towns, have successfully used the reve- Agreement nue bond industrial development scheme to effectively compete in attracting manufacturing and industrial develop ment which had previously been unfeasible. Municipal annexation must be reasonable, necessary or convenient and where sole purpose is to finance industrial development by revenue bond industrial development scheme, annexation is not

1. (1) The terms of the proposed lease shall have

reasonable, although such is not alone been approved by the municipality objectionable where other valid reasons company before submission to the division. exist. shall be made until the amendment has been Wring v. City of Jefferson, 413 SW2d approved by the division and the governing 292 (MO. App. 1967). Municipality may body of the municipality. sell facility acquired with proceeds of industrial revenue bonds. Legislatiue provisions requiring public works to be awarded upon a public letting to the lowest responsible bidder are intended to secure unrestricted competition among bidders, eliminate fraud and

CODEOFSTATEREGULATIONS

favoritism and avoid undue and excessive costs which would otherwise be imposed on taxpayers. Ordinarily, statute requiring competitive bidding on public improvements is applicable only to contracts where the city itself assures an obligation or indebtedness. A third-class municipality is not required to let contracts by competitive bidding to lowest and best bidder where the project is financed by industrial revenue bonds. Op. Atty. Gen. No. 134, Maddox, 2-S- 71. A municipality whichissues and sells industrial development revenue bonds incurs no liability to pay for the revenue bonds other than the responsibility to apply the reuenue received from the project for which the bonds were sold to retiring the bonds. Op. Atty. Gen. No. 380, Jeffrey, ll- 14-68. A city of the fourth class under a lease agreement pursuant to industrial development revenue bond issues need not follow the procehre of competitive bidding for the construction of the proposed facility thereunder, and that under section 100.200, RSMo (1969), any purchase options entered into in compliance with the statutes and approved by the Division of Commerce and Industrial Development need not be further approved at the time of their actual exercise.

PURPOSE: A proposed lease agreement between the municipality and the tentative lessee is required to be submitted to the division as an integral part of the application. This rule provides guidelines to assist municipalities in the colastruction of the lease agreement.

and

1. (2) No amendment to the lease agreement

Auth: section 100.050(4], RSMo (1986)“. Original rule filed Dec. 30,1975, effective Jan. 9,1976. “Original authority 1961, amended 1983.

Roy D. Blunt

Chapter. 2--Municipal Bonds for 4 CSR 80-2 lndustrral Development

Op. Atty. Gen. No. 1.2, Schneider, 6- 22-64. A municipality which OWLS manufacturing or industrial develop ment scheme may not require a tenant thereof facility developed by revenue bond industrial as part of the leasing agreement, to pay monies in lieu of taxes to another taxing body.

Roy D. Blunt CODEOFSTATE REGULATIONS 5