School Laws of Oklahoma
Chapter 3 - Bonds
Article II: Bonds
Section 599. Authority For Bond - Fiscal Year Limits. (Article X, § 26, Oklahoma Constitution)
(a) Except as herein otherwise provided, no county, city, town, township, school district, or other political corporation, or subdivision of the State, shall be allowed to become indebted, in any manner, or for any purpose, to an amount exceeding, in any year, the income and revenue provided for such year without the assent of three-fifths of the voters thereof, voting at an election, to be held for that purpose, nor, in cases requiring such assent, shall any indebtedness be allowed to be incurred to an amount, including existing indebtedness, in the aggregate exceeding five percent (5%) of the valuation of the taxable property therein, to be ascertained from the last assessment for State and county purposes previous to the incurring of such indebtedness: Provided, that if a school district has an absolute need therefor, such district may, with the assent of three-fifths of the voters thereof voting at an election to be held for that purpose, incur indebtedness to an amount, including existing indebtedness, in the aggregate exceeding five percent (5%) but not exceeding ten percent (10%) of the valuation of the taxable property therein, to be ascertained from the last assessment for state and county purposes previous to the incurring of such indebtedness, for the purposes of acquiring or improving school sites, constructing, repairing, remodeling or equipping buildings, or acquiring school furniture, fixtures or equipment; and such assent to such indebtedness shall be deemed to be a sufficient showing of such absolute need, unless otherwise provided by law. * * * Provided further, that any county, city, town, school district, or other political corporation, or subdivision of the state, incurring any indebtedness requiring the assent of the voters as aforesaid, shall, before or at the time of doing so, provide for the collection of an annual tax sufficient to pay the interest on such indebtedness as it falls due, and also to constitute a sinking fund for the payment of the principal thereof within twenty-five (25) years from the time of contracting the same, and provided further that nothing in this section shall prevent, under such conditions and limitations as shall be prescribed by law, any school district from contracting with:
(1) certificated personnel for periods extending one (1) year beyond the current fiscal year; or
(2) a school superintendent for periods extending more than one (1) year, but not to exceed three (3) years beyond the current fiscal year. * * * * *
Note: See Section 55 for provisions regarding multi-year contracts for Superintendents.
A school district may not lawfully use proceeds of general obligation bonds to make an installment under a lease purchase agreement where the principal amount of the transaction is increased in lieu of interest, i.e., the lease includes no component for interest, but the principal amount is increased to compensate the lessor. A school district cannot do indirectly what it is prohibited from doing directly and such a structure would violate Okla. Const. art. X, § 26. December 19, 2007 (AG Op. No. 07-42)
The Oklahoma Constitution prohibits limitation of liability clauses in all state contracts, whether for goods or services, unless at the time the contract is executed funds have been appropriated and encumbered to pay for any contingent liability which might arise. Further, a limitation of liability clause which creates an unfunded contingent liability is void as against public policy. April 14, 2006, (AG Op. No. 06-11).
Oklahoma school districts lack the legal authority to enter into “swap or derivative financial product” agreements, as that power is beyond that necessary or implied to carry out the powers expressly granted to school districts. November 28, 2005 (AG Op. No 05-43)
Const. X §26 and 70 O.S. 5-117 Nonappropriation addenda purporting to extend contract beyond current fiscal year is not sufficient to ratify or confirm renewal or extension for lease of photocopiers. District not liable for any payments owed or unpaid where unratified. Where school district accepted benefits of use of copier and vendor accepted payment, the parties mutually confirmed contract extensions. GE Capital Information Technology Solutions v. OKCPS, 2007 OK CIV APP 117
Not every contract entered into by a municipality qualified as a §26 debt. Contract with auditor, especially when funds are shown to be available to pay for services rendered, does not qualify as a § 26 debt. Fleming & Gandall, PLLC v. Town of Cashion, 2007 OK CIV APP 74, 167 P.3d 975
A debt is a promise to pay a certain amount, with interest, within a fixed time out of taxes collected. Where contract allowed for reduction of amount owed to school district based on amount of state aid collected for number of students, such reduction was not a debt for purposes of constitutional debt limitation. Southern Corrections Systems, Inc. v. Union City Public Schools, 2002 OK 93, 64 P.3d 1083.
