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[Utah Code Table of Contents]
[TITLE 11. Table of Contents]
11-14-1 Municipality defined - Bond issues authorized - Purposes - Use of bond proceeds - Costs allowed.
(1) "Municipality," for the purpose of this chapter, includes cities, towns, counties, school districts, public transit districts, and improvement districts operating under the authority of Title 17A, Chapter 2, Part 3, special service districts operating under the authority of Title 17A, Chapter 2, Part 13, the Utah Special Service District Act, metropolitan water districts operating under the authority of Title 17A, Chapter 2, Part 8, irrigation districts operating under the authority of Title 17A, Chapter 2, Part 7, water conservancy districts operating under the authority of Title 17A, Chapter 2, Part 14, and regional service areas operating under the authority of Title 17A, Chapter 2, Part 18, Regional Service Areas. It does not include the state of Utah and its institutions. Any municipality may, in the manner and subject to the limitations and restrictions contained in this chapter, issue its negotiable bonds for the purpose of paying all or part of the cost of acquiring, improving, or extending any one or more improvements, facilities, or property which the municipality is authorized by law to acquire. Any municipality may also issue such bonds for the acquisition of or the acquisition of an interest in any one or more or combination of the following types of improvements, facilities, or property to be owned by the municipality or to be owned jointly by two or more municipalities, or for the improvement or extension of any such wholly or jointly owned facility or property:
(a) public buildings of every nature, including without limitation, offices, courthouses, jails, fire, police and sheriff's stations, detention homes, and any other buildings to accommodate or house lawful activities of a municipality;
(b) waterworks, irrigation systems, water systems, dams, reservoirs, water treatment plants, and any other improvements, facilities, or property used in connection with the acquisition, storage, transportation, and supplying of water for domestic, industrial, irrigation, recreational, and other purposes and preventing pollution of water;
(c) sewer systems, sewage treatment plants, incinerators, and other improvements, facilities, or property used in connection with the collection, treatment, and disposal of sewage, garbage, or other refuse;
(d) drainage and flood control systems, storm sewers, and any other improvements, facilities, or property used in connection with the collection, transportation, or disposal of water;
(e) recreational facilities of every kind, including without limitation, athletic and play facilities, playgrounds, athletic fields, gymnasiums, public baths, swimming pools, camps, parks, picnic grounds, fairgrounds, golf courses, zoos, boating facilities, tennis courts, auditoriums, stadiums, arenas, and theaters;
(f) convention centers, sports arenas, auditoriums, theaters, and other facilities for the holding of public assemblies, conventions, and other meetings;
(g) roads, bridges, viaducts, tunnels, sidewalks, curbs, gutters, and parking buildings, lots, and facilities;
(h) airports, landing fields, landing strips, and air navigation facilities;
(i) educational facilities, including without limitation, schools, gymnasiums, auditoriums, theaters, museums, art galleries, libraries, stadiums, arenas, and fairgrounds;
(j) hospitals, convalescent homes, and homes for the aged or indigent; and
(k) electric light works, electric generating systems, and any other improvements, facilities, or property used in connection with the generation and acquisition of electricity for these municipalities and transmission facilities and substations if they do not duplicate transmission facilities and substations of other entities operating in the state prepared to provide the proposed service unless these transmission facilities and substations proposed to be constructed will be more economical to these municipalities.
(2) Any such improvement, facility, or property need not lie within the limits of the municipality. Cost under Subsection (1) may include:
(a) the cost of equipment and furnishings for such improvements, facilities, or property;
(b) all costs incident to the authorization and issuance of bonds, including engineering, legal, and fiscal advisers' fees;
(c) costs incident to the issuance of bond anticipation notes, including interest to accrue on bond anticipation notes;
(d) interest estimated to accrue on the bonds during the period to be covered by the construction of the improvement, facility, or property and for 12 months thereafter; and
(e) other amounts which the governing body finds necessary
to establish bond reserve funds and to provide working capital
related to the improvement, facility, or property.
1995
11-14-2 Election on bond issues - Qualified electors - Resolution and notice.
(1) (a) The governing body of any municipality desiring to issue bonds under the authority granted in Section 11-14-1 shall by resolution provide for the holding of an election in the municipality on the question of the issuance of the bonds.
(b) The bonds may be issued only if at the election the issuance of the bonds is approved by a majority of the qualified electors of the municipality who vote on the proposition.
(2) This section does not require an election for the issuance of refunding bonds or other bonds not required by the constitution to be voted at an election.
(3) (a) At least 30 days before the election, the governing body shall:
(i) approve the resolution; and
(ii) provide a copy of the resolution to the county clerk.
(b) The resolution calling the election and the election notice shall state:
(i) the purpose for which the bonds are to be issued;
(ii) the maximum amount of bonds to be issued; and
(iii) the maximum number of years from the issue date of the bonds to maturity.
(c) The purpose may be stated in general terms and need not specify the particular projects for which the bonds are to be issued or the specific amount of bond proceeds to be expended for each project.
(4) If the municipality is an improvement district and
if the bonds are to be payable in part from tax proceeds
and in part from the operating revenues of the district or
from any combination of tax proceeds and operating revenues,
the resolution and notice shall indicate those payment sources,
but need not specify how the bonds are to be divided between
those sources of payment.
1999
11-14-3 Notice of election - Contents - Publication - Mailing.
(1) (a) Notice of the election shall be published once a week during three consecutive weeks in a newspaper designated in accordance with Section 11-14-21 , the first publication to be not less than 21 nor more than 35 days before the election.
(b) If no official newspaper is designated, the notices shall be published in a newspaper published in the municipality, or if no newspaper is published in the municipality, the notices shall be published in a newspaper having general circulation in the municipality.
(2) When the debt service on the bonds to be issued will increase the property tax imposed upon the average value of a residence by an amount that is greater than or equal to $15 per year, the governing body shall, at least seven days but not more than 30 days before the bond election, if the bond election is not held on the date of a regular primary election, a municipal primary election, a regular general election, or a municipal general election, either mail:
(a) written notice of the bond election on a minimum three inch by five inch postcard to every household containing a registered voter who is eligible to vote on the bonds; or
(b) a voter information pamphlet prepared by the governing body, if one is prepared, that includes the information required by Subsection (4).
(3) (a) Except as provided in Subsection (3)(b), election notice given for any bond election held in this state need not be posted by any persons.
(b) (i) In a city of the third, fourth, or fifth class or a town where no newspaper is published, the governing body may require that notice of a bond election be given by posting in lieu of the publication requirements of Subsection (1).
