Hawaii Administrative Rules › Title 15 - DEPARTMENT OF BUSINESS, ECONOMIC DEVELOPMENT AND TOURISM › Hawaii Community Development Authority › Chapter 19 - DISTRICT-WIDE IMPROVEMENT PROGRAM RULES › Subchapter 5 - FINANCING › Section 15-19-81 - Assessment area bonds; financing of special assessments from available moneys

Current through June, 2024
(a) In the event of
				  an election to pay all or any part of any special assessment in installments,
				  the unpaid amount of the special assessment required to pay the contract price
				  of the improvement and any other costs involved in the undertaking of the
				  improvement, including the cost of land acquisition shall be obtained by the
				  issuance of sufficient assessment area bonds of the authority to raise the
				  required amount; provided that assessment area bonds need not be issued (i) if
				  the aggregate of the assessment installments for all property owners in the
				  assessment area is less than $1,000 in each year, or (ii) if, as provided in
				  subsection (e) hereof, the authority shall determine to advance the funds for
				  the unpaid amount of the special assessment out of any available funds of the
				  authority.
(b) The bonds shall be
				  authorized by resolution of the authority and issued pursuant to and under the
				  authority and requirements of the authority. The bonds shall be in such form,
				  either coupon or registered, shall bear the name of the benefited assessment
				  area, shall be dated, shall be numbered, shall be of the denomination or
				  denominations, shall bear interest at such rate or rates per annum, but not
				  more than fifteen per cent per annum, payable at such time or times and at such
				  place or places, shall mature at such time or times so as to cover the
				  outstanding installment payments determined upon pursuant to the provisions of
				  this chapter, shall be subject to call at such price or prices and upon such
				  terms and conditions, and may be subject to tender by the holders thereof upon
				  such terms and conditions, all as determined by resolution of the authority.
				  The bonds shall bear the facsimile signature of the chairman of the authority
				  and shall be sealed with the seal of the authority, or a facsimile thereof,
				  attested by the facsimile of the signature of the secretary of the authority
				  and shall bear a certificate of authentication manually executed by the
				  registrar. No bond shall be valid or obligatory unless certified or
				  authenticated by the registrar. Interest coupons, if any, shall bear a
				  facsimile of the signature of the chairman of the authority. The executive
				  director shall preserve a record of the bonds in a suitable book kept for that
				  purpose. The authority shall designate the registrar, if any, for the bonds and
				  the place or places of registration and transfer of such bonds, and such
				  registrar shall maintain such books of registry as shall be required by
				  resolution of the authority.
(c)
				  The assessment area bonds shall be payable only out of the moneys collected on
				  account of assessments made for the improvement or improvements for which they
				  are issued and the authority shall not otherwise guarantee payment of the
				  bonds; provided that interest payments may be advanced by the executive
				  director out of moneys available in the assessment area revolving
				  fund.
(d) Whenever the authority
				  shall have outstanding any assessment area bonds, and the authority with the
				  approval of the governor and the director of finance, determines that it will
				  be financially sound and advantageous to the State, the authority, the
				  landowners and the lessees within the assessment area for which assessment area
				  bonds have been issued to refund any outstanding assessment area bonds, the
				  authority may provide for the issuance of refunding assessment area bonds with
				  which to provide for the payment of the outstanding assessment area bonds or
				  any part thereof at or before the maturity or redemption date thereof, with the
				  right to include various series and issues of outstanding assessment area bonds
				  in a single issue of refunding assessment area bonds, to pay any redemption
				  premium and interest to accrue and become payable on the outstanding assessment
				  area bonds being refunded, and to establish reserves for the refunding
				  assessment area bonds and partly to refund outstanding assessment area bonds
				  and partly for the payment of the contract prices of an improvement and any
				  other costs involved in the undertaking of an improvement for which the
				  outstanding assessment area bonds were issued.
The refunding assessment area bonds may be issued and
					 delivered at any time prior to the date of maturity or redemption date of the
					 assessment area bonds to be refunded that the authority deems to be in its best
					 interest. The refunding assessment area bonds, except as specifically provided
					 in this subsection (d) shall be issued in accordance with the provisions of
					 this chapter with respect to assessment area bonds. Pending the time the
					 proceeds derived from the sale of refunding assessment area bonds issued under
					 this chapter are required for the purposes for which they were issued, the
					 proceeds, upon authorization or approval of the governor, may be invested in
					 obligations of, or obligations unconditionally guaranteed by the United States
					 of America, or in savings accounts, time deposits, or certificates of deposit
					 of any bank or trust company within or without the State, to the extent that
					 such savings accounts, time deposits, or certificates of deposit are
					 collaterally secured by a pledge of obligations of, or obligations
					 unconditionally guaranteed by, the United States of America; or in obligation
					 of any state of the United States of America or any agency, instrumentality, or
					 local government thereof, the provision for payment of the principal and
					 interest which have irrevocably been made by deposit of obligations of, or
					 obligations unconditionally guaranteed by the United States of America.
To further secure assessment area bonds, or the assessment
					 area bonds being refunded, or both, the State may enter into a contract with
					 any bank or trust company, within or without the State, with respect to the
					 safekeeping and application of the earnings of investments. All assessment area
					 bonds refunded and redeemed by the issue and sale or issue and exchange of
					 refunding assessment area bonds shall be defeased.
The determination of the authority with respect to the
					 financial soundness and advantage of the issue and delivery of refunding
					 assessment area bonds authorized, when approved by the governor and the
					 director of finance, shall be conclusive, but nothing in this subsection (d)
					 shall require the holders of any outstanding assessment area bonds being
					 refunded to accept payment thereof otherwise than as provided in the assessment
					 area bonds to be refunded.
(e) In the event of an election to pay all or
				  any part of any special assessment in installments, in lieu of issuing
				  assessment area bonds to pay the contract price of the improvement and any
				  other costs involved in the undertaking of the improvement, including the cost
				  of land acquisition, the authority may determine by resolution to advance the
				  funds for the unpaid amount of the special assessment out of any available
				  funds of the authority. In the event of such determination by the authority to
				  finance all or any part of any special assessment from available moneys, the
				  interest payable on the unpaid principal of such special assessment shall
				  accrue to the benefit of and be deposited, together with the principal of the
				  funds so advanced, into the fund from which such funds were advanced.