Chap. 257.—An ACT to provide for the creation of produce market authorities in
certain cities; to prescribe the rights, powers, functions and duties of such
authorities and of the officers, agents and employees of such authorities; to
prescribe with reference to such authorities certain exceptions and limitations
with respect to licenses and taxes; and to prescribe the powers and duties of
certain officers with respect to such authorities. [S B 169]

Approved March 27, 1940

1. Beit enacted by the General Assembly of Virginia, as follows:
Section 1. How Produce Market Authorities Established and
Governed.—(a) Whenever the council or other governing body of
any city in the Commonwealth having a population of more than
thirty thousand shall adopt, by the affirmative vote of a majority
of all of the members thereof, a resolution, duly approved by the
mayor of such city or passed over his veto, petitioning the Governor
to establish a produce market authority for such city under the
provisions of this act, the Governor may by proclamation establish
such authority, or, if in the opinion of the Governor no substantial
need exists therefor, he may decline so to establish such authority.

(b) Every such produce market authority, if and when estab-
lished, shall constitute a public corporation to be known as the ‘‘(here
insert name of city) Produce Market Authority.’’ By and in such
name and style it shall have the power to enter into contracts, to sue
and be sued, and to exercise all of the powers conferred and to dis-
charge all of the duties imposed upon it as hereinafter provided.

Section 2. How Governed; Appointment of Directors.—(a) Every
such market authority shall be governed by a board of five directors
to be appointed by the Governor as follows:

One member shall be appointed from a list of three persons nomi-
nated by the Director of the Division of Markets with the approval
of the Commissioner of Agriculture and Immigration; one member
from a list of three persons nominated by the Director of the Agri-
cultural Extension Division of the Virginia Agricultural and Mechani-
cal College and Polytechnic Institute; one member from a list of
three persons nominated by the mayor of the city; one member from
a list of three wholesale dealers in perishable farm produce nominated
by a majority vote of all of the wholesale dealers in perishable farm
produce operating in the city where the authority will function, each
store unit having one vote; and one member from a list of three
farmers, each of whom shall be a resident of one of the several counties
adjacent to such city or adjacent to the county or counties in which
such city is geographically located, nominated by the agricultural
agents of the said adjacent counties.

(b) The said members first appointed hereunder shall be ap-
pointed for terms of one, two, three, four and five years, according to
the order in which they are listed hereinabove, respectively. Sub-
sequent appointments shall be made for terms of five years each,
except appointments to fill vacancies which shall be for unexpired
terms. The terms of the members first appointed shall, for the pur-
pose of determining the expiration dates of their respective terms
be taken to commence on January first of the year immediately suc-
ceeding the year in which the appointments are made, although the
appointment be made and the duties be assumed prior thereto.
Each director shall continue, however, to hold office until his suc-
cessor has been appointed.

(c) Immediately after such appointments, the directors of the
authority shall enter upon the performance of their duties. The
Board of Directors shall annually elect one of its members as chairman,
and another as vice-chairman, and shall also elect annually a secre-
tary-treasurer who may or may not be a member of the board of
directors. Three directors shall constitute a quorum. No vacancy
in the board of directors shall impair the right of a quorum to exercise
all the rights and perform all the duties of the board.

(d) The members of the board of directors shall receive no sal-
aries, but shall be entitled to reimbursement for their necessary
traveling expenses, at a rate of not more than five cents per mile,
incurred in attendance upon the meetings and while otherwise en-
gaged in the discharge of their duties; each member shall also be
paid the sum of five dollars a day for each day or portion thereof
during which he is engaged in the performance of his duties as a
member of the board; but no member of any such board shall be
entitled to a sum of more than three hundred dollars on account of
such expenses and per diem compensation in any one calendar year.
Such expenses and compensation shall be paid out of the treasury
of the respective authority upon vouchers signed and approved by
the chairman of the board or by such other person or persons as may
be designated by it for such purpose.

