Judges: JOHN ASHCROFT
Filed Date: 10/17/1984
Status: Precedential
Modified Date: 7/5/2016
Dear Senator Wiggins:
This opinion is in response to your request as follows:
Does an industrial development corporation have the power and authority under Chapter 349 of the Revised Statutes of Missouri, 1978, as amended, to issue revenue bonds and to loan the proceeds derived from the issuance and sale of such bonds to a corporation for the purpose of refinancing and extinguishing outstanding indebtedness previously incurred by such corporation in connection with the purchase, construction, extension or improvement of a "project" as defined in Chapter 349?
The facts which you present to support your request indicate that The Industrial Development Authority of the City of Kansas City, Missouri (the "Authority") proposes to issue its revenue bonds and to loan the proceeds therefrom to Saint Luke's Hospital of Kansas City, a Missouri not-for-profit corporation (the "Corporation") for the purpose of refinancing and extinguishing certain outstanding indebtedness previously incurred by the Corporation in connection with the purpose, construction, extension and improvement of a hospital facility located in Kansas City, Missouri (the "Hospital"). The Authority is an industrial development corporation which was created and now exists pursuant to Chapter 349 of the Revised Statutes of Missouri, 1978, as amended (the "Act"). The Hospital constitutes a "project" as defined in Section
The corporation is hereby granted and may exercise all powers necessary or appropriate to carry out and effectuate its purposes, including but not limited to the following:
. . .
(4) To promote and solicit industrial and economic development projects as authorized by section
349.010 and to make and execute leases, contracts, releases, compromises and other instruments necessary or convenient for the exercise of its powers or to carry out its purposes;(5) To acquire, . . . and to improve, maintain, equip and furnish one or more projects, . . . regardless of whether or not any such projects shall then be in existence;
(6) To lease to others any of its projects . . . ;
(7) To sell, assign, mortgage, . . . and convey any or all of its properties . . . ;
(8) To loan the proceeds of the bonds or temporary notes hereinafter authorized to provide for the purchase, construction, extension, and improvement of projects;
(9) To issue bonds and temporary notes as hereinafter provided;
. . .
(15) To sell . . . any of its property or projects to any private corporation. . . . It shall not be necessary for a corporation [referring to an industrial development corporation] to acquire title to any project." Section
349.050 , RSMo Supp. 1983. [Emphasis added.]
Missouri courts have long recognized that "[t]he primary rule of statutory construction is to ascertain the intent of the legislature from the language used, to give effect to that intent if possible, and to consider words used in the statute in their plain and ordinary meaning." City of Willow Springs v. Missouri StateLibrarian,
The Missouri Supreme Court, in the only case interpreting the Act, construed the powers of industrial development corporations broadly. One of the arguments in State ex rel. Jardon v. IndustrialDevelopment Authority,
From the broad grant of express powers in the Act, the powers implied by the "necessary or appropriate" language, and the liberal interpretation of the Act in Jardon, it appears that the legislature intended for industrial development corporations to have broad, flexible powers in order to carry out the purposes of the Act.
[T]he purchase, construction, extension and improvement of plants, buildings, structures, or facilities, whether or not now in existence. . . . Section
349.010 (4), RSMo Supp. 1983. [Emphasis added.]
It is also clear that the Authority has the power to purchase a project, "whether or not any such projects shall then be in existence; . . .", Section
Industrial development corporations also loan the proceeds of their revenue bonds to private corporations for projects. Although the original version of the Act contained no express power to loan bond proceeds, the 1980 amendment (L. 1980 H.B. 1582 and 1277) added the power to "loan the proceeds of the bonds or notes . . . to provide the the purchase, construction, extension and improvement of projects; . . . ." Section
If an industrial development corporation has the power to issue bonds to purchase existing projects, the proceeds of which bonds are then used to reimburse the corporation for its construction costs or to refinance existing indebtedness incurred by the corporation to pay such costs, and then sell or lease the project back to a private corporation, it is unlikely that the legislature intended that the industrial development corporation should not have the power to accomplish the same objective by a more direct, efficient and less costly method, i.e., a loan of bond proceeds. As the Missouri Supreme Court said in Household Finance Corp. v.Robertson,
If a statute is susceptible of more than one construction, it must be given that which will best effect its purpose rather than one which would defeat it, even though such construction is not within the strict literal interpretation of the statute . . . ." 364 S.W.2d at 602.
CONCLUSION
It is the opinion of this office that industrial development corporations organized under the Industrial Development Corporations Act, Chapter 349 of the Revised Statutes of Missouri, 1978, as amended, have the power and authority to issue revenue bonds and to loan the proceeds therefrom to a corporation for the purpose of reimbursing such corporation for costs previously incurred and for refinancing and extinguishing outstanding indebtedness previously incurred in connection with the purchase, construction, extension or improvement of projects as defined under the Act.
Very truly yours,
JOHN ASHCROFT Attorney General