Refunding Bonds

C.R.S. tit. 22, art. 43
in effect

C.R.S. § 22-43-101 Definitions

22-43-101. Definitions. As used in this article, unless the context otherwise requires: (1) "Board of education" or "board" means the governing body authorized by law to administer the affairs of any school district. (1.5) Repealed. (2) "Net effective interest rate" of a proposed issue of refunding bonds means the net interest cost of said refunding issue divided by the sum of the products derived by multiplying the principal amounts of such refunding issue maturing on each maturity date by the number of years from the date of said proposed refunding bonds to their respective maturities. "Net effective interest rate" of an outstanding issue of bonds to be refunded means the net interest cost of said issue to be refunded divided by the sum of the products derived by multiplying the principal amounts of such issue to be refunded maturing on each maturity date by the number of years from the date of the proposed refunding bonds to the respective maturities of the bonds to be refunded. In all cases the net effective interest rate shall be computed without regard to any option of redemption prior to the designated maturity dates of the bonds. (3) "Net interest cost" of a proposed issue of refunding bonds means the total amount of interest to accrue on said refunding bonds from their date to their respective maturities, less the amount of any premium above par at which said refunding bonds are being or have been sold. "Net interest cost" of an outstanding issue of bonds to be refunded means the total amount of interest which would accrue on said outstanding bonds from the date of the proposed refunding bonds to the respective maturity dates of said outstanding bonds to be refunded. In all cases the net interest cost shall be computed without regard to any option of redemption prior to the designated maturity dates of the bonds. (4) "School district" or "district" means a school district organized and existing pursuant to law or a joint taxation district organized and existing pursuant to part 2 of article 30 of this title.

C.R.S. § 22-43-102 Refunding bonds may be issued

22-43-102. Refunding bonds may be issued. (1) Any school district in this state may issue negotiable coupon bonds to be denominated refunding bonds for the purpose of refunding any of the bonded indebtedness of such district, whether said indebtedness is due or not due, or has or may hereafter become payable or redeemable at the option of such district, or by consent of the bondholders, or by any lawful means, whether such bonded indebtedness be now existing or may hereafter be created. (2) The bonded indebtedness of any district outstanding at the time of the inclusion of all such district's territory in another district, by reorganization, consolidation, dissolution, or any other lawful means, may be refunded by action of the board of the district including such territory at the time of such refunding, whether or not such indebtedness has been assumed by the district including such territory. (3) When an entire district having outstanding bonded indebtedness has been divided and parts thereof included within two or more other districts by any lawful means, the refunding of such indebtedness shall require affirmative action by a majority of the members of the boards of each of the districts within which any part of the territory of such district owing said indebtedness is then included, except as is provided in this article to the contrary. (4) The bonded indebtedness of any school district outstanding at the time any territory of said district is detached therefrom by any lawful means, and which district has retained its lawful corporate existence subsequent to the detachment of such territory from said district, may be refunded by action of the board of such district from which territory has been detached with or without concurrence or action by the board of the district within which said detached territory is included, and such districts from which territory has been detached and which retain their corporate existence subsequent to detachment are specifically exempted from the requirements and provisions of subsection (3) of this section. (5) Any such refunding bonds may be issued to refund any issues of outstanding bonds; but no two or more issues of outstanding bonds may be refunded by a single issue of refunding bonds unless the taxable property upon which tax levies are being made for payment of each such outstanding issue of bonds is identical to the taxable property on which such levies are being made for the payment of all other outstanding bonds proposed to be refunded by such single issue of refunding bonds. (6) Repealed.

