal of, and interest on, the bonds and 434
Additional Bonds or notes and any Additional Notes then outstanding. To the extent that all or a 435
portion of the special tax requirement or revenue pledge requirement is satisfied by those deposits, 436
an equal amount of real property special tax revenue or special tax for notes revenue subsequently 437
collected shall be released from the lien on and the security interest in the special tax revenue or the 438
special tax for notes revenue created under this section and shall be paid to reimburse the General 439
Fund of the District of Columbia or other fund of the District of Columbia from which the other 440
funds were received, and any other funds so deposited in lieu of a portion of the special tax revenues 441
or pledged property tax revenues shall be subject to the pledge and security interest under this act as 442
if they were special tax revenues or special tax for notes pledged revenues pursuant to section 467 of 443
the Home Rule Act. 444
(j) The Mayor shall provide for the payment of the principal of, and interest on, the bonds 445
or notes, as it may become due and payable for any reason, by transferring funds on deposit in the 446 ENGROSSED ORIGINAL
23
Special Tax Funds, respectively, to the Paying Agent to the extent required pursuant to the bond or 447
Additional Bond issuance certificate or note or Additional Note issuance certificate provided for in 448
section 7. 449
Sec. 10. Issuance of bonds to pay notes when due. 450
(a) The District shall issue the bonds or, to the extent permitted by the Home Rule Act, 451
renewal notes to provide for the payment of the principal of the notes, as they may become due and 452
payable. 453
(b) The par value to be received from the sale of any bonds issued to refund the notes or any 454
renewal notes shall, to the extent necessary, be used to pay the principal of, and interest on, the 455
notes when due and are pledged to that purpose. 456
Sec. 11. General covenants. 457
(a) The following covenants are made by the District in connection with the 458
authorization and issuance of the bonds: 459
(1) Pursuant to section 603(c) of the Home Rule Act, the Council shall not approve 460
any budget that would result in expenditures being made by the District during any fiscal year in 461
excess of all resources that the Mayor estimates will be available from all funds available to the 462
District for that fiscal year, except as permitted by applicable law. The Mayor shall not forward to 463
the President for submission to Congress a budget that is not balanced according to the provisions 464
of section 603(c) of the Home Rule Act, except as permitted by applicable law. 465
(2) The District shall prepare its annual financial statements in accordance with 466 ENGROSSED ORIGINAL
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generally accepted accounting principles for state and local governments and cause its annual 467
financial statements to be audited by an independent accountant. 468
(3) The District shall not issue any general obligation bonds or general 469
obligation bond anticipation notes, other than bonds or renewal notes to refund any Outstanding 470
Debt, or incur any indebtedness to the Treasury of the United States for capital projects in an 471
amount that would cause th e amount of debt service payable in any fiscal year on all the 472
indebtedness, including all outstanding bonds and loans, to exceed any limitations set forth in the 473
Home Rule Act or the borrowing limitation set forth in D. C. Official Code §47- 335.02 at the time 474
the additional bonds or indebtedness are issued or incurred. For purposes of the limitation imposed 475
by this section, and as required by section 475(b) of the Home Rule Act, the Council hereby 476
determines that the estimated maximum annual debt service amount for the bonds anticipated by 477
the notes is $30 million . 478
(4) Subject to applicable law, the District shall maintain a capital projects fund, 479
separate from other funds of the District, into which it will deposit the proceeds of any bonds or 480
notes, other than bonds or notes issued to refund Outstanding Debt, less any capitalized interest 481
and accrued interest, and shall expend the proceeds only to finance capital projects and incidental 482
costs as defined in section 103(8) of the Home Rule Act. Subject to applicable law, the proceeds 483
of the bonds or notes may be escrowed in appropriate accounts with escrow agents or a trustee for 484
the bonds or notes to be applied to the applicable purposes. Interest or other investment earnings 485
