As used in ORS
288.010 to 288.110, unless the context otherwise requires:
(1) “Fiscal agency” means the bank or trust company designated
pursuant to ORS 288.020.
(2) “Subdivision” means a municipal corporation, quasi-municipal
corporation or civil subdivision in this state. [Amended by 1987 c.869 §7](1) The State Treasurer may appoint, as fiscal
agency for payment of the bonds issued by this state or by any
subdivision, a reputable and responsible bank or trust company. The
appointment when so made shall continue for a period of two years unless
sooner revoked by the State Treasurer for valid and sufficient reasons.
An appointment may be renewed and when renewed shall be for a period not
to exceed two years. The State Treasurer may revoke the renewal of an
appointment for valid and sufficient reasons. Nothing in this subsection
limits the number of times the appointment of a particular bank or trust
company as fiscal agency may be renewed.
(2) Until its successor has been appointed, the bank or trust
company named shall act as the fiscal agency of the State of Oregon, in
accordance with such terms as shall be agreed upon between the State
Treasurer and the agency. The fiscal agency shall act as custodian of
such securities owned by the State of Oregon as the State Treasurer shall
specify.
(3) If no such bank or trust company is willing to accept
appointment as fiscal agency, or if the State Treasurer considers
unsatisfactory the terms under which such a bank or trust company is
willing so to act, the bonds and bond interest shall thereupon become
payable at the State Treasury or at the office of the treasurer or fiscal
officer of the subdivision concerned, as the case may be. [Amended by
1981 c.660 §13; 1987 c.869 §8; 1991 c.352 §4; 2003 c.16 §2]The State Treasurer, immediately after the establishment of
the fiscal agency, shall publish a notice thereof in some financial paper
of general circulation in the city in which the fiscal agency is to act
on behalf of the state. Thereafter all bonds and coupons of the state or
one of its subdivisions which are by their terms payable in a specified
city, shall be paid at the fiscal agency appointed in that city. [Amended
by 1987 c.869 §9]Unless otherwise provided by law, the State Treasurer and
the treasurer or other fiscal officer of every affected subdivision shall
remit to the fiscal agency, before the maturity of any bonds or coupons
payable at the fiscal agency, sufficient moneys out of any funds in the
hands of any such treasurer or other fiscal officer applicable to such
purpose, for the redemption of such bonds or coupons. [Amended by 1967
c.220 §1; 1991 c.352 §5] Upon the receipt of any funds
by the fiscal agency, the agency shall notify the officers from whom the
funds were received that the funds have been received. (1) After payment of
the bonds or coupons issued by a subdivision for which the funds were
remitted by the treasurer or other fiscal officer of the subdivision, the
bonds or coupons shall be canceled and returned to the officer from whom
the funds were received, not less often than quarterly by January 15,
April 15, July 15 and October 15 of each year. At the option of the
treasurer or other fiscal officer, the bonds and coupons may be held for
destruction as are state bonds and coupons under ORS 288.120 and may be
destroyed in the same manner as state bonds and coupons are destroyed
under ORS 288.120.
(2) After payment of the bonds or coupons issued by this state for
which funds were remitted by the State Treasurer, the bonds or coupons
shall be canceled and held for destruction under ORS 288.120. [Amended by
1975 c.462 §3; 1981 c.252 §1]
Neither the State Treasurer nor the treasurer or other fiscal officer of
any subdivision shall be held responsible for funds remitted to the
fiscal agency. The acknowledgment of the receipt of such funds, for which
canceled bonds and coupons have not been returned, shall be a voucher to
such treasurer in any settlement. Postage and express costs shall
be proper charges against the state or subdivision therein for which they
are incurred and shall be paid to the fiscal agency and in turn be
allowed the treasurer or other fiscal officer in settlement.Nothing in ORS 288.010 to
288.110 shall be construed to affect any bond issues existing on May 20,
1911, or on February 17, 1943, that by their provisions are made payable
at a fiscal agency in the City of New York designated before February 17,
1943. However, if desired by the holder, such bond issues and the
interest thereon may be paid at the regular fiscal agency appointed in
accordance with ORS 288.020.
If the State Treasurer or the treasurer or other fiscal officer of any
subdivision neglects or refuses to perform the duties imposed by ORS
288.010 to 288.110, the State Treasurer or treasurer or other fiscal
officer shall be liable to the holder of any bonds or coupons aggrieved
by such neglect, in a sum, recoverable in an action at law against such
treasurer and the bondsmen of such treasurer, for twice the amount of the
face value of any such bonds or coupons as are dishonored on account of
the neglect or refusal of such officer to comply with the provisions of
ORS 288.010 to 288.110.(1) When the
principal and interest upon bonds issued by this state must be paid only
at the office of the State Treasurer, the bonds and interest coupons
surrendered to the State Treasurer upon payment shall be retained by the
State Treasurer for two years or until audited by the Secretary of State.
Thereafter, the State Treasurer, shall destroy them. The State Treasurer
shall prepare a list of the bonds and coupons destroyed and shall
maintain a certificate signed by the State Treasurer that the bonds and
coupons described therein were destroyed by the State Treasurer on the
date of the certificate.
(2) When the principal and interest upon bonds issued by this state
must be paid at the office of the fiscal agency or may be paid at either
the office of the fiscal agency or the State Treasurer, bonds and
interest coupons surrendered upon payment shall be destroyed by the
fiscal agency. Bonds and interest coupons that must be destroyed by the
fiscal agency under this subsection that are surrendered to the State
Treasurer upon payment shall be sent in due course by the State Treasurer
to the fiscal agency for destruction.
(3) The fiscal agency shall destroy paid bonds and interest coupons
under subsection (2) of this section not earlier than one year after the
date upon which those bonds and coupons are surrendered on payment. For
each occasion on which bonds or coupons are destroyed, the fiscal agency
shall prepare a destruction certificate for bonds and a separate
destruction certificate for coupons. A destruction certificate shall
contain a list of the bonds or coupons destroyed, the date of destruction
and the signature of an authorized agent of the fiscal agency, and shall
be filed with the State Treasurer.
(4) The fiscal agency is responsible for proper payment and
disposition of all bonds and coupons, and for any duplicate payments,
payments to unauthorized persons and nonpayment to authorized persons
occurring as a result of destruction of bonds or coupons under this
section. [1975 c.462 §2]FORMS OF GOVERNMENTAL UNIT BORROWING As used in ORS
288.150 to 288.165:
(1) “Actual cost” has the meaning given the term under ORS 310.140.
(2) “Capital construction” has the meaning given the term under ORS
310.140.
(3) “Costs” when used with capital construction or improvements has
the same meaning as “actual costs” as defined under ORS 310.140.
(4) “Credit agreement” means a note, letter of credit, line of
credit or similar agreement in which a financial institution agrees to
loan funds to the governmental unit, and the governmental unit pledges
its full faith and credit and agrees to repay the amounts loaned over
time, with or without interest.
(5) “Credit enhancement device” means a letter of credit, line of
credit, municipal bond insurance policy, standby purchase agreement or
other device or facility used to enhance the creditworthiness or
marketability of municipal bonds.
(6) “General obligation bond” means a bond including a credit
agreement that:
(a) Is a full faith and credit obligation; and
(b) Is payable from taxes that may be levied without limitation by
section 11 or 11b, Article XI of the Oregon Constitution.
(7) “Governmental unit” means a unit of local government within the
State of Oregon, including, but not limited to, cities, counties, school
districts, special districts, public corporations and intergovernmental
corporations organized under the authority of ORS 190.010.
(8) “Improvement” has the meaning given “capital improvements”
under ORS 310.140.
(9) “Limited tax bond” means a bond or other obligation that:
(a) Is a full faith and credit obligation; and
(b) Is payable from taxes that the issuer may levy within the
limitations of sections 11 and 11b, Article XI of the Oregon Constitution.
(10) “Related property” includes tangible personal or real property
that is part of, functionally related to or used in connection with a
public utility system of which the financed property is a part.
(11) “Structure” has the meaning given the term under ORS 310.140.
[1991 c.902 §98; 1997 c.541 §366; 2005 c.443 §7](1) If authorized by law other than ORS 288.150 to 288.165 and
in the manner provided by law, a governmental unit may issue general
obligation bonds when:
(a) The question of issuing the specific bonds has been approved by
the electors of the issuing governmental unit or the bonds replace
outstanding general obligation bonds pursuant to ORS 288.160; and
(b) The general obligation bonded indebtedness will be incurred for
capital construction or improvements.
(2) In addition to the authority to issue limited tax bonds
provided by other provisions of law, a governmental unit also is
authorized to issue limited tax bonds in the following circumstances:
(a) When a governmental unit is authorized by a statute or charter
to issue general obligation bonds without submitting the question of the
issuance thereof to its electors, such governmental unit may exercise
such statutory or charter authority to issue limited tax bonds for the
same purposes and subject to the same terms and conditions of such
statutory or charter authority.
(b) When the electors of a governmental unit have authorized the
issuance of general obligation bonds for a particular purpose, the
governing body, in its discretion and to carry out such purpose, may
issue all or a portion of such bonds as limited tax bonds.
(3) Notwithstanding this section or any other provision of law
requiring bonds to be authorized by ordinance, the limited tax bonds
authorized by this section shall be issued pursuant to a resolution or
ordinance of the governing body of the issuing governmental unit.
(4) A governmental unit that has outstanding general obligation or
limited tax bonds, subject to applicable covenants or agreements limiting
payment of specific obligations to particular sources of funds, shall
budget and appropriate amounts sufficient to pay in each succeeding
annual period debt service on the bonds. However, this subsection does
not require the governmental unit to adopt a supplemental budget to pay
the principal and interest coming due on the general obligation or
limited tax bonds in the fiscal year in which the bonds are authorized
and issued. The governmental unit may pay principal and interest in the
fiscal year in which the bonds are authorized and issued from any
lawfully available source of funds without adopting a supplemental budget.
