Chap. 345.—An ACT to amend and reenact Sections 1, 5, 7, 11 and 12 of Chapter
386 of the Acts of Assembly of 1940, approved April 1, 1940, enabling counties,
cities and towns to borrow money and issue bonds therefor; prescribing the
mode of procedure for, and regulating the issuance of such bonds, and provid-
ing for the payment thereof; authorizing agreements with the holders of such
bonds and providing for the remedies of such holders; also to secure the
benefits of any agency of the United States of America; now or hereafter
created, delegating powers to contract debts; and repealing inconsistent a
visions of all laws, general or special, of the’ Commonwealth. [H 402]

Approved March 31, 1948

Be it enacted by the General Assembly of Virginia:

1. That sections one, five, seven, eleven and twelve of chapter
three hundred eighty-six of the Acts of Assembly of nineteen hundred
forty, approved April one, nineteen hundred forty, be amended and
reenacted as follows:

Section 1. The following terms wherever used or referred to in this
act shall have the following meaning unless a different meaning clearly
appears from the context:

(a) The term “project” shall mean the undertaking by counties,
cities or towns of any purpose or purposes not specifically prohibited by
the Constitution of the Commonwealth.

(b) The term “governing body’ shall mean the board of super-
visors, council or other local legislative body, board, commission, or
other legislative authority having charge of the finances of any county,
city or town, and where the separate concurrence or approval of two
or more sets of such authorities is now required by law for the making
of appropriations, to the extent so required “governing body” shall
mean and include both or all of them.

(c) The term “bonds” shall mean bonds, interim certificates, or
other obligations issued by the governing body of any county, city or
town.

(d) The term “law” shall mean any act or statute, general or
special, of this State and shall include, without being limited to, the
charter of any city or town.

(e) The term “Federal agency” shall mean any agency or unit
of the Federal government, and shall include such agencies as may
be or have been designated or created to make grants or loans.

({) The term “resolution” shall mean an act of the governing
body of any county, city or town which is (1) reduced to writing, and
(2) adopted by a majority of all the members of such governing body,
and where the separate concurrence or approval of more than one branch
of such governing body is required by law for the making of appropria-
tions, by a majority of all the members of each branch of such governing
body, and which may be finally adopted at the meeting at which it is
introduced.

2. The cities and towns of this Commonwealth shall have power
and are hereby authorized :
(a) To accept from any Federal agency grants for or in aid of
any project except as may otherwise be provided by general law.

(b) To contract debts for any project, to borrow money for any
project, and to issue its negotiable bonds to finance any project; and to
provide for the rights of the holders of such bonds and to secure the
same as hereinafter further provided.

(c) To levy fees, rents, tolls, or other charges for the use of or in
connection with any project, subject to and in accordance with such
agreements with holders of bonds as may be made as hereinafter
provided.

(d) To assess, levy and collect unlimited ad valorem taxes on
all property subject to taxation, to pay the bonds, and interest thereon,
issued ‘to finance any project subject to and in accordance with such
agreements with holders of bonds as may be made as hereinafter
provided.

(e) To acquire by purchase, gift or the exercise of the power of
eminent domain and to hold and dispose of, any real or personal property,
or interest therein, in connection with any project, subject to mortgages
or other liens or otherwise, and to lease either to or from any Federal
agency any real or personal property, or interest therein, with or without
the privilege of purchase.

(f) To acquire by purchase, gift or by the exercise of the power of
eminent domain and to construct, reconstruct, replace, repair, operate,
maintain, embellish, develop, better or improve any project; and to
perform any such acts and to do any such things under, through, or by
means of its own officers, agents and employees, or by contracts with
private corporations, firms or individuals.

(g) To make such contracts and execute such instruments con-
taining such terms, provisions and conditions as in the discretion of the
governing body of such county, city or town may be necessary, proper
or advisable for the purpose of obtaining or securing grants, loans or
other financial assistance from any Federal agency; and to make such
other, further or different contracts and execute all instruments necessary
or convenient in or for the furtherance of any project.

(h) To enter on any lands, waters and premises for the purpose
of making surveys, soundings and examinations in or for the furtherance
of any project.

(i) To do all things necessary or convenient to carry out the powers
expressly given in this act and to carry out any project.

Section 5. Any resolution or resolutions of the governing body of
any city or town authorizing any bonds, or any resolution or resolutions
of the governing body of any county determining that it is advisable to
contract a debt = any project, borrow money for any project, and issue
negotiable bonds of the county to finance any project, or determining
the tenor of such bonds or other matters relating thereto, or any subse-
quent resolution or resolutions of the governing body of any county,
city, or town, may contain provisions which shall be a part of the con-
tract with the holders of the bonds as to:
(a) The payment of the principal of and interest on such bonds
exclusively from the fees, rents, tolls or other charges or revenues or
receipts of the project; and the pledging of such fees, rents, tolls,
charges, revenues and receipts of the project to secure payment thereof,
and the pledging or not pledging of the full faith and credit of the
county, city or town;

(b) The payment of principal of and interest on such bonds from
unlimited ad valorem taxes on all property subject to taxation, and the
pledging of the full faith and credit of the county, city or town to secure
the payment thereof ;

(c) Securing the payment of the principal of and interest on such
bonds by any deed of trust, mortgage, conditional sales contract, chattel
mortgage, or any other known form of securities, on the project ;

(d) The payment of the principal of and interest on such bonds
from any one or more of the foregoing sources of funds, or any combina-
tion thereof, and the pledging of any one or more of the foregoing
sources of funds or any combination thereof to secure the payment of the
bonds, and interest thereon ;