of proceeds in the capital projects fund shall be credited to the General Fund of the District of 486 ENGROSSED ORIGINAL
25
Columbia, subject to provisions for any deposit requirements to a rebate fund or other funds in 487
accordance with agreements pertaining to the bonds or notes. 488
(b) The Mayor or an Authorized Delegate may, through a trust agreement or other 489
instrument, make additional covenants of the District and agree to other provisions to better secure, 490
administer funds for, and protect the bonds or notes and the owners thereof. 491
Sec. 12. Events of default. 492
(a) Each of the following events constitutes an event of default: 493
(1) Failure to pay the principal of the bonds or notes, as the case may be, when 494
the principal becomes due and payable at maturity, upon redemption, or otherwise; 495
(2) Failure to pay an installment of interest on the bonds or notes, as the case 496
may be, upon the day when the interest becomes due; and 497
(3) Failure by the District to observe and perform any covenant, condition, 498
agreement, or provision, other than as specified in paragraphs (1) and (2) of this subsection, 499
contained in the bonds or notes, as the case may be, or in this act, but only if the failure 500
continues for a period of 90 days after transmittal to the District of written notice of failure. 501
(b) A bond or note owner who claims an event of default under subsection (a)(3) of this 502
section shall provide to the registrar written notice specifying the failure and requesting that it be 503
remedied. Upon verifying that the written notice has been transmitted by a bona fide bond or note 504
owner, the registrar, if other than the District, shall transmit the written notice to the District. If 505
the registrar is the District, the written notice shall be delivered directly to the Mayor. Transmittal 506 ENGROSSED ORIGINAL
26
to the District of the written notice required by subsection (a)(3) of this section shall not be 507
accomplished in any manner other than that set forth in this subsection. If there is a trust 508
agreement or Escrow Agreement for the bonds or notes, the notice by bond or note owners and 509
notice to the District shall be given by and to the persons designated in or pursuant to such 510
agreement. 511
Sec. 13. Remedies. 512
(a) Upon the occurrence and continuance of any event of default, any bond or note 513
owner may: 514
(1) By mandamus or other suit, action, or proceeding at law or in equity, enforce 515
all rights of the bond or note owner and require the District to carry out any agreements with or for 516
the benefit of the bond or note owner and to perform its duties under this act; 517
(2) Bring suit upon the bonds or notes, as the case may be; and 518
(3) By action or suit at law or in equity, enjoin any acts that may be unlawful or in 519
violation of the rights of the bond or note owner. 520
(b) If any proceeding initiated by any bond or note owner to enforce any right under this 521
act is discontinued or abandoned for any reason, the District and the bond or note owner shall be 522
restored to their former positions and rights, and all rights, remedies, and powers of each of the 523
parties shall continue as though the proceeding had not been initiated. 524
(c) Subject to the provisions of the Home Rule Act, if there is a trust agreement or 525
Escrow Agreement for the bonds or notes, actions under this act or such agreement, or on the 526 ENGROSSED ORIGINAL
27
bonds or notes, as the case may be, shall be subject to applicable provisions in the agreement, 527
notwithstanding other provisions in this act. 528
Sec. 14. District officials. 529
(a) The elected and appointed officials, officers, employees, or agents of the District shall 530
not be liable personally for the payment of the bonds or notes or be subject to any personal 531
liability by reason of the issuance of the bonds or notes. 532
(b) The signature, countersignature, facsimile signature, or facsimile countersignature on 533
the bonds or notes shall be valid and sufficient for all purposes, notwithstanding the fact that the 534
official ceases to be that official before delivery of the bonds or notes. 535
Sec. 15. Defeasance of bonds and notes. 536
(a) The bonds or notes, as the case may be, shall be legally defeased and no longer be 537
considered outstanding and unpaid for the purpose of this act , and the requirements of this act 538
shall be discharged with respect to the bonds or the notes if the Mayor or an Authorized 539
Delegate: 540
(1) Deposits with an escrow agent, which shall be a bank, trust company, or 541
