2023 -- H 6126
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LC002032
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S TATE OF RHODE IS LAND
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2023
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A N A C T
AMENDING CHAPTERS 106 AND 107 OF THE LOCAL ACTS OF 2021 BOTH ENTITLED
“AN ACT RELATING TO SCHOOL CONSTRUCTION AND FINANCING IN THE CITY OF
CENTRAL FALLS AND AUTHORIZING THE CITY OF CENTRAL FALLS TO ISSUE NOT
TO EXCEED $5,760,000 GENERAL OBLIGATION BONDS, NOTES AND OTHER
EVIDENCES OF INDEBTEDNESS TO FINANCE THE CONSTRUCTION, RENOVAT ION,
IMPROVEMENT, ALTERAT ION, REPAIR, FURNISHING AND EQUIPPING OF SCHOOLS
AND SCHOOL FACILITIES IN THE CITY”
Introduced By: Representative Joshua J. Giraldo
Date Introduced: March 03, 2023
Referred To: House Finance
It is enacted by the General Assembly as follows:
WHEREAS, In 2021, the General Assembly passed as companion bills Local Acts 1
Chapters 106 and 107 relating to school construction and financing in the city of Central Falls (the 2
“Prior Acts”); and 3
WHEREAS, The Prior Acts authorized the State, acting through the general treasurer to 4
execute a Financing Agreement and any other agreements necessary to effectuate the purposes of 5
the Prior Acts and the Prior Acts served as the joint resolution required pursuant to Rhode Island 6
General Laws §35-18-1, et seq (the “Rhode Island Public Corporation Debt Management Act”); 7
WHEREAS, The Prior Acts were silent on the use of premium generated from the sale of 8
bonds or notes issued by the Rhode Island Heath and Educational Building Corporation payable 9
from annual appropriations by the State; and 10
WHEREAS, It is desirable that premium on the sale of bonds and notes be permitted to be 11
used to pay costs of the Central Falls School Project as defined in the Prior Acts. 12
NOW THEREFORE, It is enacted and resolved by the General Assembly as follows: 13
SECTION 1. Section 2 of Local Acts of 2021 Chapters 106 and 107 are hereby each 14
amended as follows: 15
SECTION 2. City of Central Falls School Project. 16
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WHEREAS, The WHEREAS clauses in paragraphs 1 through 5 hereof are hereby 1
incorporated herein by reference. 2
WHEREAS, The City of Central Falls is proposing a project consisting of the construction, 3
renovation, improvement, alteration, repair, furnishing and equipping of schools and school 4
facilities in the city; and 5
WHEREAS, The Project will be financed through the Rhode Island Health and Educational 6
Building Corporation (the “Corporation”) under its school financing revenue bond program, with 7
an expected term of not to exceed thirty (30) years and it is anticipated that the State will be a 8
signatory to the Financing Agreement with the Rhode Island Health and Educational Building 9
Corporation; and 10
WHEREAS, It is anticipated that the State’s obligations under the Financing Agreement 11
will be subject to appropriation therefor by the General Assembly in each budget year; and 12
WHEREAS, The Rhode Island Public Corporation Debt Management Act requires the 13
General Assembly to provide its consent to the issuance or incurring by the State of Rhode Island 14
of certain obligations, including financing guarantees or other agreements; and 15
WHEREAS, The principal amount of bonds which will finance the project costs and costs 16
of financing covered by the Financing Agreement is not expected to exceed $144,000,000. Any 17
premium received from the sale of any bonds or notes shall be used toward project costs and shall 18
not reduce the principal amount of bonds or notes. Debt service payments will be supported by 19
revenues received by the Corporation under the Financing Agreement which include annual 20
appropriations for debt service made by the State, state school construction aid payments and state 21
school operations aid payments if any, pursuant to chapter 16-7 of the Rhode Island general laws 22
and payments from the City of Central Falls under the Financing Agreement. Total debt service on 23
the bonds in not expected to exceed $9,400,000 annually and $281,000,000 in the aggregate based 24
on an average interest rate of five percent (5.00%); 25
Now therefor be it resolved 26
RESOLVED, That this General Assembly hereby approves the issuance of bonds or notes 27
to finance the Central Falls School Project in a principal amount up to $144,000,000 plus any 28
original issue premium, such bonds or notes not to be reduced by any premium received on the sale 29
of any bonds or notes which premium shall be used for project costs for the Central Falls School 30
Project; and be it further 31
RESOLVED, That the State, acting through the general treasurer may execute the 32
Financing Agreement as contemplated herein and any other agreements necessary to effectuate the 33
purposes of this act; and be it further 34
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RESOLVED, That the bonds will be special obligations of the Corporation payable from 1
funds received by the Corporation under the Financing Agreement and other revenues received by 2
the Corporation, in any combination or priority as may be designated in the proceedings of the 3
Corporation authorizing the issuance of such debt. The total debt service on the bonds is estimated 4
to average approximately nine million four hundred thousand dollars ($9,400,000) per year or 5
approximately two hundred eighty-one million dollars ($281,000,000) in the aggregate, at an 6
average interest rate of approximately five percent (5%) and an approximately thirty (30) year 7
maturity; and be it further 8
RESOLVED, That the bonds will not constitute indebtedness of the State or any of its 9
subdivisions or a debt for which the full faith and credit of the State or any of its subdivisions is 10
pledged. This act shall constitute an enabling act of the general assembly that is required pursuant 11
to § 16-7-44. 12
RESOLVED, That the State’s authority to incur the obligations set forth herein will expire 13
within five (5) years of the date of passage of this act if such financing transaction is not executed 14
prior to that date. 15
SECTION 3. This act shall take effect upon passage. 16
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LC002032
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EXPLANATION
OF
A N A C T
AMENDING CHAPTERS 106 AND 107 OF THE LOCAL ACTS OF 2021 BOTH ENTITLED
“AN ACT RELATING TO SCHOOL CONSTRUCTION AND FINANCING IN THE CITY OF
CENTRAL FALLS AND AUTHORIZING THE CITY OF CENTRAL FALLS TO ISSUE NOT
TO EXCEED $5,760,000 GENERAL OBLIGATION BONDS, NOTES AND OTHER
EVIDENCES OF INDEBTEDNESS TO FINANCE THE CONSTRUCTION, RENOVA TION,
IMPROVEMENT, ALTERATION, REPAIR, FURNISHING AND EQUIPPING OF SCHOOLS
AND SCHOOL FACILITIES IN THE CITY”
***
This act would clarify that premium received on the sale of bonds or notes shall be used 1
for project costs. 2
This act would take effect upon passage. 3
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LC002032
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