7-12-4203. Details relating to special improvement district bonds and warrants -- definitions of bond forms. (1) (a) The bonds and warrants must be drawn against the special improvement district fund created for the district and must bear interest from the date of registration until called for redemption or paid in full. Bonds or warrants sold at a private, negotiated sale may bear interest at a rate varying periodically at the time or times and on the terms determined by the governing body of the municipality. The terms determined by the governing body of the municipality may include the establishment of a maximum rate of interest or the convertibility to a fixed rate of interest.
     (b) Variable rate bonds may be sold at a private negotiated sale if the principal amount of the bonds is $500,000 or less and the governing body of the municipality obtains separate written opinions from underwriters of Montana special improvement district bonds stating the bonds are not marketable through a competitive bond sale. Bonds sold in principal amounts below $250,000 do not require a marketability opinion.
     (c) The interest must be payable annually or semiannually, at the discretion of the governing body of the municipality, on the dates that the governing body prescribes. The warrants or bonds must bear the signatures of the mayor and clerk and may bear the corporate seal of the city. The warrants or bonds must be registered in the office of the clerk and treasurer, and if interest coupons are attached to the warrants or bonds, they must also be registered and bear the signatures of the mayor and clerk.
     (2) The bonds must be in denominations of $100 or fractions or multiples of $100, may be issued in installments, and may extend over a period not to exceed 20 years or, if refunding bonds are issued pursuant to 7-12-4194, over a period ending not later than 30 years after the date that the bonds to be refunded were issued. For the purposes of this subsection, the term of a bond issue commences on July 1 of the fiscal year in which the city first levies assessments to pay principal and interest on the bonds.
     (3) As used in part 41 and this part, unless the context clearly indicates otherwise, the following definitions apply:
     (a) "Amortization bonds" means the form of bonds that bear interest at a fixed rate and on which:
     (i) a part of the principal must be paid each time that interest becomes payable;
     (ii) the part payment of principal increases at each installment in the same amount that the interest decreases;
     (iii) the combined interest and principal due on each due date remains the same until the bonds are paid;
     (iv) the final payment may vary from prior payments in the amount resulting from disregarding fractional costs in prior payments; and
     (v) the initial payment may be larger than subsequent payments if the increase represents interest accrued over an additional period not greater than 6 months.
     (b) "Serial bonds" means a bond issue payable in semiannual or annual installments commencing not more than 2 years from the date of issue, any one installment consisting of one or more bonds, with the principal amount of bonds maturing in each installment not exceeding five times the principal amount of the bonds maturing in the immediately preceding installment.

     History: En. Sec. 25, Ch. 89, L. 1913; amd. Sec. 8, Ch. 142, L. 1915; re-en. Sec. 5249, R.C.M. 1921; re-en. Sec. 5249, R.C.M. 1935; amd. Sec. 1, Ch. 23, L. 1937; amd. Sec. 1, Ch. 177, L. 1945; amd. Sec. 5, Ch. 260, L. 1959; amd. Sec. 17, Ch. 234, L. 1971; R.C.M. 1947, 11-2231(part); amd. Sec. 4, Ch. 165, L. 1979; amd. Sec. 3, Ch. 527, L. 1981; amd. Sec. 50, Ch. 665, L. 1985; (4)En. Sec. 51, Ch. 665, L. 1985; amd. Sec. 6, Ch. 256, L. 1989; amd. Sec. 10, Ch. 449, L. 1989; amd. Sec. 11, Ch. 459, L. 1997; amd. Sec. 8, Ch. 162, L. 2001.