Chapter 3-40
REVENUE BONDS
Sections:
3-40-020 Declaration of purpose.
3-40-040 Bond ordinance—Adoption procedures and effective date.
3-40-050 Bond ordinance—Contents.
3-40-060 Rights under preexisting bond ordinance.
3-40-070 Powers conferred as additional and supplemental—Limitations imposed—Effect.
3-40-080 Use of taxes in support of a revenue-producing system.
3-40-010 Definitions.
Whenever used in this chapter, the following terms shall have the following meanings, unless a different meaning clearly appears from the context:
“Bond ordinance” means an ordinance adopted by the council of the city authorizing the issuance of revenue bonds.
“City” means the city of Harvey, Cook County, Illinois.
“Project” means the acquisition, construction, reconstruction, repair, alteration, improvement and extension of a revenue-producing facility or system, or combination of facilities or systems, and the provision of funds for the purpose of redeeming, retiring or otherwise providing for the payment of any outstanding obligations payable in whole or in part from the revenue derived from the operation thereof, or any combination of such purposes. A project may serve a particular locality within the city.
“Project costs” means and includes the aggregate total of all reasonable or necessary costs incidental to the acquisition, construction, reconstruction, repair, alteration, improvement or extension of a revenue-producing facility or system, including, without limitation, the cost of studies, reports and surveys, plans, specifications, architectural and engineering services, acquisition of real estate, easements, or other interests in land, site improvement, the provision of funds for the purpose of redeeming, retiring or otherwise providing for the payment of any outstanding obligations payable from revenues, legal, auditing, financial consulting or other special services, equipment and appurtenances, and all other necessary and incidental expenses, including capitalization of funds for reserves deemed necessary for the successful financing and operation of the project.
“Revenue bonds” means any bonds heretofore or hereafter issued by the city payable from the revenues of a revenue-producing facility or system.
“Revenue-producing facility or system” means any facility or system owned or controlled by the city, in whole or in part, or to be owned or controlled by the city, in whole or in part, which generates revenue through charges for the use or services thereof (including any land, interest in land, building, structure, facility, fixture, improvement, appurtenance, addition, machinery or equipment, or any combination thereof, and including all real and personal property deemed necessary in connection therewith). (Ord. 2041 § 1, 1975)
3-40-020 Declaration of purpose.
It is determined and declared that the ordinance codified in this chapter is enacted for the purpose of prescribing procedures for the issuance of revenue bonds by the city and the ordinance codified in this chapter is enacted pursuant to the powers conferred upon the city by the provisions of the 1970 Constitution of Illinois and the issuance of such bonds is declared and determined to be a public purpose and function pertaining to the government and affairs of the city. (Ord. 2041 § 2, 1975)
3-40-030 Additional powers.
In addition to powers which it may now have, or may subsequently acquire by law, the city shall have the following powers under this chapter:
A. To construct, acquire, reconstruct, improve, better or extend, and to finance and refinance one or more projects;
B. To issue its revenue bonds to defray, in whole or in part, the project costs of any project, and to designate an appropriate name for such bonds;
C. To pledge to the punctual payment of such revenue bonds, the interest thereon, and the redemption premium, if any, the revenue and receipts to be received from the revenue-producing project, and also to pledge other municipal funds therefor;
D. To issue its revenue bonds to refund, in whole or in part, revenue bonds heretofore or hereafter issued by the city;
E. To make, enact and enforce all necessary rules and regulations for the acquisition, construction, extension, improvement, management, operation and maintenance of the facility or system;
F. To charge a reasonable compensation for the use and service of the facility or system, sufficient at all times to comply with the covenants of the bond ordinance. (Ord. 2041 § 3, 1975)
3-40-040 Bond ordinance—Adoption procedures and effective date.
In order to exercise the powers granted by the ordinance codified in this chapter and to authorize the issuance of revenue bonds, the council shall adopt a bond ordinance in substantial compliance with the following procedures:
A. The bond ordinance shall be adopted at a meeting legally called and held in accordance with the applicable provisions of the laws of the state of Illinois and the procedures adopted by the council for the call and conduct of meetings and the adoption of ordinances.
B. After the adoption of the bond ordinance and its approval by the mayor, where required, such ordinance shall be published at least once in a newspaper published and having a general circulation within the city, or published in pamphlet form, and such ordinance shall not become effective until ten days after the date of publication. (Ord. 2041 § 4, 1975)
3-40-050 Bond ordinance—Contents.
A. Findings by the Council. The council shall make a finding and determination in the bond ordinance that the borrowing of money is necessary for the welfare of the government and affairs of the city, is for a proper public purpose, or purposes, and is in the public interest, which finding and determination shall be conclusive.
B. Description of Project.
1. The bond ordinance shall contain a description of the project to be financed, in whole or in part, by the issuance of bonds. If all or a part of the project consists of the refunding of outstanding bonds of the city, the bonds to be refunded shall be described in the ordinance. The ordinance may provide that a single issue or series of bonds be issued, both for construction and refunding purposes, and any bonds issued for refunding purposes may either be surrendered and exchanged for the bonds being refunded, such bonds to be exchanged for at least a like par amount of the bonds being refunded, or may be sold in accordance with the terms of the bond ordinance and the proceeds thereof be used to pay the bonds being refunded thereby.
