§130.56. Bonds; tax exemption; holder rights; obligations; proceeds

A. All revenue bonds and interest coupons, if any, appertaining thereto issued pursuant to this Section shall be and are hereby made negotiable instruments within the meaning of and for all the purposes of the negotiable instruments law of Louisiana, subject only to the provisions of the revenue bonds for registration as to principal and interest or as to principal only.

B. All revenue bonds and the income therefrom shall be exempt from all taxation by this state or any political subdivision thereof, except estate or gift taxes and taxes on transfers. The revenue bonds shall be legal and authorized investments for banks, savings banks, insurance companies, homestead and building and loan associations, trustees, and other fiduciaries and may be used for deposit with any officer, board, municipality, or other political subdivision of the state of Louisiana, in any case where, by present or future laws, deposit or security is required.

C. The holders of any revenue bonds issued hereunder shall have such rights and remedies as may be provided in the bond resolution or the trust agreement authorizing the issuance of the revenue bonds, including, but not by way of limitation, acceleration of payment, appointment of a trustee for bondholders, appointment of a receiver for the revenue bond project financed with the proceeds of the revenue bonds and/or the revenues from such project, and any available civil action to compel compliance with the terms and provisions of the revenue bonds and the bond resolution or trust agreement.

D. The revenue bonds shall be limited obligations of the local governmental subdivision. The principal of and interest on the revenue bonds shall not be payable from the general funds of the local governmental subdivision, nor shall they constitute a pledge, charge, lien, or encumbrance upon any of its property or upon any of its income, receipts, or revenues except the revenues, agreements, and funds or property pledged or mortgaged under the bond resolution or the trust agreement authorizing such bonds. Neither the credit nor the taxing power of the local governmental subdivision shall be pledged for the payment of such principal or interest, and no holder of revenue bonds shall have the right to compel the exercise of the taxing power by the local governmental subdivision or the forfeiture of its property in connection with any default thereon. Every revenue bond shall recite in substance that the principal of and interest on such bond is payable solely from the revenues pledged to its payment and that the local governmental subdivision is not obligated to pay such principal or interest except from such revenues.

The revenue bonds issued under the provisions of this Section shall not constitute a debt of the local governmental subdivision, within the meaning of the constitution and statutes of the state.

E. Subject to agreements with the holders of revenue bonds, all proceeds of revenue bonds and all revenues pledged under a bond resolution or trust agreement authorizing or securing such bonds may be set aside as received and deposited and held in trust by a trustee appointed by the local governmental subdivision in a fund or funds separate and apart from all other funds of the local governmental subdivision. Subject to the bond resolution or trust agreement, the trustee shall hold the same for the benefit of the holders of the bonds for the application and disposition thereof solely to the respective uses and purposes provided in such bond resolution or trust agreement.

Added by Acts 1981, No. 277, §1, eff. July 13, 1981.