C.R.S. § 22-43-103 Question of issuing refunding bonds

22-43-103. Question of issuing refunding bonds. (1) Whenever the board of education of any school district deems it expedient to issue refunding bonds under the provisions of this article and the net effective interest rate and the net interest cost of said issue of refunding bonds shall not exceed the net effective interest rate and the net interest cost of the outstanding bonds to be refunded, such refunding bonds may be issued without the submission of the question of issuing the same at an election held in accordance with article 42 of this title. If two or more issues of outstanding bonds of a school district are to be refunded by the issuance of a single issue of refunding bonds, as provided in section 22-43-102 (5), the net interest cost and net effective interest rate on the bonds to be refunded shall be computed as if all of said bonds had originally been combined as a single issue aggregating the total of the smaller issues, and the results of this computation shall be compared with the net interest cost and net effective interest rate on the whole of the single refunding issue for purposes of determining the necessity of submitting the question of issuing such refunding bonds at an election held in accordance with article 42 of this title. (2) If any district proposes to issue refunding bonds, on which issue the net interest cost or net effective interest rate exceeds the net interest cost or net effective interest rate of the outstanding bonds to be refunded, the board shall submit the question of issuing such refunding bonds and the maximum net interest cost and maximum net effective interest rate at which such refunding bonds may be issued at the regular biennial school election or at a special election called for that purpose. Any such election shall be called and held as nearly as may be in the manner provided by law for elections on the question of the issuance of other school bonds of the issuing district.

C.R.S. § 22-43-104 Authorization - form - interest

22-43-104. Authorization - form - interest. (1) Such refunding bonds shall be authorized by a resolution fixing the date, the denominations, the rate of interest on individual bonds, the maturity dates which shall not be more than twenty-five years after the date of such refunding bonds, and the place of payment within or without the state of Colorado, of both principal and interest, and prescribing the form of such refunding bonds. Such bonds shall be negotiable in form and executed in the same manner as prescribed for other school district bonds. At the discretion of the board, any such bonds may be issued with privileges for registration for payment as to principal or interest, or both. (2) The interest accruing on such refunding bonds may be evidenced by interest coupons thereto attached in substantially the same form as prescribed for other school district bonds, and, when so executed, such coupons shall be the binding obligations of the district according to their import. Such refunding bonds shall mature serially, commencing not later than five years after the date of such bonds and maturing during a period not exceeding twenty-five years after the date thereof. The amount of such maturities shall be fixed by the board of education and specified in the resolution authorizing the issuance of the refunding bonds. The right to redeem all or part of said bonds prior to their maturity, and the order of any such redemption, may be reserved in the resolution authorizing the issuance of bonds and shall be set forth on the face of said bonds. Interest on refunding bonds issued on or after July 1, 1973, pursuant to this article shall be exempt from Colorado income tax.

C.R.S. § 22-43-105 Sale - proceeds - amounts

22-43-105. Sale - proceeds - amounts. Such refunding bonds may be exchanged for the bonds to be refunded, or they may be sold at, above, or below their par value; but such refunding bonds shall be exchanged or sold at a price such that the net interest cost and the net effective interest rate for the issue of refunding bonds does not exceed the net interest cost and the net effective interest rate of the outstanding bonds to be refunded or the maximum net effective interest rate and net interest cost approved by the voters, as the case may be. Such refunding bonds shall be in a principal amount not exceeding the principal amount of the bonds to be refunded, as directed by the board of education, and the proceeds thereof shall be applied only to the purpose for which such refunding bonds were issued. The principal amount of said refunding bonds may be the same or less than the principal amount of the bonds to be refunded, if due, adequate, and sufficient provision has been made for the payment or redemption and retirement of said bonds to be refunded and the payment of the interest accruing thereon in accordance with this article.

C.R.S. § 22-43-106 Needed revenues - tax levy - miscellaneous

22-43-106. Needed revenues - tax levy - miscellaneous. (1) Whenever a board of education issues refunding bonds under the provisions of this article, sections 22-42-117 to 22-42-121 shall be applicable to said refunding bonds and the procedures therefor, in the same manner as prescribed for other school district bonds; except that any such refunding bonds shall be payable from the same funds which are to be derived from the same source as would have been used to pay the original bonds if no refunding thereof had occurred. (2) After refunding bonds are issued pursuant to this article, the resolution authorizing the same and providing for the levy of taxes for the payment of interest upon and the principal of such refunding bonds shall not be altered or repealed until the refunding bonds so authorized have been fully paid.

