Chap. 61.—An ACT to authorize the governing boards of the University of
Virginia, the Virginia Polytechnic Institute, the Virginia) Normal and
Industrial Institute and the State teachers colleges at Farmville and Har-
risonburg to issue and sell, through the commissioners of the sinking
fund, certificates of indebtedness in the name and on behalf of their insti-
tutions, respectively, to raise funds for dormitory construction purposes
and for the construction of a power and heating plant at the Virginia
Polytechnic Institute, subject to the conditions and limitations contained
in this act; to provide for the payment of the interest thereon and the
principal thereof at maturity; to authorize and require the State board of
education to sell any State bonds held as a part of the literary fund,
when so directed by the governor, and to invest the proceeds derived from
the sale of such bonds in the certificates of indebtedness issued under the
provisions of this act and to authorize and require the State board of
education, when so directed by the governor, to invest any uninvested
portion of the literary fund in the certificates of indebtedness issued under
the provisions of this act; which follows the plan of the Noell act, chapter
489, Acts of 1926, adopted in the budget. [S B 39]

Approved February 28, 1928.

L. Be it enacted by the general assembly of Virginia, as follows:

Section 1. The governing boards of the University of Virginia
at Charlottesville, the Virginia Polytechnic Institute at Blacksburg,
the Virginia Normal and Industrial Institute at Petersburg, the
State Teachers College at Farmville, and the State Teachers Col-
lege at Harrisonburg, are hereby severally authorized, through the
commissioners of the sinking fund, to issue and sell certificates of
indebtedness in the names and one behalf of the institutions, respec-
lively, to raise funds for the construction and equipment of dormi-
tories, subject to the conditions and limitations hereinafter set out;
and the governing board of the Virginia Polytechnic Institute at
Blacksburg is hereby authorized, through the commissioners of the
sinking fund, to issue and sell certificates of indebtedness in the
name and on behalf of that institution to raise funds for the con-
struction, equipment and completion of a power and heating plant,
subject to the conditions and limitations hereinafter set out. All
huildings constructed with funds derived from such certificates of
indebtedness shall be as nearly fireproof as is possible and, except
in the case of the two hundred and fifty thousand dollars ($250.-
000.00) to be borrowed by the Virginia Polytechnic Institute, all
the money made available by this act to the institutions named in
this act shall be used only for the construction and equipment of
dormitories.

Section 2. The amount of certificates of indebtedness, which may
he issued on behalf of each of the institutions herein named, shall
he as follows:

For the construction and equipment of dormitories: The Univer-
sity of Virginia at Charlottesville an amount not exceeding five
hundred thousand dollars ($500,000.00) ;

The Virginia Polytechnic Institute at Blacksburg an amount not
exceeding one hundred and fifty thousand dollars ($150,000.00) ;

The Virginia Normal and Industrial Institute at Petersburg an
amount not exceeding one hundred and thirty-three thousand, three
hundred and thirty-five dollars ($133,335.00) ;

The State Teachers College at Farmville an amount not exceed-
ing one hundred and fifty thousand dollars ($150,000.00) ;
The State Teachers College at Harrisonburg an amount not ex-
ceeding one hundred thousand dollars ($100,000.00) ;

For the construction, equipment and completion of a necessary
power and heating plant: The Virginia Polytechnic Institute at
Blacksburg an amount not exceeding two hundred and fifty thou-
sand dollars ($250,000.00).

Section 3. The certificates of indebtedness issued under the pro-
visions of this act shall be signed on behalf of the institutions in the
names of which they are issued by the presiding officers of their
governing hoards, respectively, and shall be countersigned by the
treasurer who shall keep an account thereof in his office. The cer-
tificates of indebtedness issued under this act are the certificates
of institutions issuing them, respectively, and not the certificates
of the State.

Section 4. The said certificates of indebtedness shall bear inter-
est, payable semi-annually, January first and July first of each year.
at the rate of four per centum per annum. The said certificates shall
be issued in such denominations and shall mature at such time or
times not exceeding thirty-three years from their date as may he
prescribed bv the governor.

Section 5. The loans made under this act. including interest
thereon, shall constitute a specific lien on all the grounds, buildings
and additions thereto of the several institutions obtaining said
loans, and all such buildings shall be kept fully arid adequately in-
sured for the benefit of the literary fund, or the other owner or
owners of such certificates, and the policy or policies of insurance
shall be kept on file in the office of the comptroller.