(5) When issuing limited tax bonds, a governmental unit may:
(a) Establish the maturity schedule, interest rates, including
variable or adjustable rates of interest, redemption provisions and other
terms of the limited tax bonds. Notwithstanding this subsection, the
governing body, in the ordinance or resolution authorizing the issuance
of the bonds or notes, may delegate to any elected or appointed official
or employee of the governmental unit the authority to determine the
maturity dates, principal amounts, redemption provisions, interest rates
or the method of determining a variable or adjustable interest rate,
denominations and other terms and conditions of the bonds that are not
appropriately determined at the time of enactment of the authorizing
ordinance or resolution. The authority delegated under this subsection
must be exercised subject to the applicable requirements of law and the
limitations and criteria set forth in the ordinance or resolution;
(b) Pledge as additional security for the limited tax bonds all or
any portion of its revenues or other funds of whatever kind or nature and
from whatever source derived that are not specifically restricted, under
applicable law, to uses other than the payment of the amounts owing on
the bonds including, but not limited to, taxes, fees or income derived
from public utilities or other income-producing enterprises operated by
the governmental unit, or agencies or instrumentalities thereof, or fines
and penalties, and make and enter into covenants with the owners of the
bonds to pay all or any portion of the amounts owing thereon out of all
or any portion of the revenues or other funds;
(c) Grant mortgages, trust deeds or security interests in property
that is financed with the limited tax bonds and related property, in
order to enhance the security of limited tax bonds or the obligations of
the governmental unit under a related credit enhancement device;
(d) Obtain a credit enhancement device providing additional
security for the payment of all or any portion of the amounts owing under
the bonds or for the purpose of funding, in lieu of cash, all or any
portion of any debt service reserve established with respect to the
bonds. The governmental unit may pledge as security for its obligations
arising under a credit enhancement device any revenues pledged to the
payment of the related bonds, and the obligations are payable from the
same sources from which the bonds are payable;
(e) Enter into agreements with bond trustees and deposit funds with
trustees for the benefit of bond owners and the providers of credit
enhancement devices for bonds;
(f) Enter into covenants for the benefit of bond owners or the
providers of credit enhancement devices for bonds that are intended to
improve the security of bond owners or providers of credit enhancement
devices, or to maintain the tax exempt status of interest payable on
bonds or credit enhancement agreements. Covenants may include, but are
not limited to, covenants regarding the issuance of additional bonds and
other financial obligations, the imposition and collection of any
revenues that secure the bonds, and the priority of payment of bonds and
other financial obligations of the governmental unit; and
(g) Establish a debt service reserve for the purpose of paying when
due all amounts owing on the bonds and fund the debt service reserve with
proceeds derived from the issuance and sale of the bonds or from other
sources determined by the governing body of the governmental unit.
(6) A security interest granted by a governmental unit under
authority of ORS 288.150 to 288.165 attaches and is perfected on the date
the security interest is granted or the date the governmental unit takes
possession of the property in which the security interest is granted,
whichever is later. A security interest authorized by ORS 288.150 to
288.165 has priority over all other liens and claims. [1991 c.902 §99;
1993 c.97 §5; 2005 c.443 §8](1) Proceeds of refunding
bonds authorized by this section shall be used solely to refund bonds and
pay related costs and expenses, and shall not be used to pay for costs of
operations or costs of projects not attributable to the refunding.
(2) If authorized by law other than ORS 288.150 to 288.165 and in
the manner provided by law, a governmental unit may issue general
obligation bonds to refund outstanding bonded indebtedness or to
reimburse the governmental unit for costs of capital construction or
improvements, if:
(a) The refunding general obligation bonds have been approved by
the electors in a manner that qualifies under section 11 (11)(d)(ii),
Article XI of the Oregon Constitution, and the obligations which are
refunded, or the first obligations in the series, if the refunding
general obligation bonds are part of a series of refundings, or the costs
which are to be reimbursed, were incurred for capital construction or
improvements; or
(b) The refunding general obligation bonds replace an issue of
outstanding general obligations bonds which were incurred for capital
construction or improvements.
(3) For the purposes of this section, refunding general obligation
bonds shall be deemed to replace outstanding general obligation bonds if:
(a) The refunded general obligation bonds are paid or lawfully
deemed paid upon issuance of the refunding general obligation bonds; and
(b) The net proceeds of the refunding bonds shall be used to pay
only the debt service on the refunded bonds and the costs of issuance of
the refunding bonds; and
(c) The bond refunding satisfies at least one of the following
tests:
(A) The principal amount of the refunding general obligation bonds
does not exceed the outstanding principal amount of the refunded general
obligation bonds, plus the amount of any authorized but unissued general
obligation bonds of the governmental unit; or
(B) The total amount of principal and interest payable on the
refunding general obligation bonds does not exceed the total amount of
principal and interest payable on the refunded bonds as of the date of
issuance of the refunding general obligation bonds; or
(C) The present value of the debt service on the refunding general
obligation bonds does not exceed the present value of the debt service on
the refunded general obligation bonds, with the present values calculated
at the refunding bond yield.
(4) For purposes of section 11 (13) and 11b (3)(b), Article XI of
the Oregon Constitution:
(a) If refunding general obligation bonds replace an issue of
general obligation bonds, the refunding general obligation bonds shall be
deemed to have been issued on the date of issuance of the bonds which are
replaced, or the first issue of general obligation bonds, if the
refunding general obligation bonds are part of a series of refundings; and
(b) If the bonds which are replaced were approved by the electors,
the refunding general obligation bonds shall be deemed to have been
specifically approved by the vote which approved the bonds which are
replaced, or the first issue, in a series of refundings.
(5) Notwithstanding ORS 221.200, 255.085, 287.056 or any other law
to the contrary, a ballot measure authorizing issuance of refunding
general obligation bonds need not state the principal amount of refunding
general obligation bonds, so long as the refunding bonds comply with
subsection (3) of this section. A ballot measure may authorize issuance
of general obligation bonds to refund a specific series of outstanding
general obligation bonds, or may authorize issuance of general obligation
bonds to refund all or any portion of the outstanding bonds or future
general obligation bonds, or any combination thereof.
(6) Refunded general obligation bonds shall be deemed paid within
the meaning of subsection (3) of this section if:
(a) The refunded general obligation bonds are deemed paid or
defeased under the provisions of the documents authorizing issuance of
the refunded general obligation bonds; or
(b) The governmental unit complies with ORS 288.677.
(7) If a governmental unit issues general obligation bonds to
refund general obligation bonds that were issued before December 5, 1996,
the refunded general obligation bonds and the refunding general
obligation bonds shall be treated as having been incurred to finance
capital construction and improvements under the laws in effect at the
time the refunded bonds were issued. The definitions described in section
11 (13), Article XI of the Oregon Constitution, or statutes enacted to
interpret section 11 (13), Article XI of the Oregon Constitution, shall
not apply to the refunded bonds or the refunding bonds.
(8) A governmental unit may issue refunding bonds to refund
obligations described in section 11 (5)(a)(A) and (B), Article XI of the
Oregon Constitution. Ad valorem property taxes may be levied and
collected to pay refunding bonds authorized by this subsection to the
same extent that ad valorem property taxes could be levied and collected
to pay the obligations that are refunded.
(9) A governmental unit may issue refunding bonds to refund bonds
that are not general obligations or obligations described in section 11
(5)(a)(A) and (B), Article XI of the Oregon Constitution, but are secured
by ad valorem property taxes. Ad valorem property taxes may be levied and
collected to pay refunding bonds authorized by this subsection to the
same extent that ad valorem property taxes could be levied and collected
to pay the bonds that are refunded. [1991 c.902 §100; 1995 c.333 §29;
1997 c.541 §366a](1)
As used in this section:
(a) “Lawfully available funds” means revenues or other moneys of a
governmental unit from whatever source derived, including but not limited
to moneys credited to the governmental unit’s general fund, revenues from
an ad valorem tax authorized to be levied under the governmental unit’s
permanent rate limit under sections 11 and 11b, Article XI of the Oregon
Constitution, and revenues derived from other taxes levied by the
governmental unit in accordance with and subject to limitations and
restrictions imposed under applicable law or contract, that are not
dedicated, restricted or obligated by law or contract to an inconsistent
expenditure or use.
(b) “Obligation” has the meaning given that term in ORS 288.594.
(2) When a governmental unit pledges its full faith and credit and
taxing powers to the repayment of an obligation, the pledge constitutes
an enforceable promise or contract by the governmental unit:
(a) To pay the obligation out of lawfully available funds of the
governmental unit; and
(b) If lawfully available funds are insufficient to pay when due
the amounts owing on the obligation, to levy, impose and collect a tax
that is within the authority of the governmental unit to levy, impose and
collect in an amount sufficient to pay the amounts owing under the
obligation, including past due amounts and penalties.
(3) If a governmental unit fails to pay when due an amount owing
under an obligation secured by a pledge of the full faith and credit and
taxing powers of the governmental unit, the owner of the obligation, or a
trustee appointed to act on behalf of the owner, may bring an action in
the circuit court for the county in which the principal offices of the
governmental unit are located to compel the governmental unit to:
(a) Appropriate and expend sufficient lawfully available funds to
pay the amounts owing on the obligation; or
(b) If lawfully available funds are insufficient to pay when due
the amounts owing on the obligation, levy, impose and collect a tax that
is within the authority of the governmental unit to levy, impose and
collect in an amount sufficient to pay the amounts owing under the
obligation, including past due amounts and penalties.
(4) An owner of the obligation, or a trustee appointed to act on
behalf of the owner, may initiate a proceeding to impose remedial
sanctions under ORS 33.055 against members of a governing body for
failure to comply with an order of the court under this subsection. [2003
c.195 §4](1) Subject to any
applicable limitations imposed by the Constitution or laws of the State
of Oregon or the charter, ordinance or resolution of a governmental unit,
a governmental unit or the State of Oregon, acting through the State
Treasurer pursuant to ORS 293.173, may borrow money by entering into a
credit agreement, or issuing notes, warrants, short-term promissory
notes, commercial paper or other obligations:
(a) In anticipation of tax revenues or other income for purposes
that include, but are not limited to, the payment of current expenses;
(b) To provide interim financing for capital assets to be
undertaken by the governmental unit; or
(c) To refund outstanding obligations.
(2) To secure obligations authorized under this section, a
governmental unit or the State Treasurer, acting on behalf of the state,
may:
(a) Pledge the anticipated tax revenues or other income, the
proceeds of any bonds or other permanent financing, or any combination
thereof;
(b) Segregate any pledged funds in separate accounts that may be
held by the governmental unit, the State Treasurer or third parties;
(c) Enter into contracts with third parties to obtain standby lines
of credit or other financial commitments designated to provide additional
security for obligations authorized by this section;
(d) Establish any reserves deemed necessary for the payment of the
obligations; and
(e) Adopt resolutions and enter into agreements containing
covenants and provisions for protection and security of the owners of
obligations, which shall constitute enforceable contracts with such
owners.
(3) Obligations authorized by this section that are issued in
anticipation of tax revenues or other income, except grant income, and
any obligations authorized by this section that are issued to refund them
may not be issued prior to the beginning of, and shall mature not later
than, the end of the fiscal period in which the governmental unit or the
State Treasurer expects to receive the tax revenues or other income.
Obligations issued by a governmental unit or the State Treasurer in
anticipation of tax revenues or other income, except grant income, may
not be issued in an amount greater than 80 percent of the amount budgeted
to be received in the fiscal period in which the obligations are issued.
