California Senate Bill SB1462 Introduced / Bill

 BILL NUMBER: SB 1462INTRODUCED BILL TEXT INTRODUCED BY Committee on Governance and Finance (Senators Wolk (Chair), Beall, DeSaulnier, Hernandez, Knight, Liu, and Vidak) MARCH 10, 2014 An act to amend Sections 5903 and 53395.10 of the Government Code, relating to local government. LEGISLATIVE COUNSEL'S DIGEST SB 1462, as introduced, Committee on Governance and Finance. Local government: omnibus bill. (1) Existing law authorizes a legislative body, as defined, that determines prior to issuing any bonds that the interest payable on the bonds will be subject to federal income taxation under the law in effect on the date of issuance, to require in the ordinance, resolution, indenture, agreement, or other instrument providing for the issuance of the bonds, that the bonds be denominated, payable, and redeemable in accordance with certain standards. This bill would also authorize the legislative body to include the maturity or maturities of the bonds in the ordinance, resolution, indenture, agreement, or other instrument providing for issuance. (2) Existing law authorizes the legislative body of a city or county to establish an infrastructure financing district, and requires proceedings for the establishment of a district to be instituted by the adoption of a resolution of intention to establish the proposed district that, among other things, describes the boundaries of the proposed district as referenced in a map on file in the office of the clerk of the city. This bill would specify that the description of the boundaries of the proposed district may be accomplished by reference to a map on file in the office of the clerk of either the city or county that is proposing to establish the district. Vote: majority. Appropriation: no. Fiscal committee: no. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. (a) This act shall be known, and may be cited, as the Local Government Omnibus Act of 2014. (b) The Legislature finds and declares that Californians want their governments to be run efficiently and economically and that public officials should avoid waste and duplication whenever possible. The Legislature further finds and declares that it desires to control its own costs by reducing the number of separate bills. Therefore, it is the intent of the Legislature in enacting this act to combine several minor, noncontroversial statutory changes relating to the common theme, purpose, and subject of local government into a single measure. SEC. 2. Section 5903 of the Government Code is amended to read: 5903. If, prior to issuing any bonds, the legislative body determines that the interest payable on the bonds to be issued by the state or local government will be subject to federal income taxation under the law in existence on the date of issuance or pending on the date of issuance with an effective date preceding the date of issuance, then notwithstanding any other provision of law, the ordinance, resolution, indenture, agreement, or other instrument providing for the issuance of the bonds may provide for any of the following: (a) The bonds shall be in  such   the  denominations, in  such   the  form, either bearer or registered, and payable at  such   the  place or places, either within or without the United States, at  such   the  time or times, in lawful money of the United States of America,  with the maturity or maturities,  with such   the  terms of redemption, and at  such   the  interest rate or rates, either fixed or variable, including methods of determining  such   the  rate or rates if variable, as the legislative body shall determine. (b) The bonds shall be sold at public or private sale, in such manner and place or places, either within or without the United States, and at  such   the  price or prices, above or below par, as the legislative body shall determine. (c) In connection with, or incidental to, the sale and issuance of the bonds, the state or local government may offer, sell, and issue warrants for additional bonds, as well as issue additional bonds pursuant to these warrants on terms consistent with this chapter, and may enter into any contracts which the legislative body determines to be necessary or appropriate to place the obligation of the state or local government, as represented by the bonds and the contract or contracts, in whole or in part on the interest rate, cash flow, or other basis desired by the legislative body, including, without limitation, contracts commonly known as interest rate swap agreements, forward payment conversion agreements, futures, or contracts providing for payments based on levels of or changes in interest rates, or contracts to exchange cash flows or a series of payments, or contracts, including, without limitation, options, puts or calls to hedge payment, rate, spread, or similar exposure. These contracts or arrangements may also be entered into by state or local governments in connection with, or incidental to, entering into any agreement which secures bonds, including bonds issued by private entities. These contracts and arrangements shall be made upon the terms and conditions established by the legislative body, after giving due consideration for the creditworthiness of the counterparties, where applicable, including any rating by a nationally recognized rating agency or any other criteria as may be appropriate. In addition, these contracts and arrangements may be made only if the bonds are rated in one of the three highest rating categories by two nationally recognized rating agencies, and if there has been receipt, from any rating agency rating the bonds, of written evidence that the contract or agreement will not adversely affect the rating. (d) In connection with, or incidental to, the sale and issuance of the bonds, or entering into any of the contracts or arrangements referred to in subdivision (c), the state or local government may enter into  such  credit enhancement or liquidity agreements, with  such  payment, interest rate, security, default, remedy, and other terms and conditions as the legislative body shall determine. (e) Proceeds of the bonds and any moneys set aside or pledged to secure payment of the bonds, or any of the contracts entered into pursuant to subdivision (c), may be invested in securities or obligations described in the ordinance, resolution, indenture, agreement, or other instrument providing for the issuance of the bonds and may be pledged to and used to service any of the contracts or agreements entered into pursuant to this section. SEC. 3. Section 53395.10 of the Government Code is amended to read: 53395.10. A legislative body of a city or county may designate one or more proposed infrastructure financing districts pursuant to this chapter. Proceedings for the establishment of a district shall be instituted by the adoption of a resolution of intention to establish the proposed district and shall do all of the following: (a) State that an infrastructure financing district is proposed to be established under the terms of this chapter and describe the boundaries of the proposed district, which may be accomplished by reference to a map on file in the office of the clerk of the city  or   county that is   proposing to establish the district  . (b) State the type of public facilities proposed to be financed by the district. The district may only finance public facilities authorized by Section 53395.3. (c) State that incremental property tax revenue from the city or county and some or all affected taxing entities within the district may be used to finance these public facilities. (d) Fix a time and place for a public hearing on the proposal.