P.R. Laws tit. 21, § 6008
(a) Every ordinance or resolution to authorize any obligation evidenced by bonds, notes, or any other instruments, as the case may be, shall contain the following provisions:
(1) In brief and general terms, the purpose or purposes of the bonds, notes or any other instruments;
(2) the maximum amount of money to be borrowed through the bonds, notes or any other instruments, and if it is to be applied to more than one purpose, the maximum amount of money to be appropriated to each purpose;
(3) the maximum rate or rates of interest to be accrued by the bonds, notes or any other instruments, which shall not exceed the maximum rate fixed by law or regulations;
(4) the date or dates of maturity of the notes, which shall not exceed the maximum terms of maturity fixed in §§ 6004 and 6005 of this title, and
(5) the date or dates of maturity of the bonds, which shall not exceed the maximum terms of maturity from the date of issue, which are fixed below:
Type of Bond Maturity General obligation bonds 25 General obligation bonds for the construction of affordable housing project 40 Revenue bonds 25 Special obligation bonds for capital improvements 25 Special obligation bonds for waste collection, disposal or conversion to energy systems 25 General or special obligation bonds to finance accrued budget deficits 30 Special obligation bonds for other purposes 15 Refinancing bonds (Shall not be greater than the term that applies to the type of bond to be refinanced).
(b) In the case of obligations evidenced by municipal general obligation bonds or notes, the ordinance or resolution shall also establish:
(1) That the municipality has the available loan margin and the capacity to pay, certified by the Government Bank, to incur the obligation; Provided, That it shall be understood, that capacity to pay shall mean that the deposits in the current account of the municipality in the Redemption Fund and the annual proceeds of the special surtax, according to Government Bank projections, shall be sufficient for the service of the outstanding bonds or notes and the bonds and notes to be issued until their respective maturity, and
(2) the provisions or agreements for the service of bonds or notes, including the levy of the special surtax, as provided in § 6016 of this title.
(c) In the case of obligations evidenced by revenue bonds, the ordinance shall also establish:
(1) The use and distribution of the revenues or income of the revenue generating project, including, but without being limited to the provisions for the payment of reserves, maintenance accounts and operating expenses, and for the maintenance of said project;
(2) the provisions for the municipality to transfer to the account or accounts of the revenue generating project, those amounts stipulated by the cost of leasing or otherwise providing the goods and services for said projects to the municipality or any of its departments or dependencies;
(3) the operation and maintenance of the revenue generating projects;
(4) the terms and conditions under which the holders of all or part of the revenue bonds, or the trustee of said bonds, shall have the right to have a trustee or a receiver appointed by a court of competent jurisdiction to take control of the operation and maintenance of the revenue generating project, and that the municipality may likewise do so, establish the rates, fees for services, rental rates, or any other corresponding charges or prices, and collect or manage the income of the revenue generating project;
(5) the terms and conditions under which the income of the revenue generating project shall be pledged for the service of the revenue bonds. Any pledge or assignment of said income shall be valid and effective without the need for any subsequent acts;
(6) the provisions for the Government Bank or a bank or trust company located in or outside the Commonwealth of Puerto Rico, to act as depositary of the pledged revenues of the revenue generating projects, and
(7) the provisions for the Government Bank or a bank or trust company located in or outside the Commonwealth of Puerto Rico, to act as registrar, countersigning agent and paying agent for the revenue bonds.
(d) In the case of obligations evidenced by special obligation bonds, notes or instruments, the ordinance or resolution shall also establish:
(1) The income or resources derived from one or more specific sources of income authorized by this chapter or any other Acts of the Commonwealth of Puerto Rico or of the United States of America, which are encumbered for the service of the special obligation bonds, notes or instruments, and
(2) the provisions for the Center to deposit the income or resources encumbered for the service of the special obligation bonds, notes or instruments in a special trust account or accounts, separate from other accounts of the municipality; and to authorize the paying agent designated by the municipality to pay said bonds, notes or instruments from the deposits in said special account or accounts.
(e) In the case of obligations evidenced by refinancing bonds, notes or instruments, the ordinance shall also establish:
(1) The bonds, notes or instruments to be refinanced and the total amount to be paid for principal, interest, premiums and other refinancing expenses;
(2) the backing or guarantee of the refinancing bonds, notes or instruments, and
(3) the provision that the bonds, notes or instruments to be refinanced shall not be deemed as outstanding bonds, notes or instruments for the purpose of determining the debt limits established in § 6015 of this title.
(f) In the case of obligations evidenced by notes or instruments in advance of taxes and revenues, the resolution shall also establish:
(1) The taxes, revenues or combination of taxes or revenues in advance of which the notes or instruments shall be issued or contracted, and
(2) the provisions for the establishment of a trust designated as the “Special Fund for the Payment of Notes or Instruments in Advance of Taxes or Revenues”, and for the deposit in said fund of the taxes and/or revenues in advance of the receipt of which the notes or instruments shall be issued or contracted up to the amount needed to pay the principal and interest on said notes or instruments. Unless they are needed for the service or redemption of the municipal general obligation bonds or notes or of the notes in advance of municipal general obligation bonds pursuant to § 6016 of this title, the deposits in said fund shall be applied exclusively to the service and redemption of the obligations evidenced by notes or instruments.
History —July 3, 1996, No. 64, § 9, renumbered as § 10 and amended on Aug. 12, 1997, No. 75, § 9.