2020 South Carolina Code of Laws
Title 59 - Education
Chapter 122 - The Citadel Housing Revenue Bonds
Section 59-122-120. Authority of board.

To the end that the payment of the principal and interest of the bonds authorized is adequately secured, the board may:

(1) issue bonds in such amount, within the limitations provided in this chapter, as the board considers necessary, provided that the board may use a portion of the principal proceeds derived from any sale of bonds, except bonds issued to effect refunding of outstanding bonds, to meet the payment of interest on the bonds for a period ending on the date acquired or renovated facilities are placed in service, it being recognized by the General Assembly that until the facilities to be acquired or renovated with the proceeds of the bonds are completed, an undue burden may be imposed upon then existing revenues;

(2) pledge the revenues or net revenues as provided in Section 59-122-50 for the payment of the principal of and interest on the bonds as they respectively mature;

(3) covenant that none of the facilities will be used free of charge, or specify and limit the facilities which may be made use of free of charge;

(4) covenant to establish and maintain the system of rules as will ensure the continuous use and occupancy of the facilities, the revenues from which are pledged to secure any bonds;

(5) covenant that an adequate schedule of charges will be established and maintained for all the facilities, the revenues from which are pledged to secure any bonds, to the extent necessary to provide sufficient revenues to:

(a) pay the cost of operating and maintaining the facilities including the cost of fire, extended coverage, and occupancy insurance;

(b) pay the principal and interest of the bonds as they respectively become due;

(c) create and at all times maintain any reserve fund considered necessary to meet the payment of the principal and interest;

(d) create and at all times maintain an adequate reserve for contingencies and for major repairs and replacement;

(6) covenant against the mortgaging or disposing of the facilities, the revenues from which are pledged for the payment of bonds, and against permitting or suffering any lien to be created on it, equal or superior to the lien created for the benefit of the bonds. The board may discontinue the use of or demolish obsolete facilities and it reserves the right, under terms it prescribes, to issue additional bonds on a parity with the bonds authorized by this chapter;

(7) covenant as to the use of the proceeds derived from the sale of any bonds issued pursuant to this chapter;

(8) provide for the terms, form, registration, exchange, execution, and authentication of bonds and for the replacement of lost, destroyed, or mutilated bonds;

(9) make covenants with respect to the use of facilities to be acquired or renovated with the proceeds of the bonds authorized in this chapter and of the other facilities, the revenues from which are pledged for the payment of the bonds;

(10) covenant that all revenues or net revenues pledged for the payment of the bonds must be segregated into special funds and that the funds will be used solely for the purposes for which they are intended and for no other purpose;

(11) covenant for the mandatory redemption of bonds on such terms and conditions as the resolutions authorizing the bonds must prescribe;

(12) prescribe the procedure, if any, by which the terms of the contract with the bondholders may be amended, the number of bonds whose holders must consent to it, and the manner in which the consent may be given;

(13) covenant as to the maintenance of the facilities, the revenues from which are pledged for the payment of the bonds, the insurance to be carried on the facilities, and the use and disposition of proceeds from any insurance policy;

(14) prescribe the events of default and the terms and conditions upon which all or any bonds become or may be declared due before maturity and the terms and conditions upon which the declaration and its consequences may be waived;

(15) impose a statutory lien upon the facilities, the revenues from which are pledged to secure the bonds. The lien may extend to such facilities, to their appurtenances and extensions, to their additions, improvements, and enlargements to the extent specified in the resolutions and inure to the benefit of the holders of the bonds secured by it. The facilities must remain subject to the statutory lien until the payment in full of the principal and interest of the bonds. Any holder of any of the bonds may, either at law or in equity, by suit, action, mandamus, or other proceedings, protect and enforce the statutory lien, and may, by suit, action, mandamus, or other proceedings, enforce and compel performance of all duties of the board, including the fixing of sufficient rates, the proper segregation of the revenues, and the proper application of them. The statutory lien may not be construed to give the holder authority to compel the sale of any of the facilities or any part of them;

(16) covenant that if any default occurs in the payment of the principal of or interest on any of the bonds, any court having jurisdiction in any proper action may appoint a receiver to administer and operate the facilities, the revenues from which are pledged for the payment of the bonds with power to fix rates and charges for the facilities, sufficient to provide for the payment of the expense of operating and maintaining the facilities, and to apply the income and revenues of such facilities to the payment of the bonds and the interest on them;

(17) establish on or before the occasion of the delivery of any bonds issued pursuant to this chapter a debt service reserve fund and cause it to be deposited with a corporate trustee and, to that end, the board is empowered to utilize any monies available for that purpose, including revenues previously accumulated from the facilities before the issuance of bonds;

(18) enter into an indenture with a corporate trustee providing for the collection and disbursement of net revenues and the maintenance of any reserve funds for which provision is made;

(19) contract with such advisors and counsel as it considers appropriate in connection with the issuance and sale of the bonds.

HISTORY: 1989 Act No. 102, Section 2.