national banking association with requisite trust powers, in a separate defeasance escrow 542
account, established and maintained by the escrow agent solely at the expense of the 543
District and held in trust for the bond owners, sufficient moneys or direct obligations of the 544
United States, the principal of, and interest on, which, when due and payable, will provide 545
sufficient moneys to pay when due the principal of, and interest on, the bonds or notes to be 546 ENGROSSED ORIGINAL
28
defeased; and 547
(2) Delivers to the defeasance escrow agent an irrevocable letter of instruction to 548
apply the moneys or investments to the payment of the principal of and interest on, the bonds or 549
notes to be defeased as they become due and payable. 550
(b) The defeasance escrow agent shall not invest the defeasance escrow account in any 551
investment callable at the option of its issuer if the call could result in less than sufficient moneys 552
being available for the purposes required by this section. 553
(c) The defeasance escrow account specified in subsection (a) of this section may be 554
established and maintained without regard to any District limitations placed on these accounts by 555
any law, except for this act. 556
(d) References in this section to "amounts due and payable" include, but are not limited to, 557
amounts due and payable by reason of optional or mandatory redemption. 558
Sec. 16. Additional debt and other obligations. 559
Subject to the terms of any trust agreement or Escrow Agreement pertaining to the bonds or 560
notes, the District reserves the right at any time to borrow money or enter into other 561
obligations to the full extent permitted by law, to secure the borrowings or obligations by the pledge 562
of its full faith and credit, to secure the borrowings or other obligations by any other security and 563
pledges of funds as may be authorized by law, and to issue bonds, including Additional Bonds, 564
notes, including Additional Notes, or other instruments, to evidence the borrowings or obligations. 565
Any act of the Council authorizing the issuance of Additional Bonds or Additional Notes shall 566 ENGROSSED ORIGINAL
29
provide for an increase in the special tax requirements sufficient to pay principal of, and interest on, 567
the Additional Bonds or Additional Notes. 568
Sec. 17. Tax status. 569
If and to the extent the bonds or notes are issued on a tax- exempt basis, the Mayor or an 570
Authorized Delegate shall not (1) take any action or omit to take any action, or (2) invest, reinvest, 571
or accumulate any moneys in a manner, that will cause the interest on the bonds or notes, as the 572
case may be, to be includable in gross income for federal income tax purposes or to be treated as 573
an item of tax preference for purposes of the federal alternative minimum tax. The Mayor or an 574
Authorized Delegate shall also take all actions necessary to be taken, including to make any rebate 575
payment, if any, when due, so that the intere st on the bonds or notes will not be includable in gross 576
income for federal income tax purposes or be treated as an item of tax preference for purposes of 577
the federal alternative minimum tax. 578
Sec. 18. Contract. 579
This act shall constitute a contract between the District and the owners of the bonds and 580
notes. To the extent that any acts or resolutions of the Council may be in conflict with this act, this 581
act shall be controlling with respect to bonds and notes. 582
Sec. 19. Authorized delegation of authority. 583
To the extent permitted by District and federal laws, the Mayor may delegate to any 584
authorized delegate the performance of any act authorized to be performed by the Mayor under this 585
act. 586 ENGROSSED ORIGINAL
30
Sec. 20. Maintenance of documents. 587
Copies of the specimen bonds and notes and related documents shall be filed in the 588
Office of the Secretary of the District of Columbia. 589
See. 21. Information reporting. 590
(a) Within 3 days after the Mayor's receipt of the transcript of proceedings relating to 591
the issuance of any series of the bonds or notes, the Mayor shall transmit a copy of the transcript to 592
the Secretary to the Council. 593
(b) The Mayor shall notify the Council, within 30 days, if any funds or accounts of 594
the District not otherwise legally committed have been used for the payment of principal of 595
and interest on the bonds pursuant to section 8(c). 596
(c)(1) The Mayor's letter of transmittal accompanying the submission of any proposed 597
resolution to approve the issuance of bonds or notes pursuant to this act shall include a statement 598
