40A:66-18 Guaranty of bonds.

467 words·~2 min read·/nj/title-40a/chapter-66/40a-66-18

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

18. For the purpose of aiding the municipal shared services energy authority in the planning, undertaking, acquisition, construction, financing, or operation of any electric supply project authorized pursuant to P.L.2015, c.129 (C.40A:66-1 et al.), a member municipality may, by ordinance of its governing body, in the manner provided for adoption of a bond ordinance as provided in the "Local Bond Law," N.J.S.40A:2-1 et seq. and with or without consideration and upon those terms and conditions as may be agreed to by and between the member municipality and the authority, unconditionally guaranty the punctual payment of the principal of, and interest on, all or a portion of any bonds of the authority.

Any guaranty of the bonds of the authority made pursuant to this section shall be evidenced by endorsement thereof on the bonds, executed in the name of the member municipality and on its behalf by the officer thereof as may be designated in the ordinance authorizing the guaranty, and the municipality shall be obligated to pay the principal of, and interest on, the bonds in the same manner and extent as in the case of bonds issued by it. Any ordinance authorizing the guaranty shall be treated as a security agreement and shall be subject to the provisions of the "Local Authorities Fiscal Control Law," P.L.1983, c.313 (C.40A:5A-1 et seq.).

Any guaranty of bonds of the authority may be made, and any ordinance authorizing the guaranty may be adopted, notwithstanding any statutory debt or other limitations, including particularly any limitation or requirement under or pursuant to the "Local Bond Law," N.J.S.40A:2-1 et seq., but the principal amount of the bonds so guaranteed, shall, after their issuance, be included in the gross debt of the member municipality for the purpose of determining the indebtedness of the municipality under or pursuant to the "Local Bond Law," N.J.S.40A:2-1 et seq.

The principal amount of the bonds guaranteed and included in gross debt shall be deducted and declared to be a deduction from gross debt under the "Local Bond Law," N.J.S.40A:2-1 et seq.:

a. after the issuance of the bonds until the end of the fiscal year beginning next after the completion of acquisition or construction of the facility to be financed from the proceeds of the bonds; and

b. in any annual debt statement filed pursuant to the "Local Bond Law," N.J.S.40A:2-1 et seq. as of the end of the fiscal year or any subsequent fiscal year if the revenues or other receipts or monies of the authority in that year are sufficient to pay its expenses of operation and maintenance in the year, and all amounts payable in the year on account of the principal of, and interest on, all guaranteed bonds, and all bonds of the authority issued under P.L.2015, c.129 (C.40A:66-1 et al.).

L.2015, c.129, s.18.