C.R.S. § 22-43-107 Application of bond proceeds - procedures - limitations

22-43-107. Application of bond proceeds - procedures - limitations. (1) The proceeds derived from the issuance of any refunding bonds under the provisions of this article shall either be immediately applied to the payment or redemption and retirement of the bonds to be refunded and the cost and expense incident to such procedures or shall immediately be placed in escrow to be applied to the payment of said bonds upon their presentation therefor and the costs and expenses incident to such proceedings and for no other purpose whatsoever until the bonds being refunded have been paid in full and discharged, and all accrued interest thereon has also been paid in full, upon which occurrences the escrow shall terminate, and any moneys remaining therein shall be returned to the district's bond redemption fund. (2) Any such escrowed proceeds, pending such use, may be invested or, if necessary, reinvested in securities meeting the investment requirements established in part 6 of article 75 of title 24, C.R.S., maturing at such times as to insure the prompt payment of the bonds refunded under the provisions of this article and the interest accruing thereon. (3) Such escrowed proceeds and investments, together with any interest to be derived from such investments, shall be in an amount which at all times is sufficient to pay the bonds refunded as they become due at their respective maturities or as they are called for redemption and payment on prior redemption dates, as to principal, interest, any prior redemption premium due, and any charges of the escrow agent payable therefrom. The computations made in determining such sufficiency shall be verified by a certified public accountant. (4) For the purpose of implementing the provisions of this article, the board of education of any school district has the power to enter into escrow agreements and to establish escrow accounts with any commercial bank having full trust powers located within the state of Colorado and a member of the federal deposit insurance corporation, under protective covenants and agreements whereby such accounts shall be fully secured by, or shall be invested in, securities meeting the investment requirements established in part 6 of article 75 of title 24, C.R.S., in such amounts as will be sufficient and maturing at such times so as to insure the prompt payment of the bonds refunded and the interest accruing thereon under the provisions of this article. (5) In no event shall the aggregate amount of bonded indebtedness of any school district exceed the maximum allowable amount as determined pursuant to section 22-30-126 or 22-42-104; except that, in determining and computing such aggregate amount of bonded indebtedness of any district, bonds which have been refunded, as provided in this article, either by immediate payment or redemption and retirement or by the placement of the proceeds of refunding bonds in escrow, shall not be deemed outstanding indebtedness from and after the date on which sufficient moneys are placed with the paying agent of such outstanding bonds for the purpose of immediately paying or redeeming and retiring such bonds or from and after the date on which the proceeds of said refunding bonds are placed in escrow. (6) The issuance of refunding bonds by any school district for the purposes of and in the manner authorized by this article, or by the provisions of any other law, shall never be interpreted or taken to be the creation of an indebtedness such that the same would require the approval at an election held in accordance with article 42 of this title, and no such approval shall be required for the issuance of such refunding bonds except as is specifically required by the law under which said refunding bonds are sought to be issued or have been issued. other law, shall never be interpreted or taken to be the creation of an indebtedness such that the same would require the approval at an election held in accordance with article 42 of this title, and no such approval shall be required for the issuance of such refunding bonds except as is specifically required by the law under which said refunding bonds are sought to be issued or have been issued. (7) No bonds may be refunded under the provisions of this article unless the holders thereof voluntarily surrender said bonds for immediate exchange or immediate payment, or unless said bonds either mature or are callable for redemption prior to their maturity under their terms within ten years after the date of issuance of the refunding bonds, and provisions shall be made for paying or redeeming and discharging all of the bonds refunded within said period of time. (8) No bonds shall be refunded under the provisions of this article within a period of one year following the actual issuance and delivery thereof to their initial purchasers unless the proceeds of said refunding bonds are immediately applied to the payment or redemption and retirement of the bonds being refunded. (9) No bonds shall be issued under the provisions of this article for the purpose of refunding any refunding bonds unless the original bonds refunded by said refunding bonds have previously been paid or redeemed and matured or unless the proceeds of said refunding bonds are immediately applied to the payment or redemption and retirement of the original refunding bonds being refunded.

C.R.S. § 22-43-108 Reports

22-43-108. Reports. Each school district which issues refunding bonds under the provisions of this article shall file a report within sixty days after the issuance of said bonds with the state board of education. The report shall indicate the principal amount of bonds refunded, the net effective interest rate of both the bonds refunded and the refunding bonds, the net interest cost of both the bonds refunded and the refunding bonds, all school district costs incident to the issuance of refunding bonds, including those of the escrow agent, and such other items as may be determined by the state board of education.

C.R.S. § 22-43-110 Prior obligations not impaired

22-43-110. Prior obligations not impaired. (Repealed)
Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://leg.colorado.gov/sites/default/files/images/olls/crs2024-title-22.docxFetched: 10/6/2026