(e) The board of directors or any member or members thereof
shall be subject to removal from office in like manner as are State,
county, city, town and district officers under the provisions of section
twenty-seven hundred and five and twenty-seven hundred and six
of the Code of Virginia.

Section 3. Powers and Duties of the Authority; How Exercised.—
(a) All of the powers and duties conferred upon such market authority
shall be exercised through the board of directors.

(b) Every such market authority shall have the following powers:

(1) To adopt and to use a corporate seal and alter the same at
its pleasure;

(2) To acquire, hold and dispose of such personal property as
may be necessary to effect its corporate purposes;

(3) To acquire by purchase or lease, on such terms and conditions
and in such manner as it may deem proper, or by condemnation in
accordance with and subject to the provisions of sections forty-three
hundred and sixty to forty-three hundred and eighty-three of the
Code of Virginia, or by gift, such real property, or rights or ease-
ments therein, as it may be necessary to acquire to effect its corporate
purposes, and to sell or dispose of the same, or any portion thereof or
interest therein, whenever it shall become expedient to do so; all real
property so acquired by any such authority shall be located within
the corporate limits of the city for which the authority is established;

(4) To construct, maintain and repair, such buildings and other
structures upon land owned or leased by it, and to provide therein or
thereon such equipment and facilities as may be reasonably necessary
to accommodate the requirements of the merchants and farmers
engaged in the buying and selling of perishable farm produce at
wholesale in the city for which any such market authority is estab-
lished; all such buildings, structures, equipment and facilities of any
such market authority are hereinafter in this act sometimes referred
to collectively as the ‘“‘market’’ of such authority;

(5) To appoint and employ such officers, agents and employees
as may be necessary to effect its corporate purposes, to hx their
compensation and prescribe their duties;

(6) To lease the buildings and facilities hereinabove provided
for, or to grant privileges for the use thereof, to such farmers, whole-
sale dealers and other persons engaged in the wholesale marketing of
perishable farm produce, whether in buying or selling, as may make
application for such facilities and agree to abide by the rules and
regulations of the market authority, in consideration of such rents,
fees and charges, and upon such terms and conditions, as may be
agreed upon by the authority and the respective parties with whom
it may contract for such leases or such privileges;

(7) To provide upon the market premises a building or room
suitable and adequate for the operation of a restaurant to accommo-
date the requirements of the persons buying and selling and of the
persons employed at such market, and to lease such room or building
to a responsible proprietor upon such terms and conditions as may
be agreed upon;

(8) To provide upon the market premises such sanitary facilities
and parking space as may be necessary to accommodate the require-
ments of the persons buying and selling and of the persons employed
at such market;

(9) To make such rules and regulations as in its judgment may
be necessary for the proper operation of such market; to provide
experienced and competent persons to act as graders and classifiers
on such market and to fix their compensation; to prescribe and desig-
nate reasonable grades and classes for the various kinds of perishable
farm produce sold upon such market, which grades and classes shall
conform to those established pursuant to the laws of this State or of
the United States whenever the same are applicable; and

(10) To do any and all other things which may be reasonable,
necessary and convenient to carry out the powers expressly given in
this act.

(c) Every such market authority shall select a market manager,
fix his compensation and prescribe his powers and duties. Such
market manager shall be trained and experienced in the various
phases of marketing perishable farm produce. He may be authorized
to select such other employees as it may be necessary to employ, and
to fix their compensation and prescribe their duties.

(d) Nothing in this act shall be construed to prohibit any such
authority from permitting, under appropriate regulations promul-
gated by its board of directors for the purpose, as an incidental function
of the market, the selling and buying of food products other than
perishable farm produce at its market. Every such authority shall
have the power to grant privileges for the use of its facilities to per-
sons engaged in the buying and selling of such other food products in
consideration of such fees and charges and upon such terms and
conditions as may be agreed upon, subject to the regulations pre-
scribed as aforesaid.

Section 4. In the exercise of its powers every such market au-
thority shall be subject to all of the zoning, building, fire, sanitary,
health and other police ordinances and regulations of the city in which
it is established.