(ii) When the governing body imposes a posting requirement, the city recorder, town clerk, or other officer designated by the governing body shall post notice of the bond election in at least five public places in the city or town at least 21 days before the election.
(4) The printed, posted, and mailed notice required by this section shall identify:
(a) the date and place of the election;
(b) the hours during which the polls will be open; and
(c) the purpose for which the bonds are to be issued, the maximum amount of bonds to be issued, and the maximum number of years to maturity of the bonds.
(5) The governing body shall pay the costs associated
with the printed, posted, and mailed notice required by this
section.
2003
11-14-4 Election procedure - Time for election - Equipment - Election officials - Combining precincts.
(1) (a) The governing body shall:
(i) designate the voting places to be used;
(ii) fix the hours during which the polls are to be open, which, if the election is a special election, shall be those provided by law for the conduct of regular general elections;
(iii) cause to be provided the necessary ballot boxes, ballots, paraphernalia, equipment, and supplies needed for the election as determined by the governing body; and
(iv) unless the election officials to serve at each voting place are otherwise appointed under the provisions of general law, appoint three election officials, who shall be qualified electors of the municipality or other entity calling the election, to serve at each voting place.
(b) The governing body may appoint one or more alternate election officials to so serve in case of the absence for any cause of the designated election officials.
(2) (a) (i) A bond election may be held and the proposition for the issuance of bonds may be submitted at any general, primary, or other election held in the municipality or other entity calling the bond election, or at a special election called for the purpose.
(ii) A bond election may not be held, nor a proposition for issuance of bonds be submitted, at the Western States Presidential Primary election established in Title 20A, Chapter 9, Part 8, Western States Presidential Primary.
(b) A special election may, but need not, be held on the same day as any other election.
(c) Where a bond election is being held on the same day as any other election held in the municipality or entity calling the bond election or in some part of that municipality or entity, the election officials serving for the other election may also serve as election officials for the bond election.
(3) (a) Voting precincts may be combined for purposes of bond elections.
(b) The governing body may designate whatever voting places
that it considers best suited, so long as no voter is required
to vote outside the county in which he resides.
1999
11-14-6 Election procedure.
(1) The qualifications as an elector of any person applying for a ballot at a bond election may be challenged for cause by any one or more of the election officials or by any other person at the time the ballot is applied for, but notwithstanding any challenge hereunder, any such person shall receive a ballot and be permitted to vote if:
(a) the person is shown on the registration lists as a registered voter in the municipality or other entity calling the bond election; and
(b) the person takes an oath sworn to before one of the election officials that he is a qualified elector of such municipality or entity.
(2) The oath referred to in Subsection (1) may, but need not, be in substantially the following form: ELECTOR'S OATH
STATE OF UTAH ) COUNTY OF ____________)
The undersigned, having been first duly sworn upon oath, deposes and says under the pains and penalties of perjury, as follows:
That I am a citizen of the United States; that I am 18 years of age or older; that I am now and have been a resident of the state of Utah for not less than 30 days; that I am a resident of ____ County and of the voting district or precinct of the (municipality or other entity calling the bond election) in which I am offering to vote; that I am a duly registered voter of ____ County and I am a qualified voter of and reside within the confines of (municipality or other entity calling the bond election); and that I have not previously voted at the bond election being held on this __________(month\day\year) in (municipality or other entity calling the bond election). ____________________________________________________________ Signature of Elector ____________________________________________________________ Address of Elector
I, the undersigned, Judge of election, hereby certify that the person whose signature appears above, signed the foregoing statement on this __________(month\day\year), immediately after I administered to him an oath in the following words: You do solemnly swear (or affirm) that you have read the oath to which you are about to subscribe your signature and that the facts recited therein are true and correct, so help you God (or under the pains and penalties of perjury). ____________________________________________________________ Judge of Election Each election official is expressly authorized to administer the oath.
(3) In the case of challenges made pursuant to Subsection (1), the election officials shall keep a list of the names of each person challenged, the grounds for the challenge, and whether such person was permitted to vote. The list shall be made in duplicate and the duplicate list shall be made available to the governing body when it canvasses the election results.
(4) No bond election shall be held invalid on the grounds
that unqualified voters voted unless it shall be shown by
clear and convincing evidence in a contest filed prior to
the expiration of the period in which bond election contest
may be filed that unqualified voters in sufficient numbers
to change the result voted at the bond election. When the
election results are canvassed, the canvass shall show separately
the number of votes which were challenged and the number
of challenged voters who were permitted to vote, but the
votes cast by the voters shall be accepted as having been
legally cast for purposes of determining the outcome of the
election, unless the court in a bond election contest shall
find otherwise.
2000
11-14-7 Election - Registration of voters - Special registration not required - Registration lists supplied by clerk.
(1) There shall be no special registration of voters for a bond election and the official register last made or revised shall constitute the register for such bond election except that:
(a) if the bond election is held on the same day as a general, special, primary, or other election held in the municipality or other bond-issuing entity or in part of the municipality or entity, all persons registered to vote in such other election shall be considered registered to vote in the bond election; and
(b) if the bond election is not to be held on the same day as any other election, the county clerk of each county in which the municipality or entity is wholly or partly located shall register at his office during regular office hours except Saturdays, Sundays, and holidays, and except during the 20-day period immediately preceding the bond election, any person who on the day of the bond election will be a qualified elector, such person to be registered in the same manner as provided by law for registration by satellite registrars.
(2) The county clerk of each county in which a municipality or entity holding the bond election is located shall make registration lists or copies of such lists available at each polling place for use by registered electors entitled to use such voting place.
(3) If the registration lists furnished include electors
who do not reside within the municipality or entity whose
bonds are being voted upon, the county clerk or the municipality
or other entity shall cause to be indicated on the registration
lists the names of the registered electors who do not reside
in such municipality or entity, but the failure to so indicate
or any inaccuracy in such indication shall not be considered
an irregularity or ground for invalidating the bond election.
1996
11-14-8 Election officials - Filling vacancies.
The governing body may fill any vacancies in the office
of election official at the bond election. If any election
official is unable or fails to attend or serve at the voting
place designated at the hour fixed for opening the polls,
the other election officials shall appoint, or in the absence
of all officials the voters present shall elect, the necessary
number of election officials to serve in the place of the
absent or delinquent appointees.
1965
11-14-9 Election officials - Oaths - Powers and duties - Expenses of determining qualified voters.