Recovering an overpayment of state aid does not impose the type of obligation prohibited by the constitutional debt limitations. ISD No. 20 of Muskogee County v. Okla. State Dept. of Education, 2003 OK 18, 65 P.3d 612.
Contract between engineers and city which has a contingent debt violates Art. X, §26 because it creates an obligation in one fiscal year which results in a debt in a succeeding fiscal year. Wyatt-Doyle & Butler Engineers, Inc. v. City of Eufaula, 13 P.3d 474, 2000 OK 74.
Debt is incurred when bonds are voted on, issued, approved, and delivered; voters may authorize an amount of bonded indebtedness in excess of 10% of assessed valuation but bonded indebtedness may only be incurred up to constitutional limit. April 5, 2002 (AG Op. No. 02-14)
Contract which contains an exculpatory or indemnity provision violates constitutional provision regarding creation of debt unless funds have been appropriated to cover the obligation at the time the contract was made. January 26, 2001 (AG Op. No. 01-2)
School district may not use current year monies to fund payments to employees for unpaid benefits under the Flexible Benefits Allowance Act which accrued in prior fiscal year. May 22, 2000 (AG Op. No. 00-29)
Early retirement incentive plan which was ratified annually by board of education did not violate constitutional fiscal year limitations. Matter of Tax Protest of Steve Beebe, 1999 OK CIV APP 69, 986 P.2d 525
Fiscal year limitations prevent school district from entering into agreements for periods in excess of one fiscal year unless three-fifths of voters of school district approve. School district may enter into lease for one fiscal year or less with an option to renew in future years to be exercised at the discretion of the school district. November 10, 1999 (AG Op. No. 99-73)
Fiscal year limitations do not apply to state’s obligation to recoup overpayment of state aid through reductions of future state aid and does not prevent State Department of Education from such recoupment. July 20, 1999 (AG Op. No. 99-36)
An interest-free loan to a municipality which is forgiven in certain amounts until completion of a 10 year contract is a debt that is prohibited by Article X, § 26 of the Oklahoma Constitution regardless of the fact that the municipality may never have to repay the balance. At the time the agreement is created, it creates an indebtedness that is to be repaid beyond the current fiscal year. June 30, 1997 (AG Op. No. 97-47)
If school district refuses to make payment owed to county assessor for revaluation expense, county assessor may bring mandamus action during fiscal year to compel school district to include the expense in its budget and to compel it to make immediate payment. Once fiscal year in which expense was incurred has ended, county assessor must obtain a judgment for the expense in order to compel school district to budget expense and pay such judgment. Clay v. ISD No. 1 of Tulsa Co., 935 P.2d 294 (Okla. 1997)
Contract of city manager which straddled two fiscal years violated Article X, § 26. There was no exception for city manager as for teachers. City of Bixby v. State ex rel. Dept. of Labor, 934 P.2d 364 (Okla. App. 1996)
The issuance of refunding bonds concurrent with the cancellation or retirement of outstanding obligations without approval of the electorate does not violate Art. X Sec. 26 of the Oklahoma Constitution. The issuance of refunding bonds and the placement of the proceeds thereof in escrow for the retirement of the outstanding obligations at a later date, otherwise known as “advanced refunding,” does not violate Art. X., Sec. 26 subject to the specific constraints. December 10, 1985 (AG Op. No. 85-184)
Constitution bars claim against school district for utility service attributable to previous fiscal year. May 14, 1981 (AG Op. No. 81-51)
Constitution prohibits contract of employment to have effect beyond fiscal year immediately following current fiscal year in which decision to reemploy is made or taken effect by operation of law. November 6, 1980 (AG Op. No. 80-272)
Bonds may be issued for more specific purposes than those enumerated in Constitution, provided special purpose falls within general purpose set out in Constitution. March 5, 1976 (AG Op. No. 76-145)
Contract seeking to bind school district’s revenues to succeeding fiscal year is void. ISD No. 1 v. Howard, 336 P.2d 1097 (Okla. 1959)
Debt limit of five percent can be exceeded for purchase of transportation equipment. Dependent School District No. 13 v. Williamson, 325 P.2d 1045 (Okla. 1958)
Proceeds of bonds issued to erect school building, improve school site and purchase equipment may be used to purchase building and move it to another site and equip it for a gymnasium. June 28, 1957
Constitutional provision which limits school district’s indebtedness at five percent of its assessed valuation is a limitation on incurring of new indebtedness but is not a limitation to annexing district’s absorbing of assets and liabilities of annexed territory. ISD No. 1 v. Williamson, 262 P.2d 701 (Okla. 1953)
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Section 600. Bond Commissioner. (62 O.S. § 11)
The Attorney General is hereby made exofficio Bond Commissioner of the State of Oklahoma.
