Rhode Island Constitution articles 12 Of Debts
Rhode Island Constitution – Article XII: Of Debts
Overview:
Article XII of the Rhode Island Constitution deals with the management and limitation of public debt. It sets constitutional safeguards to ensure the state does not incur excessive or irresponsible debt, protecting public finances and taxpayers.
Key Provisions of Article XII – Of Debts:
Limitations on State Debt:
The state may not contract debts beyond certain limits established by law or the constitution.
Debt must be incurred only for public purposes.
Approval Requirements:
Significant borrowing or debt issuance may require approval by the legislature, and in some cases, approval by the voters through referendums.
This ensures democratic oversight of public borrowing.
Use of Borrowed Funds:
Funds raised by debt must be used only for the specific public projects or purposes authorized.
Debt Repayment:
The state must ensure there are means for repayment of debts, including establishing taxes or other revenue sources.
Protection of Public Credit:
Provisions are in place to maintain the creditworthiness and trust of the state in financial markets.
Purpose and Importance:
Prevents excessive or reckless borrowing by the state government.
Ensures transparency and accountability in public finance.
Protects the long-term financial health of Rhode Island.
Provides voters a role in approving major financial decisions.
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