The election officials, before opening the polls, shall
be sworn to perform all the duties incumbent on them as such,
the oath to be taken before any officer authorized to administer
oaths, or each election official may administer the oath
to any other election official. The election officials may
administer any oath and receive any affidavit provided for
in this act. The election officials at any bond election
shall have the same powers and duties in conducting the elections
and in preserving order at the polls as are conferred and
imposed upon similar officers under the general election
laws. The governing body ordering the election shall provide
for payment, out of bond proceeds or otherwise, of the actual
expenses entailed in ascertaining the taxpayer-status of
the electors qualified to vote at the election.
1965
11-14-10 Election ballots - Form and contents.
(1) The governing body shall prescribe the form of ballot to be used at the election, but the proposition appearing thereon shall include a statement of the maximum amount of the bonds, the maximum number of years they are to run from their respective dates, and in general terms, the purpose for which they are to be issued. In addition, if the bonds are to be payable in part from tax proceeds and in part from the operating revenues of the municipality, or from any combination thereof, the proposition shall so indicate, but need not specify how the bonds are to be divided as to source of payment. The proposition shall be followed by the words, "For the issuance of bonds" and "Against the issuance of bonds," with appropriate boxes in which the voter may indicate his choice. If a bond question or questions are submitted at an election not specially held for that purpose, the bond question or questions may be combined with the candidate ballot.
(2) Where voting machines are used, the ballot shall be
in such form as is appropriate for such use, and absentee
ballots shall be in the form prescribed by law for such ballots.
1981
11-14-11 Election - Counting and canvassing - Results.
Immediately after the closing of the polls the judges
of the election shall proceed to count and canvass the ballots
cast and make returns thereof to the governing body. The
governing body shall not later than ten days after the election
meet and canvass the returns. The oaths taken pursuant to
Subsection (1) of Section
11-14-6
and the ballots and ballot boxes shall be held
in safekeeping in the manner and for the period provided
by law with respect to ballots for other elections. The canvass
of the election returns shall be made in public and at its
conclusion the governing body shall make an official finding
as to the total number of votes cast, the number of affirmative
votes, the number of negative votes, the number of mutilated
ballots and the number of challenged voters as above required,
and shall declare the bond proposition to have carried or
lost. Such findings shall be incorporated in the official
minutes of the governing body, and it shall not be necessary
to file any statement or certificate of such results or affidavit
with respect to the facts pertaining to the election nor
pertaining to the indebtedness and valuation of the municipality
with the county clerk or with any other official. The determination
of the governing body that a majority of the qualified electors
of the municipality voting on the proposition, have assented
to the issuance of the bonds, shall be conclusive in any
action or proceeding involving the validity of the election
or determination or declaration of the result thereof instituted
after the expiration of the period provided in Section
11-14-12
for the filing of actions contesting the validity
of bond elections and after the date of delivery of and payment
for any part of the bonds.
1975
11-14-12 Contest of election and legality of bonds - Procedure.
The general election laws with respect to the contest of elections shall be applicable to bond elections. Any such contest shall be regarded as one contesting the outcome of the vote on the proposition, rather than election to office, the municipality or other entity calling the election rather than a person declared to have been elected to office, shall be regarded as the defendant, and one of the grounds of contest may be the lack of the required qualifications of voters in sufficient numbers to change the result of the bond election.
When the validity of any bond election is contested, the plaintiff or plaintiffs must, within forty days after the returns of the election are canvassed and the results thereof declared, file with the clerk of the district court of the county in which any part of the municipality or entity conducting the bond election or some part thereof is located, a verified written complaint setting forth specifically:
(1) The name of the party contesting the bond election, and that he is an elector of the municipality or entity conducting the bond election.
(2) The proposition or propositions voted on at the bond election which are contested.
(3) The particular grounds of such contest. No such contest
shall be maintained and no bond election shall be set aside
or held invalid unless such a complaint is filed within the
period prescribed in this section.
1965
11-14-13 Issuance of bonds by governing body - Computation of indebtedness under constitutional and statutory limitations.
If the governing body has declared the bond proposition
to have carried and no contest has been filed, or if the
contest is filed after it has been favorably terminated,
the governing body may proceed to issue the bonds voted at
the election. It is not necessary that all of the bonds be
issued at one time, but no bonds so voted may be issued more
than ten years after the date of the election. No bonds so
voted may be issued to an amount which will cause the indebtedness
of the municipality to exceed that permitted by the Utah
Constitution or statutes. In computing the amount of indebtedness
which may be incurred pursuant to constitutional limitations,
the constitutionally permitted percentage shall be applied
to the fair market value, as defined under Section
59-2-102
, of the taxable property in the municipality
as computed from the last equalized assessment rolls for
state and county purposes prior to the incurring of the additional
indebtedness, except that in the case of cities the last
equalized assessment rolls for city purposes shall be controlling.
In determining the fair market value of the taxable property
in the municipality as provided in this section, the value
of all tax equivalent property, as defined in Section
59-3-102
, shall be included as a part of the total fair
market value of taxable property in the municipality, as
provided in Title 59, Chapter 3, the Tax Equivalent Property
Act. Bonds of improvement districts issued in a manner that
they are payable solely from the revenues to be derived from
the operation of the facilities of the district may not be
included as bonded indebtedness for the purposes of the computation.
Where bonds are issued by a city, town, or county payable
solely from revenues derived from the operation of revenue-producing
facilities of the city, town, or county, or payable solely
from a special fund into which are deposited excise taxes
levied and collected by the city, town, or county, or excise
taxes levied by the state and rebated pursuant to law to
the city, town, or county, or any combination of those excise
taxes, the bonds shall be included as bonded indebtedness
of the city, town, or county only to the extent required
by the Utah Constitution, and any bonds not so required to
be included as bonded indebtedness of the city, town, or
county need not be authorized at an election, except as otherwise
provided by the Utah Constitution, the bonds being hereby
expressly excluded from the election requirement of Section
11-14-2
. No bond election is void because the amount
of bonds authorized at the election exceeded the limitation
applicable to the municipality at the time of holding the
election, but the bonds may be issued from time to time in
an amount within the applicable limitation at the time the
bonds are issued.
1988
11-14-14 Bond issue - Resolution - Negotiability - Registration - Maturity - Interest - Payment - Redemption - Combining issues - Sale - Financing plan.