2. The ordinance shall contain a general description of the construction or acquisition portion of the project and an estimate of the total project cost. It shall not be necessary that the ordinance refer to detailed plans and specifications for the construction or acquisition. The ordinance shall state the means providing for defraying the total project costs and shall determine the period of usefulness of the project to be constructed or acquired.
C. Form of Bonds and Coupons. The bond ordinance shall prescribe the bond form and coupon form (if any), and it shall be plainly stated in the face of each bond whether or not the bond does in any way constitute an indebtedness of the city within the meaning of any constitutional or statutory limitation, and indicate the revenues and other funds from which principal and interest will be paid. The bonds shall be executed by the officers of the city designated in the bond ordinance, and such bonds shall be the valid and binding obligation of the city notwithstanding that, before the delivery thereof, all of the persons whose signatures appear thereon have ceased to be officers of the city. The bonds and coupons may be executed either by the manual or printed facsimile signatures of the designated officers, all as provided in the bond ordinance, and all in accordance with the provisions of the Uniform Facsimile Signature of Public Officials Act.
D. Sale of Bonds, Maturity of Bonds and Redemption. A contract for the sale of the bonds may be entered into before or after the adoption of the bond ordinance. If such contract has been entered into prior to the adoption of the bond ordinance, the bonds shall bear interest at such rate or rates fixed by the contract of sale and shall be set forth in the bond ordinance. If such contract is entered into after the adoption of the bond ordinance, the bonds shall bear interest at such rate or rates as shall be designated by a resolution of the council adopted prior to the delivery of the bonds. The bond ordinance shall fix all of the other terms and conditions in connection with the bonds determined advisable by the council, and such bonds shall be payable at such times, be in one or more series, bear such date or dates, mature at such time or times not exceeding forty (40) years from their respective dates, be payable in such medium of payment at such place or places, carry such registration privileges, be subject to such terms of redemption at such premiums, be executed in such manner, contain such terms, covenants and conditions, and be in such form, either coupon or registered, as such ordinance may provide or as may be subsequently determined by the council before the bonds are issued. The bonds may be sold at public or private sale in such manner and upon such terms as may be deemed advisable by the council of the city. The bonds shall be deemed to be securities and negotiable instruments within the meaning and for all purposes of the Uniform Commercial Code.
E. Covenants in the Bond Ordinance. The bond ordinance may contain covenants as to (1) the use and disposition of the revenue and receipts from the revenue-producing facility or system for which the bonds are to be issued, including the creation and maintenance of reserves; (2) the issuance of other or additional bonds relating to the revenue-producing facility or system or any rehabilitation, improvements, renovations, enlargements or additions thereto; (3) the maintenance and repair of such revenue-producing facility or system; (4) the insurance to be carried thereon and the use and disposition of insurance monies; (5) the appointment of any bank or trust company within or outside the state of Illinois, having the necessary trust powers as trustee for the benefit of the bondholders, as paying agent, and as bond registrar, (6) the investment of any funds; and (7) the terms and conditions upon which the holders of the bonds or any portion thereof or any trustees therefor, are entitled to the appointment of a receiver. The provisions of the bond ordinance shall constitute a contract with the holder or holders of the bonds and continue in effect until the principal of, the interest on, and the redemption premiums, if any, on the bonds so issued have been fully paid, or until payment has been provided for, all as set out in the bond ordinance, and the duties of the city and its officers under the bond ordinance shall be enforceable by any bondholder by mandamus or other appropriate suit, action or proceedings in any court of competent jurisdiction; provided, however, that the bond ordinance may provide that all such remedies and rights to enforcement may be vested in a trustee for the benefit of the bondholders, which trustee shall be subject to such control by all or less than all of the bondholders, as set out in the bond ordinance.
F. Use of Bond Proceeds. The proceeds of the sale of revenue bonds issued pursuant to this chapter shall be used solely and only for the purpose or purposes for which the bonds were authorized in the bond ordinance. (Ord. 2041 § 5, 1975)
3-40-060 Rights under preexisting bond ordinance.
Nothing herein contained shall be construed to alter, change or impair the rights of the holders of any of the revenue bonds of the city issued prior to the effective date of the ordinance codified in this chapter, and the rights of such holders shall remain in full force and effect, all as provided in the ordinances heretofore adopted by the council and authorizing the issuance of the revenue bonds presently outstanding. (Ord. 2041 § 6, 1975)
3-40-070 Powers conferred as additional and supplemental—Limitations imposed—Effect.
Subject only to the limitations set forth in Section 3-40-060, the procedures herein set forth for the issuance of revenue bonds shall be controlling and shall be complied with by the city in the borrowing of money by the issuance of revenue bonds, notwithstanding any provisions to the contrary contained in the “Illinois Municipal Code,” and all acts amendatory thereof and supplementary thereto, and in any other law or laws of the state of Illinois or any ordinance heretofore adopted by the city. The powers conferred by this chapter are in addition to and supplementary to any powers conferred by any such laws or ordinances and revenue bonds may be issued pursuant to this chapter for the purpose of financing projects and paying project costs without regard to the requirements, restrictions or other provisions contained in any law or any other ordinance. (Ord. 2041 § 7, 1975)
3-40-080 Use of taxes in support of a revenue-producing system.
Nothing contained in this chapter shall prevent the city from using the proceeds of taxes collected by the city or any other funds in the hands of the city for the purpose of operating, maintaining or supporting a revenue-producing facility or system, or for financing projects. (Ord. 2041 § 8, 1975)