10-427a. Same; conditions and limitations; proceeds, disposition and investment.
10-427a
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 sold
or exchanged for the bonds being refunded either as a whole or in installments
at any time either at, before or after the maturity of
the bonds being refunded. Such bonds shall be
exempt from statutory limitations of bonded indebtedness and shall not be
included in computing the total bonded indebtedness of the municipality
for the purpose of applying any statute limiting the bonded indebtedness
of the municipality.
(b) If refunding bonds are sold more than six months
prior to the maturity or earliest prior redemption date of the bonds being
refunded, the proceeds derived from the sale, together with
any other moneys on hand, shall be placed in escrow under a trust agreement
with a Kansas bank having full trust powers. The proceeds and moneys
shall be invested
in direct obligations of, or obligations the principal of and the interest
on which are unconditionally guaranteed by, the United States of
America or municipal obligations which are secured by direct obligations
of the United States of America, and which shall mature or be subject to
redemption by the holders thereof not later than the respective dates when
the proceeds of the obligations together with the interest
accruing thereon and any other moneys or investments held in escrow will
be required for the purposes intended.
The trust
agreement shall pledge or assign the moneys and investments held in trust
for the payment of the principal of the bonds being refunded and may pledge
or assign the moneys and investments held in trust for the payment of the
interest on the bonds being refunded and any redemption premium thereon.
The trust agreement may pledge or assign any of the obligations or other
moneys or investments, or interest accruing thereon, held in trust, which
are in excess of the amount of the obligations and other moneys and
investments held which is equal to the amount of the principal of the bonds
to be refunded which comes due on the date for which the bonds may have
been called for redemption or irrevocable instructions to call bonds for
redemption have been given and any redemption premium
thereon, for the payment of the principal of and interest on any or all of
the refunding bonds and any redemption premium thereon, and shall contain
provisions for protecting and enforcing the rights and remedies of the
holders of the bonds.
History: L. 1978, ch. 53, § 2; L. 1983, ch. 48, § 5;
L. 1987, ch. 60, § 5; May 28.