Section 5.30 Revenue Obligations

• Library: Local Government Deskbook (2017 Ed.)

3. (§5.30) Revenue Obligations

The issuance of revenue bonds for limited purposes is provided for in article VI, §§ 27(a) and 27(b), of the Missouri Constitution. Section 27(a) authorizes cities, towns, or villages to issue these bonds, by a majority vote of the electors, for the purpose of paying all or part of the cost of purchasing, constructing, extending, or improving:

· revenue-producing water, gas, or electric light works, or heating or power plants; and

· airports.

The cost of operation and maintenance and the principal and interest on the bonds are payable solely from revenues derived from the operation of the utility or airport. Section 27(a).

Section 27(b) authorizes any city, town, or village, by a majority vote of the governing body (but not the electors), to issue revenue bonds to purchase, construct, extend, or improve any facility to be leased or otherwise disposed of to private persons or corporations for manufacturing, commercial, warehousing, and industrial development purposes. The payment of principal and interest on these industrial revenue bonds is to be derived from the lease or other disposal of the facility. Section 27(b). Article VI, § 27(c), of the Missouri Constitution defines revenue bonds as used in §§ 27(a) and 27(b) as bonds, although neither the principal nor interest is an indebtedness of the city, town, or village.

The provisions of article VI, §§ 27–27(c), of the Missouri Constitution differ considerably from those in §§ 26(a)–26(g) relating to general obligation bonds. No debt limit is prescribed, so the only limitations are the amounts that the governing body is willing to submit to the voters, the...