Chap. 126.—An ACT to provide for the issuance of bonds to carry into effect the

purposes for which any sanitary district has been or may hereatter be created.

[H B 227]
Approved March 7, 1946

Be it enacted by the General Assembly of Virginia:

1. Section 1. The governing body of any county in which a
sanitary district has been or may hereafter be created by general or spe-
cial law shall have power, subject to the conditions and limitations of this
act, to issue bonds of such sanitary district to an amount in the aggregate
of not exceeding eighteen. per centum of the assessed value of all real
estate in the district subject to local taxation, for the purpose of raising
the necessary funds to carry into effect the purposes for which such sani-
tary district is formed, provided, however, that such limitation of eight-
een per centum shall not apply if the petition required by section two of
this act states the maximum amount of bonds to be issued and that such
bonds are to be issued for a specific undertaking from which the Sanitary
District may derive revenue, but from and after a period to be deter-
mined by the governing body of the county, not exceeding five years from
the date of the election authorized in section two of this act, whenever
and for so long as such undertaking fails to produce sufficient revenue to
pay for cost of operation and administration (including interest on bonds
issued therefor), and the cost of insurance against loss by injury to per-
sons or property, and an annual amount to be covered into a sinking
fund sufficient to pay, at or before maturity, all bonds issued on account
of said undertaking, all such bonds outstanding shall be included in de-
termining such limitation.

Section 2. The circuit court of such county or the judge thereof in
vacation, upon the petition of a majority of the members of the governing
body of the county, or upon the petition of fifty qualified voters residing
in such sanitary district, shall make an order requiring the judges of elec-
tion at the next election of county officers, or at any other time not less
than thirty days from the date of such order, which shall be designated
therein, to open a poll and take the sense of the qualified voters of the
district on the question whether the governing body shall issue bonds for
one or more of the purposes for which the sanitary district was created.

Section 3. The election shall be conducted in the manner prescribed
by law for the conduct of regular elections, and the ballots shall be printed
and voted, and the returns made and canvassed and the results certified,
in accordance with the provisions of section one hundred ninety-seven-a
of the Code of Virginia.

Section 4. If it shall appear from the report of the commissioners
of election that a majority of the qualified voters of the sanitary district
voting on the question are in favor of issuing the bonds, the circuit court,
or the judge thereof in vacation, shall enter of record an order requiring
the governing body to proceed at its next meeting to carry out the wishes
of the voters as expressed at the election.

Section 5. Whenever the sense of the qualified voters of the dis-
trict shall be taken on the question whether the governing body shall
issue bonds for one or more of the purposes for which the sanitary district
was created, the election and returns shall be subject to the inquiry,
determination and judgment of the circuit court of the county upon the
written complaint of twenty-five or more of the qualified voters of the
district, of an undue election or false returns, two of whom shall take an
oath that the facts set forth in such complaint are true to the best of their
knowledge and belief, and the court shall, in judging of such election and
returns, proceed upon the merits thereof and determine concerning the
same according to the Constitution and laws of this State, but such com-
plaint shall not be valid unless it shall have been filed within thirty days
after the election in the office of the clerk of the court. The governing
body of the county shall be made a defendant by summons or notice to its
chairman of the filing of the complaint, and after such service of notice
on the chairman of such governing body, either party, upon reasonable
notice to the other, shall be at liberty to take depositions to sustain or
invalidate such election. Service of notice on any three of the complain-
ants shall be sufficient. The court shall proceed at its next term after
such service of summons or notice to determine the contest without a
jury on the evidence, oral or written, unless good cause be shown for a
continuance, and shall make a proper record of its judgment. If the
judgment be that the election was a valid one in favor of the issuance of
bonds in the district, the court shall make an order in conformity with the
preceding section.

Section 6. The governing body at its next meeting or as soon there-
after as practicable, shall determine what amount of bonds shall be issued
for the purposes defined in the order calling the election.

