Haw. Code R. § 15-19-81

Current through November, 2024

Section 15-19-81 - Assessment area bonds; financing of special assessments from available moneys

(a) In the event of an election to pay all or any part of any special assessment in installments, the unpaid amount of the special assessment required to pay the contract price of the improvement and any other costs involved in the undertaking of the improvement, including the cost of land acquisition shall be obtained by the issuance of sufficient assessment area bonds of the authority to raise the required amount; provided that assessment area bonds need not be issued (i) if the aggregate of the assessment installments for all property owners in the assessment area is less than $1,000 in each year, or (ii) if, as provided in subsection (e) hereof, the authority shall determine to advance the funds for the unpaid amount of the special assessment out of any available funds of the authority.

(b) The bonds shall be authorized by resolution of the authority and issued pursuant to and under the authority and requirements of the authority. The bonds shall be in such form, either coupon or registered, shall bear the name of the benefited assessment area, shall be dated, shall be numbered, shall be of the denomination or denominations, shall bear interest at such rate or rates per annum, but not more than fifteen per cent per annum, payable at such time or times and at such place or places, shall mature at such time or times so as to cover the outstanding installment payments determined upon pursuant to the provisions of this chapter, shall be subject to call at such price or prices and upon such terms and conditions, and may be subject to tender by the holders thereof upon such terms and conditions, all as determined by resolution of the authority. The bonds shall bear the facsimile signature of the chairman of the authority and shall be sealed with the seal of the authority, or a facsimile thereof, attested by the facsimile of the signature of the secretary of the authority and shall bear a certificate of authentication manually executed by the registrar. No bond shall be valid or obligatory unless certified or authenticated by the registrar. Interest coupons, if any, shall bear a facsimile of the signature of the chairman of the authority. The executive director shall preserve a record of the bonds in a suitable book kept for that purpose. The authority shall designate the registrar, if any, for the bonds and the place or places of registration and transfer of such bonds, and such registrar shall maintain such books of registry as shall be required by resolution of the authority.

(c) The assessment area bonds shall be payable only out of the moneys collected on account of assessments made for the improvement or improvements for which they are issued and the authority shall not otherwise guarantee payment of the bonds; provided that interest payments may be advanced by the executive director out of moneys available in the assessment area revolving fund.

(d) Whenever the authority shall have outstanding any assessment area bonds, and the authority with the approval of the governor and the director of finance, determines that it will be financially sound and advantageous to the State, the authority, the landowners and the lessees within the assessment area for which assessment area bonds have been issued to refund any outstanding assessment area bonds, the authority may provide for the issuance of refunding assessment area bonds with which to provide for the payment of the outstanding assessment area bonds or any part thereof at or before the maturity or redemption date thereof, with the right to include various series and issues of outstanding assessment area bonds in a single issue of refunding assessment area bonds, to pay any redemption premium and interest to accrue and become payable on the outstanding assessment area bonds being refunded, and to establish reserves for the refunding assessment area bonds and partly to refund outstanding assessment area bonds and partly for the payment of the contract prices of an improvement and any other costs involved in the undertaking of an improvement for which the outstanding assessment area bonds were issued.

The refunding assessment area bonds may be issued and delivered at any time prior to the date of maturity or redemption date of the assessment area bonds to be refunded that the authority deems to be in its best interest. The refunding assessment area bonds, except as specifically provided in this subsection (d) shall be issued in accordance with the provisions of this chapter with respect to assessment area bonds. Pending the time the proceeds derived from the sale of refunding assessment area bonds issued under this chapter are required for the purposes for which they were issued, the proceeds, upon authorization or approval of the governor, may be invested in obligations of, or obligations unconditionally guaranteed by the United States of America, or in savings accounts, time deposits, or certificates of deposit of any bank or trust company within or without the State, to the extent that such savings accounts, time deposits, or certificates of deposit are collaterally secured by a pledge of obligations of, or obligations unconditionally guaranteed by, the United States of America; or in obligation of any state of the United States of America or any agency, instrumentality, or local government thereof, the provision for payment of the principal and interest which have irrevocably been made by deposit of obligations of, or obligations unconditionally guaranteed by the United States of America.

To further secure assessment area bonds, or the assessment area bonds being refunded, or both, the State may enter into a contract with any bank or trust company, within or without the State, with respect to the safekeeping and application of the earnings of investments. All assessment area bonds refunded and redeemed by the issue and sale or issue and exchange of refunding assessment area bonds shall be defeased.

The determination of the authority with respect to the financial soundness and advantage of the issue and delivery of refunding assessment area bonds authorized, when approved by the governor and the director of finance, shall be conclusive, but nothing in this subsection (d) shall require the holders of any outstanding assessment area bonds being refunded to accept payment thereof otherwise than as provided in the assessment area bonds to be refunded.

(e) In the event of an election to pay all or any part of any special assessment in installments, in lieu of issuing assessment area bonds to pay the contract price of the improvement and any other costs involved in the undertaking of the improvement, including the cost of land acquisition, the authority may determine by resolution to advance the funds for the unpaid amount of the special assessment out of any available funds of the authority. In the event of such determination by the authority to finance all or any part of any special assessment from available moneys, the interest payable on the unpaid principal of such special assessment shall accrue to the benefit of and be deposited, together with the principal of the funds so advanced, into the fund from which such funds were advanced.

Haw. Code R. § 15-19-81

[Eff 9/17/84, am 11/1/85, am 2/22/93, am 6/3/95] (Auth: HRS §§ 206E-4, 206E-6) (Imp: HRS §§ 206E-4, 206E-6)