(4) Obligations authorized by this section that are issued in
anticipation of grant income or to provide interim financing for capital
assets shall mature not later than five years after the obligations are
issued and may be redeemed beginning not later than one year after the
governmental unit or the State Treasurer expects to receive the grant or
the capital asset is projected to be completed.
(5) Notwithstanding subsections (3) and (4) of this section:
(a) A school district, education service district, community
college district or community college service district may issue
obligations that are issued in anticipation of tax revenues or other
income to mature not later than 13 months after the date the obligations
were issued.
(b) A city that is incorporated on or after January 1, 1990, and is
within an urban growth boundary may issue an obligation in anticipation
of tax revenues or other income prior to the beginning of the fiscal
period in which the city expects to receive the revenues or other income
if the obligation:
(A) Matures not later than 18 months after the obligation is
issued; and
(B) Is issued in an amount that does not exceed 80 percent of the
amount of lawfully available funds, as defined in ORS 288.162, that the
governmental unit reasonably expects to receive.
(6) Refunding obligations issued pursuant to subsection (1)(c) of
this section shall mature not later than five years after the refunding
obligations are issued.
(7) The debt limitations imposed by law or the charter of any
governmental unit do not affect the right of any governmental unit to
issue obligations under authority of this section, nor are any of the
obligations to be taken into consideration in determining the percentage
or extent to which the governmental unit is indebted under the debt
limitation. Obligations issued to refund outstanding obligations are not
considered to be within any of such debt limitations.
(8) Except as provided in this section, obligations authorized by
this section may be in any form and contain any terms, including
provisions for redemption at the option of the owner and provisions for
the varying of interest rates in accordance with any index, banker’s loan
rate or other standard.
(9) The governing body of an issuing governmental unit, in the
ordinance or resolution authorizing the issuance of obligations under
this section, may delegate to any elected or appointed official or
employee of the governmental unit the authority to determine maturity
dates, principal amounts, redemption provisions, interest rates or the
method for determining a variable or adjustable interest rate,
denominations and other terms and conditions of such obligations that are
not appropriately determined at the time of enactment or adoption of the
authorizing ordinance or resolution, which delegated authority shall be
exercised subject to applicable requirements of law and such limitations
and criteria as may be set forth in such ordinance or resolution. Except
to the extent of any such delegation, the governmental unit or the State
Treasurer shall determine:
(a) The maximum effective rate of interest the obligations shall
bear;
(b) The manner of sale;
(c) The discount, if any, the governmental unit may allow;
(d) The terms and conditions by which the obligations may be
redeemed prior to maturity;
(e) The maturities of the obligations;
(f) The form and denominations of the notes or other obligations;
and
(g) All other terms and conditions related to the sale of the
obligations.
(10) The governmental unit or the State Treasurer may contract with
third parties to serve as issuing, paying and authenticating agents for
any obligations authorized by this section.
(11) Obligations authorized by this section may be sold at public
or private sale upon such terms as the governmental unit or the State
Treasurer finds advantageous, with such disclosure as the governmental
unit or State Treasurer deems appropriate. ORS 287.040 applies to
obligations issued by governmental units under this section.
(12) As used in this section, “fiscal period” means:
(a) In the case of a governmental unit, a fiscal year.
(b) In the case of the State of Oregon, a biennium. [1991 c.902
§101; 1993 c.97 §6; 2002 s.s.1 c.1 §1; 2002 s.s.4 c.1 §4; 2003 c.195 §14;
2005 c.6 §1]PAYMENT OR REISSUANCE OF LOST, MUTILATED OR DESTROYED EVIDENCE OF
INDEBTEDNESS As used in ORS
288.410 to 288.460, unless the context requires otherwise:
(1) “Evidence of indebtedness” includes interest coupons originally
attached to bonds issued by an issuer even though detached therefrom
subsequent to the date on which such bonds were issued.
(2) “Duplicate” means a duplicate of an instrument.
(3) “Governing body” means the person, board, commission, council
or other body authorized to direct the issuance of instruments for the
issuer.
(4) “Indemnity bond” means an undertaking conditioned that the
asserted owner of an instrument, as principal, will protect the issuer
and the paying officer against loss or liability resulting from any
demand or payment of the principal of or interest on an instrument and
that such asserted owner will surrender such instrument to the paying
officer if it comes into the possession of the asserted owner.
(5) “Instrument” means any lost, mutilated or destroyed evidence of
indebtedness of an issuer, other than warrants or checks.
(6) “Issuer” means the state, county, municipality, district or
civil subdivision which has issued an instrument.
(7) “Lost” means lost or stolen for a length of time and under
circumstances that indicate that the instrument has been destroyed or
irrevocably lost, that it is not held by any person as the property of
the person and that it will not be the basis of a claim against the
issuer.
(8) “Mutilated” means defacement of an instrument to the extent
that its negotiation may be impaired.
(9) “Paying officer” means the public officer, other than a fiscal
or paying agent, to whom instruments may be presented for payment. [1959
c.410 §1](1) The paying officer shall pay the principal of or
interest on any instrument at or after maturity when, except as provided
in subsections (2) and (3) of this section, the asserted owner of the
instrument:
(a) Submits a satisfactory affidavit describing the instrument and
the circumstances surrounding the acquisition of the instrument and
giving a detailed statement of the circumstances surrounding its loss,
mutilation or destruction;
(b) Surrenders the instrument, if mutilated and in the possession
of the asserted owner; and
(c)(A) Furnishes an indemnity bond executed by two or more sureties
satisfactory to the paying officer and qualifying as in the case of
sureties for bail for twice the face amount of the instrument plus
interest due thereon; or
(B) Furnishes an indemnity bond executed by a surety company
licensed to do business in the state for the face amount of the
instrument plus interest due thereon.
(2) If the asserted owner does not have personal knowledge of the
information that must be contained in the affidavit required under
subsection (1)(a) of this section, the person having the personal
knowledge may make the affidavit.
(3) If the face amount of an instrument plus interest due thereon
is $1,000 or more, a surety company licensed to do business in the state
must execute the indemnity bond required under subsection (1) of this
section. [1959 c.410 §2; 2003 c.14 §143](1) If an instrument has not yet matured, the
governing body of the issuer shall direct the appropriate officer to
execute and deliver a duplicate to the asserted owner of such instrument
when, except as provided in subsection (2) of this section, such asserted
owner:
(a) Submits a satisfactory affidavit describing the instrument and
the circumstances surrounding acquisition of such instrument and giving a
detailed statement of the circumstances surrounding its loss, mutilation
or destruction;
(b) Surrenders the instrument, if mutilated and in the possession
of the asserted owner;
(c) Furnishes an indemnity bond executed by a surety company
licensed to do business in the state for the face amount of the
instrument plus interest due and to become due thereon; and
(d) Deposits a sum sufficient to pay the expenses of issuing a
duplicate with an appropriate officer of the issuer.
(2) If the asserted owner does not have personal knowledge of the
information that must be contained in the affidavit required under
subsection (1)(a) of this section, the person having such personal
knowledge may make the affidavit. [1959 c.410 §3; 2005 c.22 §210]
If the asserted owner of a lost, mutilated or destroyed instrument that
was registered provides an affidavit, certification or other reliable
proof that the governing body or paying officer reasonably finds protects
the issuer from conflicting claims for payment under the registered
instrument, the paying officer may waive the requirements of ORS 288.420
and the governing body may waive the requirements of ORS 288.430 with
respect to that registered instrument. [1993 c.97 §20] If any duplicate be issued,
it shall be in the same form and amount and bear the same serial number,
date of issue and date of maturity as the original instrument. If the
instrument be a bond with interest coupons attached, only interest
coupons that have not matured under the terms of the original instrument
as of the date the duplicate is issued shall be attached to the
duplicate. The officer issuing the duplicate shall indorse the word
“DUPLICATE” and the date of its issuance upon its face and upon the face
of any interest coupon attached thereto. The officer issuing the
duplicate shall sign the duplicate on behalf of the issuer. [1959 c.410
§6] The paying officer
may waive the requirement of an indemnity bond as imposed by ORS 288.420
and the governing body may waive such requirement as imposed by ORS
288.430 when the asserted owner of the instrument furnishes an
undertaking for the face amount of such instrument plus all interest due
and to become due thereon to protect the issuer and the paying officer
from loss or liability resulting from any demand or payment of the
principal of or interest on such instrument and:
(1) The asserted owner surrenders a mutilated instrument that is so
complete that any missing portion thereof could not form the basis of a
valid claim against the issuer; or
(2) The asserted owner of the instrument is the state in its
individual or fiduciary capacity or any county, municipality, district or
civil subdivision that is not in default on the payment of any of its
outstanding obligations. [1959 c.410 §4; 2005 c.22 §211]If any paying officer refuses to pay
or if any governing body refuses to direct the issuance of a duplicate,
the asserted owner of an instrument may petition any circuit court for an
order requiring the paying officer or governing body to show cause why
the paying officer or governing body should not be required to pay such
instrument in accordance with its terms or direct the issuance of a
duplicate. If, upon hearing, it appears to the satisfaction of the court
that the petitioner is the owner of the instrument, that it has been
lost, mutilated or destroyed and that no sufficient cause has been shown
why it should not be paid or a duplicate thereof issued, the court shall
make an order requiring the paying officer to pay it or requiring the
governing body to direct the issuance of a duplicate upon such conditions
as the court considers adequate for the protection of the issuer and the
paying officer against loss or liability resulting from any demand or
payment of the principal of or interest on the instrument. [1959 c.410 §5]BONDS GENERALLY(1) If a court of competent
jurisdiction determines that the proceeds of an issue of exempt bonded
indebtedness is used for expenditures that are not expenditures for
capital construction or capital improvements, the court may require the
governmental unit issuing the bonded indebtedness to take only the
following actions:
(a) The court may order the governmental unit to replace the
misspent proceeds on a reasonable schedule determined by the court, with
interest, from sources other than the taxes that the governmental unit
levies to pay the bonded indebtedness, and to use the replaced funds for
capital construction or capital improvement expenditures or to pay bond
debt service; or
(b) If the governmental unit fails to comply with an order to
replace the misspent proceeds, or acknowledges that the governmental unit
is unable to replace the misspent proceeds, the court may determine that
a portion of the future levies to pay the bonded indebtedness shall be
subject to the limits of section 11b, Article XI of the Oregon
Constitution. The portion that is subject to those limits shall be
determined by calculating the amount of the taxes that are necessary to
pay the principal and interest on the bonded indebtedness that is
allocable to the misspent proceeds.