Section 601. Forms and Procedure - Certificate. (62 O.S. § 13)
It shall be the duty of the Bond Commissioner to prepare uniform forms and prescribe a method of procedure under the laws of the state in all cases where it is desired to issue public securities or bonds, in any county, township, municipality or political or other subdivisions thereof of the State of Oklahoma; and it shall be the further duty of said Bond Commissioner to examine into and pass upon any security so issued, and such security, when declared by the certificate of said Bond Commissioner to be issued in accordance with the forms of procedure so provided shall be incontestable in any court in the State of Oklahoma unless suit thereon shall be brought in a court having jurisdiction of the same within thirty (30) days from the date of the approval thereof by the Bond Commissioner.
Taxpayers can contest bond election either before bond commissioner approves issuance of bonds or within 30 days of bond commissioner’s approval. Dean v. Wes Watkins Area Vocational Technical Sch. Dist., 782 P.2d 116 (Okla. 1989)
Section 602. Bond Invalid Without Certificate. (62 O.S. § 14)
No bond hereafter issued by any political or municipal subdivision of this State shall be valid without the certificate of said Bond Commissioner.
Section 602.1. Issuance of Bonds: Attorney General’s Duties. (62 O.S. § 15)
A. In all stages of proceedings leading to the issuance and sale of general obligation bonds pledging the full faith and credit of the state, it shall be a duty of the Attorney General to perform all necessary legal work incident thereto. Neither the Attorney General nor any other officer of the state may use any public funds to pay for the services of a private attorney or consulting fee in connection with such work. Neither the Attorney General nor Assistant Attorney General shall receive any remuneration, other than salary, for legal services performed in proceedings leading to the issuance and sale of bonds as provided in this act. If a marketing opinion is desired, the bond buyers shall pay for its procurement.
B. In all proceedings leading to the issuance and sale of revenue bonds by any state agency acting pursuant to a specific legislative validating act, a private attorney or attorneys may be employed when the legislative validating act does not prohibit such employment. The employment contract with the private attorney or attorneys shall be filed of record with the Attorney General. In no case shall the employed private attorney be paid a fee in excess of that authorized in the validating act. In addition, the Attorney General is authorized to charge an examination fee for review and approval of revenue bond or note proceedings, as provided for in subsection E of this section. If a marketing opinion is desired, the bond buyers shall pay for its procurement.
C. In all proceedings leading to the issuance and sale of general obligation bonds or revenue bonds by any state agency acting pursuant to a specific legislative validating act, any financial or marketing consultant employed by the state for services relative to the marketing of such bonds shall not be paid a fee in excess of that authorized in the validating act.
D. Except for the provisions of subsection E of this section, nothing herein shall apply to legal proceedings leading to the issuance or sale of bonds pursuant to Article X, Sections 26, 27 and 35 of the Oklahoma Constitution or to any obligation issued by public trusts under the Public Trust Act (except those trusts created by the state as contrasted to its subdivisions or other governmental entities), the Interlocal Cooperation Act and the Local Industrial Development Act.
E. In all proceedings leading to the issuance and sale of revenue bonds or notes by any state agency, or the issuance and sale of general or limited obligation bonds pledging the faith and credit, whether general or special, of the state or any political subdivision thereof, where the Attorney General is required by law to review such proceedings, the Attorney General is authorized to charge and collect a nonrefundable examination fee, payable at the time the proceedings are finally approved and bonds or notes are delivered. The issuer may reimburse itself for the examination fee from the proceeds of the bond or note issue. Such examination fee shall not exceed the following amounts:
1. Three one-hundredths of one percent (0.03%) of the first Five Million Dollars ($5,000,000.00) of the principal amount of bonds or notes issued; and
2. Two one-hundredths of one percent (0.02%) of any principal amount of bonds or notes issued in excess of Five Million Dollars ($5,000,000.00), up to and including Fifty Million Dollars ($50,000,000.00); and
3. One one-hundredth of one percent (0.01%) of any principal amount of bonds or notes in excess of Fifty Million Dollars ($50,000,000.00).