The maximum amount of bonds issued shall in no case exceed the
limitations prescribed in section one of this act, and in the event such
governing body does not at such meeting direct the present issuing of
all the said bonds, it may thereafter, from time to time, direct the residue
thereof to be issued to carry out the wishes of the voters, so far as nec-
essary, as expressed in such election, and in event the governing body,
for any reason, fails or refuses to issue the bonds so authorized to be
issued, the circuit court of the county may, upon the complaint of ten
qualified voters of the district, and after ten days’ notice to the chairman
of the governing body, for cause shown, issue an order directing it to
issue said bonds or any unissued residue thereof, or such portion thereof
as the court may, from time to time, deem proper to be issued in order
to carry out the wishes of the voters as expressed in the election. The
governing body shall have power to appoint an agent or agents to sell
the bonds and to pay such agent or agents a commission for negotiating
the sale not exceeding three per centum of the amount of bonds sold by
them, provided the bonds shall be sold to be paid for in lawful money
only, and shall not be sold at less than their par value. When sucha sale
has been negotiated, the governing body shall issue the bonds. Such
bonds may be either registered or with coupons attached, as the governing
body may prescribe, and coupon bonds may be registerable as to principal,
or as to principal and interest, at the option of the holder, under such
rules and regulations as may be prescribed by the governing body. The
bonds shall be signed by the chairman and countersigned by the clerk
of the governing body under its seal; shall be in denominations of one
hundred dollars or some multiple thereof; shall bear interest at a rate not
exceeding six per centum per annum, payable semi-annually, both prin-
cipal and interest to be payable at such place or places as may be de-
termined by the governing body, and shall be payable not exceeding
thirty-four years from the date thereof, but may, in the discretion of the
governing body, be made redeemable at such time or times within such
period or periods and upon such notice as the governing body may pre-
scribe and stipulate upon the face of the bond when issued. The govern-
ing body shall deliver the bonds to the treasurer of the county, who shall
deliver them to the purchasers thereof, or to their order, upon the pay-
ment of the purchase price thereof. The treasurer and his sureties shall
be liable for the amount received for such bonds as though it were a
county levy, and such funds shall be expended for the purposes for which
the bonds were voted and none other. The treasurer shall receive as
compensation for his services hereunder one-eighth of one per centum of
the amount thus coming into his hands, and also to the reasonable cost of
giving surety on such additional bond or bonds as may be required of
him, if any, on account of his recepits heretofore or hereafter of such
funds, and the governing body may direct the treasurer to deposit the
proceeds of the bond issue in such ‘bank or banks as it may approve, to
the credit of such treasurer, to be paid out on his checks therefor, and at
the rate of interest to be specified, and all interest accrued therefrom shall
be accounted for by the treasurer, and shall be expended for the purposes
for which the bonds were issued, and insofar as not necessary therefor,
shall be paid into the sinking fund to redeem the principal thereof at ma-
turity. The treasurer shall not be liable for any deposits which shall be
lost by reason of the insolvency or failure of any bank in which he shall
have been directed by the governing body to deposit them. A bond with
surety may be required by such body from any bank in which such de-
posits are made.

Section 7. The net revenue derived from the operation of the pub-
lic utilities so established by the sanitary district shall be set apart by the
governing body to pay the interest on the bonds issued hereunder and to
create a sinking fund to redeem the principal thereof at maturity. The
governing body is hereby authorized and empowered to apply any part or
all of the sinking fund in redemption of such bonds, 1f redeemable by
their terms, or to the purchase of any of such bonds at any time, and all
bonds so redeemed or purchased by such governing body shall be im-
mediately canceled and shall not be reissued, and the governing body
is authorized and empowered to invest all accumulations of money to the
credit of the sinking fund in bonds of the United States, of the State of
Virginia or of any county, city or town of the State.

The governing body shall, if necessary. for the payment of the in-
terest on the bonds or to increase the sinking fund provided for here-
under, levy an annual tax upon all the property in the district subject
to local taxation to pay such interest and to make payments into said
sinking fund.