South Carolina General Assembly
104th Session, 1981-1982

Bill 888


                    Current Status

Bill Number:               888
Ratification Number:       481
Act Number                 392
Introducing Body:          Senate
Subject:                   Authorize the Board of Trustees of the
                           Medical University of South Carolina to
                           acquire additional student and faculty housing
                           facilities
View additional legislative information at the LPITS web site.


(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

(A392, R481, S888)

AN ACT TO AUTHORIZE THE BOARD OF TRUSTEES OF THE MEDICAL UNIVERSITY OF SOUTH CAROLINA TO ACQUIRE ADDITIONAL STUDENT AND FACULTY HOUSING FACILITIES; TO EMPOWER THE BOARD OF TRUSTEES TO EFFECT LOANS FOR SUCH PURPOSES THROUGH THE ISSUANCE OF REVENUE BONDS AND ALSO FOR THE PURPOSE OF REFUNDING OUTSTANDING BONDS PAYABLE FROM THE REVENUE DERIVED FROM STUDENT AND FACULTY HOUSING FACILITIES; TO DEFINE THE PROCEDURE BY WHICH SUCH LOANS MAY BE EFFECTED AND THE COVENANTS AND UNDERTAKINGS TO SECURE THE LOANS; AND TO MAKE PROVISION FOR THE PAYMENT OF LOANS.

Be it enacted by the General Assembly of the State of South Carolina:

Findings of General Assembly

Section 1. Findings of General Assembly. The General Assembly finds that heretofore, and in pursuance of the authorization of Act 1059 of 1950, the board of trustees, hereafter called "the trustees", of The Medical University of South Carolina, hereafter called "Medical University", effected the issuance of one million dollars of dormitory revenue bonds dated October 1, 1952, for student housing facilities, which are secured by a pledge of the net revenues derived from such student and faculty housing facilities.

The enrollment at the Medical University has expanded steadily and continues to rise, making it apparent that there is a definite need for further facilities to house the expanding enrollment. Due consideration and investigation has been given to this need and to the method of raising monies to enable the trustees to construct such additional facilities.

It has, therefore, been determined to authorize, under the conditions herein set forth, additional bonds of the Medical University, payable from the revenues herein set forth, for the purposes and to the extent herein provided.

Additional student and faculty housing facilities authorized--bonds may be refunded

Section 2. Additional student and faculty housing facilities authorized--bonds may be refunded. The trustees are authorized to acquire additional student and faculty housing facilities and to improve and renovate existing student and faculty housing facilities to the extent they shall approve; and the proceeds of bonds authorized by this act are made available for that purpose. The trustees are also authorized to refund bonds that may from time to time be outstanding pursuant to this act by exchange or otherwise.

Borrow--use of proceeds

Section 3. Borrow--use of proceeds. Upon receiving the approval of the State Budget and Control Board and upon review of the Bond Review Committee created by Act 761 of 1976, the trustees shall be permitted to issue, from time to time, revenue bonds or notes, provided that not more than ten million dollars of such obligations may be outstanding at any one time. The trustees are also hereby authorized to refund all or any part of any outstanding revenue bonds of the Medical University payable in whole or in part from the revenues also pledged to the payment of bonds issued pursuant to this act and which are outstanding on the occasion of any such refunding. So much of the proceeds of the loans herein authorized as shall not be required to retire outstanding bonds shall be used in the construction, reconstruction, and equipping of dormitories and buildings designed for student and faculty housing, and auxiliary and related facilities, to be located on lands owned by the Medical University. Such buildings, when constructed, shall be used for the purpose of providing housing, and auxiliary and related facilities, for students and faculty of the Medical University.

Payment

Section 4. Payment. All bonds issued pursuant to this act shall be payable from the net revenues derived by the Medical University from the rental of all dormitories, student dwelling quarters and facilities, houses, residences, apartment buildings, from time to time used or designed for use as student and faculty housing, and all furniture, furnishings and equipment therein, which are now owned by the Medical University, or which may hereafter be acquired by the Medical University for any of such purposes; provided, that the trustees may abandon the use of any portion of the facilities or sell or dispose of any portion of the facilities upon the receipt of a written recommendation by the chief financial officer of the Medical University and approval of the Budget and Control Board and the Joint Bond Review Committee to the effect that such action will not adversely affect the ability of the Medical University to discharge its obligations to the holders of bonds issued pursuant to this act and upon such further conditions as shall be prescribed in the resolution of the trustees providing for the issuance of bonds. For purposes of this act the term "net revenues" shall mean that sum which remains from the gross revenues derived from the rental of housing facilities after deducting the amounts required in any given year for the operation and maintenance of such facilities.