All fees collected as authorized by this subsection shall be deposited in the Attorney General’s Revolving Fund created in Section 20 of Title 74 of the Oklahoma Statutes.
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Section 603. Approval of Bonds. (Article 10, § 29, Oklahoma Constitution)
No bond or evidence of indebtedness of this State shall be valid unless the same shall have endorsed thereon a certificate, signed by the Auditor and Attorney General of the State, showing that the bond or evidence of debt is issued pursuant to law and is within the debt limit. No bond or evidence of debt of any county, or bond of any township or any other political subdivision of any county, shall be valid unless the same have endorsed thereon a certificate signed by the County Clerk, or other officer authorized by law to sign such certificate, and the County Attorney of the county, stating that said bond, or evidence of debt, is issued pursuant to law, and that said issue is within the debt limit.
Section 604. Bonds - Maturity - Installments - Contract. (62 O.S. § 353)
A. Except as provided for in subsection B of this section, whenever any municipal corporation or political subdivision of this state shall vote any bonds or issue any funding or refunding bonds, such bonds, or combined issue of bonds referred to in Section 354 of this title shall be made to mature in equal annual installments, beginning not less than two (2) nor more than five (5) years after their date, except that the first maturing installment may be for such sum, not more than one installment and the last maturing installment may be for such sum not more than two installments, as will complete the full issue of such bonds notwithstanding the necessity of varying the amount thereof to complete the same.
B.
1. Whenever any municipal corporation or political subdivision of this state shall vote any bonds or issue any funding or refunding bonds, such bonds, or combined issue of bonds referred to in Section 354 of this title, may be made to mature pursuant to a schedule of annual installments which allows the bonds to be structured with level debt service payments. Such bonds shall mature beginning not less than two (2) years nor more than five (5) years after their date.
2. For purposes of this subsection:
a. “level debt service” means that net total annual or fiscal debt service, except for short or stub periods, must be approximately equal for every annual or fiscal period, provided that all net annual or fiscal payments must be within a dollar amount range not to exceed the greater of two tenths of one percent (0.2%) of the bond issue or twice the stated denomination of the bonds, and
b. “short or stub periods” means the period preceding the beginning of full amortization of principal and payment of interest.
C. For purposes of subsections A and B of this section, a mandatory sinking fund redemption amount shall be deemed to be a maturity or maturing installment.
D. The denomination of bonds issued pursuant to the provisions of this section shall be One Thousand Dollars ($1,000.00) or multiples thereof, except the first numbered bond may be for such odd amount as will complete the full issue of the bonds. Provided, when a book entry system is utilized, the issuer may issue and deliver one bond only, for the entire principal amount of each maturity or of the entire issue, to the book entry agent.
Section 605. Municipal Corporations - Sale of Bonds - Notice - Bids. (62 O.S. § 354)
A. Whenever any municipal corporation or political subdivision of the State of Oklahoma shall by separate propositions vote bonds for two or more purposes, the governing body thereof may combine and offer for sale in one issue of bonds all of the purposes so voted, and shall set out in the ordinance or resolution providing for the issuance of the bonds and in the printed bond for the combined purposes the amount authorized to be expended for each purpose as set out in each proposition submitted and approved by the electors, and the bonds may be designated general obligation bonds or as may be determined by the governing board of the municipal corporation or political subdivision.
B. When one or more issues of bonds, including a combined bond issue referred to herein, except funding or refunding bonds, shall be made or ordered by any county, city, town, board of education, school district, or other political subdivision of the state, the proper officers shall, before selling such bonds cause at least ten (10) days’ notice to be given of the time and place when and where bids therefor will be received and the methods by which bids may be submitted, which, in the discretion of the governing body, may be by sealed bid, facsimile bid, electronic mail bid or other bidding method. Such notice shall be signed by the county clerk if issued by a county, and by the clerk of any city, town, board of education, school district, or other subdivision of the state, as the case may be, and shall be published once a week for two (2) consecutive weeks in a legally-qualified newspaper published in such political subdivision and if there be no such newspaper then in a legally-qualified newspaper of general circulation in such political subdivision. The date mentioned in such notice for the sale of such bonds shall not be less than ten (10) days after the first publication thereof. In the event a municipal corporation or political subdivision has by separate propositions voted bonds for two or more purposes, the proper officers shall set out in such notice of sale whether bids will be received for a combined bond issue for all of such purposes as one unit, or bids will be received for separate bond issues for each purpose.
