Sec. 18. Limited Liability. (a) The bonds issued under the authority of this chapter by a municipality shall not be general obligations of the municipality issuing them. The principal of, premium, if any, and interest on the bonds shall not be payable from the general funds of the municipality, nor shall they constitute a legal or equitable pledge, charge, lien, or encumbrance upon any of its property or upon any of its income, receipts, or revenues, except the funds which are pledged under the resolution authorizing the bonds or the trust agreement securing the bonds. Neither the faith and credit nor the taxing power of a municipality or of the state are, or may be, pledged for the payment of the principal of, premium, if any, or interest on the bonds, and no holder of the bonds shall have the right to compel the exercise of the taxing power by the state or a municipality or the forfeiture of any of its property in connection with any default. Every bond shall recite in substance that the principal of, premium, if any, and interest on the bond is payable solely from the revenues and other funds pledged to its payment and that the municipality is not obligated to pay the principal, premium, if any, or interest except from such revenues and other funds.
(b) The bonds issued under the authority of this chapter by a joint agency shall constitute obligations of the joint agency issuing them and neither the state nor any political subdivision thereof, other than the joint agency, shall be obligated to pay the principal of, premium, if any, or interest on the bonds and neither the faith and credit nor the taxing power of the state or any such political subdivision thereof or of any such municipality shall be pledged to the payment of the principal of, premium, if any, or interest on the bonds.
(c) Payments made under a transmission contract under section 9(a)(14) of this chapter must be paid solely from revenues of the joint agency entering into the contract. The obligation to make these payments does not constitute an indebtedness, or lend the credit of the state, a political subdivision, or a municipality to a public utility.
As added by Acts 1980, P.L.68, SEC.1. Amended by P.L.81-1997, SEC.5.
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