§ 26-74-304 - Issuance of bonds.
26-74-304. Issuance of bonds.
(a) Counties levying the tax permitted in this subchapter are authorized, in addition to the authority existing under the laws of this state, to acquire, construct, equip, reconstruct, extend, and improve capital improvements of a public nature, collectively referred to as a "project", within or near such counties and are authorized to issue bonds to provide funds for accomplishing projects and to pledge all or any part of the revenues which the county is entitled to receive from the tax levied by such county pursuant to this subchapter to pay lease rentals, or principal of, interest on, and fees and expenses in connection with such bonds.
(b) Bonds issued by a county pursuant to this subchapter shall be authorized by ordinance of the quorum court of the county. The bonds may:
(1) Be coupon bonds payable to bearer or may be registered as to principal or as to principal and interest;
(2) Be exchangeable for bonds of another denomination;
(3) Be in such form and denominations;
(4) Be made payable at such places within or without the state;
(5) Be issued in one (1) or more series;
(6) Bear such date or dates;
(7) Mature at such time or times, not exceeding forty (40) years from their respective dates;
(8) Bear interest at such rate or rates;
(9) Be payable in such medium of payment; and
(10) Be subject to such terms of redemption; and
(11) Contain such terms, covenants, and conditions as the ordinance authorizing their issuance may provide including, without limitation, those pertaining to:
(A) The custody, investment, and application of the proceeds of the bonds;
(B) The collection and disposition of revenues;
(C) The maintenance of various funds and reserves;
(D) The nature and extent of the security and pledging of revenues;
(E) The rights, duties, and obligations of the county and the trustee for the holders and registered owners of the bonds; and
(F) The rights of the holders and registered owners of the bonds.
(c) There may be successive bond issues for the purpose of financing the same project, and there may be successive bond issues for financing the cost of reconstructing, replacing, constructing additions to, extending, improving, and equipping projects already in existence, whether or not originally financed by bonds issued under this subchapter, and with each successive issue to be authorized as provided by this subchapter. Priority between and among issues and successive issues as to security of the pledge of revenues and lien on the project facilities involved may be controlled by the ordinance authorizing the issuance of bonds under this subchapter. Subject to the provisions of this subchapter pertaining to registration, the bonds shall have all the qualities of negotiable instruments under the laws of the State of Arkansas. A copy of the ordinance authorizing bonds under this subchapter, certified by the county clerk of the county, shall be filed with the Director of the Department of Finance and Administration and with the Treasurer of State.
(d) The bonds shall be executed by the county judge of the county and attested by the county clerk of the county, by their manual or facsimile signatures. Coupons attached to the bonds shall be executed by the facsimile signature of the county judge. In case any of the officers whose signatures appear on the bonds or coupons cease to be such officers before delivery of the bonds or coupons, their signatures shall nevertheless be valid and sufficient for all purposes. The bonds shall be sealed with the seal of the county issuing the bonds.
(e) The bonds shall not be general obligations of the county involved but shall be special obligations secured and payable as provided in this subchapter. In no event shall the bonds constitute an indebtedness of the county within the meaning of any constitutional or statutory limitation. The principal of and interest on all bonds issued under the authority of this subchapter shall be secured by a pledge of, and shall be payable from, all or any part of the revenues derived from the tax levied by the county, and to which the county is entitled, pursuant to this subchapter or from all or any part of the revenues derived from the operation of the project involved, if and to the extent permitted by other laws of the State of Arkansas authorizing the issuance of revenue bonds secured by the revenues of such facilities. The ordinance authorizing the issuance of bonds together with this subchapter shall constitute a contract by and between the county and the holders and registered owners of the bonds issued by the county under the authority of this subchapter, which contract, and all covenants, agreements, and obligations therein, shall be promptly performed in strict compliance with the terms and provisions of the contract, and the contract and all rights of the holders and registered owners of the bonds and the obligations of the county may be enforced by mandamus or by any other appropriate proceeding at law or in equity. It shall be plainly stated on the face of each bond that it has been issued under the provisions of this subchapter.
(f) The ordinance authorizing the bonds may provide for the execution by the county with a bank or trust company, within or without the State of Arkansas, of a trust indenture. The trust indenture may control the priority between and among successive issues and series, and may contain any other terms, covenants, and conditions that are deemed desirable by the governing body, including, without limitation, those pertaining to:
(1) The custody, investment, and application of the proceeds of bonds;
(2) The collection and disposition of revenues;
(3) The maintenance of various funds and reserves;
(4) The nature and extent of the security;
(5) The rights, duties, and obligations of the county and the trustee for the holders and registered owners of the bonds; and
(6) The rights of the holders and registered owners of the bonds.
(g) Bonds issued under the authority of this subchapter may be sold at public or private sale. If sold at public sale, the bonds shall be sold on sealed bids, and notice of the sale shall be published one (1) time in a newspaper having a general circulation throughout the State of Arkansas, at least ten (10) days prior to the date of the sale. In either case, the bonds may be sold at such price as the county may accept, including sale at a discount.
(h) Bonds issued under the authority of this subchapter are made securities in which insurance companies, trust companies, banks, investment companies, executors, administrators, trustees, and other fiduciaries may properly and legally invest funds, including capital in their control or belonging to them. Such bonds are made securities which may properly and legally be deposited with and received by any state or municipal officer or any agency or political subdivision of the state for any purpose for which the deposit of bonds or obligations of the state is authorized by law. Any municipality or county, or any board, commission, or other authority established by any such municipality or county, or the boards of trustees, respectively, of any retirement fund or retirement system created by or pursuant to authority conferred by the General Assembly in its discretion may invest any of its funds not immediately needed for its purposes in bonds issued under the authority of this subchapter, and bonds issued under the authority of this subchapter shall be eligible to secure the deposit of public funds.
(i) The principal of and interest on bonds issued under the authority of this subchapter shall be exempt from all state, county, school district, community college district, and municipal taxes. This exemption shall include income, property, inheritance, and estate taxes.
(j) Revenue bonds may be issued under this subchapter for the purpose of refunding any obligations issued under this subchapter or under the authority of any other law for the purpose of providing all or part of the funds for the construction, reconstruction, extension, equipment, acquisition, or improvement of any capital improvements of a public nature. These refunding bonds may be combined with bonds issued under the provisions of this section into a single issue. When bonds are issued under this section for refunding purposes, the bonds may either be sold or delivered in exchange for the outstanding obligations. If sold, the proceeds may be either applied to the payment of the obligations refunded or deposited in escrow for the retirement thereof. The ordinance under which the refunding bonds are issued may provide that any of the refunding bonds shall have the same priority of lien on the revenues pledged for their payment as was enjoyed by the obligations refunded thereby. These refunding bonds shall be issued and secured in the manner provided for other bonds issued under this subchapter and shall have all the attributes of these bonds.