C. All bonds shall be sold to the bidder who shall stipulate in the bid the lowest interest cost which such bonds shall bear which, at the option of the governing body, may be determined based on true interest cost. Upon the acceptance of such bid, the bonds shall be issued in accordance therewith and shall be delivered to the purchaser upon payment of the purchase price thereof. Each bidder shall submit with the bid a sum in cash, cashier’s check, surety bond or similar security undertaking as stipulated by the governing body, equal to two percent (2%) of the principal amount of the bond issue, and upon the acceptance of any bid, such deposit shall become the property of the county, or municipality selling the bonds, and shall be accredited on the purchase price thereof, upon the understanding that if the purchaser shall fail for five (5) days after tender of the bonds to pay the balance of the purchase price, the sale shall be thereby annulled and the deposit shall in such event be retained by the governing body of such county or municipality and credited to the account for which such bonds are being issued and shall be used accordingly. No tender of the bonds shall be valid until after the expiration of the period of contestability, as provided by law. All other deposits shall be returned. The governing body, selling such bonds, shall have the right to reject all bids and readvertise the bonds for sale. No funding or refunding bonds issued hereunder shall bear a higher rate of interest than the indebtedness which is funded or refunded.
D. The provisions of Section 351 et seq. of this title shall not apply to sale of bonds issued by a vote of the people to the United States Government, or any agency thereof, and the governing board of a municipal corporation or political subdivision of the state is hereby authorized to sell such bonds to the United States Government or any agency thereof at a private sale for a sum of not less than par with accrued interest added, and the governing board shall fix the rate of interest which such bonds shall bear which shall not be a larger rate of interest than that authorized by the electors voting at the bond election.
Under constitution, municipal corporation has no authority to contract indebtedness payable out of a fund before the fund is provided. Municipality may lawfully contract indebtedness payable from bond fund only when the bond issue arises from exchange for liability upon bonds. Municipal bonds are “issued” when control and possession pass from the municipality to purchaser or person in whose hands they become a claim against the municipality; furthermore, though authorized and executed, bonds do not become obligatory and operative until delivered. McMasters v. Town of Byars, 223 P.2d 545 (Okla. 1950)
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Section 606. Bidders - Persons Forbidden to Bid on Bonds. (62 O.S. § 355)
No person, firm or corporation, who shall represent the county, city, town, board of education, school district, or other subdivision of the State of Oklahoma, in the preparation or handling of such bond issue, or the proceedings incident thereto, in any manner, shall be permitted to bid for or become the purchaser of such bonds upon sale thereof, or be interested in any bid submitted at the sale of said bonds, and no bidder shall be interested in any proceedings contract.
Section 607. Bonds - Permission to Sell - Manner of Sale. (62 O.S. § 356)
The governing board of any county, city, town, school district, township, and other municipal subdivisions of this state is hereby permitted to sell bonds heretofore and hereafter voted upon and authorized by a vote of the qualified electors of the respective municipalities in such amounts as the governing board of said municipalities may deem necessary and proper. The sale of said bonds shall be in the manner now provided by law.
Section 608. Signing and Attestation of Bonds - Certificates. (62 O.S. § 358)
All general obligation bonds including funding and refunding bonds issued by a county, city, town, township, board of education or school district shall be signed by the chief officer of such municipality or political subdivision attested by the clerk. Facsimile signatures may be used as provided in the Registered Public Obligations Act of Oklahoma. There shall be endorsed thereon a certificate signed by the district attorney and county clerk of the county in which such issuing municipality or political subdivision is located that said bonds or evidence of debts are issued pursuant to law and that said issue is within the debt limit. There shall be contained on each of said bonds a certificate of the treasurer of the issuing municipality or political subdivision that he registered the said bonds.