(1) Bonds issued under this chapter shall be authorized by resolution of the governing body, shall be fully negotiable for all purposes, may be made registrable as to principal alone or as to principal and interest, shall mature at such time or times not more than 40 years from their date, shall bear interest at such rate or rates, if any, shall be payable at such place or places, shall be in such form, shall be executed in such manner, may be made redeemable prior to maturity at such times and on such terms, shall be sold in such manner and at such prices, either at, in excess of, or below face value, and generally shall be issued in such manner and with such details as may be provided by resolution; it being the express intention of the legislature that interest rate limitations elsewhere appearing in the laws of Utah shall not apply to nor limit the rate of interest on bonds issued under this chapter. The resolution shall specify either the rate or rates of interest, if any, on the bonds or specify the method by which the interest rate or rates on the bonds may be determined while the bonds are outstanding. If the resolution specifies a method by which interest on the bonds may be determined, the resolution shall also specify the maximum rate of interest the bonds may bear. Bonds voted for different purposes by separate propositions at the same or different bond elections may in the discretion of the governing body be combined and offered for sale as one issue of bonds. The resolution providing for this combination and the printed bonds for the combined issue shall separately set forth the amount being issued for each of the purposes provided for in each proposition submitted to the electors. If the municipality has retained a fiscal agent to assist and advise it with respect to the bonds and the fiscal agent has received or is to receive a fee for such services, the bonds may be sold to the fiscal agent but only if the sale is made pursuant to a sealed bid submitted by the fiscal agent at an advertised public sale.
(2) (a) All bonds shall be paid by the treasurer of the municipality or the treasurer's duly authorized agent on their respective maturity dates or on the dates fixed for the bonds redemption. All bond coupons, other than coupons cancelled because of the redemption of the bonds to which they apply, shall similarly be paid on their respective dates or as soon thereafter as the bonds or coupons are surrendered.
(b) Upon payment of a bond or coupon, the treasurer of the municipality or the treasurer's duly authorized agent, shall perforate the bond or coupon with a device suitable to indicate payment.
(c) Any bonds or coupons which have been paid or cancelled may be destroyed by the treasurer of the municipality or by the treasurer's duly authorized agent.
(3) Bonds, bond anticipation notes, or tax anticipation
notes with maturity dates of one year or less may be authorized
by a municipality from time to time pursuant to a plan of
financing adopted by the governing body. The plan of financing
shall specify the terms and conditions under which the bonds
or notes may be issued, sold, and delivered, the officers
of the municipality authorized to issue the bonds or notes,
the maximum amount of bonds or notes which may be outstanding
at any one time, the source or sources of payment of the
bonds or notes, and all other details necessary for issuance
of the bonds or notes. Subject to the Constitution, the governing
body of the municipality may include in the plan of financing
the terms and conditions of agreements which may be entered
into by the municipality with banking institutions for letters
of credit or for standby letters of credit to secure the
bonds or notes, including payment from any legally available
source of fees, charges, or other amounts coming due under
the agreements entered into by the municipality.
1983
11-14-14.5 Bonds, notes, or other evidences of indebtedness of political subdivisions exempt from taxation except corporate franchise tax.
All bonds, notes, or other evidences of indebtedness issued
under this chapter or under any other law authorizing the
issuance of bonds, notes, or indebtedness by any county,
city, town, school district, public transit district, improvement
district, special service district, metropolitan water district,
water conservancy district, irrigation district, or any other
political subdivision now existing or subsequently created
under the laws of Utah (including, but not limited to, bonds
payable solely from special assessments and tax anticipation
indebtedness) and the interest on them shall be exempt from
all taxation in this state, except for the corporate franchise
tax.
1987
11-14-15 Facsimile signatures and facsimile seal, use permitted - Validity of signed bonds.
(1) If the use of a facsimile signature is authorized by the body empowered by law to authorize the issuance of the bonds or other obligations of any agency, instrumentality, or institution of this state or of any municipal corporation, political subdivision, improvement district, taxing district, or other governmental entity within the state, whether or not issued under this chapter, any officer so authorized may execute, authenticate, certify, or endorse, or cause to be executed, authenticated, certified, or endorsed the bond or other obligation, or any certificate required to be executed on the back thereof, with a facsimile signature in lieu of his manual signature if at least one signature required or permitted to be placed on the face thereof shall be manually subscribed. Upon compliance with this chapter by the authorized officer, his facsimile signature has the same legal effect as his manual signature. When any seal is required in the execution, authentication, certification, or endorsement of the bond or other obligation, or any certificate required to be executed on the back thereof, the authorized officer may cause the seal to be printed, engraved, lithographed, stamped, or otherwise placed in facsimile thereon. The facsimile seal has the same legal effect as the impression of the seal.
(2) Bonds or other obligations bearing the signatures
(manual or facsimile) of officers in office on the date of
the execution thereof shall be valid and binding obligations
notwithstanding that before the delivery thereof any or all
of the persons whose signatures appear thereon shall have
ceased to be officers of the municipality.
1981
11-14-16 Registration, denominations and exchange of obligations.
(1) Unless otherwise provided by the municipality, the Registered Public Obligations Act governs and applies to all bonds, bond anticipation notes, and tax anticipation notes (bonds, bond anticipation notes and tax anticipation notes being referred to in this section as "obligations") issued in registered form. If the Registered Public Obligations Act is inapplicable to an issue of obligations, Subsection 11-14-16 (2) governs and applies with respect to such issue.
(2) Any obligations issued under this chapter may be issued
in denominations of $100 or any multiple of $100. The governing
body may provide for the exchange of any of these obligations
after issuance for obligations of larger or smaller denominations
in such manner as may be provided in the authorizing resolution,
provided the obligations in changed denominations shall be
exchanged for the original obligations in like aggregate
principal amounts and in such manner that no overlapping
interest is paid; and such obligations in changed denominations
shall bear interest at the same rate or rates, if any, shall
mature on the same date or dates, shall be as nearly as practicable
in the same form except for an appropriate recital as to
the exchange, and shall in all other respects, except as
to denominations and numbers, be identical with the original
obligations surrendered for exchange. Where any exchange
is made under this section, the obligations surrendered by
the holders at the time of exchange shall be cancelled; any
such exchange shall be made only at the request of the holders
of the obligations to be surrendered; and the governing body
may require all expenses incurred in connection with such
exchange, including the authorization and issuance of the
new obligations, to be paid by such holders.
1983
11-14-17 Additional pledge for general obligation bonds - Revenue bonds - Resolution.
