1998 Minnesota Statutes

     475.60 Sale of bonds. 

    Subdivision 1.    Advertisement.  All obligations shall 
 be negotiated and sold by the governing body, except when 
 authority therefor is delegated by the governing body or by the 
 charter of the municipality to a board, department, or officers 
 of the municipality.  Except as provided in section 475.56, 
 obligations shall be sold at not less than par value plus 
 accrued interest to date of delivery.  Except as provided in 
 subdivision 2 all obligations shall be sold at public sale after 
 notice given at least ten days in advance by publication in a 
 legal newspaper having general circulation in the municipality 
 and ten days in advance by publication in a daily or weekly 
 periodical published in a Minnesota city of the first class, or 
 its metropolitan area, which circulates throughout the state and 
 furnishes financial news as a part of its service. 

    Subd. 2.    Requirements waived.  The requirements as to 
 public sale shall not apply to: 

    (1) obligations issued under the provisions of a home rule 
 charter or of a law specifically authorizing a different method 
 of sale, or authorizing them to be issued in such manner or on 
 such terms and conditions as the governing body may determine; 

    (2) obligations sold by an issuer in an amount not 
 exceeding the total sum of $1,200,000 in any 12-month period; 

    (3) obligations issued by a governing body other than a 
 school board in anticipation of the collection of taxes or other 
 revenues appropriated for expenditure in a single year, if sold 
 in accordance with the most favorable of two or more proposals 
 solicited privately; 

    (4) obligations sold to any board, department, or agency of 
 the United States of America or of the state of Minnesota, in 
 accordance with rules or regulations promulgated by such board, 
 department, or agency; 

    (5) obligations issued to fund pension and retirement fund 
 liabilities under section 475.52, subdivision 6, obligations 
 issued with tender options under section 475.54, subdivision 5a, 
 crossover refunding obligations referred to in section 475.67, 
 subdivision 13, and any issue of obligations comprised in whole 
 or in part of obligations bearing interest at a rate or rates 
 which vary periodically referred to in section 475.56; 

    (6) obligations to be issued for a purpose, in a manner, 
 and upon terms and conditions authorized by law, if the 
 governing body of the municipality, on the advice of bond 
 counsel or special tax counsel, determines that interest on the 
 obligations cannot be represented to be excluded from gross 
 income for purposes of federal income taxation; 

    (7) obligations issued in the form of an installment 
 purchase contract, lease purchase agreement, or other similar 
 agreement; 

    (8) obligations sold under a bond reinvestment program; and 

    (9) if the municipality has retained an independent 
 financial advisor, obligations which the governing body 
 determines shall be sold by private negotiation. 

    Subd. 3.    Published notice.  Published notice, where 
 required, shall specify the maximum principal amount of the 
 obligations, the place of receipt and consideration of bids and 
 such other details as to the obligations and terms of sale as 
 the governing body deems suitable.  The published notice shall 
 either specify the date and time for receipt of bids or provide 
 that the bids will be received at a date and time not less than 
 ten nor more than 60 days after the date of publication.  If the 
 published notice does not state the specific date or amount for 
 the sale, it shall specify the manner in which notice of the 
 date or amount of the sale will be given to prospective 
 bidders.  Notification of prospective bidders shall be given by 
 electronic data transmission or other form of communication 
 common to the municipal bond trade at least four days (omitting 
 Saturdays, Sundays, and legal holidays) before the date for 
 receipt of bids.  If within five days after the date of 
 publication a prospective bidder requests in writing to be 
 notified by mail, the municipality shall do so.  Failure to give 
 the notice as described in the preceding sentence to a bidder 
 shall not affect the validity of the sale or of the 
 obligations.  The governing body may employ an agent to receive 
 and open the bids at any place within or outside the corporate 
 limits of the municipality, in the presence of an officer of the 
 municipality or the officer's designee, but the obligations 
 shall not be sold except by action of the governing body or 
 authorized officers of the municipality after communication of 
 the bids to them.  Additional notice may be given for such time 
 and in such manner as the governing body deems suitable.  At the 
 time and place so fixed, the bids shall be opened and the offer 
 complying with the terms of sale and deemed most favorable shall 
 be accepted, but the governing body may reject any and all such 
 offers, in which event, or if no offers have been received, it 
 may award the obligations to any person who within 30 days 
 thereafter presents an offer complying with the terms of sale 
 and deemed more favorable than any received previously, or upon 
 like notice the governing body may invite other bids upon the 
 same or different terms and conditions, except that if the 
 original published notice does not state the specific date or 
 amount for the sale and if the material terms and conditions of 
 the sale remain the same, except for the date and amount, notice 
 of the date or amount may be given in the manner provided above. 

    Subd. 4.    Public subscription.  In lieu of calling 
 for bids, obligations may be sold on public subscription, after 
 notice given in the manner required for public sale.  Such 
 notice of call for public subscription shall specify the 
 interest rate and all terms of sale, including the date and 
 place of delivery of the obligations. 

    Subd. 5.    Compliance mandatory.  No contract for the 
 sale and delivery of obligations shall be enforceable unless 
 made in accordance with this section. 

    Subd. 6.    Prohibitions and penalties.  Any officer of 
 any municipality who shall enter into or approve any contract or 
 agreement for the sale of obligations contrary to the provisions 
 hereof or which lessens, restricts or tends to prevent 
 competitive bidding shall be guilty of a misdemeanor. 

    Subd. 7.    Investment of proceeds.  A municipality, 
 after it has contracted for the sale of obligations, may enter 
 into a contract for the future purchase of securities described 
 in section 118A.04, for a purchase price, including accrued 
 interest on it, not in excess of the sale price of the 
 obligations, excluding accrued interest on them.  The contract 
 shall provide a settlement date for the purchase of the 
 securities which is not earlier than the anticipated delivery 
 date of the obligations.  

    Subd. 8.    Continuing disclosure agreements.  Any 
 officer of a municipality charged with the responsibility of 
 issuing bonds for or on behalf of the municipality is authorized 
 to enter into written agreements or contracts relating to the 
 continuing disclosure of information necessary to comply with, 
 or facilitate the issuance of bonds in accordance with, federal 
 securities laws, rules and regulations, including securities and 
 exchange commission rules and regulations, section 240.15c2-12.  
 An agreement may comprise covenants with purchasers and holders 
 of bonds set forth in the resolution authorizing the issuance of 
 the bonds, or a separate document authorized by resolution. 

    HIST: 1949 c 682 s 10; 1965 c 583 s 1; 1971 c 903 s 4; 1976 c 
 324 s 9,10; 1978 c 764 s 128; 1980 c 607 art 8 s 3; 1982 c 523 
 art 3 s 3; 1984 c 563 s 5,6; 1Sp1985 c 14 art 8 s 54; 1986 c 465 
 art 2 s 21; 1987 c 344 s 31; 1988 c 702 s 11; 1989 c 355 s 
 21-23; 1991 c 342 s 17; 1995 c 256 s 28; 1996 c 399 art 2 s 12