Section 609. Bond Issued - Payment of Expenses. (62 O.S. § 359)
The governing board of any county, city, town, school district or any other political subdivision of the state is hereby authorized to pay all expenses incident to the issuance of any general obligation bonds, including fees for legal or other assistance in the preparation of proceedings therefor, same to be paid from the proceeds of such bonds, or from any other monies legally available.
Section 610. Sinking Fund - Computation. (62 O.S. § 399)
It shall be the duty of every county, city, town, township, the board of education of any city, and of every school district, issuing bonds under this article, and of the proper officers thereof, to create a sinking fund; and there shall be levied by the proper officers, annually, a sufficient tax therefor for the redemption of such bonds, which shall be collected as other taxes, and paid into the treasury as provided by law for other taxes, and shall remain as a specific fund for the redemption of said bonds; and amount of which sinking fund shall be as follows: In every instance in which bonds shall be issued under this article, for twenty (20) years or less, the quotient found by dividing the amount of the principal of such bonds by such number of years shall be the amount of sinking fund to be levied each year for the redemption of such bonds; but in every instance in which such bonds shall be issued for more than twenty (20) years, it shall not be necessary to create a sinking fund, or to levy a tax therefor, until the twentieth year prior to maturity of such bonds, at which time, and each year thereafter one-twentieth (½0) of the principal amount of such bonds shall be levied as a sinking fund for the redemption of such bonds: Provided, that any county, city, town, township, the board of education of any city, or any school district, issuing bonds under this Article, may buy in and cancel any such bonds whenever the same can be done at or below par: Provided, further, that such sinking fund, when not required for the payment or purchase of bonds, may be invested in bonds of the United States or of the State of Oklahoma, and in no other manner: And provided, further, that under the provisions of this Article, the proper officers are authorized, if desirable, to issue installment bonds, running twenty-five (25) years, having coupons attached, representing the semiannual interest to become due thereon; and each coupon attached to any installment bond shall, after five (5) years from its date, represent one-fortieth (1/40) of its principal, which amount shall be shown by separate words and figures aside from the interest represented in the coupon; and each installment bond shall show upon its face that its principal is included in its coupons
Bonded indebtedness represents long-term debt. General fund revenues may not be used to pay off bonded indebtedness or as a substitute for the statutory process to retire bonded indebtedness. April 5, 2002 (AG Op. No. 02-14)
When a board of education determines that the projects for which a bond issue was voted have been completed, the money remaining in the bond fund must be transferred to the sinking fund, which may be used to pay judgments against the school district if there is a compliance with statutory requirements. AG Op. March 8, 1967
The number of levies for sinking fund purposes depends upon the date of issuance and maturity of the bonds and is equal to the number of fiscal years intervening between the date of the issuance and the date of maturity of the bonds in which a tax levy may be made and the tax levy collected. In re Gypsy Oil Co., 285 P. 67 (Okla. 1929)
Section 611. Payment. (62 O.S. § 400)
Whenever the bonds or interest coupons issued under Sections 391 et seq. of this title, shall become due, they shall be, on presentation of coupon bonds, promptly paid by the proper disbursing officer, out of the money in his hands collected for that purpose; and he shall endorse upon the face of any bond or coupon paid by him, in red ink, the word “paid”, and the date of payment, and sign his name thereto, and at each settlement he shall turn over the bonds and coupons so paid and canceled, which shall be carefully preserved or destroyed Provided however, the presentation of a registered bond shall not be required for payment of interest thereon when payment of interest is otherwise provided by the terms of the bond.
Bonded indebtedness represents long-term debt. General fund revenues may not be used to pay off bonded indebtedness or as a substitute for the statutory process to retire bonded indebtedness. April 5, 2002 (AG Op. No. 02-14)
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Section 612. Penalty for Misappropriation. (62 O.S. § 401)
Any person who shall appropriate or use, or aid or abet in appropriating or using, any of the funds or monies mentioned in this Article, for any other purpose than as in this Article, provided, shall be deemed guilty of a misdemeanor, and on conviction thereof shall be fined in a sum equal to the amount of money so appropriated or used, and imprisoned in the county jail for not less than three (3) nor more than twelve (12) months, and shall also be liable in a civil action for the amount so misappropriated or used, to be prosecuted by any such bond holder or other party entitled thereto.