(1) To the extent constitutionally permissible, municipalities may pledge as an additional source of payment for their general obligation bonds all or any part of revenues, fees, and charges attributable to the operation or availability of facilities or may issue bonds payable solely from such revenues, fees, or charges.
(2) (a) The legislative body may issue bonds payable solely from revenues, fees, or charges attributable to extensions and improvements to revenue-producing facilities.
(b) If the legislative body issues bonds under Subsection (2)(a), the resolution authorizing these bonds shall set forth as a finding of the legislative body:
(i) the value of the then existing facility and the value of this facility after completion of the extensions or improvements proposed to be constructed; and
(ii) that portion of the revenues, fees, or charges derived from the entire facility when the contemplated extensions and improvements are completed which the value of the existing facility bears to the value of the facility after completion shall be considered to be revenue derived from the existing facility and the remainder may be set aside and pledged to the payment of the principal of and interest on the bonds and for the establishment of appropriate reserve fund or funds, and such portion shall be considered to be revenue derived exclusively from the extensions and improvements.
(3) (a) Any resolution or trust indenture authorizing bonds to which such revenues, fees, or charges are pledged may contain such covenants with the future holder or holders of the bonds as to the management and operation of the affected facilities, the imposition, collection, and disposition of rates, fees, and charges for commodities and services furnished thereby, the issuance of future bonds, the creation of future liens and encumbrances against the facilities, the carrying of insurance, the keeping of books and records, the deposit and paying out of revenues, fees, or charges and bond proceeds, the appointment and duties of a trustee, and other pertinent matters as may be considered proper by the governing body.
(b) If the revenue, fee, or charge so pledged involves either sewer or water revenues, fees, or charges or both sewer and water revenues, fees, or charges, provision may be made for charges for sewer services and water services to be billed in a single bill and for the suspension of water or sewer services, or both, to any customer who shall become delinquent in the payment due for either.
(c) Provision may be made for the securing of such bonds by a trust indenture, but no such indenture shall convey, mortgage, or create any lien upon property of the municipality.
(d) Either the bond resolution or such trust indenture
may impose in the holders of the bonds full rights to enforce
the provisions thereof, and may include terms and conditions
upon which the holders of the bonds or any proportion of
them, or a trustee therefor, shall be entitled to the appointment
of a receiver who may enter and take possession of the facility
or facilities, the revenues, fees, or charges of which are
so pledged, and may operate and maintain them, prescribe
charges and collect, receive, and apply all revenues, fees,
or charges therefrom arising in the same manner as the municipality
itself might do.
2000
11-14-17.5 Revenue bonds payable out of excise tax revenues.
(1) To the extent constitutionally permissible, cities, towns, or counties may issue bonds payable solely from a special fund into which are to be deposited excise taxes levied and collected by the city, town, or county, or excise taxes levied by the state and rebated pursuant to law to the city, town, or county, or any combination of those excise taxes, or may pledge all or any part thereof as an additional source of payment for their general obligation bonds.
(2) (a) Any resolution authorizing the issuance of bonds payable in whole or in part from the proceeds of excise tax revenues may contain covenants with the holder or holders of the bonds as to the excise tax revenues, the disposition of the excise tax revenues, the issuance of future bonds, and other pertinent matters that are considered necessary by the governing body to assure the marketability of those bonds, provided the covenants are not inconsistent with the provisions of this chapter.
(b) The resolution may also include provisions to insure the enforcement, collection, and proper application of excise tax revenues as the governing body may think proper.
(c) The proceeds of bonds payable in whole or in part from pledged class B or C road funds shall be used to construct, repair, and maintain streets and roads in accordance with Sections 72-6-108 and 72-6-110 and to fund any reserves and costs incidental to the issuance of the bonds.
(d) When any bonds payable from excise tax revenues have been issued, the resolution or other enactment of the governing body imposing the excise tax and pursuant to which the tax is being collected, the obligation of the governing body to continue to levy, collect, and allocate the excise tax, and to apply the revenues derived therefrom in accordance with the provisions of the authorizing resolution or other enactment, shall be irrevocable until the bonds have been paid in full as to both principal and interest, and is not subject to amendment in any manner which would impair the rights of the holders of those bonds or which would in any way jeopardize the timely payment of principal or interest when due.
(3) (a) The state pledges to and agrees with the holders of any bonds issued by a city, town, or county to which the proceeds of excise taxes collected by the state and rebated to the city, town, or county are devoted or pledged as authorized in this section, that the state will not alter, impair, or limit the excise taxes in a manner that reduces the amounts to be rebated to the city, town, or county which are devoted or pledged as authorized in this section until the bonds or other securities, together with applicable interest, are fully met and discharged.
(b) Nothing in this Subsection (3) precludes alteration, impairment, or limitation of excise taxes if adequate provision is made by law for the protection of the holders of the bonds.
(c) Each city, town, or county may include this pledge and undertaking for the state in those bonds.
(4) The outstanding bonds to which excise tax revenues have been pledged as the sole source of payment may not at any one time exceed an amount for which the average annual installments of principal and interest will exceed 80% of the total excise tax revenues received by the issuing entity from the collection or rebate of the excise tax revenues during the fiscal year of the issuing entity immediately preceding the fiscal year in which the resolution authorizing the issuance of bonds is adopted.
(5) Bonds issued solely from a special fund into which are to be deposited excise tax revenues constitutes a borrowing solely upon the credit of the excise tax revenues received or to be received by the city, town, or county and does not constitute an indebtedness or pledge of the general credit of the city, town, or county.
(6) (a) Before issuing any bonds under this section, a city, town, or county shall:
(i) give public notice of its intent to issue the bonds; and
(ii) hold a public hearing to receive input from the public with respect to the issuance of the bonds.
(b) The city, county, or town shall:
(i) publish the notice once each week for two consecutive weeks in the official newspaper as designated under Section 11-14-21 , with the first publication being not less than 14 days before the public hearing; and
(ii) ensure that the notice identifies:
(A) the purpose for the issuance of the bonds;
(B) the maximum principal amount of the bonds to be issued;
(C) the excise taxes proposed to be pledged for repayment of the bonds; and
(D) the time, place, and location of the public hearing.
(7) A city, town, or county shall submit the question
of whether or not to issue any bonds under this section to
voters for their approval or rejection if, within 30 calendar
days after the notice required by Subsection (6), a written
petition requesting an election and signed by at least 20%
of the registered voters in the city, town, or county is
filed with the city, town, or county.
2001
11-14-17.6 Special service district bonds secured by federal mineral lease payments - Use of bond proceeds - Bond resolution - Nonimpairment of appropriation formula - Issuance of bonds.
