BONDS FOR SCHOOL BUILDING PROGRAMS
AN ACT TO AMEND CHAPTER 71 OF THE REVISED CODE OF DELAWARE, 1935, RELATING TO FREE PUBLIC SCHOOLS, AUTHORIZING THE ACQUISITION OF LANDS AND BUILDINGS THEREFOR, AUTHORIZING AND REGULATING THE ISSUANCE OF BONDS FOR SCHOOL PURPOSES, PRESCRIBING A NEW LIMIT UPON THE AMOUNT OF SUCH BONDS WHICH MAY BE ISSUED, AND PROVIDING FOR THE MAKING AND KEEPING OF RECORDS IN RELATION TO SUCH BONDS.
Be it enacted by the Senate and House of Representatives of the State of Delaware in General Assembly met:
Section 1. That Article 11 of Chapter 71 of the Revised Code of Delaware, 1935, be, and the same hereby is amended by striking out 2718. Sec. 96 of said Chapter and inserting in lieu thereof the following:
2718. Sec. 96. AUTHORITY TO ISSUE BONDS; BIDS THEREFOR; RECORD OF PROCEEDINGS:--The Board of Education of a Special School District or the Board of School Trustees of a School District is authorized and empowered to issue bonds for the purpose of carrying out any plan or program for the acquisition of lands or the acquisition or construction of buildings as may be authorized by the provisions of this Chapter when such plan or plans shall have been approved by the State Board of Education. The faith and credit of such School District is hereby expressly pledged for the full and complete payment of the principal of and interest on any bonds authorized to be issued under this Chapter, and the said bonds shall be exempt from taxation, with respect to both principal and interest, by the State or any political subdivision thereof for any purpose.
When any such bonds shall be sold and delivered pursuant to the provisions of this Article, the certification by the State
Board of Education pursuant to the provisions of Section 104 of this Chapter and the certification by the Board of Education of the Special School District or the Board of School Trustees of the School District issuing such bonds that the said bonds have been issued in due compliance with the provisions of this Chapter shall be conclusive upon said School District and all and every other person whatsoever of the right, power and authority for the issuance of said bonds and the legality and validity thereof and of the principal debt and interest represented thereby, and the legality and validity of such bonds shall thereafter not be subject to question in any Court of Law or Equity by such School District or by any person or persons for or on its behalf, and this provision shall be and become part of the contract and obligation represented by each such bond.
Whenever any bonds are to be issued pursuant to the authority contained in this Article the Board of the School District issuing such bonds is authorized to advertise twice a week for such number of weeks, not less than two, as shall be determined by such Board, in such newspapers or journals, either within or without the State, as such Board may determine, that bids will be received for such bonds at such place or places as may be stated in said advertisement, under such terms, provisions and regulations as may be determined by such Board. Such Board may authorize the submission of bonds to bids so that prospective purchasers thereof may bid both with respect to the premium therefor and the rate of interest thereon, or either thereof, as such Board may determine, provided that any such bid with respect to the interest rate shall not contain a fraction of less than one-eighth of one percent. Such Board may provide for the securing of the opinion of competent counsel, whether within or without this State, respecting the validity of such bonds and may pay for the cost thereof out of the proceeds of the sale of such bonds. The accrued interest between the date of the bonds and the time of sale and delivery of and payment for said bonds shall be adjusted with the purchaser under such regulations as may be determined by such Board; provided, however, that any overdue coupons attached to such bonds shall be detached and canceled prior to the delivery of such bonds. Upon the day mentioned in such advertisement as the day for opening of bids for said bonds the Board of the School District issuing
such bonds shall receive such bids for the purchase of all or such number of the bonds so advertised to be sold, and upon the opening of such bids as many of said bonds as shall have been bid for shall be awarded by such Board to the highest or best responsible bidder or bidders therefor for cash, provided the amount of such bid is, in the opinion of the Board, adequate. If two or more successful bidders shall have made the same bid and the aggregate of such bids is in excess of the bonds to be sold, the bonds shall be awarded ratably among such successful bidders. If said bonds, when' so offered for sale, shall not be bid for, or if an insufficient price shall be bid, they may be sold by such Board at private sale upon the best terms obtainable therefor, provided they shall not be sold at private sale for less than par and accrued interest. Such Board shall cause a complete record of the proceedings taken in relation to the issuance of such bonds to be made and kept with the other records of such Board, and shall cause a duplicate of such record to be made and filed with the State Board of Education.
