2023 -- H 6479
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LC003114
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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
AUTHORIZING THE TOWN OF CUMBERLAND TO ISSUE NOT TO EXCEED $52,000,000
GENERAL OBLIGATION BONDS, NOTES AND OTHER EVIDENCES OF
INDEBTEDNESS TO FINANCE THE CONSTRUCTION , RENOVATION, IMPROVEMENT,
ALTERATION, REPAIR, FURNISHING AND EQUIPPING OF A NEW ELEMENTARY
SCHOOL AND OTHER REL ATED SCHOOL FACILITIES AND THE DEMOLITION OF AN
EXISTING ELEMENTARY SCHOOL ON LAND PRESE NTLY OCCUPIED BY THE B.F.
NORTON SCHOOL IN THE TOWN PROVIDED THAT THE AUTHORIZATION SHALL BE
REDUCED BY ANY GRANT RECEIVED FROM THE SCHOOL BUILDING AUTHOR ITY
CAPITAL FUND
Introduced By: Representatives Voas, Marszalkowski, and Phillips
Date Introduced: June 02, 2023
Referred To: House Finance
It is enacted by the General Assembly as follows:
SECTION 1. The town of Cumberland is hereby empowered, in addition to authority 1
previously granted, to issue bonds in an amount not exceeding fifty-two million dollars 2
($52,000,000) from time to time under its corporate name and seal. The bonds of each issue may 3
be issued in the form of zero coupon bonds, capital appreciation bonds, serial bonds or term bonds 4
or a combination thereof and shall be payable either by maturity of principal in the case of serial 5
bonds or by mandatory serial redemption in the case of term bonds, in installments of principal, the 6
first installment to be not later than five (5) years and the last installment not later than thirty (30) 7
years after the date the bonds are issued. 8
SECTION 2. The town may be eligible for school housing aid reimbursement on debt 9
service pursuant to chapter 7 of title 16, or for a grant, loan or other "financial assistance" as defined 10
in § 45-38.2-1(6), from the school building authority capital fund under chapter 38.2 of chapter 45. 11
The amount of borrowing authorized pursuant to this act shall be reduced by the amount of any 12
grant received by the town from the school building authority capital fund. This act shall constitute 13
an enabling act of the general assembly that is required pursuant to § 16-7-44. Any bonds, notes or 14
other evidences of indebtedness issued under this act for school projects shall not be eligible for 15
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state housing aid reimbursement pursuant to § 16-7-44 unless the school projects described herein 1
have been approved by the Rhode Island department of education. 2
SECTION 3. The bonds shall be signed by the mayor and the director of finance and shall 3
be issued and sold in such amounts as the town council may authorize. The manner of sale, 4
denominations, maturities, interest rates and other terms, conditions and details of any bonds or 5
notes issued under this act may be fixed by the proceedings of the town council authorizing the 6
issue or by separate resolution of the town council or, to the extent provisions for these matters are 7
not so made, they may be fixed by the officers authorized to sign the bonds or notes. 8
Notwithstanding anything contained in this act to the contrary, the town may enter into financing 9
agreements with the Rhode Island health and educational building corporation pursuant to chapter 10
7 of title 16 and chapter 38.1 of title 45 and, with respect to bonds or notes issued in connection 11
with such financing agreements, if any, the town may elect to have the provisions of chapter 38.1 12
of title 45 apply to the issuance of the bonds or notes issued hereunder to the extent the provisions 13
of chapter 38.1 of title 45 are inconsistent herewith. In addition, the town may enter into financing 14
agreements with the Rhode Island infrastructure bank pursuant to the provisions of chapter 12.2 of 15
title 46 and, with respect to bonds or notes issued in connection with such financing agreements, if 16
any, the town may elect to have the provisions of chapter 12.2 of title 46 apply to the issuance of 17
the bonds or notes issued hereunder to the extent the provisions of chapter 12.2 of title 46 are 18
inconsistent herewith. Such election may be fixed by the proceedings of the town council 19
authorizing such issuance of by separate resolution of the town council, or, to the extent provisions 20
for these matters are not so made, they may be fixed by the officers authorized to sign the bonds or 21
notes. The proceeds derived from the sale of the bonds shall be delivered to the director of finance, 22
and such proceeds exclusive of premiums and accrued interest shall be expended: (1) For the 23
construction, renovation, improvement, alteration, repair, furnishing and equipping of a new 24
elementary school and other related school facilities and the demolition of an existing elementary 25