(1) Special service districts may:
(a) issue bonds payable, in whole or in part, from federal mineral lease payments which are to be deposited into the Mineral Lease Account under Section 59-21-1 and distributed to special service districts under Subsection 59-21-2 (3)(h); or
(b) pledge all or any part of the mineral lease payments referred to in Subsection (1)(a) as an additional source of payment for their general obligation bonds.
(2) The proceeds of these bonds may be used:
(a) to construct, repair, and maintain streets and roads;
(b) to fund any reserves and costs incidental to the issuance of the bonds and pay any associated administrative costs; and
(c) for capital projects of the special service district.
(3) (a) The special service district board shall enact a resolution authorizing the issuance of bonds which, until the bonds have been paid in full:
(i) shall be irrevocable; and
(ii) may not be amended in any manner that would:
(A) impair the rights of the bond holders; or
(B) jeopardize the timely payment of principal or interest when due.
(b) Notwithstanding any other provision of this chapter, the resolution may contain covenants with the bond holder regarding:
(i) mineral lease payments, or their disposition;
(ii) the issuance of future bonds; or
(iii) other pertinent matters considered necessary by the governing body to:
(A) assure the marketability of the bonds; or
(B) insure the enforcement, collection, and proper application of mineral lease payments.
(4) (a) Except as provided in Subsection (4)(b), the state may not alter, impair, or limit the statutory appropriation formula provided in Subsection 59-21-2 (3)(h), in a manner that reduces the amounts to be distributed to the special service district until the bonds and the interest on the bonds are fully met and discharged. Each special service district may include this pledge and undertaking of the state in these bonds.
(b) Nothing in this section:
(i) may preclude the alteration, impairment, or limitation of these bonds if adequate provision is made by law for the protection of the bond holders; or
(ii) shall be construed:
(A) as a pledge guaranteeing the actual dollar amount ultimately received by individual special service districts;
(B) to require the Department of Transportation to allocate the mineral lease payments in a manner contrary to the general allocation method described in Subsection 59-21-2 (3)(h); or
(C) to limit the Department of Transportation in making rules or procedures allocating mineral lease payments pursuant to Subsection 59-21-2 (3)(h).
(5) (a) The average annual installments of principal and interest on bonds to which mineral lease payments have been pledged as the sole source of payment may not at any one time exceed:
(i) 80% of the total mineral lease payments received by the issuing entity during the fiscal year of the issuing entity immediately preceding the fiscal year in which the resolution authorizing the issuance of bonds is adopted; or
(ii) if the bonds are issued during the first fiscal year the issuing entity is eligible to receive funds, 60% of the amount estimated by the Department of Transportation to be appropriated to the issuing entity in that fiscal year.
(b) The Department of Transportation shall not be liable for any loss or damage resulting from reliance on the estimates.
(6) The final maturity date of the bonds may not exceed 15 years from the date of their issuance.
(7) Bonds may not be issued under this section after December 31, 2010.
(8) Bonds which are payable solely from a special fund
into which mineral lease payments are deposited constitute
a borrowing based solely upon the credit of the mineral lease
payments received or to be received by the special service
district and do not constitute an indebtedness or pledge
of the general credit of the special service district or
the state.
2001
11-14-18 Refunding bonds - Limitation on redemption of bonds.
Any bond issued under this chapter may be refunded as provided in the Utah Refunding Bond Act.
Nothing contained in this act nor in any other law of
this state shall be construed to permit any municipality
to call bonds now or hereafter outstanding for redemption
in order to refund such bonds or in order to pay them prior
to their stated maturities, unless the right to call such
bonds for redemption was specifically reserved and stated
in such bonds at the time of their issuance, and all conditions
with respect to the manner, price and time applicable to
such redemption as set forth in the proceedings authorizing
the outstanding bonds are strictly observed, the intention
of this paragraph being to make it certain that the holder
of no outstanding bond may be compelled to surrender such
bond for refunding prior to its stated maturity or optional
date of redemption expressly reserved therein, even though
such refunding might result in financial benefit to the issuing
municipality.
1983
11-14-19 General obligation bonds - Levy and collection of taxes.
Any bonds issued hereunder in such manner that they are not payable solely from revenues other than those derived from ad valorem taxes shall constitute full general obligations of the municipality, for the prompt and punctual payment of principal of and interest on which the full faith and credit of the municipality are pledged, and the municipality is hereby expressly required, regardless of any limitations which may otherwise exist on the amount of taxes which the municipality may levy, to provide for the levy and collection annually of ad valorem taxes without limitation as to rate or amount on all taxable property in the municipality fully sufficient for such purpose. If by law ad valorem taxes for the municipality are levied by a board other than its governing body, the taxes for which provision is herein made shall be levied by such other board and the municipality shall be under the duty in due season in each year to provide such other board with all information necessary to the levy of taxes in the required amount. Such taxes shall be levied and collected by the same officers, at the same time and in the same manner as are other taxes levied for the municipality.
If any municipality shall neglect or fail for any reason
to levy or collect or cause to be levied or collected sufficient
taxes for the prompt and punctual payment of such principal
and interest, any person in interest may enforce levy and
collection thereof in any court having jurisdiction of the
subject matter, and any suit, action or proceeding brought
by such person in interest shall be a preferred cause and
shall be heard and disposed of without delay. All provisions
of the constitution and laws relating to the collection of
county and municipal taxes and tax sales shall also apply
to and regulate the collection of the taxes levied pursuant
to this section, through the officer whose duty it is to
collect the taxes and money due the municipality.
1965
11-14-19.5 Bond anticipation notes.
(1) Whenever the governing body considers it advisable and in the interests of the municipality to anticipate the issuance of bonds to be issued under this chapter, the governing body may, pursuant to appropriate resolution, issue bond anticipation notes. Each resolution authorizing the issuance of bond anticipation notes shall:
(a) describe the bonds in anticipation of which the notes are to be issued; and
(b) specify the principal amount of the notes and the maturity dates of the notes. The resolution shall specify either the rates of interest, if any, on the notes or specify the method by which interest on the notes may be determined while the notes are outstanding. If the resolution specifies a method by which the interest rates on the notes may be determined, the resolution may specify the maximum rate of interest which the notes may bear.