Section 5. Limitation of Powers.—(a) No such produce market
authority shall have the power to discriminate in the operation of
such market against the sale on such market of any perishable farm
products, nor against any producer of any perishable farm product,
on account of the county or State in which any such product is pro-
duced, or on account of the legal nature of the producer or other per-
son engaged in the marketing of any such product, whether individual,
cooperative, partnership or corporate, or on account of the conditions
of employment or the nature of the labor employed in the production
or marketing of such product; but every such authority shall take all
reasonable action and precaution to prevent any such discrimination.

(b) No such market authority shall use or permit the use of any
funds of the authority, regardless of the source thereof, for any pur-
pose other than for the acquisition, construction, equipment, main-
tenance, repair, expansion and operation of such market and for such
other purposes as are incident thereto and in accordance with the
powers of the authority as prescribed by this act.

(c) No such market authority shall have the power to acquire,
construct, maintain or operate more than one market; nor shall any
such authority acquire, construct, maintain or operate any market or
facility which is not operated primarily for the purpose of purchasing
and selling at wholesale.

Section 6. Bonds.—(a) Every such market authority shall have,
in addition to its other powers, the power to borrow money and to
issue and sell, in accordance with the provisions of this act, revenue
bonds, and general obligation bonds secured by trust indentures, to
provide the funds necessary for effecting any or all of its corporate
purposes, and to issue refunding bonds for the purpose of paying or
retiring bonds previously issued hereunder.

Every such bond issue shall be authorized by resolution of the
board of directors and the bonds shall bear such date or dates, mature
at such time or times, not exceeding thirty years from the date of
issue, bear interest at such rate or rates, not to exceed five (5%) per
centum per annum payable annually or semi-annually, be in such
denomination or denominations, be in such form, either coupon or
registered, be payable at such place or places and be subject to such
terms of redemption, as such resolutions may provide. No premium
provided for redemption prior to maturity of any such bond issue
shall be so great as to render the cost of such bond issue greater than
five and one-half (544%) per centum of the aggregate par value of
such bond issue per annum during the time such bonds are outstanding
prior to redemption, including interest and any such premium.

(b) All such bonds shall be signed by the chairman of the board
of directors of the authority, and the official seal of the authority
shall be affixed thereto and attested by the secretary-treasurer of the
authority, and any coupons attached thereto shall bear the facsimile
signature of the chairman of the board of directors of the authority.
In case any officer whose signature shall appear on any bonds or
whose facsimile signature shall appear on any coupon, shall cease to
be such officer before the delivery of such bonds, such signature shall
nevertheless be valid and sufficient for all purposes the same as if he
had remained in office until such delivery.

The said bonds may be sold at public or private sale at not less
than par. Any provision of the general laws to the contrary notwith-
standing, any bonds issued pursuant to this act shall be fully negotiable
within the meaning and for all of the purposes of chapter two hundred
and thirty-three of the Code of Virginia.

(c) The bonds of any authority established pursuant to the pro-
visions of this act shall not constitute a debt of the city for which
such authority is established or of the Commonwealth, and shall
not be payable out of any funds or properties other than those of
the authority issuing such bonds. Every such bond shall so state
upon its face. Neither the board of directors nor any agent of any
authority executing any bonds pursuant to this act shall be liable
personally on the bonds by reason of such execution.

(d) Upon the passage of a resolution providing for a bond issue
by any authority established as herein provided, the board of directors
shall cause a notice of such resolution to be published once a week
for two successive weeks in some newspaper published or having a
general circulation in the city in which such authority is established.
Said notice shall state the total amount of the issue, the purpose for
which the funds derived therefrom will be used, the interest rate
thereof, how the bonds will be secured, and such other matter as may
be necessary to describe the essential terms and conditions of the
said bonds, and it shall state that any action or proceeding questioning
the validity of such bond issue or of the resolution must be brought
within twenty days after the day upon which such notice is last
published.