school on land presently occupied by the B. F. Norton School in the Town and all costs related 26
thereto; (2) For payment of the principal or interest on temporary notes issued under section 4; (3) 27
In payment of capitalized interest on bonds or notes; (4) In repayment of advances under section 5; 28
or (5) In payment of related costs of issuance of any bonds or notes. No purchaser of any bonds or 29
notes under this act shall be in any way responsible for the proper application of the proceeds 30
derived from the sales thereof. The project shall be carried out and all contracts made therefor on 31
behalf of the town by the town administrator, subject to approval of the town council. The proceeds 32
of bonds or notes issued under this act, any applicable federal or state assistance and other monies 33
referred to in sections 7 and 10, shall be deemed appropriated for the purposes of this act without 34
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further action than that required by this act. The bond issue authorized by this act may be 1
consolidated for the purposes of issuance and sale with any other bond issue of the town heretofore 2
or hereafter authorized; provided that, notwithstanding any such consolidation, the proceeds from 3
the sale of the bonds authorized by this act shall be expended for the purposes set forth above. 4
SECTION 4. The town council may by resolution authorize the issue from time to time of 5
interest bearing or discounted notes in anticipation of the issue of bonds or in anticipation of the 6
receipt of federal or state aid for the purposes of this act. The amount of original notes issued in 7
anticipation of bonds may not exceed the amount of bonds which may be issued under this act, 8
(without any reduction for any grant to be received from the school building authority capital fund). 9
The amount of original notes issued in anticipation of federal or state aid may not exceed the 10
amount of available federal or state aid as estimated by the director of finance. Temporary notes 11
issued hereunder shall be signed by the manual or facsimile signatures of the director of finance 12
and the mayor shall be payable within five (5) years from their respective dates, but the principal 13
of and interest on notes issued for a shorter period may be renewed or paid from time to time by 14
the issue of other notes thereunder, provided the period from the date of an original note to the 15
maturity or any note issued to renew or pay the same debt or the interest thereon shall not exceed 16
five (5) years. Any temporary notes in anticipation of bonds issued under this section may be 17
refunded prior to the maturity of the notes by the issuance of additional temporary notes; provided 18
that, no such refunding shall result in any amount of such temporary notes outstanding at any one 19
time in excess of two hundred percent (200%) of the amount of bonds which may be issued under 20
this act; and provided further, that if the issuance of any such refunding notes results in any amount 21
of such temporary notes outstanding at any one time in excess of the amount of bonds which may 22
be issued under this act, the proceeds of such refunding notes shall be deposited in a separate fund 23
established with the bank which is paying agent for the notes being refunded. Pending their use to 24
pay the notes being refunded, monies in the fund shall be invested for the benefit of the town by 25
the paying agent at the direction of the director of finance in any investment permitted under section 26
5. The monies in the fund and any investments held as a part of the fund shall be held in trust and 27
shall be applied by the paying agent solely to the payment or prepayment of the principal of and 28
interest on the notes being refunded. Upon payment of all principal of and interest on the notes, any 29
excess monies in the fund shall be distributed to the town. The town may pay the principal of and 30
interest on notes in full from other than the issuance of refunding notes prior to the issuance of 31
bonds pursuant to section 1 hereof. In such case, the town’s authority to issue bonds or notes in 32
anticipation of bonds under this act shall continue provided that: (1) The town council passes a 33
resolution evidencing the town’s intent to pay off the notes without extinguishing the authority to 34
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issue bonds or notes; and (2) That the period from the date of an original note to the maturity date 1
of any other note shall not exceed five (5) years. 2
SECTION 5. Pending any authorization or issue of bonds hereunder or pending or in lieu 3
of any authorization or issue of notes hereunder, the director of finance, with the approval of the 4
town council, may, to the extent that bonds or notes may be issued hereunder, apply funds in the 5
