June 15, 1976
Mr. Ruben G. Maulis
338 South Main Street
Winner, South Dakota 57580
OFFICIAL OPINION NO. 76-60
Town of Witten revenue bonds
Dear Mr. Maulis:
You have requested an official opinion from this office based upon the following facts:
The Town of Witten by vote authorized a bond issuance in 1971 for $35,000 of Water Revenue Bonds. At that time they expended and issued $25,000 in bonds to "develop a water utility by the acquisition of sites and equipment for the development of a new water well, water main, and appurtenant facilities."
At the time of the construction of said facilities, they decided to wait and see whether the system would be feasible in its operation without a water storage facility which would be used for the dual purpose of settling and aerating the artesian water. Now, approximately four years later, it has been determined that the storage facilities and aerating facilities are necessary since the rust and mineral deposits are accumulating in the water transmission lines and creating problems.
Based on the above facts, you ask:
Can the Town of Witten now issue the additional $10,000 of water Revenue Bonds since they had authorized $35,000 and expended only $25,000, without again voting on the question?
The general rule is that unless specific provision to the contrary exists, once bonds are approved by the electorate, they need not be issued at one time or in anyone installment. Unless a provision requires them to be issued at a particular time, the municipality may issue the voted bonds as needed within a reasonable time. McQuillan, Municipal Corporations, Vol. 15, p. 572.
The "reasonable time" requirement is generally given a liberal construction by the courts. In the case of Quaid, et al. v. City of Detroit, 29 N.W. 2d 687, the court held that the approval of the city's sewer and drain bonds, which were voted and approved by the electors in 1928, was not invalidated by the city's failure for 19 years to issue the bonds. Likewise, in the case of Public Schools of Muskegon v. Smith, 139 N.W. 264, the court stated that the effect of the lapse of time as to whether or not the circumstances indicate a subsisting approval or indicate abandonment or revocation, must be determined by the particular facts and circumstances of the case. If the objects to be served by the bonds are the same, if there has been no exceptional change in the physical setup in the community, the courts appear to be inclined to find that the lapse of time alone has not invalidated the electors' approval.
On the basis of the facts available to me, it appears the Town of Witten could use the additional $10,000 of water revenue bonds without again voting on the question.
Respectfully submitted,
WILLIAM J. JANKLOW
ATTORNEY GENERAL
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