§1403 — Title 48 Territories and Insular Possessions | U.S. Code

Summary

Lets the Government of the Virgin Islands and its towns issue general obligation bonds or other debt to build, buy, fix, or run public projects. That covers many things like roads, bridges, ports, sewers and treatment plants, municipal buildings, schools, libraries, gyms and fields, firehouses, power systems and other utilities (including ones run by the Saint Thomas Power Authority), slum clearance, urban renewal, and low-rent housing. No municipality or the territorial government may borrow more than 10% of the total assessed value of taxable real property in its area. Bonds’ terms are set by the issuer but must mature within 30 years. Interest may not exceed 4% per year and is paid twice a year. Bonds must sell for at least their face amount plus accrued interest. They may be sold publicly or privately, may be redeemable or not, and may have different registration rules; signatures on bonds stay valid even if the official leaves before delivery. Bond principal and interest are exempt from federal, territorial, state, and local taxes. The government must collect enough taxes to pay bond debt, even if that requires a tax rate higher than 1.25% of assessed value.

Title 48, §1403

Territories and Insular Possessions — Source: USLM XML via OLRC

To construct, improve, extend, better, repair, reconstruct, acquire, and operate any and all types of public works which shall include, but not be limited to, streets, bridges, wharves, and harbor facilities, sewers and sewage-disposal plants, municipal buildings, schools, libraries, gymnasia and athletic fields, fire houses, electric distribution systems or other work pertaining to electric systems, and other public utilities, including those owned or operated by the Saint Thomas Power Authority, or to clear slums, accomplish urban redevelopment or provide low-rent housing, negotiable general obligation bonds and other obligations may be issued by the government of the Virgin Islands or any municipality thereof: Provided, That no public indebtedness of any municipality thereof shall be incurred in excess of 10 per centum of the aggregate assessed valuation of the taxable real property in such municipality and that no public indebtedness of the government of the Virgin Islands shall be incurred in excess of 10 per centum of the aggregate assessed valuation of the taxable real property in the islands. Bonds issued pursuant to sections 1403 to 1403b of this title shall bear such date or dates, may be in such denominations, may mature in such amounts and at such time or times, not exceeding thirty years from the date thereof, may be payable at such place or places, may be sold at either public or private sale, may be redeemable (either with or without premium) or nonredeemable, may carry such registration privileges as to either principal and interest, or principal only, and may be executed by such officers and in such manner, as shall be prescribed by the government of the Virgin Islands or of the municipality issuing the bonds. In case any of the officers whose signatures appear on the bonds or coupons shall cease to be such officers before delivery of such bonds, such signature, whether manual or facsimile, shall, nevertheless, be valid and sufficient for all purposes, the same as if such officers had remained in office until such delivery. The bonds so issued shall bear interest at a rate not to exceed 4 per centum per annum, payable semiannually. All such bonds shall be sold for not less than the principal amount thereof plus accrued interest. All bonds issued by the government of the Virgin Islands or any municipality thereof, including specifically interest thereon, shall be exempt from taxation by the Government of the United States, or by the government of the Virgin Islands or any political subdivision thereof, or by any State, Territory, or possession or by any political subdivision of any State, Territory, or possession, or by the District of Columbia: Provided further, That the government of the Virgin Islands and any municipality thereof shall be obliged to levy and collect sufficient taxes for servicing any of the outstanding bonds, even if such taxation is required at a rate in excess of or in addition to the tax or tax rate of 1.25 per centum of the assessed value which is provided for in section 1401b 11 See References in Text note below. of this title.

Editorial Notes

References in Text

section 1401b of this title, referred to in text, was repealed by Pub. L. 110–40, § 1(a), June 29, 2007, 121 Stat. 232.

§1403 Issuance of Bonds or Other Obligations by Government or Municipalities; Use of Proceeds; Limit on Public Indebtedness; Terms, Execution, Interest Rate, and Sale Price; Taxes

Summary

Title 48, §1403

Notes & Related Subsidiaries

Editorial Notes

References in Text

Citations & Metadata