HOUSE BILL NO. 55
AN ACT TO AMEND CHAPTER 158, VOLUME 36, LAWS OF DELAWARE, AS AMENDED, BEING THE CHARTER OF THE CITY OF DOVER, RELATING TO THE ISSUANCE OF GENERAL OBLIGATION BONDS FOR REFUNDING PURPOSES.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE (Two—thirds of all members elected to each House thereof concurring therein):
Section 1. Amend Section 50(c), Chapter 158, Volume 36, Laws of Delaware, as amended, by striking Section 50(c) and substituting in lieu thereof a new Section 50(c) to read as follows:
"(c) Bonds may be authorized and issued pursuant to subsection (b), without a referendum vote, by a resolution of the Council which shall have the affirmative vote of three—fourths of the members thereof and the approval of the Mayor, for the following purposes:
(i) to finance public storm sewers, streets and appurtenances provided that no more than $1,000,000 aggregate principal amount of bonds may be issued at any one time pursuant to this clause (i) and any new bonds issued pursuant to this clause (i) may not cause the total aggregate principal amount of bonds outstanding at any one time pursuant to this clause (i) to exceed one percent (1%) of the total taxable assessment for a general tax at the time such new bonds are issued; and
(ii) to refund bonds secured by the City's full faith and credit, prior to their stated maturity, provided that (A) the present value of the aggregate principal and interest payments of the refunding bonds are not greater than the present value of the aggregate principal and interest payments on the bonds to be refunded determined by discounting at the effective interest rate on the refunding bonds, calculated based on the internal rate of return; and (B) at the time of issuance of the refunding bonds there are deposited in escrow, pledged to secure the refunded bonds, sufficient monies and/or direct obligations of, or obligations the principal of and interest on which are guaranteed by, the United States government, which, without regard to any reinvestment earnings, will be sufficient to pay when due all interest, principal and redemption price on the refunded bonds at maturity or upon earlier call for redemption."
Section 2. Amend Section 50, Chapter 158, Volume 36, Laws of Delaware, as amended, by adding a new Section 50(g) to read as follows:
"(g) For the purposes of the debt limitations prescribed in this section, (i) any bonds which have been refunded pursuant to subsection (c)(11) shall be treated as no longer outstanding and (ii) bonded indebtedness, principal amount of bonds and bonds outstanding shall be determined without regard to original issue discount."
Section 3. This Act shall be effective upon its enactment into law.
Approved April 13, 1993.