(2) No action may be filed or maintained against a governmental
unit because of an alleged expenditure of proceeds of exempt bonded
indebtedness for purposes other than capital construction or
improvements, if the misspent amount is less than $5,000. [1997 c.541
§366b]Note: 288.500 to 288.513 were enacted into law by the Legislative
Assembly but were not added to or made a part of ORS chapter 288 or any
series therein by legislative action. See Preface to Oregon Revised
Statutes for further explanation. For
purposes of sections 11 and 11b, Article XI of the Oregon Constitution,
the date on which bonded indebtedness is issued is the earliest date on
which any bond in a series is issued. [1997 c.541 §366c]Note: See note under 288.500. In
determining the “true cash value” of taxable property for the purpose of
calculating the total amount of indebtedness which may be incurred by the
state or local governments under the Oregon Constitution or laws of the
State of Oregon, the “real market value,” as defined in section 11b
(2)(a), Article XI of the Oregon Constitution, may be used if and to the
extent that the “real market value” does not exceed the “true cash
value.” [1991 c.902 §1]Note: See note under 288.500. As used in ORS
288.515 to 288.600:
(1) “Bonds” means general obligation, revenue or tax increment
bonds, notes, lease purchase, financing or loan agreements, land sale
contracts or other borrowings of a public body.
(2) “Public body” means the State of Oregon, its agencies,
institutions or any municipality authorized by law to issue bonds.
(3) “Municipality” means a political subdivision of this state and
municipal, quasi-municipal and public corporations and intergovernmental
entities organized under ORS chapter 190 authorized by law to issue
bonds. [1981 c.94 §2; 1983 c.347 §1; 1991 c.583 §6; 2005 c.443 §9] The Legislative Assembly
finds and declares that:
(1) It is a matter of statewide concern that certain covenants made
by public bodies regarding any pledge of revenues securing bonds or other
obligations not be impaired by subsequent initiative or referendum
measures.
(2) These covenants usually are in the form of a promise to charge
and collect rates, fees, tolls, rentals or other charges sufficient to
produce revenues to maintain a specified level of debt service coverage.
(3) Such covenants are material to the security for the bonds or
other obligations and to investors’ expectations regarding timely payment
of the bonds or other obligations. Any possibility that such covenants
might be rolled back, frozen or otherwise subjected to subsequently
imposed conditions or restrictions negatively affects the ability of
public bodies to market their bonds, to obtain credit enhancement and to
obtain satisfactory ratings on their bonds. [1997 c.171 §2]Note: 288.517 and 288.518 were added to and made a part of 288.515
to 288.600 by legislative action but were not added to any smaller series
therein. See Preface to Oregon Revised Statutes for further explanation.Any municipality that is authorized to issue revenue bonds by any
law other than the Uniform Revenue Bond Act, ORS 288.805 to 288.945, may,
when issuing those bonds, exercise the powers specified in ORS 288.825
(3) and (4). The municipality may also pledge any revenues that such
authorizing law allows the municipality to commit to pay the revenue
bonds and any amounts held as reserves for the revenue bonds. [1997 c.171
§3]Note: See note under 288.517.(1) Except as provided in subsection (5) of this section, a
public body issuing bonds shall determine:
(a) The maximum effective rate of interest, if any, which the bonds
shall bear including variable interest rates if the public body so
decides;
(b) The principal amounts, consistent with any limitations
established by law, of the bonds or series of bonds to be issued;
(c) The discount or premium, if any, which the public body will
allow;
(d) The terms by which the bonds may be redeemed prior to maturity,
including, but not limited to, the amount of any permitted premium;
(e) The form of the bonds;
(f) The term of the bonds;
(g) The schedule for payment of bond principal and interest;
(h) The denominations of the bonds; and
(i) For revenue bonds, tax increment bonds or notes, the type of
sale.
(2) When issuing general obligation bonds, the public body must
sell the bonds in conformance with ORS 287.014 to 287.022.
(3) A municipality may establish a sinking fund for the purpose of
repaying principal and interest when due and may covenant to make
contributions to that fund.
(4) Notwithstanding any other provision of law requiring bonds to
be authorized by ordinance, a public body may authorize the issuance of
bonds by order or resolution of its governing body, and in the ordinance,
resolution or other official authorization, a public body may delegate to
any elected or appointed official or employee of the public body the
authority to determine the maturity dates, principal amounts, redemption
provisions, interest rates or the method for determining a variable or
adjustable interest rate, denominations and other terms and conditions of
the bonds that are not appropriately determined at the time of enactment
of the authorizing ordinance or resolution. The delegated authority shall
be exercised subject to the applicable requirements of law and any
limitations and criteria set forth in the ordinance, resolution or other
official authorization.
(5) When a public body issuing general obligation bonds is the
State of Oregon or one of its agencies, the maximum effective rate of
interest which the bonds shall bear is 13 percent per annum. However, if
an agency is unable to sell the bonds after a reasonable marketing
effort, the maximum effective rate of interest may be increased but shall
not exceed 14 percent per annum.
(6) Notice of any redemption authorized under subsection (1)(d) of
this section shall be given in the manner directed by the public body,
which shall include, if the bonds are not in registered form, publication
in at least one issue of a business and financial newspaper published
within the City of Portland, Oregon.
(7) Notwithstanding any other law, a public body is not required to
publish a notice of redemption for bonds that are in registered form.
[1981 c.94 §3; 1981 c.661 §4; 1981 c.879 §1; 1983 c.347 §2; 1985 c.441
§3; 1993 c.97 §7; 1997 c.171 §13] (1)
Notwithstanding any other provision of law relating to the appointment of
bond counsel, a public body may provide for the appointment of bond
counsel to advise and assist the public body in the issuance of bonds or
certificates of participation, including the issuance of refunding bonds
and obligations, and in the lawful administration of outstanding bonds or
certificates of participation. The services provided by an appointed bond
counsel may include:
(a) Advising the public body concerning the legality of specific
proposed taxable or tax-exempt obligations and the compliance, in
substance and procedure, of those obligations with law, including but not
limited to federal securities laws and regulations and federal and state
tax laws and regulations;
(b) Issuing legal opinions, including opinions on the
authorization, tax status and the binding effect of the obligations and
their associated documents and on the lawful use of the proceeds of the
obligations, as may be required by the demands of the bond market for the
obligations;
(c) Advising the public body on legal procedures and practices in
the bond market for the obligations, including advice on the structuring
and marketing of the obligations;
(d) Preparing or assisting in the preparation of any document
related to a specific issue of obligations, including but not limited to
a bond authorization, bond resolution, indenture, prospectus, preliminary
official statement, official statement, bond sale notice, bond form, bid
form or bond purchase agreement;
(e) Advising the public body concerning the maintenance of the tax
status of specific obligations, compliance with any requirements for
representations or disclosures relating to the obligations and compliance
with any documents issued or executed with respect to the obligations; and
(f) Advising the public body concerning accounting and investment
procedures recommended or required for compliance with tax and federal
securities and rebate requirements.
(2) No appointment of bond counsel under this section shall be
construed as authorizing bond counsel to advise or represent the public
body on matters that are committed by statute to the Attorney General or
by local law to counsel for the public body. An appointment of bond
counsel by a state agency or institution shall be subject to the prior
approval of the State Treasurer and the Attorney General.
(3) ORS 279A.140 does not apply to an appointment of bond counsel
under this section. [1995 c.247 §2; 2001 c.536 §7; 2003 c.794 §245]Note: 288.523 was added to and made a part of 288.515 to 288.600 by
legislative action but was not added to any smaller series therein. See
Preface to Oregon Revised Statutes for further explanation.
(1) A public body may expend bond proceeds for the payment of interest on
the bonds for the period established by the public body.
(2) A public body may expend bond proceeds to purchase or redeem
the bonds from which proceeds are derived. [1981 c.94 §4; 1983 c.347 §3]A public body may defer initial
payment of principal on bonds for a period of time it reasonably
determines, and shall determine whether interest should be paid
semiannually or otherwise. [1981 c.94 §5] A public body authorized by law to possess a
seal shall cause such seal to be imprinted, attached, impressed or
otherwise evidenced on any bond of which it is the issuer. However, the
failure to imprint, attach, impress or otherwise evidence a seal on any
bond shall not affect the validity thereof. [1981 c.94 §6] Bonds of a public body shall be
executed by the signature or signatures of one or more officers as
specified by the public body. Signatures of the designated officers may
be either manual or facsimile, but at least one signature shall be manual
in form. However, all signatures of the public body may be by facsimile
if the bonds are to be authenticated by at least one manual signature.
[1981 c.94 §7; 1995 c.333 §5] Bonds may be issued in coupon form, with or
without privilege of registration, or may be in registered form, or both,
with the privilege of converting and reconverting from one form to
another, upon such terms and conditions as provided by the public body
and applicable provisions of federal law. As evidence of indebtedness,
the public body may utilize immobilized or book-entry delivery systems
and may use depositories for these purposes. [1981 c.94 §8; 1983 c.129 §1]The preliminary official statement required for general
obligation bonds by ORS 287.018 shall not be required for any issue for
which a commitment to purchase has been received from any state or
federal agency unless such state or federal agency requires the
preparation of such document. If any other purchaser is awarded the sale
of general obligation bonds offered at a sale for which a commitment to
purchase such bonds has been received from a state or federal agency, an
official statement shall be prepared prior to the delivery of the bonds
if such other purchaser so requests. [1981 c.94 §9] At the option of the
treasurer or other fiscal officer of a subdivision making use of a paying
agent other than the state’s fiscal agency, bonds and coupons may be held
for destruction as are state bonds and coupons under ORS 288.120 and may
be destroyed in the same manner as state bonds and coupons are destroyed
under ORS 288.120. [1981 c.252 §2] (1) In connection with the
issuance of bonds, any municipality may appoint one or more paying agents
to serve as paying agent on bonds issued after May 26, 1983.
(2) The paying agents designated under subsection (1) of this
section shall either be a financial institution authorized to do business
in Oregon or the state’s fiscal agent as provided for in ORS 288.020.
(3) Any municipality which is required by law to use the county
treasurer as paying agent may appoint a paying agent and registrar. The
municipality shall provide the county treasurer written notice of such
appointment no later than 20 days following the appointment.
(4) Any municipality appointing a paying agent under the authority
of ORS 288.545 and 288.570 to 288.590 may:
(a) Provide for powers, duties and functions and compensation of
such paying agent.
(b) Limit the liabilities of such paying agent.
(c) Prescribe a method for resignation, removal, merger or
consolidation of such paying agent, appointment of a successor paying
agent and transfer of right and properties to such successor paying agent.
(5) The entity through which bonds are payable shall serve as
registrar under such terms and conditions as may be required by rule of
the Oregon Municipal Debt Advisory Commission in effect at the time such
agreement is executed.