Section 2. That Article 11 of Chapter 71 of the Revised Code of Delaware, 1935, be, and the same hereby is amended by striking out 2719. Sec. 97 of said Chapter and inserting in lieu thereof the following:
2719. Sec. 97. LIMITATIONS RESPECTING BONDS:-- A Board of Education of a Special School District or a Board of School Trustees of a School District shall not issue bonds, except for the purpose of refunding outstanding bonds, in an amount which would cause the aggregate amount of bonded debt of such Special School District or School District, less the amount of sinking funds on hand for the payment of such bonded debt, to exceed seven per centum (7%) of the assessed value of the real and personal property in such School District, and such bonds shall not be issued or sold at less than their face value. Said bonds shall be in such denomination or denominations, in such form, and shall bear such rate of interest, not exceeding five per centum (5%) per annum, as shall be determined by the Board of the School District issuing such bonds. Said bonds shall be issued in serial form, maturing and becoming payable in successive years, beginning not more than one year after the date of said bonds and ending not more than twenty-five (25)
years after said date; and the amount of bonds maturing in any one year, except the last year, shall be not less than one twenty-fifth of the aggregate principal amount of the bonds of such issue.
Section 3. That Article 11 of Chapter 71 of the Revised Code of Delaware, 1935, be, and the same hereby is amended by striking out 2720. Sec. 98 of said Chapter and inserting in lieu thereof the following:
2720. Sec. 98. FORM AND DESIGNATION OF BONDS: --Any bonds issued pursuant to the provisions of this Article 11 shall be designated by the name of the School District issuing such bonds and the year in which such bonds are issued. Such bonds shall be numbered consecutively and shall bear date as of the date approved by the Board of the School District issuing the same. They shall bear interest from and after such date, payable semi-annually on the days designated in such bonds. The principal of said bonds shall be payable at the Farmers Bank of the State of Delaware in the County in which said bonds are issued upon presentation of such bonds upon or after the maturity thereof, and the interest upon such bonds shall be paid at said Farmers Bank of the State of Delaware upon presentation of a coupon representing such semi-annual interest.
Said bonds shall be signed by the President and one other member of the Board of Education of the Special School District or by the Chairman and one other member of the Board of School Trustees of a School District as the case may be. Such Board of Education or the Board of School Trustees is authorized to adopt a seal to be used in the execution of said bond. Such Board of Education or Board of School Trustees may, in lieu of the signatures hereinabove required, authorize by special resolution that the signatures of the persons required to sign said bonds may be engraved or facsimiles thereof printed or otherwise transcribed upon said bonds and when such engraved or facsimile signatures shall be so authorized and engraved, printed or otherwise impressed upon said bonds they shall have the same effect as written signatures of such persons. The coupons attached to said bonds shall bear upon their face the engraved or printed signature of the President or Chairman of
such Board, as the case may be. Each of said bonds shall be numbered consecutively and the coupons attached thereto shall bear the same number as the bond itself.
Until bonds in definite form can be prepared, the Board issuing such bonds may cause temporary bonds with appropriate coupons to be prepared which shall be executed and signed as is provided in this Section, which said temporary bonds shall be exchangeable for definitive bonds at the request of the holder.
Section 4. That Article 11 of Chapter 71 of the Revised Code of Delaware, 1935, be, and the same hereby is amended by striking out 2721. Sec. 99. of said Chapter and by inserting in lieu thereof the following:
2721. Sec. 99. CANCELLATION AND DESTRUCTION OF BONDS AND COUPONS:--As and when any of the bonds issued under the authority of this Chapter or the coupons annexed thereto shall have been paid the same shall be cancelled and shall be delivered by the branch of the Farmers Bank of the State of Delaware, at which the same were paid to such Board of Education or Board of School Trustees, who shall forthwith make a record of the payment of such bonds or coupons and promptly thereafter cause the same to be burned or otherwise destroyed.
Section 5. That Article 11 of Chapter 71 of the Revised Code of Delaware, 1935, be and the same is hereby amended by adding a new Section to be designated as 2721A. Sec. 99 (a), as follows:
2721A. Sec. 99 (a). The Permanent Budget Commission is hereby authorized and directed to promulgate and enforce rules and regulations governing the fiscal records to be maintained by the State Treasurer and the school districts, pertaining to bonds of school districts and school bonds of the City of Wilmington.
Section 6. That Article 11 of Chapter 71 of the Revised Code of Delaware, 1935, be, and the same hereby is amended by striking out 2727. Sec. 105. of said Chapter and by inserting in lieu thereof the following:
2727. Sec. 105. CONTRACTS RELATING TO THE PURCHASE OF LANDS FOR SCHOOL PURPOSES:--Nothing in this Chapter shall be deemed or construed to prohibit a Board of Education of a Special School District or a Board of Trustees of a School District, with the prior approval of the State Board of Education, from purchasing or from entering into contracts relating to the acquisition of lands for school purposes, provided such Board of Education or such Board of Trustees shall have available to it funds for such purposes.
Approved November 4, 1949.