treasury of the town to the purposes specified in section 2, such advances to be repaid without 6
interest from the proceeds of bonds or notes subsequently issued or from the proceeds of applicable 7
federal or state assistance or from other available funds. 8
SECTION 6. Any proceeds of bonds or notes issued hereunder or of any applicable federal 9
or state assistance, pending their expenditure, may be deposited or invested by the director of 10
finance in demand deposits, time deposits, or savings deposits in banks which are members of the 11
Federal Deposit Insurance Corporation or in obligations issued or guaranteed by the United States 12
of America or by any agency or instrumentality thereof or as may be provided in any other 13
applicable law of the State of Rhode Island or resolution of the town council or pursuant to an 14
investment policy of the town. 15
SECTION 7. Any accrued interest received upon the sale of bonds or notes hereunder shall 16
be applied to the payment of the first interest due thereon. Any premiums arising from the sale of 17
bonds or notes hereunder and any earnings or net profit realized from the deposit or investment of 18
funds hereunder shall, in the discretion of the director of finance, be applied to the cost of preparing, 19
issuing, and marketing bonds or notes hereunder to the extent not otherwise provided, to the 20
payment of the cost of the project, to the payment of the principal of or interest on bonds or notes 21
issued hereunder or to any one or more of the foregoing. The cost of preparing, issuing and 22
marketing bonds or notes hereunder may also, in the discretion of the director of finance, be met 23
from bond or note proceeds exclusive of accrued interest or from other monies available therefor. 24
Any balance of bond or note proceeds remaining after payment of the cost of the projects and the 25
cost of preparing, issuing and marketing bonds or notes hereunder shall be applied to the payment 26
of the principal of or interest on bonds or notes issued hereunder. To the extent permitted by 27
applicable federal laws, any earnings or net profit realized from the deposit or investment of funds 28
hereunder may, upon receipt, be added to and dealt with as part of the revenues of the town from 29
property taxes. In exercising any discretion under this section, the director of finance shall be 30
governed by any instructions adopted by resolution of the town council. 31
SECTION 8. All bonds and notes issued under this act and the debts evidenced thereby 32
shall be obligatory on the town in the same manner and to the same extent as other debts lawfully 33
contracted by it and shall be excepted from the operation of § 45-12-2 of the general laws. No such 34
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obligation shall at any time be included in the debt of the town for the purpose of ascertaining its 1
borrowing capacity. The town shall annually appropriate a sum sufficient to pay the principal and 2
interest coming due within the year on bonds and notes issued hereunder to the extent that monies 3
therefor are not otherwise provided. If such sum is not appropriated, it shall nevertheless be added 4
to the annual tax levy. In order to provide such sum in each year and notwithstanding any provision 5
of law to the contrary, all taxable property in the town shall be subject to ad valorem taxation by 6
the town without limitation as to rate or amount. 7
SECTION 9. Any bonds or notes issued under the provisions of this act, if properly 8
executed by officers of the town in office on the date of execution, shall be valid and binding 9
according to their terms notwithstanding that before the delivery thereof and payment therefor any 10
or all of such officers shall for any reason have ceased to hold office. 11
SECTION 10. The town, acting by resolution of its town council is authorized to apply for, 12
contract for and expend any federal or state advances or other grants or assistance which may be 13
available for the purposes of this act, and any such expenditures may be in addition to other monies 14
provided in this act. To the extent of any inconsistency between any law of this state and any 15
applicable federal law or regulation, the latter shall prevail. Federal and state advances, with interest 16
where applicable, whether contracted for prior to or after the effective date of this act, may be 17
repaid as project costs under section 2. 18
SECTION 11. Bonds and notes may be issued under this act without obtaining the approval 19
of any governmental agency or the taking of any proceedings or the happening of any conditions 20
except as specifically required by this act for such issue. In carrying out any project financed in 21
whole or in part under this act, including where applicable the condemnation of any land or interest 22