(6) If the municipality’s paying agent is the state’s fiscal agent,
the municipality shall also designate a coregistrar within the State of
Oregon. The coregistrar may be either a financial institution authorized
to do business in Oregon or a municipality. A municipality may appoint
the state’s fiscal agent as paying agent for bonds issued by the
municipality. The municipality is not required under this section to
appoint the state’s fiscal agent as paying agent for all bonds issued by
the municipality.
(7) Notwithstanding subsection (5) of this section, a municipality
may elect to serve as its own paying agent, and in cases where the
municipality so elects, it may contract with a financial institution
authorized to do business in Oregon or the State of Oregon’s fiscal agent
to register bonds at the time of original issuance.
(8) The authority granted by ORS 288.545 and 288.570 to 288.590 is
in addition to any authority to appoint a paying agent or registrar
provided by statute or charter amendment. [1983 c.129 §§3,5; 1985 c.441
§4; 1993 c.97 §8] A county treasurer may
enter into agreements with financial institutions to serve as paying
agent and registrar, as provided in ORS 288.570 (1) to (8), for any bond
issue for which the county treasurer serves as paying agent. A county
treasurer may recover costs from the municipality for the service. [1983
c.129 §4; 1985 c.441 §5] The records of
registered bond ownership, whether maintained by the state or a
municipality or its registrar, are not public records within the meaning
of ORS 192.410 (4). [1983 c.129 §6] (1) As used in this section,
“forward current refunding” means execution and delivery of a forward
delivery bond purchase agreement or similar instrument under which a
public body contracts to sell current refunding bonds at a specified
future date.
(2) To refund outstanding bonds, a public body may issue and
deliver bonds to refund all or any portion of the outstanding bonds of
the public body and to execute and deliver any contract or agreement that
is necessary or desirable to currently refund or to effect a forward
current refunding of bonds. The proceeds of the refunding bonds shall be
used solely to pay the principal of, and interest and premium, if any, on
the bonds being refunded, costs of issuing the refunding bonds plus not
more than six months of interest on the refunding bonds. The proceeds of
the refunding bonds shall be used to pay debt service on the refunded
bonds within one year after the refunding bonds are issued.
(3) The State Treasurer may adopt rules regulating the issuance of
refunding bonds and forward current refundings under this section. If the
State Treasurer adopts rules, refunding bonds may not be issued and a
forward current refunding agreement may not be executed under this
section unless the issuance or execution complies with the rules adopted
by the State Treasurer.
(4) Bonds issued to refund revenue bonds that were issued pursuant
to ORS 288.815 shall be considered to have been issued in full compliance
with ORS 288.815, and the issuance of the refunding bonds shall not be
subject to ORS 288.815. However, a forward current refunding or the
issuance of the refunding bonds must be authorized by ordinance or
resolution of the issuing public body. [1987 c.91 §2; 1993 c.97 §9; 1999
c.559 §10](1) As used in this section:
(a) “Obligation” means a revenue bond, limited tax bond, general
obligation bond, certificate of participation, note, lease purchase or
installment purchase obligation, financing agreement, credit agreement or
other contractual undertaking of a public body, however denominated, to
repay borrowed moneys or to pay the purchase price of property acquired
by the public body, a credit enhancement device, as the term is defined
in ORS 288.805, given as additional security for an obligation described
in this paragraph or an intergovernmental agreement entered into under
ORS chapter 190.
(b) “Operative document” means a resolution, ordinance, trust
indenture, security agreement or other document in which a public body
pledges property as security for an obligation of the public body.
(c) “Pledge” means to create a security interest in or a lien on
property to secure payment or performance of an obligation. The security
interest or lien is created by mortgaging, assigning or encumbering
property or by creating a security interest in any other manner.
(d) “Pledgee” means:
(A) A trustee for the holder of an obligation; or
(B) The holder of an obligation if a trustee was not appointed in
the operative document or if the operative document authorizes the holder
of an obligation to foreclose the lien of a pledge and enforce the
remedies consequent to the pledge in lieu of the trustee.
(e) “Property” means real or personal property of a public body,
tangible or intangible, whether owned by the public body when the pledge
is made or acquired subsequently by the public body. “Property” also
means revenues as that term is defined in ORS 288.805, contract rights,
receivables and securities.
(2) Notwithstanding the Uniform Commercial Code, this section
governs the creation, perfection, priority and enforcement of a lien of a
pledge made by a public body. The Uniform Commercial Code does not apply
to the creation, perfection, priority or enforcement of a lien of a
pledge made by a public body.
(3) A public body may pledge all or a portion of its property as
security for payment of its obligations and for performance of a covenant
or agreement entered into in relation to the issuance of an obligation of
the public body. The lien created by the pledge is valid and binding from
the time the pledge is made. Pledged property is subject immediately to
the lien of the pledge without physical delivery, filing or any other act.
(4) Except as provided otherwise expressly in the operative
document, the lien of the pledge is superior to and has priority over
other claims and liens of any kind.
(5) When property subject to a pledge is acquired by a public body
after the pledge is made, the property is subject to the lien upon
acquisition by the public body without physical delivery, filing or any
other act, and the lien shall relate to the time the public body
originally made the pledge.
(6) A public body may reserve the right to pledge a pledged
property as security for an obligation subsequently issued by the public
body. If a public body reserves that right, subject to the terms of the
operative document that created the previous pledge, the lien of the
subsequent pledge may be on a parity or pari passu basis with the lien of
the previous pledge, on a prior and superior basis with the lien of the
previous pledge or on a subordinate basis with the lien of the previous
pledge, as specified in the operative document creating the subsequent
pledge. The lien of the subsequent pledge:
(a) Has the priority specified in the operative document creating
the subsequent pledge; and
(b) Is superior to and has priority over other claims and liens of
any kind except the lien of a pledge with which the lien of the
subsequent pledge is on a parity or subordinate basis, as specified in
the operative document.
(7) Except as provided in subsection (8) of this section, a pledgee
may commence an action in a court of competent jurisdiction to foreclose
the lien of the pledge and exercise rights and remedies available to the
pledgee under the operative document.
(8) When pledged property consists of moneys or property in a fund
for debt service reserves or payments, a pledgee may foreclose the lien
of the pledge by applying the moneys or property in the fund to the
payment of obligations subject to the terms, conditions and limitations
in the operative document.
(9) Any initiative or referendum measure approved by the electors
of the public body that changes statutory or municipal charter provisions
affecting rates, fees, tolls, rentals or other charges shall not be given
any force or effect if to do so would impair existing covenants made with
holders of existing bonds or other obligations regarding the imposition,
levy or collection of the rates, fees, tolls, rentals or other charges
pledged to secure outstanding bonds or other obligations.
(10) If a public body is authorized by law to pledge its revenues
to secure revenue bonds or other borrowings, the public body may enter
into rate covenants. Rate covenants authorized by this subsection may
obligate the public body to periodically set the rates and charges:
(a) That generate the pledged revenues at specific levels
including, but not limited to, a specific monetary charge for each unit
of commodity or service provided or a schedule of rates and charges that
includes fixed and variable components;
(b) In accordance with a formula established in the operative
document governing the revenue bonds or other borrowings. The formula may
provide for rates to be determined by reference to factors including, but
not limited to:
(A) Historical operating expenses;
(B) Projected future operating expenses;
(C) The funding of depreciation;
(D) The costs of capital improvements;
(E) The costs of complying with contractual obligations and
covenants;
(F) The costs of complying with regulatory requirements;
(G) Reports of independent consultants regarding the level of
pledged revenues required to operate and maintain a utility in accordance
with prudent utility practice;
(H) Debt service on the revenue bonds or other borrowings; and
(I) The funds needed to establish or maintain reserves required by
law or contract and the funds needed to maintain an unencumbered
carryforward fund balance or working capital to meet unanticipated
expenses or fluctuations in revenues that may arise;
(c) At levels sufficient to maintain underlying credit ratings
assigned to the revenue bonds and other borrowings by one or more
nationally recognized credit rating services without regard to any
improvement in credit ratings due to the provision of additional security
for revenue bonds and other borrowings through bond insurance or credit
enhancement; or
(d) That generate pledged revenues each year in amounts at least
equal to operations and maintenance expenses of the system that produces
the pledged revenues, plus debt service on the revenue bonds and other
borrowings, plus an additional amount that is reasonably required to
obtain favorable terms for the revenue bonds and other borrowings.
(11) Without regard to whether a rate covenant was entered into
before or after October 23, 1999, a rate covenant authorized by this
section is a contract that binds the public body making the rate covenant
and is enforceable against the public body in accordance with the terms
of the rate covenant. [1987 c.91 §3; 1997 c.171 §14; 1999 c.559 §5; 2001
c.537 §3] Any
public body authorized to issue variable rate bonds may:
(1) Enter into letter of credit or other credit enhancement
agreements in order to provide liquidity or security for bonds. Such
credit enhancement agreements shall be payable solely from the same
sources of funds which the public body may legally commit to pay debt
service on the bonds and the public body may pledge as security for its
obligations arising under or with respect to any credit enhancement
agreement any revenues pledged to the payment of the related bonds or
from which the bonds are payable.
(2) Issue bonds which are subject to redemption at the option of
the owner. However, such right of redemption must be limited to money
available under a credit enhancement agreement, proceeds of the bonds and
reserves of the public body established for such purpose. [1987 c.91 §4;
1995 c.333 §6]Notwithstanding any other provision of law, a
municipality issuing bonds, the interest on which is intended to be
excludable from gross income under federal income tax laws, may:
(1) Covenant for the benefit of the owners of the bonds to pay
rebates that are required under the federal income tax laws in order for
interest on the bonds to be excludable from gross income. The rebates
shall be considered an interest expense of the bonds, and may be paid
from any source of funds which may be used to pay interest on the bonds,
or from any source of funds which earns interest that is subject to
rebate.
(2) Invest in United States Government securities or other legal
investments which have a yield that is less than current market yield, in
order to facilitate compliance with federal laws which govern whether
interest on the bonds is excludable from gross income under federal
income tax laws. [1987 c.840 §4] A
public body may issue bonds, notes or other evidences of indebtedness the
interest on which is taxable for federal income tax purposes to the
holders of the bonds, notes or other evidences of indebtedness.
Notwithstanding the grant of such authority to a public body, a public
body shall consent to such taxation expressly and in writing at the time
at which the bonds, notes or other evidences of indebtedness are issued.
The express written consent shall be made a part of the transcript of the
proceedings of the issuance. [1987 c.840 §8]REFUNDING BONDS As used in ORS
288.605 to 288.695, unless the context requires otherwise:
(1) “Advance refunding bonds” means bonds issued for the purpose of
refunding bonds first subject to redemption or maturing one year or more
from the date of the advance refunding bonds.
(2) “Bond” means any revenue bond, general obligation bond or
certificate of participation.