Credit of State not to be pledged--trustees not liable

Section 5. Credit of State not to be pledged--trustees not liable. The faith and credit of the State of South Carolina shall not be pledged for the payment of the principal and interest of such bonds, and there shall be on the face of each bond a statement plainly worded to that effect. Neither the trustees nor any other person signing the bonds shall be personally liable therefor.

Trustees to adopt resolutions concerning bonds--maturity--interest- -denominations--redemption

Section 6. Trustees to adopt resolution concerning bonds- -Maturity--interest--denominations--redemption. In order to avail themselves of the authorizations set forth in this act, the trustees shall adopt resolutions providing for the issuance of bonds of the Medical University, within the limitations herein mentioned, which resolutions shall prescribe the tenor, terms, and conditions of such bonds. Such bonds shall be issued as serial bonds, maturing in equal or unequal amounts, at such times and on such occasions as the trustees shall determine. Provided, always, that the last maturing bonds of any issue shall be expressed to mature not later than forty years from their date, and the first maturing bonds of any issue, issued pursuant to this act, shall fall due within five years from their date. They shall bear such rates of interest, payable on such occasion, as the trustees shall prescribe, and the bonds shall be in such denominations, shall be payable in such medium of payment, and at such place as such resolutions shall prescribe. All bonds may be issued with a provision permitting their redemption on any interest payment date prior to their respective maturities as the trustees shall prescribe. Bonds made subject to redemption prior to their stated maturities may contain a provision requiring the payment of a premium for the privilege of exercising the right of redemption, in such amount or amounts as the trustees shall prescribe in the resolutions authorizing their issuance. All bonds subject to redemption shall contain a statement to that effect on the face of each bond. The resolutions authorizing their issuance shall contain provisions specifying the manner of call and the notice of call that must be given.

Form

Section 7. Form. Such bonds may be in the form of negotiable coupon bonds, payable to bearer, with the privilege to the holder of having them registered on the books of a registrar to be named, and the principal thus made payable to the registered holder, unless the last registered transfer shall have been to bearer, upon such conditions as the trustees may prescribe, or such bonds may be issued as fully registered bonds. If issued as fully registered bonds, it may be provided that they may thereafter be converted into negotiable coupon bonds of the tenor described above.

Exempt from taxes

Section 8. Exempt from taxes. The bonds authorized by this act and all interest to become due thereon shall be exempt from taxation in the State of South Carolina as provided in Section 12-1-60 of the 1976 Code.

Certain persons may purchase bonds

Section 9. Certain persons may purchase bonds. It shall be lawful for all executors, administrators, guardians, and fiduciaries, all sinking fund commissions, and the State Budget and Control Board as Trustee of the South Carolina Retirement System, to invest any monies in their hands in such bonds.

Execution

Section 10. Execution. Such bonds and the coupons, if any, attached to such bonds, shall be executed in the name of the Medical University in such manner and by such persons as the trustees shall from time to time determine, and the seal of the Medical University shall be affixed to or impressed on each bond. Any coupons attached to such bonds shall be authenticated by the facsimile signature of one or more of the persons signing the bonds. The delivery of the bonds so executed shall be valid notwithstanding changes in officers or seal occurring after such execution.

Sale

Section 11. Sale. The bonds shall be disposed of in such manner as the trustees shall determine, except that no sale, privately negotiated without public advertisement, shall be made unless the approval of the State Budget and Control Board shall be obtained. If the trustees shall elect to sell the bonds at public sale, at least one advertisement thereof shall appear in some newspaper of general circulation in South Carolina not less than ten days prior to the occasion fixed for the opening of bids.

Powers and duties of trustees

Section 12. Powers and duties of trustees. To the end that the payment of the principal and interest of the bonds authorized hereby shall be adequately secured, the trustees shall be empowered in their discretion:

1. To issue bonds in such amount, within the limitations herein provided, as the trustees shall deem necessary, provided, that it shall be lawful for the trustees to use a portion of the principal proceeds derived from any sale of bonds, except bonds issued to effect refunding of outstanding bonds, to meet the payment of interest on such bonds for a period of one year, it being recognized by the General Assembly that until the facilities to be constructed with the proceeds of the loan shall be completed, an undue burden may be imposed upon then existing revenues.

2. To pledge the entire revenues specified in Section 2 of this act, for the payment of the principal of and interest on the bonds as they respectively mature.

