12-195.   Same; use of proceedsfor payment of bonds prohibited; exceptions.(a) Except as otherwise provided in K.S.A. 12-195b, 12-1774,12-17,103 and K.S.A. 2001 Supp. 74-8924, andamendments thereto, or subsection(b), no city orcounty shallcommit any of the funds or proceeds derivedfrom a retailers' sales tax as a guarantee for the payment of bondsissued by such city or county or the Kansas development financeauthority.

      (b)   Any city or county which is the recipient of funds derived from alocal option sales tax pursuant to K.S.A. 12-187 et seq., andamendments thereto, is hereby authorized to issue revenue bonds to providefor the payment of all or any portion of the cost of public facilities orimprovementsof such city or county for which such city or county is authorized pursuantto the constitution or laws of this state to issue general obligationbonds and to pledge revenues received from countywide or cityretailers' sales taxes for the payment thereof. No such bonds shall beissued for the payment of all or any portion of the cost of any facilitiesor improvements to be used for commercial or retail purposes, except thatsuch prohibition shall not apply to revenue bonds issued for the payment of thecost of constructing or improving a convention or exposition hall or centeror public auditorium.In the event the governing body of a city or countyproposes to issue such bonds, and the question of pledging the revenuesreceived from the countywide or city retailers' sales tax has notpreviously been submitted to and approved by the voters of the city orcounty, such proposition shall be published once each week for twoconsecutive weeks in the official city or county newspaper, as the caserequires. If, within 30 days after the last publication of theproposition, a petition is filed with the county election officersigned by not less than 4% of the electors of thecity or county, as the case requires, who voted for the office of secretaryof state at the last preceding general election for such office requestingan election thereon, no such bonds shall be issued unless the propositionis submitted to and approved by a majority of the voters of the city orcounty, as the case requires, voting at an election held thereon. Any suchelection shall be called and held in accordance with the provisions ofK.S.A. 10-120, and amendments thereto, or in accordance with the provisionsof the mail ballot election act.

      (1)   Suchbonds shall be authorized by ordinance of the governing body of such cityor resolution of the governing body of such county. The bonds may be issuedas registered bonds or coupon bonds,payable to bearer, and, if coupon bonds, may be registrable as to principalonly or as to principal and interest, and may be made exchangeable forbonds of another denomination or in another form. The bonds may be in suchform and denominations, may have such date or dates, may be stated tomature at such time or times, may bear interest payable at such times and atsuch rate or rates, may be payable at such places within or without thestate, may be subject to such terms of redemption in advance of maturity atsuch prices, and may contain such terms and conditions, all as the city orcounty shall determine. The bonds shall have all the qualities of and shallbe deemed to be negotiable instruments under the laws of the state ofKansas. The authorizing ordinance or resolution may contain any other terms,covenantsand conditions that the city or county deems reasonable and desirable,including without limitation thosepertaining to the maintenance of various funds and reserves, the nature andextent of any security for payment of the bonds, the custody andapplication of the proceeds of the bonds, the collection, transfer anddisposition ofsales tax revenues, the investing of bond proceeds or any funds pledged tothe repayment of the bonds, and the rights, duties and obligations of thecity or county and the owners of the bonds.

      (2)   The authorizing ordinance or resolution may provide for the execution ofa trustindenture between the city or county and any financial institution withinor without the state of Kansas. The trust indenture may contain any terms,covenants and conditions that are deemed desirable by the city or county.

      (3)   Any authorizing ordinance or resolution and trust indenturerelating to theissuance of and security for the bonds shall constitute a contract betweenthe city or county and the owners of the bonds, which contract, and allcovenants, agreements and obligations therein, shall be promptly performedin strict compliance with the terms and provisions of such contract, andthe covenants, agreements and obligations of the city or county may beenforced by mandamus or other appropriateproceeding at law or in equity. The pledge of revenues made by the city orcounty shall be valid and binding from the time when such pledge is madeand the revenues so pledged and thereafter received by the city or countyshall immediately be subject to the lien of such pledge without suchphysical delivery thereof or further act on the part of the city or county,and the lien of any such pledge shall be valid and binding as against allparties having claims of any kind against the issuer, irrespective ofwhether such parties have notice thereof. Neither the authorizingordinance or resolution nor any other instrument by which a pledge is created need befiled or recorded except in the records of the city or county.

      (4)   The revenue bonds may be sold in such manner, either at public orprivate sale, and upon such terms as the city or county shall determine tobe reasonable, including sale at discount. It shall be plainly stated on theface of each such bond that it has been issued under this act, that the bondsshall be special obligations of the city or county, payable solely and onlyfrom the revenuespledged to the payment of the bondsandthat in no event, shall the bonds constitute an indebtedness of thestate of Kansas or the city or county for which the faith and credit of thestate of Kansas or city or county ispledged.

      (5)   Any bonds issued under the provisions of this section and theinterest thereon, shall be exempt from all taxes levied by the state ofKansas, or any political or taxing subdivision thereof,except inheritance taxes.

      (6)   Bonds may be issued for the purpose of refunding, either at maturityor in advance of maturity, any bonds issued under this section. Suchrefunding bonds may either be sold or delivered in exchange for the bondsbeing refunded. If sold, the proceeds may either be applied to thepayment of the bonds being refunded or deposited in trust and theremaintained in cash or investments for the retirement of the bonds beingrefunded, as shall be specified by the city or county and the authorizingordinance or resolution or trust indenture securing such refunding bonds. Theauthorizing ordinance or resolution or trust indenture securing the refundingbonds mayprovide that the refunding bonds shall have the same security for theirpayment as provided for the bonds being refunded. Refunding bonds shall besold and secured in accordance with the provisions of this act pertainingto the sale and security of the bonds.

      (7)   Bonds issued under the provisions of this act shall be eligible tosecure the deposit of public funds under article 14 of chapter 9 of theKansas Statutes Annotated, and amendments thereto.

      (8)   Bonds issued under the provisions of this act shall be in additionto and not subject to any statutory limitation of bonded indebtednessimposed on such city or county.

      History:   L. 1978, ch. 56, § 9; L. 1983, ch. 227, § 1;L. 1987, ch. 63, § 4; L. 1987, ch. 60, § 7;L. 1988, ch. 73, § 2;L. 1991, ch. 54, § 1; L. 1991, ch. 55, § 2;L. 1993, ch. 213, § 3;L. 1998, ch. 199, § 21;L. 1999, ch. 158, § 1; July 1.