(3) “Certificate of participation” means:
(a) Any financing agreement entered into by the State of Oregon, an
agency or institution of the State of Oregon under ORS 283.085 to 283.092
or a public corporation under ORS chapter 353, or any certificate of
participation issued under such financing agreement.
(b) Any financing agreement entered into by a local public body
authorized by law to enter into financing agreements, or any certificate
of participation issued under such financing agreements.
(4) “Financing agreement” means a lease purchase agreement, an
installment sale agreement, a loan agreement or any other agreement to
finance real or personal property that is or will be owned and operated
by a public body, or to refinance previously executed financing
agreements.
(5) “Forward current refunding” means execution and delivery of a
forward delivery bond purchase agreement or similar instrument under
which a public body contracts to sell current refunding bonds at a
specified future date.
(6) “General obligation bond” means any bond, note, warrant,
certificate of indebtedness or other obligation of a public body which
constitutes an indebtedness within the meaning of the constitutional or
statutory debt limitation and which is secured by the unlimited taxing
power of the public body.
(7) “Governing body” means the council, commission, board or other
legislative body of the public body designated in ORS 288.605 to 288.695
in which body the legislative powers of the public body are vested,
provided that with respect to the state it shall mean the State Treasurer.
(8) “Government obligations” means any of the following:
(a) Direct obligations of or obligations the principal of and
interest on which are unconditionally guaranteed by the United States of
America and bank certificates of deposit secured by the obligations;
(b) Bonds, debentures, notes, certificates of participation or
other obligations issued by a federal agency or other instrumentality of
the United States Government; or
(c) Other debt obligations determined by administrative rule of the
State Treasurer or the Oregon Municipal Debt Advisory Commission to be
highly secured and widely accepted in the marketplace as obligations for
a defeasance escrow.
(9) “Issuer” means the public body issuing any bond or bonds.
(10) “Ordinance” means an ordinance of a public body or resolution
or other instrument by which the governing body of the public body
exercising any power takes formal action and adopts legislative
provisions and matters of some permanency.
(11) “Public body” means the State of Oregon, its agencies,
institutions, political subdivisions, municipal, quasi-municipal and
public corporations and intergovernmental entities created by
intergovernmental agreements under ORS chapter 190 authorized by law to
issue general obligation bonds or revenue bonds or to enter into
financing agreements and cause certificates of participation to be issued
under such financing agreements.
(12) “Revenue bond” means any bond, note, warrant, certificate of
indebtedness or other obligation for the payment of money issued by a
public body or any predecessor of any public body and which is payable
from designated revenues or a special fund but excluding any obligation
constituting an indebtedness within the meaning of the constitutional or
statutory debt limitations and any obligation payable solely from special
assessments or special assessments and a guaranty fund.
(13) “Special revenue bond” means any bond, note, warrant,
certificate of indebtedness or other obligation for the payment of money
issued by a public body or any predecessor of any public body which is
payable from designated revenues or a special fund and which is subject
to statutory debt limitations. [1977 c.536 §3; 1997 c.820 §1; 1999 c.559
§11; 2005 c.443 §10]
(a) It is desirable to afford public bodies the authority to reduce
the costs on their outstanding bonds, thereby resulting in a savings in
the costs of capital expenditures of a public body; that such a savings
is for the benefit of the people of the state;
(b) Legislation permitting a public body to pay and discharge all
or any part of outstanding bonds in arrears, or about to become due and
for which sufficient funds are not available, or to effect a
reorganization of its permanent debt, or to effect a savings is desirable
to protect the credit of the state and its public bodies; and
(c) To determine the extent of the need to issue advance refunding
bonds or to effect a forward current refunding and to insure that
issuance of such bonds is to the advantage of and in the best interests
of and for the general welfare of the state and all public bodies, it is
desirable that the State Treasurer approve of the issuance of all such
bonds.
(2) The Legislative Assembly declares that the issuance of advance
refunding bonds and the authority to effect a forward current refunding
are matters of general statewide concern and ORS 288.605 to 288.695
preempt all statutory or charter authority to issue advance refunding
bonds or to effect a forward current refunding, except that ORS 288.605
to 288.695 are not applicable to nor shall it affect advance refunding
bonds issued prior to October 4, 1977. [1977 c.536 §2; 1999 c.559 §12]
(1) Subject to subsections (3) and (4) of this section, the governing
body of any public body may by ordinance provide for the issuance of
bonds without an election to refund outstanding bonds, including advance
refunding bonds heretofore or hereafter issued by the public body or its
predecessor, or to fund the obligations of the public body under any
contract, lease, sublease or agreement entered into with the Oregon Mass
Transportation Financing Authority pursuant to ORS 267.227 and 391.500 to
391.660, and to pay redemption or prepayment premiums and costs of
issuance, only in order:
(a) To pay or discharge all or any part of such outstanding
obligations or series or issue of bonds, including any interest thereon,
in arrears or about to become due and for which sufficient funds are not
available;
(b) To effect a favorable reorganization of the permanent debt
structure of the issuer; or
(c) To effect a savings discounted to present value to the public
body or in the event of industrial development bonds, to effect a savings
discounted to present value to the principal obligor of the revenue bonds.
(2) When issuing refunding revenue bonds or advance refunding
revenue bonds to refund revenue bonds that were issued in accordance with
ORS 288.815, a municipality, as defined by ORS 288.805 (3), is not
required to comply with the procedures prescribed in ORS 288.815 in
issuing bonds pursuant to this section.
(3) To determine whether or not a saving will be effected,
consideration shall be given to the interest to fixed maturities of the
refunding bonds and the bonds or obligations to be refunded, the costs of
issuance of the refunding bonds, the redemption or prepayment premiums,
if any, to be paid and the known earned income from the investment of the
refunding bond proceeds pending redemption or prepayment of the bonds or
obligations to be refunded.
(4) The refunding plan shall be subject to provisions concerning
payment and to all other contractual provisions in the proceedings
authorizing the issuance of the bonds or obligations to be refunded or
otherwise appertaining thereto and to the review and authorization of the
State Treasurer.
(5) For purposes of ORS 288.605 to 288.690, wherever reference is
made to “the bonds or obligations to be refunded” or any words of similar
import, such reference shall include the following:
(a) In the case of an advance refunding of general obligation
bonds, limited tax bonds, as defined in ORS 288.150, revenue bonds or
certificates of participation, the general obligation, limited tax or
revenue bonds or the certificates of participation to be refunded; or
(b) In the case of a funding of the obligations of a mass transit
district under any contract, lease, sublease or agreement entered into
with the Oregon Mass Transportation Financing Authority under ORS 267.227
and 391.500 to 391.660, both the obligations of the mass transit district
under such contract, lease, sublease or agreement and the revenue bonds
issued by the Oregon Mass Transportation Financing Authority under ORS
391.500 to 391.660 which are secured by such contract, lease, sublease or
agreement.
(6) Subject to ORS 288.605 to 288.690, a mass transit district may
exercise the powers conferred upon public bodies under this section and
ORS 288.637 and issue advance refunding bonds for the purpose of
refunding the obligations of such mass transit district under any
contract, lease, sublease or agreement with the Oregon Mass
Transportation Financing Authority under ORS 267.227 and 391.500 to
391.660, in which event such advance refunding bonds shall, for purposes
of ORS 288.605 to 288.690, be deemed to be issued for the purpose of the
advance refunding of revenue bonds.
(7) A financing agreement may be used to refund outstanding
financing agreements or certificates of participation under this section.
If the obligation to be refunded is a financing agreement or a
certificate of participation, then the advance refunding obligation,
without regard to the type of obligation, may be secured by the same
claims against the public body that secure the financing agreement or
certificate of participation to be refunded. [1977 c.536 §4; 1985 c.429
§3; 1993 c.97 §10; 1997 c.820 §2] (1)
Refunding bonds may not be issued under ORS 288.605 to 288.695 unless
authorized by the State Treasurer under this section.
(2) Following adoption of an ordinance or resolution approving a
refunding plan to issue advance refunding bonds, the refunding plan shall
be submitted to the State Treasurer for review and approval.
(3) Following adoption of an ordinance or resolution approving a
refunding plan to effect a forward current refunding, the refunding plan
must be submitted to the State Treasurer for review and approval if the
State Treasurer has adopted rules under ORS 288.592 related to forward
current refunding bonds.
(4) After review of a proposed refunding plan, the State Treasurer
shall advise the public body, in writing, whether the sale of refunding
bonds is authorized. Failure of the State Treasurer to notify the public
body within 30 business days after receipt of the refunding plan shall be
deemed an authorization to proceed. Except as provided in ORS 288.625, in
making determinations under this section the State Treasurer shall
consider all relevant factors, including the purposes for which the
refunding plan is adopted, the terms of the refunding plan, the effects
(if any) of applicable federal laws and the views of recognized experts
in the field.
(5) The State Treasurer may delegate the authority to approve
refunding plans, including approval of the investment of the refunding
bond proceeds, to the Oregon Municipal Debt Advisory Commission.
(6) The administrative expenses of the State Treasurer incurred in
reviewing refunding plans shall be charged against the bond proceeds or
may be paid by the public body from such other funds as may be available.
[1977 c.536 §17; 1989 c.435 §1; 1999 c.559 §13; 2001 c.47 §1] Advance refunding bonds may be issued
or a forward current refunding may be effected for general obligation,
revenue or special revenue bonds, at the discretion of the governing
body, in the manner provided in ORS 287.016 to 287.022. [1977 c.536 §5;
1987 c.840 §2; 1999 c.44 §20; 1999 c.559 §14] Any
governing body refunding bonds under ORS 288.605 to 288.695 may seek
assistance on matters pertaining to the issuance of the refunding bonds
or a forward current refunding from the Oregon Municipal Debt Advisory
Commission pursuant to ORS 287.020 and 287.034. [1977 c.536 §6; 1999
c.559 §15] (1) Bonds may be
refunded under ORS 288.605 to 288.695 when the holders of the bonds to be
refunded voluntarily surrender them for exchange or payment or if they
mature or are subject to redemption prior to maturity of the refunding
bonds.
(2) In any advance refunding plan created pursuant to ORS 288.605
to 288.695, the governing body shall provide, irrevocably in the
ordinance authorizing the issuance of the advance refunding bonds, for
the redemption of the bonds to be refunded not later than six months from
the date they are first subject to redemption. [1977 c.536 §7](1) Notwithstanding any other provision of ORS 288.605 to
288.695:
(a) The governing body may permit redemption of bonds to be
refunded at maturity or any earlier time and permit advance refunding of
bonds or a forward current refunding of bonds which are not callable
prior to maturity notwithstanding the conditions and requirements of ORS
288.635.
(b) The governing body may permit advance refunding of advance
refunding bonds or may effect a forward current refunding notwithstanding
the conditions and requirements of ORS 288.635.