Section 6. The State board of education is hereby authorized and
required to sell any bonds of the State held as a part of the literary
fund, when and as directed by the governor to do so, and is required,
when and as directed by the governor, to invest the proceeds derived
from the sale of such bonds in the certificates of indebtedness issued
under the provisions of this act. The State board of education is
further authorized and required, when and as directed to do so by
the governor, to invest anv uninvested portion of the literary fund
in the certificates of indebtedness issued under the provisions of
this act, and all such certificates purchased with funds belonging
to the literary fund shall become the property of and a part of that
fund. In the event that sufficient funds are not available for the
purchase of all such certificates with money belonging to the literary
fund, or the proceeds arising from the sale of the bonds hereinabove
referred to, the commissioners of the sinking fund are directed.
when and as required by the governor to do so, to sell the said cer-
tificates of indebtedness for cash at such prices, not less than par.
as mav he approved by the governor and said commissioners.

Section 7. The sums of money loaned from the literary fund, as
above provided or received from the sale of certificates of indebted-
ness issued and sold under the provisions of this act, shall be paid
into the State treasury to the credit of the institutions on behalf of
which such certificates are issued, and such amounts so paid into
the treasury to the credit of such institutions, respectively, are
hereby appropriated to and may be expended by the governing
boards, respectively, for the construction and completion of dormt-
tories for the use of students of the respective institutions and for
no other purpose whatsoever, except in the case of the Virginia
Polytechnic Institute at Blacksburg the sum of two hundred and
fifty thousand dollars ($250,000.00) obtained in the manner author-
ized by this act shall be expended for the construction and equip-
ment of a power and heating plant. All payments out of the treas-
ury shall be made upon order of the comptroller. The plans, bids
and costs of the buildings shall be acted upon and approved by the
governing boards of the respective institutions and the State board
of education. In order to provide for the payment of the interest
and principal on the certificates issued under this act and the cre-
ation of a sinking fund to retire them at maturity, the comptroller
shall set aside quarterly to the credit of special accounts to be
opened on the books of the comptroller for each of such institu-
tions, so much of the net rents and fees received from students, or
other persons, for the use of the dormitories constructed with funds
derived from the issuance of such certificates of indebtedness, and
paid into the State treasury, as may be necessary for said purpose.
The rents charged for the use of such dormitories shall not be less
than six dollars ($6.00) per month for each student occupying a
room therein and on the basis of not less than two students to a
room, and the same applies to each student in excess of two to a
room who may occupy any of the rooms.

The term net rents and fees as herein used shall be construed
to mean the gross rents and fees received for the use of such dorm1-
tories, less the cost of operation and maintenance of such dormi-
tories, including the insurance premium. In the case of the power
and heating plant to be erected by the Virginia Polytechnic Insti-
tute, so much of the income arising from the sale of electric current
and paid into the State treasury, as may be necessary therefor, shall
be set aside quarterly to the credit of the said special accounts to be
opened on the books of the comptroller as aforesaid to be used for
the payment of the interest and principal on the certificates issued
by said institution under this act and the creation of a sinking
fund to retire the principal at maturity. It shall be the duty of the
auditor of public accounts semi-annually to audit the accounts of
the rents and fees received and disbursed by each institution, and,
if it shall come to his knowledge that said accounts are not being
kept properly, or that any of said rents and fees are being devoted
to purposes not authorized by this act, he shall report the fact to
the governor. In the event that the rents derived from said dormi-
tories, or the proceeds arising from the sale of the current generated
at the power and heating plant-of the Virginia Polytechnic Insti-
tute, are not sufficient to pay off the indebtedness of said institu-
tions, when and as required by this act, then the amount of such
deficiency shall be set aside by the comptroller out of the other
revenue, paid into the State treasury by such institution on or before
the due date of any installment of principal or interest on such cer-
tificates.

Section 8. If at any time default shall be made by any institu-
tion in the payment into the State treasury of the moneys hereby
required so to be paid in for interest, principal and sinking fund
requirements, the commissioners of the sinking fund shall notify
the comptroller of this fact, and he is hereby authorized and directed
to draw his warrant upon the then current annual State appropria-
tion to such institution for the amount which is then due on account
of interest and principal. Such warrant shall thereupon be honored
and such amount disposed of in the same manner as if it had been
paid into the State treasury by such institution as required by sec-
tion seven of this act.

Section 9. The moneys so received into the State treasury shall
be used by the commissioners of the sinking fund, first, to pay the
interest on such certificates of indebtedness issued on behalf of such
institutions, respectively, when and as it becomes due and payable,
and the halance shall be used to pay the principal thereof. All
moneys disbursed by the commissioners of the sinking fund shall
be paid out of the State treasury on warrants of the comptroller
issued on the order of such commissioners.

The purchasers of any of the certificates of indebtedness issued
under this act shall not be required to see to the application of the
purchase money.