Whereas, The deferred operation of this act would tend to defeat its purpose, which is to immediately facilitate the borrowing of money and making of expenditures by cities, towns and districts for essential public purposes, therefore it is hereby declared to be an emergency law, necessary for the immediate preservation of the public convenience.
Be it enacted by the Senate and House of Representatives
in General Court assembled, and by the authority of the same,
SECTION 1. Section 4 of chapter 44 of the General Laws, as appearing in the 1990 Official Edition, is hereby amended by adding the following sentence:- Notes may be authorized and issued under this section by the treasurer of the city, town or district, with the approval of the officer, committee, board or other body required by law to countersign such notes.
SECTION 2. Said chapter 44 is hereby amended by striking out section 17, as so appearing, and inserting in place thereof the following section:-
Section 17. If a city, town or district votes to issue bonds, notes or certificates of indebtedness in accordance with law, the officers authorized to issue the same may, in the name of such city, town or district, make a temporary loan for a period of not more than two years in anticipation of the money to be derived from the sale of such bonds, notes or certificates, and may issue notes therefor. A city, town or district may refund, by the issue of other notes, a temporary loan issued under the authority of the first sentence; provided, however, that the period from the date of issue of the original loan to the date of maturity of the refunding loan shall not exceed two years, unless such temporary loan is paid in part from revenue funds of the city, town or district as hereinafter provided for, in which case the period from the date of issue of the original loan to the date of maturity of the refunding loan shall not exceed five years. A temporary loan refunded under this section shall be paid in part from revenue funds of the city, town or district at or before the maturity date of any such refunding loan that is issued to mature more than two years, but not more than three years, from the date of issue of the original loan. A like payment from revenue funds shall be made at or before the maturity date of any such refunding loan that is issued to mature more than three years, but not more than four years, from the date of issue of the original loan and again at or before the maturity date of any such refunding loan that is issued to mature more than four years from the date of issue of the original loan. Each such payment from revenue funds shall be at least equal to the minimum annual payment which would have been required if such temporary loan had been converted to a serial loan prior to its first refunding that required a payment from revenue funds under this section, and the authorized amount of the serial loan shall be reduced by the aggregate amount of all such payments. Each payment made by a city, town or district as provided in the preceding sentence shall be reported by the auditor or accountant of the city or town or other officer having similar duties, or by the treasurer if there be no such officer, to the assessors, who shall include the amount so reported in the determination of the next annual tax rate, unless the city, town or district has otherwise made provision therefor. The amount of a payment from revenue funds made by a regional school district or regional refuse disposal district as provided herein shall be included in the next annual district operating and maintenance budget, unless the regional district committee has otherwise made provision therefor. The time within which a serial loan shall be due and payable shall not be extended by reason of the making of a temporary loan hereunder beyond the time fixed by law. If a balance remains in the proceeds of a temporary loan issued in anticipation of a serial loan at the time when the serial loan is issued, said balance may be applied to the payment of such temporary loan.
Notes issued under sections four, six and six A for a shorter period than is permitted by said sections may be refunded by the issue of other notes within the required period; provided, however, that the period from the date of issue of the original loan to the date of maturity of the refunding loan shall be not more than the statutory authorization; and provided, further, that no notes shall be refunded under this section except under authority of such vote, if any, as is required for the original borrowing.
SECTION 3. Section seventeen A of said chapter forty-four is hereby repealed.
SECTION 4. Said chapter 44 is hereby further amended by inserting after section 20 the following section:-
Section 20A. Cities, towns and districts that have duly authorized the issuance of serial bonds, notes or certificates of indebtedness may make expenditures for the purposes for which such serial bonds, notes or certificates of indebtedness were authorized from any available revenue funds in advance and in anticipation of such issuance. Cities, towns and districts that have been allotted a grant by the commonwealth or the federal government may make expenditures for the purposes of such grant from any available revenue funds in advance and in anticipation of receipt of reimbursements from such grant, to such maximum amount and subject to such limitations as may be provided in the rules, regulations and guidelines promulgated by the director. For purposes of this section, available revenue funds shall not include revenue cash the use of which is restricted to purposes other than current maintenance expenses. Such advances shall be made by the treasurer with the approval of the officer or officers authorized to issue the bonds or notes. Prior to making any such advance, the treasurer shall determine that the issuance of such serial bonds, notes or certificates of indebtedness has been duly authorized in accordance with law. Such cities, towns or districts shall reimburse the account or accounts from which the advance was made from the proceeds of bonds, notes, including notes in anticipation of the serial loan, or certificates of indebtedness issued during the fiscal year in which the advance was made. Advances made under authority of this section shall be subject to rules, regulations or guidelines promulgated by the director.
SECTION 5. Said chapter 44 is hereby further amended by inserting after section 22B the following section:-
Section 22C. Bonds or notes issued by a town or district may be secured in whole or in part by insurance or by letters or lines of credit or other credit facilities upon a two-thirds vote of the board of selectmen of the town or a two-thirds vote of the prudential committee, if any, otherwise the board or commissioners of the district. Any such insurance, letter or line of credit or credit facility may provide for reimbursement to be made over such period of time, not to exceed two years beyond the maturity date of the bonds or notes so secured, as the officers authorized to issue the bonds or notes shall deem proper and may provide for interest on such reimbursement to be paid at such rate or rates of interest as the officers authorized to issue the bonds or notes shall deem proper, including rates variable from time to time as determined by such index, banker's loan rate or other method as may be specified therein. For the purpose of securing its bonds or notes, a town or district, acting by its treasurer, upon a two-thirds vote of the board of selectmen of the town, or a two-thirds vote of the prudential committee, if any, otherwise the board or commissioners of the district may enter into a trust agreement between the town or district and a corporate trustee which shall be a bank or trust company doing business in the commonwealth. Any such trust agreement, and any other agreements necessary or incidental to the issuance of such bonds or notes, shall be in such form as may be deemed proper by the officers authorized to issue the bonds or notes, and shall be executed by such officers. It shall be lawful for any bank or trust company doing business in the commonwealth to act as a depository or trustee under any such trust agreement and to furnish such indemnification and pledge such securities as may be required by the town or district. Any trustee under a trust agreement established pursuant to this section may bring suit upon the bonds or notes and may, either at law or equity, by suit, action, mandamus or other proceedings for legal or equitable relief, enforce all rights under the laws of the commonwealth or granted hereunder or under such trust agreement, and may enforce and compel the performance of all duties required under such trust agreement to be performed by the town or district or by any officer thereof. All expenses incurred in carrying out the provisions of this section may be treated by the town or district as a cost of preparing, issuing and marketing its bonds or notes.