(2) The governing body shall determine whether each proposed
redemption, advance refunding or forward current refunding under
subsection (1) of this section furthers the policies expressed in ORS
288.610 and 288.615. If the governing body determines that the
redemption, advance refunding or forward current refunding furthers such
policies, the governing body may proceed with the redemption, advance
refunding or forward current refunding authorized by this section. [1985
c.429 §2; 1993 c.97 §23; 1999 c.559 §16] The ordinance or
other official action authorizing the issuance of advance refunding bonds
pursuant to ORS 288.605 to 288.695 may contain any redemption terms
deemed advisable in the discretion of the governing body or its designee.
[1977 c.536 §8; 1993 c.97 §24; 1995 c.333 §7] (1) Advance refunding
bonds may not be issued in a principal amount in excess of the minimum
principal amount estimated to be necessary:
(a) To purchase a principal amount of government securities that
is, together with the interest earnings thereon, sufficient to pay all
installments of principal, interest and redemption premiums, if any, on
the bonds being refunded when they fall due in accordance with the
advance refunding plan; and
(b) To pay any amounts charged to the issuer as administrative
costs, expenses or fees, in connection with the advance refunding
transaction, that can be paid from the proceeds of the advance refunding
bond issue.
(2) If the issuer of advance refunding bonds receives an amount of
proceeds that exceeds the actual amount required under subsection (1) of
this section, the excess amount of proceeds must be used to pay interest
on the advance refunding bonds. [1977 c.536 §9; 2005 c.443 §11] Prior
to the application of the proceeds derived from the sale of advance
refunding bonds to the purposes for which the refunding bonds have been
issued, the advance refunding bond proceeds, together with any other
funds the governing body may set aside for the payment of the bonds to be
refunded, may be invested and reinvested only in government obligations.
Investment shall take place at a time or at times as may be required to
provide funds sufficient to pay principal, interest and redemption
premiums, if any, in accordance with the advance refunding plan. To the
extent incidental expenses have been capitalized, the advance refunding
bond proceeds may be used to defray such expenses. The governmental
obligations used for investment and reinvestment of advance refunding
bonds shall be approved by the State Treasurer in accordance with ORS
288.620. [1977 c.536 §10] (1) Notwithstanding any other provision of law,
no governing body shall cause to be levied upon the taxable property
within its district a tax to pay the maturing interest and principal on
any bond or bonds being refunded pursuant to ORS 288.605 to 288.695, if
the amount owed on the bonds being refunded is secured by the investment
of the advance refunding bond proceeds together with any other funds the
governing body may set aside for the payment of the bonds to be refunded.
(2) Subject to ORS 288.665, each governing body, where applicable,
shall annually cause to be levied upon the taxable property within its
boundaries a sum sufficient, with other revenues that are available, to
pay the maturing interest and principal of all advance refunding bonds
that are general obligation bonds and, within constitutional and
statutory limitations, a sum sufficient, with other revenues that are
available, to pay the maturing interest and principal of all limited tax
bonds, as defined in ORS 288.150. [1977 c.536 §11; 1997 c.820 §3] (1) The
governing body may contract with respect to the safekeeping and
application of the advance refunding bond proceeds and other funds
included therewith and the income therefrom including the right to
appoint a trustee which may be any trust company or state or national
bank having powers of a trust company within the State of Oregon.
(2) The governing body may provide in the refunding plan that until
such moneys are required to redeem, retire or pay interest and principal
installments on the general obligation or revenue bonds to be refunded,
the refunding bond proceeds and other funds and the income from the
advance refunding bond proceeds shall be used to pay and secure the
payment of the principal of and the interest on the advance refunding
bonds.
(3) For the payment of revenue refunding bonds, the governing body
may pledge, or otherwise make the bonds payable from, any revenues which
might legally be pledged for the payment of revenue bonds of the issuer
of the type being refunded.
(4) Provisions shall be made by the governing body for moneys
sufficient in amount to accomplish the refunding as scheduled. [1977
c.536 §12; 1993 c.97 §11] (1) Subject
to subsection (2) of this section, when a public body has irrevocably set
aside for and pledged to the payments of revenue bonds to be refunded
advance refunding bond proceeds and other moneys in amounts which
together with known earned income from the investment of the advance
refunding bond proceeds are sufficient in amount to pay the principal of
and interest and any redemption premiums on such revenue bonds as the
same become due and to accomplish the refunding as scheduled, the
governing body may provide that the advance refunding revenue bonds shall
be payable from any source which, at the time of the issuance of either
the advance refunding bonds or the revenue bonds to be refunded, might
legally either be or have been designated as a source from which the
advance refunding revenue bonds shall be payable or be or have been
pledged for the payment of the revenue bonds refunded to the extent it
may legally do so, notwithstanding the designation or pledge of such
revenues for the payment of the outstanding revenue bonds being refunded.
(2) The power granted to a public body under subsection (1) of this
section shall be exercised only to the extent that all provisions of law
and all other contractual provisions in the proceeding authorizing the
issuance of the bonds to be refunded are respected. [1977 c.536 §13; 1993
c.97 §12]
(1) Except for advance refunding bonds sold pursuant to ORS 288.615
(1)(a), the maturity dates of general obligation bonds issued to refund
voted general obligation bonds may not be more than 30 days after the
maturity dates of the bonds to be refunded. However, as long as the total
debt service on the refunding bonds does not exceed the total debt
service on the bonds to be refunded, the amounts maturing on any given
date may be changed, and the refunding general obligation bonds may
mature earlier than the bonds to be refunded.
(2) Subsection (1) of this section does not apply to general
obligation bonds of the State of Oregon. [1977 c.536 §14; 1983 c.798 §9;
2001 c.47 §2] In
computing indebtedness for the purpose of any constitutional or statutory
debt limitation there shall be deducted from the amount of outstanding
indebtedness the amounts of money and investments credited to or on
deposit for general obligation or special revenue bond retirement. [1977
c.536 §15] If a
public body causes government obligations to be placed irrevocably in
escrow in an amount calculated to be sufficient to pay principal and
interest on outstanding bonds issued by the body as they mature or have
been irrevocably called for prior redemption, in accordance with rules
established by the State Treasurer, the amounts of money and investments
credited to or on deposit for the payment of such outstanding bonds shall
be deducted from the amount of outstanding indebtedness in computing
indebtedness for the purpose of any constitutional or statutory debt
limitation. Bonds for which government obligations have been so deposited
irrevocably in escrow shall be deemed to be defeased to the same extent
as if such bonds had been advance refunded pursuant to the provisions of
ORS 288.605 to 288.690. [1983 c.347 §5] Bonds for
refunding and bonds for any other purpose or purposes authorized may be
issued separately or issued in combination in one or more series or
issued by the same issuer. [1977 c.536 §16] The State Treasurer shall adopt such rules as are
necessary to carry out the purposes of ORS 288.605 to 288.695, provided
that the rules shall as a minimum conform to all applicable laws and
regulations thereunder of the United States that pertain to advance
refunding. The rules may be changed from time to time as the State
Treasurer considers necessary. [1977 c.536 §19]If any provision of ORS 288.605 to 288.695,
or its application to any person or circumstances is held invalid, the
remainder of ORS 288.605 to 288.695, or the application of the provision
to other persons or circumstances is not affected. [1977 c.536 §18]ORS 288.605 to 288.695 may be cited as the
Advance Refinancing and Refunding Bond Act of 1977. [1977 c.536 §1]UNIFORM REVENUE BOND ACT As used in ORS
288.805 to 288.945:
(1) “Credit enhancement device” means a letter of credit, line of
credit, municipal bond insurance policy or other device or facility used
to enhance the creditworthiness or marketability of municipal bonds.
(2) “Facilities” means real property, including land, streets and
other improvements, betterments, appurtenances, structures and fixtures,
and personal property which is functionally related and subordinate to
real property.
(3) “Municipality” means the political subdivisions in or of this
state, municipal, quasi-municipal and public corporations and
intergovernmental entities organized under ORS chapter 190.
“Municipality” does not include a people’s utility district organized
under the authority of ORS chapter 261.
(4) “Private negotiated sale” means the sale of revenue bonds for
which the rate or rates and other terms and conditions are negotiated
between the public body and the purchaser.
(5) “Public body” means the State of Oregon, its agencies,
institutions or any municipality.
(6) “Revenue bonds” means bonds issued for any public purpose,
which are secured by revenues either pledged or designated to be payable
for such public purpose of the public body and which are sold under the
authority granted by ORS 288.805 to 288.945. Nothing in ORS 288.805 to
288.945 is intended to permit a public body to impose fees and charges
that are not otherwise authorized by law.
(7) “Revenues” means all fees, tolls, excise taxes, assessments,
property taxes and all other taxes of whatever kind or nature, rates,
charges, rentals and all other income and receipts of whatever kind or
character derived by or to which a public body is entitled from the
operation, sale or use of facilities, projects, utilities or systems
owned or operated by the public body and other revenues legally available
to be pledged to secure the revenue bonds or to be designated as revenues
from which the revenue bonds shall be payable. [1983 c.320 §1; 1987 c.354
§1; 1991 c.583 §7; 1991 c.902 §102; 1993 c.97 §13] (1) A
municipality, upon adoption of a resolution or a nonemergency ordinance
authorizing the issuance of bonds in accordance with this section, may
issue revenue bonds under ORS 288.805 to 288.945.
(2) A municipality may not sell revenue bonds under ORS 288.805 to
288.945 authorized by a nonemergency ordinance until the period for
referral of the ordinance has expired. If a nonemergency ordinance
authorizing bonds is referred, the municipality may not sell the bonds
unless the voters approve the revenue bonds.
(3) A municipality may not sell revenue bonds under ORS 288.805 to
288.945 authorized by a resolution until at least 60 days following
publication of the notice required in subsection (7) of this section.
(4) The resolution must provide that electors residing within the
municipality may file a petition with the municipality asking that the
question of whether to issue the bonds described in the resolution be
referred to a vote.
(5) If the municipality receives petitions containing valid
signatures of that municipality’s electors totaling not less than five
percent of the municipality’s electors, the question of issuing the bonds
described in the resolution shall be placed on the ballot at the next
legally available election date.
(6) If a petition is filed with the municipality within 60 days
following publication of the notice described in subsection (7) of this
section, bonds may not be sold until the issuance of bonds described in
the resolution is approved by a majority of the electors of that
jurisdiction voting on the question.
