ARTICLE IX. WATER REVENUE BONDS (2-32-770 et seq.)

2-32-770 Issuance – Authorized when – Effect.

   The City of Chicago, acting by its city council, may, from time to time, borrow money for the purpose of paying the cost of constructing extensions, improvements, or both, to the existing Chicago Water System, and for the purpose of paying the principal of and accrued interest on interim notes issued pursuant to Sections 2-32-850 through 2-32-890 of this chapter to provide temporary financing for such extensions, improvements, or both, to the Chicago Water System, and in evidence of such borrowing, issue its water revenue bonds, which shall be payable both as to principal and interest solely and only from the revenues to be derived from the operation of the water system of said city, which water revenue bonds shall become due within 40 years of their date and shall not in any event constitute an indebtedness of said city within the meaning of any constitutional or statutory provision or limitation on indebtedness which may be incurred and the water revenue bonds shall not be payable from ad valorem taxes to be levied and extended against taxable property situated within the city. The procedures for the issuance of water revenue bonds shall be as substantially herein provided in Sections 2-32-780 through 2-32-840 of this chapter.

(Prior code § 7-67)

2-32-780 Issuance – Ordinance and public hearing required.

   The city council shall adopt an ordinance (hereinafter designated the "water revenue bond ordinance"), which shall set forth the amount of money necessary to be borrowed and the amount of the water revenue bonds to be issued in evidence of such borrowing, shall describe in a general way the improvements, extensions, or both, necessary to be made and the estimated cost thereof. It shall not be necessary that such water revenue bond ordinance refer to or incorporate therein by reference detailed plans and specifications of such improvements, extensions, or both.

   Prior to the adoption of any such water revenue bond ordinance, a public hearing shall be held thereon by the finance committee of the city council, provided that no approval of projects to be permanently financed thereby shall be necessary if such projects have been theretofore approved by the finance committee and the city council, and financed through the issuance of interim notes pursuant to Sections 2-32-850 through 2-32-890 of this chapter, pursuant to a notice given of such public hearing, such notice to refer generally to the subject matter of the water revenue bond ordinance and to be published at least once in a newspaper published in and having a general circulation within the City of Chicago, the date of such publication to be not less than ten days prior to the date of the public hearing.

(Prior code § 7-68)

2-32-790 Contents of ordinance.

   The water revenue bond ordinance shall fix the details of the bonds to be issued, including their date, number, denomination and maturity, which cannot exceed 40 years from their date and their maximum rate of interest which shall not exceed eight percent per annum. The bonds shall be sold in such manner as may be determined in the water revenue bond ordinance and they shall be sold at a price of not less than par. The water revenue bond ordinance shall further provide that it will be plainly stated on the face of each water revenue bond that the same has been issued under and pursuant to the provisions of this ordinance and that such water revenue bond does not constitute an indebtedness of the City of Chicago within any constitutional or statutory provision or limitation as to debt. The water revenue bond ordinance shall further set forth and contain such provisions and covenants as may be deemed necessary or advisable for the assurance of the prompt payment of the water revenue bonds thereby authorized and as may be thereafter authorized and including the prompt payment of water revenue bonds or certificates theretofore issued and which by their terms are payable from the revenues of the Chicago Water System and may be then outstanding.

(Prior code § 7-69)

2-32-800 Repayment from water system funds – Water rates.

   Whenever water revenue bonds are issued pursuant to the provisions of this ordinance, the entire revenue received from the operation of the Chicago Water System shall be deposited in a separate fund designated as the "Water Fund of the Municipality of Chicago". This fund shall be used only in paying (1) the cost of maintenance and operation of the Chicago Water System; (2) obligations of the City of Chicago heretofore issued that are payable by their terms from the revenues of the system, whether such obligations were heretofore issued in the form of certificates, bonds or otherwise; (3) Water revenue bonds issued pursuant to the provisions of this Code; and (4) establishing and maintaining all reserve funds or accounts as may be covenanted for in the bond ordinances adopted authorizing such water revenue bonds. Provided, however, that any funds available after or not necessary for satisfying the above requirements may be used for any lawful purpose of the Chicago Water System.

   Rates charged by the city for water used shall be sufficient to pay the cost of maintenance and operation of the Chicago Water System and to pay promptly when due the principal of and interest upon all the obligations of the city heretofore issued that are payable by their terms only from such revenues of the water system and the payment of water revenue bonds issued pursuant to the provisions of the water revenue bond sections of this chapter, and to establish and maintain all reserve funds or accounts as may be covenanted for in bond ordinances adopted and authorizing the issuance of such water revenue bonds. These rates charged shall not be reduced while any of such certificates or bonds or obligations are unpaid.

(Prior code § 7-70)

2-32-810 Execution of ordinance – Signatures.

   The water revenue bond ordinance shall authorize execution of the bonds therein authorized on behalf of the city by being signed by the mayor and by the city comptroller and to be attested by the city clerk, and by the respective proxies of said mayor and city comptroller, shall determine whether such bonds to be issued shall be registered in the name of the owner as to principal only and shall indicate the place or places of payment of the principal and interest maturing on said bonds and shall also set forth the form of water revenue bonds to be issued.

   The mayor and the city comptroller may each designate another to act as their respective proxies and to affix their respective signatures to any such water revenue bonds, and in such case, each shall send to the city council written notice of the person so designated by each, such notice stating the name of the person so selected to sign as proxy for the mayor and the city comptroller, respectively. A written signature of the mayor or of the city comptroller, respectively, executed by the person so designated underneath, shall be attached to each notice. Each notice, with the signature attached, shall be recorded in the Journal of the Proceedings of the City Council and then filed with the city clerk. When the signature of the mayor is placed on a water revenue bond at the direction of the mayor in the specified manner, the bond, in all respects, shall be as binding on the city as if signed by the mayor in person. When the comptroller's signature is so affixed to a water revenue bond at the comptroller's direction, the bond, in all respects, shall be as binding on the city as if signed by the comptroller in person.

(Prior code § 7-71)

2-32-820 Signature validity.

   In case any officer whose signature appears on the specified bonds or the coupons attached thereto ceases to hold his office before the delivery of the bonds to the purchaser, his signature nevertheless shall be valid and sufficient for all purposes, to the same effect as if he had remained in office until the delivery of the bonds.

(Prior code § 7-72)

2-32-830 Use of proceeds.

   The provisions of any water revenue bond ordinance shall constitute an appropriation of the amounts required as therein referred to and described and upon the delivery of the bonds therein authorized, the proceeds thereof shall be used solely and only for the purpose or purposes for which the bonds were authorized. Upon the adoption of any such bond ordinance by the city council and its approval by the mayor, the same shall be published by the city clerk in pamphlet form and shall be in full force and effect upon its publication. Such water revenue bond ordinance shall not be subject to referendum approval by the voters but shall become effective upon its publication as above provided for.

(Prior code § 7-73)