(2) Bond anticipation notes shall be issued and sold in a manner and at a price, either at, below, or above face value, as the governing body determines by resolution. Interest on bond anticipation notes may be made payable semiannually, annually, or at maturity. Bond anticipation notes may be made redeemable prior to maturity at the option of the governing body in the manner and upon the terms fixed by the resolution authorizing their issuance. Bond anticipation notes shall be executed and shall be in a form and have details and terms as provided in the authorizing resolution.
(3) Contemporaneously with the issuance of the bonds in anticipation of which bond anticipation notes are issued, provision shall be made for the retirement of any outstanding bond anticipation notes.
(4) Whenever the bonds in anticipation of which notes are issued are to be payable from ad valorem taxes and constitute full general obligations of the municipality, the bond anticipation notes and the interest on them shall be secured by a pledge of the full faith and credit of the municipality in the manner provided in Section 11-14-19 and shall also be made payable from funds derived from the sale of the bonds in anticipation of which the notes are issued. Whenever the bonds in anticipation of which the notes are to be issued are to be payable solely from revenues derived from the operation of revenue-producing facilities, these bond anticipation notes and the interest on them shall be secured by a pledge of the income and revenues derived by the municipality from the revenue-producing facilities and shall also be made payable from funds derived from the sale of the bonds in anticipation of which the notes are issued.
(5) Bond anticipation notes issued under this section may be refunded by the issuance of other bond anticipation notes issued under this section.
(6) Sections 11-14-15 , 11-14-16 , 11-14-20 , 11-14-21 , and 11-14-22 apply to all bond anticipation notes issued under this section.
(7) Bonds are not considered to have been issued more
than ten years after the date of the election authorizing
the issuance of them, under Section
11-14-13
, if the issuance of these bonds has been anticipated
under this section by bond anticipation notes issued prior
to the expiration of this ten-year period.
1985
11-14-19.6 Prior bonds validated - Exceptions.
All bonds issued by any municipality prior to the effective
date of this act and all proceedings had in the authorization
and issuance of them are hereby validated, ratified, and
confirmed; and all such bonds are declared to constitute
legally binding obligations in accordance with their terms.
Nothing in this section shall be construed to affect or validate
any bonds, the legality of which is being contested at the
time this act takes effect.
1975
11-14-19.7 Issuance of negotiable notes or bonds authorized - Limitation on amount of tax anticipation notes or bonds - Procedure.
(1) For the purpose of meeting the current expenses of the municipality and for any other purpose for which funds of the municipality may be expended, the governing body may borrow money not in excess of 90% of the taxes and other revenues of the municipality for the current year, issuing therefor negotiable notes or bonds of the municipality. In the event that such notes or bonds are issued prior to the annual tax levy for the year in which such indebtedness is contracted, the amount so issued shall not exceed 75% of the tax revenues and other revenues of the preceding year, and the proceeds shall be applied only in payment of current and necessary expenses and other purposes for which funds of the municipality may be expended, and there shall be included in the annual levy a tax and there shall be provision made for the imposition and collection of sufficient revenues other than taxes sufficient to pay the same at maturity. In the event that the taxes and other revenues in any one year are insufficient through delinquency or uncollectibility of taxes or other cause to pay when due all the lawful debts of the municipality which have been or may hereafter be contracted, the governing body of the municipality is authorized and directed to levy and collect in the next succeeding year a sufficient tax and to provide for the imposition and collection of sufficient revenues other than taxes to pay all of such lawfully contracted indebtedness, and may borrow as provided in this section in anticipation of such tax and other revenues to pay any such lawfully contracted indebtedness. Each resolution authorizing the issuance of tax anticipation notes shall:
(a) Describe the taxes or revenues in anticipation of which the notes are to be issued; and
(b) Specify the principal amount of the notes, the interest rates, if any, (including a variable interest rate), the notes shall bear, and the maturity dates of the notes, which dates shall not extend beyond the last day of the issuing municipality's fiscal year.
(2) Tax anticipation notes shall be issued and sold in such manner and at such prices (whether at, below, or above face value) as the governing body shall by resolution determine. Tax anticipation notes shall be in bearer form, except that the governing body may provide for the registration of the notes in the name of the owner, either as to principal alone, or as to principal and interest. Tax anticipation notes may be made redeemable prior to maturity at the option of the governing body in the manner and upon the terms fixed by the resolution authorizing their issuance. Tax anticipation notes shall be executed and shall be in such form and have such details and terms as shall be provided in the authorizing resolution.
(3) The provisions of Sections 11-14-14.5 , 11-14-15 , 11-14-16 , 11-14-19.7 , 11-14-20 , 11-14-21 , 11-14-22 , 11-14-24 , and 11-14-25 shall apply to all tax anticipation notes issued under this section. In applying these sections to tax anticipation notes, "bond" or "bonds" as used in these sections shall be deemed to include tax anticipation notes.
(4) "Municipality" as used in this section shall have
the meaning set forth in Section
11-14-1
.
1983
11-14-19.8 Tax anticipation obligations validated.
All obligations issued in anticipation of the collection
of taxes and other revenues by any municipality prior to
the effective date of this act and all proceedings had in
the authorization and issuance of them are validated, ratified,
and confirmed; and all these obligations are declared to
constitute legally binding obligations in accordance with
their terms. Nothing in this section shall be construed to
affect or validate any of these obligations, the legality
of which is being contested at the time this act takes effect.
1981
11-14-20 Nature and validity of bonds issued - Applicability of other statutory provisions - Budget provision required - Applicable procedures for issuance.
Bonds issued under this act shall have all the qualities
of negotiable paper, shall be incontestable in the hands
of bona fide purchasers or holders for value and shall not
be invalid for any irregularity or defect in the proceedings
for their issuance and sale. This act is intended to afford
an alternative method for the issuance of bonds by municipalities
and shall not be so construed as to deprive any municipality
of the right to issue its bonds under authority of any other
statute, but nevertheless this act shall constitute full
authority for the issue and sale of bonds by municipalities.
The provisions of Section
11-1-1
, Utah Code Annotated 1953, shall not be applicable
to bonds issued under this act. Any municipality subject
to the provisions of any budget law shall in its annual budget
make proper provision for the payment of principal and interest
currently falling due on bonds issued hereunder, but no provision
need be made in any such budget prior to the issuance of
the bonds for the issuance thereof or for the expenditure
of the proceeds thereof. No ordinance, resolution or proceeding
in respect to the issuance of bonds hereunder shall be necessary
except as herein specifically required, nor shall the publication
of any resolution, proceeding or notice relating to the issuance
of the bonds be necessary except as herein required. Any
publication made hereunder may be made in any newspaper conforming
to the terms hereof in which legal notices may be published
under the laws of Utah, without regard to the designation
thereof as the official journal or newspaper of the municipality.