Section 613. Coupons Receivable for Taxes. (62 O.S. § 402)
The interest coupons provided for in this article, shall, as fast as they become due, be receivable in payment of taxes due to the particular county, city, town, the board of education of any city, the township or school district, which may have issued such coupons, and shall be received by all collecting officers the same as cash, in payment of such taxes.
Section 614. Cancellation. (62 O.S. § 403)
All county, township and other municipal bonds on which final judgment shall hereafter be rendered by any court of record in this state shall be canceled in open court, and returned by the clerk of such court to the clerk of the proper municipality.
Section 615. Sales of Bonds Must Net Par Value and Interest. (62 O.S. § 351)
It shall be unlawful for any board of county commissioners, governing body of any municipality or school district or any other officer of any such political subdivision of this state, to sell, agree to sell or contract to sell any bonds issued by a vote of the people for any sum less than ninety-nine percent (995) of the face amount thereof with accrued interest added, and any and all commission allowed any firm, person or corporation for the sale of such bonds must, after being deducted from the sum total for which said bonds are sold, leave in the treasury the sum equal to at least ninety-nine percent (995) of the face value of the bonds and accrued interest thereof.
Section 616. Violation By Public Officers - Penalties. (62 O.S. § 352)
Any member of any board of county commissioners, any member of any governing body of a municipality or school district, and any other officer of any of the aforesaid political corporations or subdivisions of this state, or any other officer of any political subdivision of this state, who shall sell, or agree to sell, or contract to sell at less than par, any bonds of his respective county, city, town, township, school district, or other political corporation or subdivision, shall be guilty of a misdemeanor, forfeit and be removed from office, and in addition, be liable on his official bond for the difference between the sum received and the par value of the bonds with accrued interest thereon.
Section 617. Officer Dealing in Bonds and Warrants - Misdemeanor. (21 O.S. § 353)
A. It shall be unlawful for any public officer or deputy or employee of such officer to either directly or indirectly, buy, barter for, or otherwise engage in any manner in the purchase of any bonds, warrants or any other evidence of indebtedness against this state, any subdivision thereof, or municipality therein, of which he is an officer.
B. The provisions of this section shall not apply to those municipal officers and employees who are subject to Section 8-113 of Title XI of the Oklahoma Statutes.
Section 618. Application of Sinking Fund. (62 O.S. § 435)
Such sinking fund shall be used:
First. For the payment of interest coupons as they fall due.
Second. For the payment of bonds falling due, if any such there be, and,
Third. For the payment of judgments against the municipality, if any there be; provided, that when any sinking fund has been used or may hereafter be used to pay judgments as herein provided, that notwithstanding the fact that such judgment or judgments have been paid with such sinking fund, it shall be the duty of the proper officers to make levies to pay such judgments the same as if the same had not been paid out of such sinking fund, and when so levied and collected the same shall be turned into the sinking fund out of which such judgment or judgments was paid.
Mandamus was appropriate legal remedy to enforce a county’s legal right to payment for school district’s share of ad valorem tax revaluation program and such writ of mandamus represents a sinking fund obligation. Board of County Commissioners v. City of Muskogee, 820 P.2d 797 (Okla. 1991)
A school district may not finance special improvement district assessments by levying a tax in excess of the number of mills permitted under Okla. Const. Art. X, Sec. 9. A school district may not utilize sinking fund levies pursuant to Okla. Const. Art. X, Sec. 28, where no judgment has been rendered against it. December 2, 1985. (AG Op. No. 85-133)
Section 619. Interest Rate Limitations on Bonds. (62 O.S. § 498.1)
Bonds or other obligations of any type or character authorized and issued by counties, municipalities, and school districts, including, but not limited to, bonds or obligations issued pursuant to Section 15-101 of Title 70 and Section 738 of Title 19, public housing authorities created pursuant to the Oklahoma Housing Authorities Act, Sections 1051 et seq. of Title 63, or port authorities created pursuant to Section 1102 of Title 82, may bear interest at a rate not to exceed ten percent (10%) per annum, payable not more often than semiannually, without regard to the limitations in any other law, general or special, except the Constitution of Oklahoma, except that said interest rate limitations shall not apply to any bonds or other obligations purchased by the federal government or any agency thereof.
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