Be it enacted by the Senate and House of Representatives
in General Court assembled, and by the authority of the same,
SECTION 1. Notwithstanding the provisions of chapter forty-four of the General Laws or any other general or special law to the contrary, the city of Medford may issue and sell "minibonds", so-called, in an amount not to exceed five hundred thousand dollars in the aggregate, in accordance with and subject to the provisions of this act, provided that such bonds shall have been duly authorized by said city in the manner prescribed by law.
SECTION 2. The treasurer of the city of Medford, with the approval of the city manager of said city, is hereby authorized to issue or sell the bonds described in section one of such denomination or denominations of not less than five hundred nor more than five thousand dollars, as the treasurer, with such approval, may determine. Each minibond may provide that it shall be redeemed by or on behalf of the city upon due presentation by an appropriate person on any business day at the principal amount thereof plus interest accrued at such rate, or rates, which rate may be determined prior to the issuance thereof, provided that no minibond, so-called, shall mature more than five years from its date. The facsimile signatures of the city treasurer and the city manager on such minibonds shall have the same legal effect as their manual signatures and no such minibond need bear the manual signatures of such officers or of any trustee, authenticating agent, transfer agent or other agent.
SECTION 3. Whenever the city of Medford shall have issued minibonds which are not payable in annual serial installments, the city shall appropriate annually an amount equal to the aggregate principal amount of each issue of such minibonds divided by the number of years from the date thereof to the maturity date of such issue, plus an amount equal to the interest thereon payable in that year less any amounts previously appropriated to pay such interest and available for such purposes in the fund hereinafter provided for or otherwise. The amount appropriated annually for the payment of minibonds, so-called, shall be held in a separate fund and in trust solely for the payment of redemption of such minibonds and the interest thereon. The funds so held may be invested in obligations issued or guaranteed by the United States, the commonwealth or any agency, authority or political subdivision thereof and the income derived from such investments shall be retained in the fund and may be expended by the city treasurer without further appropriation to pay the principal and interest on such minibonds at their maturity or earlier redemption. Said treasurer may provide that the yield on any investment in the fund shall be limited to any extent deemed by him to be necessary to assure that the interest paid on such minibonds shall be exempt from federal income taxation.
SECTION 4. The treasurer of the city of Medford, with the approval of the city manager, may enter into arrangements with a financial institution for a letter or line of credit or other credit facility in order to ensure that funds will be available to redeem any minibonds that may be presented for payment at any time in excess of the amount then available therefor, in the fund described in section three or otherwise, and, in that connection, may enter into agreements providing for reimbursement to the issuer of any such letter or line of credit or other credit facility for any sums advanced thereunder.
SECTION 5. This act shall take effect upon its passage.