§ 7.08. Contents of bond ordinance for revenue producing utilities.

The ordinance authorizing the issuance of any bonds for any revenue producing utility shall state either:

A.

That the bonds shall be payable from the ad valorem taxes without limitation of rate or amount; the full faith and credit of the city is deemed to be pledged for the payment of principal and interest thereof; and the bonds are to be issued pursuant to the provisions of Article VII, Section 10 of the Constitution of Virginia and are not to be included in determining the power of the city to incur indebtedness within the limitation prescribed by Article VII, Section 10 of the Constitution of Virginia; provided, however, that from and after a period specified in such ordinance, not exceeding five years from the date of the election authorizing the bonds, whenever and for so long as such revenue producing utility fails to produce sufficient revenue to pay for the cost of operation and administration, including the interest on bonds issued therefor, the cost of insurance against loss by injury to persons or property, and an annual amount to be placed into a sinking fund sufficient to pay the bonds at or before maturity, all outstanding bonds issued on account of such revenue producing utility shall be included in determining such limitation; or

B.

That the principal and interest of such bonds shall be payable exclusively from the revenue of such revenue producing utility, the faith and credit of the city shall not be deemed to be pledged for the payment of such principal and interest, and the bonds are to be issued pursuant to the provisions of Article VII, Section 10 of the Constitution of Virginia and are never to be included in determining the power of the city to incur indebtedness within the limitations prescribed by Article VII, Section 10 of the Constitution of Virginia.