as to: 599
(A) Whether the bonds or notes of any series are intended to be sold by 600
competitive bid or by negotiated sale and, if bonds of any series are intended to be sold by 601
negotiated sale, a copy of the Mayor's written determination that sale by competitive bid is not 602
feasible or is not in the best interests of the District and a statement of the reasons supporting 603
this determination; and 604
(B) Whether the bonds or notes of any series are intended to be issued on a 605
tax-exempt or taxable basis. 606 ENGROSSED ORIGINAL
31
(d)(1) No portion of the proceeds of the sale of bonds or notes shall be used to 607
compensate a District employee unless the employee actually performs duties related to the 608
projects financed by this act, as provided in section 5(e). 609
(2) Within 30 days after the effective date of this act, and before any bonds or 610
notes are issued pursuant to this act, the Mayor shall submit to the Council a list of all 611
District employees who are compensated, in whole or part, by capital improvement funds. 612
(e) With respect to a negotiated sale of bonds or notes, the underwriters shall provide 613
written notification to the District of the following circumstances: 614
(1) Any relationship, during the prior 2 years, with elected or appointed District 615
officials, or the District's bond counsel or financial advisor, which could create a conflict of 616
interest or apparent conflict of interest with the duties performed, or to be performed, by such 617
underwriters or other advisors for the District; 618
(2) Any arrangement, during the prior 2 years, to share fees with other 619
underwriters, firms, or individuals in connection with the provision of services to the District by 620
either entity; and 621
(3) Any public finance transaction for any other issuer where the underwriter, or 622
prospective underwriter, is serving, or has served in the prior 2 years, as financial advisor in any 623
transaction where the District's financial advisor was, or is, an underwriter. 624
Sec. 22. Period of Limitations. 625
At the end of the 20- day period beginning on the date of the first publication pursuant to 626 ENGROSSED ORIGINAL
32
the notice in section 463(a) of the Home Rule Act that an act authorizing the issuance of the 627
bonds has taken effect: 628
(1) Any recital or statement of fact contained in such act or in the preamble or title of 629
this act shall be deemed to be true for the purpose of determining the validity of any bonds 630
authorized by this act, and the District and all others interested shall be estopped from denying 631
any such recital or statement of fact; and 632
(2) This act, and all proceedings in connection with the authorization of the issuance 633
of bonds authorized by this act, shall be deemed to have been duly and regularly taken, passed, 634
and done by the District, in compliance with the Home Rule Act and all other applicable laws, for 635
the purpose of determining the validity of this act and the proceeding in connection with the 636
authorization and issuance of bonds authorized by this act; and no court shall have jurisdiction in 637
any suit, action, or proceeding commenced before the end of such 20 -day period. 638
Sec 23. Severability. 639
As provided in the General Rule of Severability Adoption Act of 1983, effective March 640
14, 1984 (D.C. Law 5-56; D.C. Official Code § 45- 201), if any provision of this act or the 641
application of this act to any person or circumstance is held to be unconstitutional or beyond the 642
statutory authority of the Council, or otherwise invalid, the i nvalidity shall not affect other 643
provisions or applications of the act that can be given effect without the invalid provision or 644
application, and to this end the provisions of this act are declared to be severable. 645
Sec. 24. Fiscal impact statement. 646 ENGROSSED ORIGINAL
33
The Council adopts the fiscal impact statement in the committee report as the fiscal 647
impact statement required by section 602(c)(3) of the District of Columbia Home Rule Act, 648
approved December 24, 1973 (87 Stat. 813; D.C. Official Code § 1- 206.02(c)(3)). 649
Sec. 25. Effective date. 650
This act shall take effect following approval by the Mayor (or in the event of veto by the 651
Mayor, action by the Council to override the veto), a 30- day period of Congressional review as 652
provided in section 602(c)(1) of the District of Columbia Home Rule Act, approved December 653
24, 1973 (87 Stat. 813; D.C. Official Code § 1- 206.02(c)(1)), and publication in the District of 654
Columbia Register. 655