10-427a.   Same; conditions and limitations; proceeds, disposition and investment.(a) Refunding bonds issued under the authority of K.S.A.10-427, and amendments thereto, may be soldor exchanged for the bonds being refunded either as a whole or in installmentsat any time either at, before or after the maturity ofthe bonds being refunded. Such bonds shall beexempt from statutory limitations of bonded indebtedness and shall not beincluded in computing the total bonded indebtedness of the municipalityfor the purpose of applying any statute limiting the bonded indebtednessof the municipality.

      (b)   If refunding bonds are sold more than six monthsprior to the maturity or earliest prior redemption date of the bonds beingrefunded, the proceeds derived from the sale, together withany other moneys on hand, shall be placed in escrow under a trust agreementwith a Kansas bank having full trust powers. The proceeds and moneysshall be investedin direct obligations of, or obligations the principal of and the intereston which are unconditionally guaranteed by, the United States ofAmerica or municipal obligations which are secured by direct obligationsof the United States of America, and which shall mature or be subject toredemption by the holders thereof not later than the respective dates whenthe proceeds of the obligations together with the interestaccruing thereon and any other moneys or investments held in escrow willbe required for the purposes intended.The trustagreement shall pledge or assign the moneys and investments held in trustfor the payment of the principal of the bonds being refunded and may pledgeor assign the moneys and investments held in trust for the payment of theinterest on the bonds being refunded and any redemption premium thereon. The trust agreement may pledge or assign any of the obligations or othermoneys or investments, or interest accruing thereon, held in trust, whichare in excess of the amount of the obligations and other moneys andinvestments held which is equal to the amount of the principal of the bondsto be refunded which comes due on the date for which the bonds may havebeen called for redemption or irrevocable instructions to call bonds forredemption have been given and any redemption premiumthereon, for the payment of the principal of and interest on any or all ofthe refunding bonds and any redemption premium thereon, and shall containprovisions for protecting and enforcing the rights and remedies of theholders of the bonds.

      History:   L. 1978, ch. 53, § 2; L. 1983, ch. 48, § 5;L. 1987, ch. 60, § 5; May 28.