CHAPTER 46

An Act to amend and reenact § 15.1-225 of the Code of Virginia, relating
to procedure upon default on general obligation bonds of political
subdivisions of the State. § 12)

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Approved February 19, 1964

Be it enacted by the General Assembly of Virginia:

1. That § 15.1-225 of the Code of Virginia be amended and reenacted
as follows:

§ 15.1-225. Whenever it shall be made to appear to the Governor from
any petition filed with him by or on behalf of the holder of any general
obligation bonds of any unit, verified by the holder, hereinafter referred
to as the petitioner, or by his or its duly authorized agent, that such unit
has defaulted for over sixty days in the payment of the principal of or
interest on any of its outstanding general obligation bonds held by such
petitioner, the Governor shall make a summary investigation into the facts
disclosed in the petition and for that purpose may administer oaths and
take testimony thereunder, issue subpoenas, and compel the attendance
of witnesses and the production of books, memoranda, papers and other
documents, articles, instruments and data.

If it be established to the satisfaction of the Governor that the bonds
held by the petitioner are genuine and are the bonds of the unit and that
the unit is and has been for a period of at least sixty days in default in
the payment of such bonds or the interest thereon, the Governor shall make
an order directing the Comptroller to withhold on and after sixty days
from the issuance of such order all further payment to the unit of all
funds or of any part thereof, except the amount required by section one
hundred and thirty-five of the Constitution to be applied to the schools of
the primary and grammar grades in the unit and the amount payable to
the unit from the collection of the State capitation tax, appropriated and
payable by the Commonwealth to the unit for any and all purposes until
such default shall be paid. When the Governor finds that a unit is in default
upon its general obligation bonds he shall give notice thereof in a news-
paper of general circulation published in the city of Richmond and the
cost thereof shall be a charge against the funds in the hands of the Comp-
troller payable to such unit. The Governor shall, within sixty days fol-
lowing such publication, notify the Comptroller of all petitions for pay-
ment filed with him by the holders of bonds of such unit. The Governor *
Shall, within ninety days after such notification and while such default
continues, direct in writing the payment of all sums so withheld by the
Comptroller, or so much thereof as shall be necessary, to the * holders of
the bonds of the class or series so in default, so as to cover, or cover in-
sofar as possible, the default as to such bonds or interest thereon *. Any
payment so made by the Comptroller to the * holders of the bonds of the
class or series so in default shall be credited by * them as if made direct by
ee ane shall be charged by the Comptroller against the unit as if paid

e unit.

The * holders of the bonds of the class or series so in default at the
time of such payment, or at the time of each payment, shall receipt therefor
and deliver to the Comptroller all bonds and interest coupons satisfied by
such payment, and the Comptroller shall thereupon report each payment
so made to the governing body of the unit affected and deliver or send
by registered mail to the governing body all bonds and interest coupons
received by the Comptroller under the provisions of this section.
If all of the holders of the bonds of the class or series so in default
cannot be found, the Comptroller shall hold for the benefit of those not so
found their pro rata share of the sums so withheld and pay same when
such holders are found.

For the purpose of this section bonds of any magisterial district or
school district of any county shall be treated as bonds of the county in
which such magisterial district or school district is located.