2005 Connecticut Code - Sec. 7-568. Issuance of deficit obligations to fund general fund deficiency.

      Sec. 7-568. Issuance of deficit obligations to fund general fund deficiency. (a) Except as expressly provided in subsection (a) of section 7-394b and sections 7-560 to 7-579, inclusive, no municipality shall issue any deficit obligation to fund a general fund deficiency.

      (b) Notwithstanding any charter, special act or home-rule ordinance to the contrary, any municipality which has no outstanding deficit obligation and which has not issued a deficit obligation in the past five years, is authorized and empowered to issue deficit obligations to fund a deficit, provided such municipality shall, within the time and in the manner prescribed by regulations adopted by the secretary, in consultation with the Treasurer: (1) Notify the secretary of its intent to issue such deficit obligations, (2) provide the secretary with the documentation required under subsection (a) of section 7-394b and sections 7-560 to 7-579, inclusive, (3) establish a property tax intercept procedure, and (4) establish and covenant to maintain with a trustee a debt service payment fund into which the property tax receipts shall be deposited pursuant to the property tax intercept procedure in an amount at least equal to the debt service payment requirement and from which the trustee shall disburse funds to pay debt service on all general obligations of such municipality which have a term of over one year as and when the same shall become due. The secretary shall refer to the Municipal Finance Advisory Commission, pursuant to the provisions of section 7-395, any municipality which notifies the secretary that it intends to issue deficit obligations under this section.

      (P.A. 93-421, S. 9, 22.)

      History: P.A. 93-421 effective July 1, 1993.