Any suit or proceeding in any court bringing into question the
validity of the bonds or of the resolution, must be commenced within
twenty days after the date upon which the said notice is last published,
and thereafter no right or defense founded upon the invalidity of the
resolution or of the bonds shall be asserted.

Section 7. Revenue Bonds.—(a) Revenue bonds, as to both
principal and interest, shall be payable exclusively from the revenue
or from such part thereof as may be designated therefor by the resolu-
tion providing for the issuance of such bonds, derived from the opera-
tion of the market over and above the costs of maintenance, repair
and operation of the market and after setting aside the reserve for
extraordinary expenditures as provided in section eleven of this act.

(b) Every such authority shall have the power to provide by
the resolution authorizing any revenue bond issue that the obligees
of such bonds, or any portion of them, shall have the right, upon
default of the authority in the payment of any installment of interest
thereon or of the principal when it shall become due and payable, to
obtain the appointment of a receiver or receivers in any court of
record having chancery jurisdiction in the city where such authority
is established; and that such receiver or receivers, when appointed,
may enter and take possession of the market and every facility
thereof, operate the same, and collect all rents, fees and charges
accrued or to accrue to the authority. Every such receiver shall
apply all revenue received by him in accordance with the obligations
of the authority and as directed by the court. The court in which
any such receivership proceedings are instituted and conducted shall
enter appropriate orders providing that if and when the purposes of
the receivership shall have been accomplished and the obligations of
the authority satisfactorily adjusted or discharged, the possession,
control and management of the market and of the facilities thereof
shall be restored to the board of directors and their authorized agents.

(c) The board of directors may also provide, in its resolution
authorizing such bond issue, for the making of appropriate covenants
against the alienation, mortgage or pledge of its properties and assets,
or any part of the same, and may further provide that the revenues
of the authority, or any part thereof, shall be held by the authority
as if it were the trustee of an express trust.

Section 8. Trust Indentures.—(a) To secure the payment of
bonds, issued pursuant to this act, the authority issuing bonds shall
have, in addition to its other powers, the power to execute trust
indentures whereby all or any part of its revenue earned or to be
earned, accrued or to accrue, may be pledged and all or any part of
its real or personal property or assets of any other kind or description
may be granted, conveyed or transferred to the trustee or trustees
in trust to secure the payment of the principal and interest of such
bonds in accordance with the terms thereof. In every such trust in-
denture the trustee or trustees shall be one or more banks or trust
companies authorized under the laws of the Commonwealth or of
the United States to do a trust business in Virginia.

(b) Any such trust indenture may contain such provisions for
protecting and enforcing the rights and remedies of the bondholders
as may be reasonable and proper and not in violation of law, including
covenants of the authority against the future pledging or mortgaging
of its revenue, and its real and personal property and other assets,
covenants limiting its right to sell or otherwise dispose of any of its
properties or assets and to incur additional debts and obligations,
covenants limiting the use of any or all of its real or personal property
and providing for the insurance to be carried thereon, the replace-
ment thereof and the disposition of the proceeds from any insurance
contract, surety bond or other indemnifying contract. The authority
may vest in the trustee or trustees, or in the holders of the bonds or
any portion of them, the right to enforce such covenants and the
payment of such bonds, the right to take possession of, to use, operate
and manage any or all of its properties in the event of a default by
the authority.

(c) All expenses incurred in carrying out any such trust in-
denture shall be treated as a part of the operating costs of the market.

Section 9. Recordation.—In any case in which a bond issue is
secured by a trust indenture such trust indenture shall be recorded
in the office of the clerk of the court in which deeds are required to
be recorded in the city for which such authority is established. The
said trust indenture shall be recorded and indexed in such book or
books and in such manner as deeds of trust securing the payment of
money are required to be recorded and indexed.

Section 10. Remedies.—Every obligee of an authority established
pursuant to this act, including bondholders, lessors and lessees and
every other party contracting with the authority, shall have, in addi-
tion to such remedies as he may have at law or in equity pursuant to
general law, the right by mandamus to compel the authority, its board
of directors, officers or agents to perform each and every term, pro-
vision and covenant contained in any contract of the authority, and
by suit in equity to enjoin any acts or things which may be unlawful
or in violation of any right of such obligee under any contract of
the said authority or otherwise.