(e) The fees, rents, tolls, charges, taxes and other revenues or
receipts of the project and the amounts to be raised in each year thereby,
and the use and disposition of such fees, rents, tolls, charges, taxes and
other revenues and receipts of the project ;

(£) The setting aside of reserves or sinking funds and the regula-
tion and disposition thereof ;

(g) Limitations on the right of the county, city or town to restrict
and regulate the use of the project ;

(h) Limitations on the purpose to which the proceeds of sale
of any issue of bonds then or thereafter to be issued may be applied ;

(i) Limitations on issuance of additional bonds ;

(j) The procedure, if any, by which the terms of any contract with
bondholders may be amended or abrogated, the amount of bonds the
holders of which must consent thereto, and the manner in which such
consent may be given;

(k) Conferring upon the bondholders the following remedies:

In the event that any county, city or town shall default in the
payment of principal of or interest on any of the bonds after the same
shall become due, and such default shall continue for a period of thirty
days, or in the event that any county, city or town shall fail or refuse
to comply with the provisions of this act, or shall default in any agree-
ment made with the holders of the bonds, the holders of twenty-five per
centum in aggregate principal amount of the bonds then outstanding,
by instrument or instruments filed with the Secretary of the Common-
wealth and acknowledged by them before an officer authorized by the
laws of this State to take acknowledgments of deeds, may appoint a
trustee to represent the bondholders for the purposes herein provided.
Such trustee may, and upon written request of the holders of twenty-five
per centum in aggregate principal amount of the bonds then outstanding,
shall, in his or its own name
(1) By mandamus, or other suit, action or proceeding at law or in
equity, enforce all rights of the bondholders and require the county,
city or town, and the governing body thereof, to carry out any agreement
with the bondholders, and to perform its and their duties under this
act;

(2) Bring suit upon the bonds;

(3) By action or suit in equity, enjoin any acts or things which
may be unlawful or in violation of the rights of the bondholders ;

(4) Declare all bonds due and payable, but if all defaults shall
be made good and may then, with the consent of the holders of twenty-
five per centum of the principal amount of the bonds then outstanding,
annul such declaration and its consequences; provided, however, that
before declaring the principal of all bonds due and payable, the trustee
shall first give thirty days’ notice in writing to the county, city or town by
filing said notice in the office of the clerk of the county or the mayor
of the city or town.

In any suit, action or proceeding by the trustee, the fees, counsel fees,
and expenses of the trustees shall constitute taxable disbursements, and
all costs and disbursements allowed by the court shall be a first charge on
any fees, rents, tolls, or other charges, taxes, or other revenues and
receipts derived from, levied for, or obtained in connection with the
project. Said trustees shall in addition to the powers granted in this
section, of this act, have and possess all of the powers necessary or
appropriate for the exercise of any functions specifically set forth herein,
or incident to the general representation of the bondholders represented
by such trustee, in the enforcement and protection of their rights.

(5) Any other matter required by any Federal agency as a condition
precedent to the obtaining of a direct grant or grants of moneys for or
in aid of any project, or to defray or partially to defray the cost of the
labor and materials employed upon any project, or to obtain loan or loans
of moneys for or in aid of any project, from any Federal agency.

Section 7. All proceeds received from the sale of the bonds of
any county, city or town issued under this act, and all fees, rents, tolls,
charges, revenues or other receipts derived from any project, and any
moneys received from any Federal agency shall be paid to the treasurer
or other financial officer of the county, city or town, who shall not
commingle said moneys with any other moneys. Said moneys shall be
deposited in a separate bank account or accounts in the name of the
county, city or town. The governing body of any county, city or town
may by resolution, provide that all deposits of such fees, rents, tolls,
charges, revenues or other receipts derived from any project, and any
moneys received from any Federal agency shall, if required by any
contract made with any Federal agency be secured by obligations of the
United States or of the Commonwealth of Virginia of a market value
equal at all times to the amount of such deposits and all banks and
trust companies are authorized to give such security for such deposits ;
and the governing body of any county, city or town is authorized to
enter into any contract with any Federal agency containing such require-
ment. In lieu of any such contractual requirement such deposits shall be
secured as now provided by law. ,

Section 11. It is the purpose of this act ‘to enable counties, cities,
and towns to encourage public works, and thereby to assist in the national
recovery and promote the public welfare, and to these ends counties,
cities and towns shall have power to do all things necessary or convenient
to carry out said purpose in addition to the express powers conferred in
this act; this act is remedial in nature and the. powers hereby granted
shall be liberally construed.

This act shall not be limited in its application to the issuance of bonds
for projects in aid of which the United States or any agency thereof
shall make or be authorized and empowered to make grants or loans but
shall extend to the issuance of bonds for any other project.

Section 12. In so far as the provisions of this act are inconsistent
with the provisions of any other law, the provisions of this act shall be
controlling. The powers conferred by this act shall be in addition and
supplemental to the powers conferred by any other law; and bonds,
interim certificates or other obligations may be issued hereunder for any
project notwithstanding that other law may provide for the issuance of
bonds for like purposes and without regard to the requirements, restric-
tions or other provisions contained in any other law, and except as
provided as to counties in section one hundred fifteen-a, and as to cities
and towns in section one hundred and twenty-seven of the Constitution
of Virginia, without regard to any requirement for the approval by vote
of the qualified voters of any county, city or town, of the contracting of
a debt, the borrowing of money or the authorizing or issuing of bonds
or other obligations. Bonds may be issued under this act notwithstanding
any debt or other limitation prescribed by any other law, and the mode
and method of procedure for the issuance of bonds under this act need
not conform to the provisions of any other law.