Municipal or sewerage authorities must issue certificates of indebtedness after a 10-day cash-payment period, and the certificates have limits on sale price and interest.
§4046. Issuance of certificates of indebtedness; requisites of certificates; redemption; sewerage account The governing authority of the municipality or sewerage district, after the expiration of the ten days in which the owners may pay cash, shall issue certificates of indebtedness covering the remainder which may be due under any contract let. The governing authority may sell at one time to any bidder the entire amount of the certificates so authorized, or may offer, sell and deliver them in convenient instalments from time to time, and the said proceeds of the sale shall be used to liquidate the claim of any contractor having done the work accepted. The governing authority may, however, deliver to the contractor in liquidation of the contract, the certificates on the same basis as the same might have been sold. The certificates shall be engraved or printed and numbered, and entitled sewerage certificates of the particular municipality or sewerage district affected. They shall show on their face the year of their issuance, when they will be paid, and the annual rate of interest, which interest shall not be more than six per cent, and payable annually on each certificate at the maturity of the principal on any of the series, at the option of the governing body or under the terms of the contract entered into. They shall be signed by the mayor and city clerk of the municipality or the president and secretary of the sewerage district, as the case may be, and shall be issued in denominations of one hundred, five hundred or one thousand dollars. They shall not be sold for less than ninety-five per cent of their par value. Par value as used herein shall mean principal and interest accrued to date of delivery. The maturities of the certificates shall be fixed by the municipality or sewerage district with due regard to the period of maturities of assessments against the various property holders. The certificate shall contain the stipulation that no property holder shall be held liable for any assessment in excess of that actually due by his property, and that the payment of the assessment against his property shall free it from the lien and privilege provided. The governing body of the municipality or sewerage district may, on the maturity dates of any of the series of certificates, redeem a greater amount of the certificates than those maturing, provided notice of its intention to do so has been published in the official journal once a week for fifteen days preceding the date of the maturity of any series. The certificates of indebtedness shall be the obligation of the municipality or sewerage district secured by the lien and privilege on the property affected, shall be payable to bearer, and are declared to be negotiable instruments, and shall be included in the securities that may be acceptable for deposit with the treasurer of the state of Louisiana in accordance with law. The funds derived each year from the collection of instalments due by the various property holders, as well as the proceeds of the sale of any or all certificates shall remain a fund specially dedicated to the payment of the certificates. No municipality or sewerage district, or any officer thereof, shall use the fund for any purpose other than that of imputing payment to the certificates hereinabove provided for. Pending their disbursement for this purpose, the funds shall be deposited with the fiscal agent of the city or sewerage district, to the credit of a special account, to be known as "Sewerage Account," and whatever interest shall be earned thereon shall be credited to the fund. The municipality or sewerage district, through its officers, shall be the agent of the contractor for the collection of the instalments due, and the payment to the municipality or sewerage district will release the property holder from any further payment and entitle him to a receipt authorizing the cancellation of the lien and privilege recorded against the property, the property holder being in no wise liable beyond the assessment made against his own property.