No resolution adopted or proceeding taken hereunder shall
be subject to referendum petition or to an election other
than as herein required. All proceedings adopted hereunder
may be adopted on a single reading at any legally convened
meeting of the governing body.
1965
11-14-21 Publication of notice, resolution, or other proceeding - Contest.
(1) If a municipality has one or more newspapers published within its boundaries, the governing body of the municipality shall, from time to time, designate one of the newspapers as the "official newspaper" for the publication of all notices required under this chapter. Otherwise, the governing body, from time to time, shall designate a newspaper with general circulation in the municipality as the "official newspaper" for the publication of such notices.
(2) The governing body of any public body may provide for the publication of any resolution or other proceeding adopted by it under this chapter in the "official newspaper" designated under Subsection (1).
(3) In case of a resolution or other proceeding providing for the issuance of bonds, the governing body may, in lieu of publishing the entire resolution or other proceeding, publish a notice of bonds to be issued, titled as such, containing:
(a) the name of the issuer;
(b) the purpose of the issue;
(c) the type of bonds and the maximum principal amount which may be issued;
(d) the maximum number of years over which the bonds may mature;
(e) the maximum interest rate which the bonds may bear, if any;
(f) the maximum discount from par, expressed as a percentage of principal amount, at which the bonds may be sold; and
(g) the times and place where a copy of the resolution or other proceeding may be examined, which shall be at an office of the issuer, identified in the notice, during regular business hours of the issuer as described in the notice and for a period of at least 30 days after the publication of the notice.
(4) For a period of 30 days after the publication any
person in interest may contest the legality of such resolution
or proceeding, any bonds which may be authorized by such
resolution or proceeding, or any provisions made for the
security and payment of the bonds. After the 30-day period
no person may contest the regularity, formality, or legality
of such resolution or proceeding for any cause.
1987
11-14-22 Short title - Title to appear on face of bonds - Effect of future statutes dealing with municipal bond issues.
This act may be cited as the "Utah Municipal Bond Act,"
all bonds issued pursuant to authority contained in this
act shall contain on their face a recital to that effect,
and no act hereafter passed by the legislature amending other
acts under which bonds authorized to be issued by this act
might be issued or dealing with bond issues of municipalities
shall be construed to affect the authority to proceed under
this act in the manner herein provided unless such future
statute amends this act and specifically provides that it
is to be applicable to bonds issued under this act.
1965
11-14-23 Exemptions from application of chapter - Exception.
(1) Except as provided in Subsection (2), this chapter does not apply to bonds issued by the state of Utah nor to bonds or obligations payable solely from special assessments levied on benefited property.
(2) Sections
11-14-14.5
and
11-14-28
have general application in accordance with
their terms.
2001
11-14-24 Conflict of laws.
To the extent that any one or more provisions of this
act shall be in conflict with any other law or laws, the
provisions of this act shall be controlling.
1965
11-14-25 Separability clause.
If any one or more sentences, clauses, phrases, provisions
or sections of this act or the application thereof to any
set of circumstances shall be held by final judgment of any
court of competent jurisdiction to be invalid, the remaining
sentences, clauses, phrases, provisions and sections hereof
and the application of this act to other sets of circumstances
shall nevertheless continue to be valid and effective, the
legislature hereby declaring that all provisions of this
act are severable.
1965
11-14-26 Validity of prior bond issues.
All bonds issued by any municipality prior to the effective
date of this act and all proceedings had in the authorization
and issuance thereof are hereby validated, ratified and confirmed
and all such bonds are declared to constitute legally binding
obligations in accordance with their terms. Nothing in this
section shall be construed to affect or validate any bonds,
the legality of which is being contested at the time this
act takes effect.
1965
11-14-27 Application of act.
Sections
11-14-2
,
11-14-4
,
11-14-6
,
11-14-7
,
11-14-8
,
11-14-9
,
11-14-12
,
11-14-15
, and
11-14-18
shall apply to all bond elections and to all
bonds issued by any city, town, county, school district,
public transit district, improvement district under Title
17A, Chapter 2, Part 3, special service district operating
under authority of the Utah Special Service District Act,
water conservancy district, metropolitan water district and,
except as otherwise provided in Section
11-14-23
, by any other taxing district or governmental
entity whether or not the bonds are issued pursuant to authority
granted by this act and, as to matters provided in Section
11-14-18
, this act shall apply to all bonds issued and
outstanding as of May 11, 1965, as well as to bonds issued
after that date.
1997
11-14-28 Creation and perfection of government security interests.
(1) As used in this section:
(a) "Bonds" means any bond, note, lease, or other obligation of a governmental unit.
(b) "Governmental unit" has the meaning assigned in Subsection 70A-9a-102 (45).
(c) "Pledge" means the creation of a security interest of any kind.
(d) "Property" means any property or interests in property, other than real property.
(e) "Security agreement" means any resolution, ordinance, indenture, document, or other agreement or instrument under which the revenues, fees, rents, charges, taxes, or other property are pledged to secure the bonds.
(2) This section expressly governs the creation, perfection, priority, and enforcement of a security interest created by the state or a governmental unit of the state, notwithstanding anything in Title 70A, Chapter 9a, Uniform Commercial Code - Secured Transactions, to the contrary.
(3) (a) The revenues, fees, rents, charges, taxes, or other property pledged by a governmental unit for the purpose of securing its bonds are immediately subject to the lien of the pledge.
(b) (i) The lien is a perfected lien upon the effective date of the security agreement.
(ii) The physical delivery, filing, or recording of a security agreement or financing statement under the Uniform Commercial Code or otherwise, or any other similar act, is not necessary to perfect the lien.
(c) The lien of any pledge is valid, binding, perfected, and enforceable from the time the pledge is made.
(d) The lien of the pledge has priority:
(i) based on the time of the creation of the pledge unless otherwise provided in the security agreement; and
(ii) as against all parties having claims of any kind in tort, contract, or otherwise against the governmental unit, regardless of whether or not the parties have notice of the lien.
(e) Each pledge and security agreement made for the benefit or security of any of the bonds shall continue to be effective until:
(i) the principal, interest, and premium, if any, on the bonds have been fully paid;
(ii) provision for payment has been made; or
(iii) the lien created by the security agreement has been
released by agreement of the parties in interest or as provided
by the security agreement that created the lien.
2001