3. To covenant that no housing facilities owned by the Medical University will be used free of charge, or to specify and limit the facilities which may be made use of free of charge.

4. To covenant to establish and maintain such system of rules as will insure the continuous use and occupancy of the facilities, whose revenues are pledged to secure any bonds.

5. To covenant that an adequate schedule of charges will be established and maintained for all the facilities, whose revenues shall be pledged to secure any bonds, to the extent necessary to produce sufficient revenues to:

(a) Pay the cost of operating and maintaining the facilities including the cost of fire, extended coverage and occupancy insurance;

(b) Pay the principal and interest of the bonds as they respectively become due;

(c) Create and at all times maintain an adequate Debt Service Reserve Fund to meet the payment of such principal and interest;

(d) Create and at all times maintain an adequate reserve for contingencies, and for major repairs and replacement.

6. To covenant against the mortgaging or disposing of the facilities, whose revenues shall be pledged for the payment of such bonds, and against permitting or suffering any lien to be created thereon, equal or superior to the lien created for the benefit of such bonds; provided, always, that the trustees shall be empowered to discontinue the use of, or demolish, obsolete facilities and to reserve the right, under such terms as they shall prescribe, to issue additional bonds on a parity with the bonds authorized by this act.

7. To covenant as to the use of the proceeds derived from the sale of any bonds issued pursuant to this act.

8. To provide for the terms, form, registration, exchange, execution, and authentication of bonds, and for the replacement of lost, destroyed, or mutilated bonds.

9. To make covenants with respect to the use of facilities to be constructed with the proceeds of the bonds authorized hereby, and of the other facilities, whose revenues shall be pledged for the payment of the bonds.

10. To covenant that all revenues pledged for the payment of the bonds shall be duly segregated into special funds, and that such funds will be used solely for the purposes for which they are intended and for no other purpose.

11. To covenant for the mandatory redemption of bonds on such terms and conditions as the resolutions authorizing such bonds shall prescribe.

12. To prescribe the procedure, if any, by which the terms of the contract with the bondholders may be amended, the number of bonds whose holders must consent thereto, and the manner in which such consent shall be given.

13. To covenant as to the maintenance of the facilities, whose revenues shall be pledged for the payment of the bonds, the insurance to be carried thereon, and the use and disposition of proceeds from any insurance policy.

14. To prescribe the events of default and the terms and conditions upon which all or any bonds shall become or may be declared due before maturity, and the terms and conditions upon which such declaration and its consequences may be waived.

15. To impose a statutory lien upon the facilities, whose revenues shall be pledged to secure the bonds. Such lien shall extend to such facilities, to their appurtenances and extensions, to their additions, improvements, and enlargements to the extent specified in the resolutions and shall insure to the benefit of the holders of the bonds secured thereby. Such facilities shall remain subject to such statutory lien until the payment in full of the principal and interest of the bonds. Any holder of any of the bonds, or any of the coupons representing interest thereon, may, either at law or in equity, by suit, action, mandamus, or other proceedings, protect and enforce the statutory lien, and may, by suit, action, mandamus, or other proceedings enforce and compel performance of all duties of the trustees, including the fixing of sufficient rates, the proper segregation of the revenues, and the proper application thereof. Provided, however, that the statutory lien shall not be construed to give any such bond or coupon holder authority to compel the sale of any of the facilities, or any part thereof.

16. To covenant that if there be any default in the payment of the principal of or interest upon any of the bonds, any court having jurisdiction in any proper action may appoint a receiver to administer and operate the facilities, whose revenues shall be pledged for the payment of such bonds, with power to fix rates and charges for the facilities, sufficient to provide for the payment of the expense of operating and maintaining such facilities, and to apply the income and revenues of such facilities to the payment of such bonds, and the interest thereon.

17. To establish on or before the occasion of the delivery of any bonds issued pursuant to this act a debt service reserve fund and to cause the same to be deposited with a corporate trustee and, to that end, the trustees shall be empowered to utilize any monies available for such purpose, including revenues previously accumulated from the facilities prior to the issuance of bonds.

No time limit set on issuance of bonds

Section 13. No time limit set on issuance of bonds. The authorizations granted by this act shall remain in full force and effect until they shall be rescinded by subsequent enactment, and no time limit is set for the issuance of bonds pursuant to this act.

Analysis lines

Section 14. Analysis lines. The analysis lines included after each section number are for informational purposes only and shall not be deemed to be part of the sections themselves.

Time effective

Section 15. This act shall take effect upon the approval by the Governor.