Section 11. Revenues; Sinking Fund.—(a) Every authority es-
tablished under this act shall fix and revise from time to time the
rents, fees and other charges to be paid by persons operating on the
market for the use of the various facilities and equipment constructed
or furnished upon the premises of the market and for any other
service furnished or provided by the authority incident to the operation
of the market and the powers of the authority hereunder.

Such rents, fees and charges shall be fixed so as to provide suff-
cient funds to pay the cost of maintaining, repairing and operating
the market and the principal and interest of any bonds issued pur-
suant to this act or other debts contracted as the same shall become
due and payable. A reserve shall be accumulated and maintained
out of the revenue of every such authority for extraordinary repairs
and expenses and for such other purposes as may be provided in
any resolution authorizing a bond issue or in any trust indenture
executed pursuant to this act.

(b) All revenues of any such authority over and above those
required for the maintenance, repair and operation of the market
and for maintaining reserves as hereinbefore provided, shall be set
aside in a sinking fund which shall be pledged to and charged with
the payment of (one) the interest on all outstanding bonds or other
debts, of the authority as the same shall become due and payable,
(two) the principal of such bonds or other debts as they shall become
due and payable, and (three) the principal and premium upon bonds
to be retired or redeemed before maturity. Every resolution providing
for any bond issue shall provide for the establishment and mainte-
nance of such sinking fund.

(c) No individual, firm, association or corporation shall receive
any profit or dividend from the revenues, earnings or other funds or
assets of any such authority other than for services rendered, for
materials and supplies furnished and for other value actually re-
ceived by the authority; nor shall the Commonwealth or any political
subdivision thereof be entitled to any such profit or dividend. The
rents, fees and charges hereinbefore provided to be fixed by the au-
thority shall not be greater than necessary to provide sufficient funds
to meet the requirements of this section.

Section 12. Aid from Federal Government.—In addition to the
other powers conferred by this act, every authority established here-
under shall have the power to borrow money and to accept contribu-
tions, grants and other financial assistance from the federal govern-
ment and other agencies and agency or instrumentality thereof for
or in aid of the construction and equipment of its market or the retire-
ment or refunding of its bonds. To these ends every such authority
shall have the power to comply with such conditions and to execute
such mortgages, trust indentures and agreements as may be necessary,
convenient or desirable and not in conflict with any provisions of
this act.

Section 13. Audit and Publication of Accounts; Records and
Reports; Duties of the Director of the Division of Markets.—(a) The
director of the Division of Markets shall cause the books and records
of every authority established pursuant to this act to be audited
annually by such auditors or accountants as may be designated by
him for the purpose and approved by the Commissioner of Agricul-
ture and Immigration. The said director shall also cause a statement
of the revenues, expenditures, assets and liabilities of every such
authority, as shown by the said audit, to be published annually in
some newspaper published or having a general circulation in the
city wherein such authority is established. The said audit shall be
made and the said statement published on or before March first of
each year; and such audit shall cover the business and transactions
of the authority for the preceding calendar year. The cost of such
audit and publication shall be borne by the respective authorities.

(b) Every authority established hereunder shall keep such
records and make such reports to the director of the Division of
Markets as may be required by the director with the approval of
the Commissioner of Agriculture and Immigration.

(c) In case any such authority shall fail or refuse to keep such
records and to make such reports as are required by subsection (b)
of this section, the director of the Division of Markets through the
attorneys for the Commonwealth of the several counties and cities,
may institute the necessary proceedings or otherwise, in his discretion,
to have the directors, or such of them as are responsible for such
failure or refusal, removed from office as provided in subsection (d)
of section two of this act.

Section 14. Separability of Provisions.—If any provision of this
act, or the application thereof to any person or circumstance, is held
invalid, the remainder of this act and the application of such pro-
vision to other persons or circumstances shall not be affected thereby.