SB189 (2005) Detail

Authorizing the use of interest rate swap agreements and other similar agreements by the cities of Manchester and Nashua.


CHAPTER 91

SB 189 – FINAL VERSION

2005 SESSION

05-1011

10/01

SENATE BILL 189

AN ACT authorizing the use of interest rate swap agreements and other similar agreements by the cities of Manchester and Nashua.

SPONSORS: Sen. D'Allesandro, Dist 20; Sen. Martel, Dist 18

COMMITTEE: Ways and Means

ANALYSIS

This bill authorizes the cities of Manchester and Nashua to enter into certain agreements for managing interest rates, investments, and payments for bonded indebtedness.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

05-1011

10/01

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Five

AN ACT authorizing the use of interest rate swap agreements and other similar agreements by the cities of Manchester and Nashua.

Be it Enacted by the Senate and House of Representatives in General Court convened:

91:1 Swap Agreements; Cities of Manchester and Nashua.

I. Notwithstanding any general or special law to the contrary, the cities of Manchester and Nashua shall have the following authority with respect to bonds or notes issued pursuant to RSA 33, RSA 33-B, or pursuant to any other enabling authority heretofore or hereinafter enacted.

II. In this act:

(a) “City” means the city of Manchester or the city of Nashua, as the case may be.

(b) “City finance officer” means the city finance officer of the city of Manchester.

(c) “Legislative body” means the board of mayor and aldermen of the city of Manchester and the board of alderman of the city of Nashua.

(d) “Mayor” means the mayor of the city.

(e) “Obligations” means bonds, notes, or other evidences of indebtedness of the city, issued or to be issued under and pursuant to RSA 33, RSA 33-B, or pursuant to any other enabling authority, whether heretofore or hereinafter enacted.

(f) “Swap agreement” means an agreement, including terms and conditions incorporated by reference therein, which is a swap rate agreement, basis swap, forward rate agreement, rate cap agreement, rate floor agreement, rate collar agreement, or any other similar agreement, including any option to enter into any of the foregoing; or any combination of such agreements; or a master agreement for any of the agreements in this subparagraph, together with all supplements.

(g) “Treasurer” means the treasurer of the city of Nashua.

III. Upon the authorization by a vote of at least two-thirds of all members of the legislative body of the city, the finance officer or the treasurer, as the case may be, with the approval of the mayor, may, on behalf of the city, enter into and amend any swap agreements that the city finance officer, or the treasurer, as the case may be, with the approval of the mayor, determines to be necessary or desirable for the purpose of managing an interest rate, currency, commodity price, investment, or similar risk that arises in connection with, or is incidental to, the issuance, carrying, or securing of obligations, or the acquisition or carrying of investments. Swap agreements entered into by the city shall contain such provisions, including payment, term, security, default, and remedy provisions, and shall be with such parties as the city finance officer or the treasurer, as the case may be, with the approval of the mayor, shall determine to be necessary or desirable after due consideration to the creditworthiness of those parties.

IV. In connection with entering into any swap agreements or in connection with the issuance of any bonds or notes of the city issued pursuant to RSA 33, RSA 33-B, or pursuant to any other enabling authority, the city finance officer or the treasurer, as the case may be, with the approval of the mayor, may enter into credit enhancement or liquidity agreements on behalf of the city, with such payment, security, default, remedy, and other terms and conditions as the city finance officer or the treasurer, as the case may be, with the approval of the mayor, shall determine. Notwithstanding any general or special law to the contrary, any bonds or notes of the city issued pursuant to RSA 33, RSA 33-B, or pursuant to any other enabling authority, whether heretofore or hereafter enacted, including any bonds or notes of the city issued in conjunction with a swap agreement as authorized hereby, may mature at such times, not exceeding 30 years, or such longer term as may be provided in RSA 33, RSA 33-B, or pursuant to any other provision of law, in such amounts, and may bear interest at such rate or rates, including rates variable from time to time as determined by such index, banker’s loan rate, auction rate, or other method as may determined by the city finance officer, or the treasurer, as the case may be, with the approval of the mayor. Bonds or notes of the city may be made redeemable before maturity at the option of the city or any holder thereof at such price or prices and upon such other terms and conditions as may be fixed by the city finance officer, or the treasurer, as the case may be, with the approval of the mayor, prior to the issuance of any such bonds or notes.

V. The city finance officer or treasurer, as the case may be, with the approval of the mayor, when so authorized by vote of the legislative body of the city authorizing a swap agreement, may determine that the obligation of the city to make payments in accordance with the terms of a swap agreement, shall be a general obligation of the city for which its full faith and credit may be pledged. In the event that such a determination shall have been made, the amounts the city is required to pay in accordance with the terms of a swap agreement in each fiscal year shall without annual vote of the city be annually assessed and collected to the same extent as if such payments constituted payments of principal and interest on loans.

VI. Notwithstanding any general or special law to the contrary, no swap agreement authorized by this act shall be included in the computation of any debt limitation imposed upon the city.

91:2 Premium on the Sale of Bonds or Notes of the City. Notwithstanding any general or special law to the contrary, any premium received by the city may, in the discretion of the city finance officer or the treasurer, be:

(a) Applied to the payment of the costs of preparing, issuing, and marketing any such bonds or notes;

(b) Applied to the cost of the project or projects for which such bonds or notes were issued, resulting in a like reduction of the amount of bonds or notes issued to finance such project;

(c) Deposited in the general fund of the city and available to be appropriated for any lawful purpose of the city; or

(d) Applied in any combination of the foregoing.

91:3 Purpose of Bonds or Notes. Notwithstanding the provisions of any general or special law to the contrary, the city may authorize and issue its general obligation bonds or notes for any purpose for which it may raise money.

91:4 Refunding Bonds. Notwithstanding the provisions of any general or special law to the contrary, the city may authorize the issuance of general obligation refunding bonds in order to pay all or part of any issue of its outstanding general obligation bonds and for the payment of any redemption premium thereon, all or part of the interest coming due on or prior to the date on which the outstanding general obligation bonds are redeemed, and the costs of issuing and marketing any such general obligation refunding bonds. Notwithstanding any general or special law to the contrary, any general obligation refunding bonds issued by the city shall mature at such time or times and in such amounts as the city finance officer, with the approval of the mayor, shall determine; provided, however, that the present value of the principal and interest payments due on any issue of general obligation refunding bonds of the city shall not exceed the present value of the principal and interest payments to be paid on the general obligation bonds to be refunded by such issue of general obligation refunding bonds.

91:5 Authentication of Bonds or Notes. The requirements of RSA 33:11 regarding the authentication of bonds shall not apply to the city.

91:6 Supplemental Authority. The authority granted by this act shall be in addition to, and not in place of the authority granted to the cities of Manchester and Nashua by any other general or special law.

91:7 Effective Date. This act shall take effect 60 days after its passage.

(Approved: June 7, 2005)

(Effective Date: August 6, 2005)

Links

SB189 at GenCourtMobile

Action Dates

Date Body Type

Bill Text Revisions

SB189 Revision: 9243 Date: Jan. 21, 2010, midnight

Docket