(7) A notice describing the purposes for which the bonds described
in the resolution are sold shall be published by the municipality in at
least one newspaper of general circulation within the municipality and in
the same manner as are other public notices of that municipality. The
notice shall contain:
(a) The date the resolution was adopted and the number thereof, if
any;
(b) Expected source of revenue for repayment of the revenue bonds;
(c) Estimated principal amount of the bonds to be sold;
(d) The procedures by which the question of issuing the revenue
bonds may be referred to a vote;
(e) The time in which the required signatures must be gathered;
(f) Any other information the municipality may wish to include; and
(g) The fact that the resolution is available for inspection at the
appropriate office of the municipality.
(8) Nothing in this section prohibits the municipality on its own
initiative from referring the resolution or nonemergency ordinance
authorizing the sale of revenue bonds to a vote of the electors of the
municipality.
(9) When the public body issuing revenue bonds is a municipality,
the municipality shall issue the bonds in accordance with the provisions
of ORS 288.515 to 288.560. [1983 c.320 §§2,7; 2003 c.195 §15]
(1) A public body either may pledge to the payment of revenue bonds, or
may make revenue bonds payable from, all or any portion of:
(a) The revenues of any revenue producing facility providing
services related to the services financed by the public bonds;
(b) The revenues of a public utility or system, or an addition or
extension to the public utility or system, where the improvements,
projects or facilities financed by the revenue bonds are a portion of the
public utility or system;
(c) All or any portion of the revenues of the public body; or
(d) Any other legally available moneys.
(2) A public body shall cause to be prepared a plan showing that
the estimated net revenues which will be pledged or designated are
sufficient to pay the estimated debt incurred under the bond issue.
(3) If the public body determines that it is necessary to provide
additional security for revenue bonds, a public body may mortgage, grant
security interests in or otherwise encumber facilities, projects,
utilities or systems owned or operated by the public body. Such security
may be given in favor of the holders of revenue bonds, a trustee therefor
or as security for its obligations arising under any credit enhancement
device. The public body may obtain a credit enhancement device for
revenue bonds provided that such credit enhancement device shall be
payable solely from revenues.
(4) When issuing revenue bonds, a public body may exercise any one
or more of the following powers:
(a) The governing body, in the ordinance or resolution authorizing
the issuance of such bonds, may delegate to any elected or appointed
official or employee of the governmental unit the authority to determine
the maturity dates, principal amounts, redemption provisions, interest
rates or the method for determining a variable or adjustable interest
rate, denominations and other terms and conditions of such bonds which
are not appropriately determined at the time of enactment of the
authorizing ordinance or resolution, which delegated authority shall be
exercised subject to the applicable requirements of law and such
limitations and criteria as may be set forth in such ordinance or
resolution.
(b) The public body may pledge as security for its obligations
arising under or with respect to any credit enhancement device any
revenues pledged to the payment of the related bonds or designated as
revenues from which the bonds shall be payable, and such obligations
shall in any event be payable from the same sources from which such bonds
are payable.
(c) The public body may enter into agreements with bond trustees
and deposit funds with trustees for the benefit of such bondowners.
(d) The public body may establish a debt service reserve for the
purpose of paying when due all amounts owing on such bonds, which debt
service reserve may be funded out of the proceeds derived from the
issuance and sale of such bonds or from such other sources as the
governing body of the public body may determine. [1983 c.320 §§3,3a,4;
1991 c.902 §103; 1993 c.97 §14] Revenue bonds authorized to be
sold as provided for in ORS 288.815 may be sold at public competitive bid
or at private negotiated sale, as determined by the public body. However,
before a private negotiated sale is authorized, the public body must make
specific findings that such a method of sale is desirable. [1983 c.320
§5; 1991 c.902 §104] (1) When issuing
revenue bonds at a private negotiated sale, a municipality may obtain an
independent expert to advise the municipality and to evaluate:
(a) The terms and conditions of the proposed sale;
(b) The pricing of the proposed sale; and
(c) Any other relevant aspects of the sale.
(2) The evaluation authorized by subsection (1) of this section
must be made either in writing or, if orally, at a public meeting of the
municipality authorizing a private negotiated sale. [1983 c.320 §6; 1995
c.333 §30; 2003 c.195 §16] The State of
Oregon, its institutions and agencies, may issue revenue bonds under the
authority of ORS 288.805 to 288.945 to finance revenue producing
facilities. Such revenue bonds shall be issued by the State Treasurer
under such terms and conditions as the State Treasurer shall determine.
[1983 c.320 §8] If revenue
bonds are issued by a municipality, the municipality shall prepare and
make available, for use in connection with the initial offering and sale
of the revenue bonds, a preliminary official statement that discloses the
material information that the issuer determines is relevant to a
potential investor and any information the Oregon Municipal Debt Advisory
Commission may by rule require. [1983 c.320 §9; 2005 c.443 §12] (1)
As used in this section, “competitive bidding process of the public body”
means a process that is formally approved by the public body for
notifying multiple potential purchasers, soliciting firm proposals from
those potential purchasers, including interest rates and prices, and
awarding the sale to the bidder offering the most favorable terms to the
public body.
(2) For public competitive bid sales, the public body shall either
solicit bids in compliance with the competitive bidding process of the
public body or prepare and publish a notice of revenue bond sale which
shall specify:
(a) The time, date and place where bids are to be received, and
considered and acted upon, the total amount of revenue bonds, and the
denominations of the revenue bonds;
(b) The issue date, maturity dates and amounts, interest payment
dates, and place of payment of the revenue bonds;
(c) The date of optional redemption, if any, the call price
premium, if any, and the order of revenue bond redemption and place of
redemption;
(d) The maximum effective rate of interest and the minimum
percentage of par value of the revenue bonds which may be bid;
(e) The required good faith deposit, which may be in the form of a
certified or cashier’s check on a bank that is doing business in this
state or a bond or other commitment that the public body determines is
adequate to protect the public body against failure by a bidder to comply
with the terms of a bid, in the amount of not less than two percent of
the par value of the revenue bonds, or $500,000, whichever is the lesser;
(f) Such constraints on the coupon rates as the issuer may impose;
(g) The interest basis and definition thereof on which the revenue
bond bids are to be awarded;
(h) The name of bond counsel, if any, who will furnish the legal
opinion;
(i) Registration provision, if any;
(j) Estimated delivery date and place;
(k) Such other conditions as the public body may impose;
(L) The statute and ordinance, if any, pursuant to which the
revenue bonds are to be issued; and
(m) The purpose of the revenue bonds.
(3) Except when bonds are sold in compliance with the competitive
bidding process of the public body, bids submitted at public competitive
bid sales must be bids that are:
(a) Submitted for all revenue bonds offered for sale;
(b) Unconditional; and
(c) Submitted either in writing in a sealed envelope clearly marked
as a proposal for revenue bonds or telecopied or otherwise submitted to
the public body in a manner that avoids public disclosure of the content
of bids before the deadline for bid submission. [1983 c.320 §10; 1997
c.631 §441; 1999 c.559 §17]Except when the public body is the State of Oregon or when the
revenue bonds are sold in accordance with the competitive bidding process
of the public body, as defined in ORS 288.875, for any public competitive
bid sale:
(1) The issuer shall cause the notice of bond sale, or a summary
thereof, to be published as provided in subsection (2) of this section
not fewer than 10 calendar days prior to the date of the bond sale.
(2) The issuer shall publish the notice of bond sale, or a summary
of the notice of bond sale, by one or more of the following methods:
(a) Publication in a newspaper of general circulation within the
boundaries of the issuer;
(b) Publication in a newspaper of general circulation in Portland,
Oregon;
(c) Publication in a national newspaper;
(d) Electronic publication on the Internet; or
(e) Electronic publication in another form that is reasonably
calculated to reach potential bidders effectively.
(3) If a summary of the notice of bond sale is published under this
section, the summary must specify where the complete notice of bond sale
is published or available.
(4) Copies of the complete notice of bond sale shall be furnished
upon request to bidders, investors and the public. [1983 c.320 §11; 1991
c.143 §2; 1991 c.902 §105; 1999 c.559 §18; 2001 c.537 §4] For the state, a
competitive bid process shall be conducted in the manner prescribed by
the State Treasurer, which may include, but is not limited to, notifying
potential purchasers, conducting sales, accepting and awarding bids by
written, telephonic, facsimile, electronic or any other means of
communication and offering for sale and accepting bids on any combination
of bonds or on an all or none basis. [1983 c.320 §12; 1999 c.44 §19] (1) For all public competitive
bid sales, the bonds shall be awarded on the basis described in the
notice of sale or in the solicitation of bids that is part of the
competitive bidding process of the public body, as defined in ORS
288.875. All bids must be entered into the public record of the public
body issuing the revenue bonds.
(2) Except when the revenue bonds are sold in compliance with the
competitive bidding process of the public body:
(a) All bids shall be publicly opened at the time and place
specified in the notice of sale.
(b) The revenue bonds shall be sold to the responsible bidder whose
bid will result in the lowest interest cost to the public body, as
defined in the manner set forth in the notice of sale, and taking into
consideration any premium or discount bid.
(c) Unless all bids are rejected, the sale must be acted upon
within four hours of the time the bids are opened.
(3) The issuer may reject any or all bids and continue the sale
date to a date certain or readvertise the sale of revenue bonds in the
manner determined by the issuer or by an authorized representative of the
issuer. The issuer shall make public the reasons why any or all bids are
rejected.
(4) The preliminary official statement required for revenue bonds
by ORS 288.865 shall not be required for any issue for which a commitment
to purchase has been received from any state or federal agency unless
such state or federal agency requires the preparation of such document.
If any other purchaser is awarded the sale of the revenue bonds offered
at a sale for which a commitment to purchase such bonds has been received
from a state or federal agency, an official statement shall be prepared
prior to the delivery of the bonds if such other purchaser so requests.
[1983 c.320 §§14,15; 1995 c.333 §32; 1999 c.559 §19] The revenue bonds issued under the
authority of ORS 288.805 to 288.945 shall:
(1) Contain a statement that such bonds are payable solely out of
pledged revenues, or out of revenues designated as revenues from which
the bonds shall be payable, of the public body and are not general
obligations of the public body;
(2) Be in such denominations of $5,000 or multiples thereof, as the
public body determines; and
(3) Be payable at the place designated by the public body. [1983
c.320 §16; 1993 c.97 §15] The powers conveyed by ORS
288.805 to 288.945 are in addition to any other powers possessed by
municipalities and shall not be deemed to limit such powers. [1983 c.320
§17]ORS 288.805 to 288.945 may be cited as the
Uniform Revenue Bond Act. [1983 c.320 §18]MISCELLANEOUS PROVISIONSWhen calculating compliance with any constitutional, statutory or
charter debt limit:
(1) The amount of interest to be paid on bonds, whether current or
deferred, shall not be taken into account; and
(2) For any zero coupon bond or other original issue discount bond
on which periodic interest payments are not made, only the accreted value
of the bonds on the date the bonds are issued shall be taken into
account. [1999 c.559 §7]
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