in land, and in the levy and collection of assessments or other charges permitted by law on account 23
of any such project, all action shall be taken which is necessary to meet constitutional requirements 24
whether or not such action is otherwise required by statute; but the validity of bonds and notes 25
issued hereunder shall in no way depend upon the validity or occurrence of such action. 26
SECTION 12. All or any portion of the authority to issue bonds and notes under this act 27
may be extinguished by resolution of the town council, without further action by the general 28
assembly seven (7) years after the effective date of this act. 29
SECTION 13. The director of finance and the mayor, on behalf of the town, are hereby 30
authorized to execute such documents or other papers as either of them deem necessary or desirable 31
to carry out the intent of this act and are also authorized to take all actions and execute all documents 32
or agreements necessary to comply with federal tax and securities laws, which documents or 33
agreements may have a term coextensive with the maturity of the bonds authorized hereby, 34
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including Rule 15c2-12 of the Securities and Exchange Commission (the “Rule”) and to execute 1
and deliver a continuing disclosure agreement or certificate in connection with the bonds or notes 2
in the form as shall be deemed advisable by such officers in order to comply with the Rule. 3
SECTION 14. The question of the approval of this act shall be submitted to the electors of 4
the town at the next election to be held on November 7, 2023. The question shall be submitted in 5
substantially the following form: “Shall an Act, passed at the 2023 session of the General 6
Assembly, entitled, ‘AN ACT AUTHORIZING THE TOWN OF CUMBERLAND TO ISSUE 7
NOT TO EXCEED $52,000,000 GENERAL OBLIGATION BONDS, NOTES AND OTHER 8
EVIDENCES OF INDEBTEDNESS TO FINANCE THE CONSTRUCTION, RENOVATION, 9
IMPROVEMENT, ALTERATION, REPAIR, FURNISHING AND EQUIPPING OF A NEW 10
ELEMENTARY SCHOOL AND OTHER RELATED SCHOOL FACILITIES AND THE 11
DEMOLITION OF AN EXISTING ELEMENTARY SCHOOL ON LAND PRESENTLY 12
OCCUPIED BY THE B.F. NORTON SCHOOL IN THE TOWN PROVIDED THAT THE 13
AUTHORIZATION SHALL BE REDUCED BY ANY GRANT RECEIVED FROM THE 14
SCHOOL BUILDING AUTHORITY CAPITAL FUND' be approved?" and the warning for the 15
election shall contain the question to be submitted. From the time the election is warned and until 16
it is held, it shall be the duty of the town clerk to keep a copy of the act available at his/her office 17
for public inspection, but the validity of the election shall not be affected by this requirement. 18
SECTION 15. This section and the foregoing section shall take effect upon the passage of 19
this act. The remainder of this act shall take effect upon the approval of this act by a majority of 20
those voting on the question at the election prescribed by the foregoing section. 21
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EXPLANATION
OF
A N A C T
AUTHORIZING THE TOWN OF CUMBERLAND TO ISSUE NOT TO EXCEED $52,000,000
GENERAL OBLIGATION BONDS, NOTES AND OTHER EVIDENCES OF
INDEBTEDNESS TO FINANCE THE CONSTRUCTION , RENOVATION, IMPROVEM ENT,
ALTERATION, REPAIR, FURNISHING AND EQUIPPING OF A NEW ELEMENTARY
SCHOOL AND OTHER REL ATED SCHOOL FACILITIES AND THE DEMOLITION OF AN
EXISTING ELEMENTARY SCHOOL ON LAND PRESE NTLY OCCUPIED BY THE B.F.
NORTON SCHOOL IN THE TOWN PROVIDED THAT THE AUTHORIZATION SHALL BE
REDUCED BY ANY GRANT RECEIVED FROM THE SCHOOL BUILDING AUTHOR ITY
CAPITAL FUND
***
This act would authorize the town of Cumberland to issue bonds and notes in an amount 1
not exceeding $52,000,000 to finance the construction, renovation, improvement, alteration, repair, 2
furnishing and equipping of a new elementary school and other related school facilities and the 3
demolition of an existing elementary school on land presently occupied by the B. F. Norton School 4
in the town. The amount of borrowing authorized pursuant to this act shall be reduced by the amount 5
of any grant received by the town from the school building authority capital fund. 6
This act shall constitute an enabling act of the general assembly that is required pursuant 7
to § 16-7-44. Any bonds, notes or other evidences of indebtedness issued under this act for school 8
projects shall not be eligible for state housing aid reimbursement pursuant to § 16-7-44 unless the 9
school projects described herein have been approved by the Rhode Island department of education. 10
Sections 14 and 15 would take effect upon passage. The remainder of the act would take 11
effect upon approval of the question provided for in Section 14. 12
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LC003114
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