ENROLLED
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ACT No. 948
Regular Session, 2010
HOUSE BILL NO. 1397
BY REPRESENTATIVES ELLINGTON AND ROBIDEAUX
AN ACT1
To amend and reenact R.S. 49:330, relative to certain mineral revenue contracts; to establish2
an advisory committee relative to contracting with respect to such contracts; to3
provide for committee membership, powers, duties, and functions; to provide for4
annual meetings; to provide for annual reporting; and to provide for related matters.5
Be it enacted by the Legislature of Louisiana:6
Section 1. R.S. 49:330 is hereby amended and reenacted to read as follows: 7
ยง330. Mineral Income Advisory Committee; Mineral revenue contracts by state8
treasurer9
A.(1) The Mineral Income Advisory Committee is hereby created. The10
committee shall be composed of the following members:11
(a) The chairman of the House Committee on Appropriations, or his12
designee.13
(b) The chairman of the Senate Finance Committee, or his designee.14
(c) The chairman of the House Committee on Ways and Means, or his15
designee.16
(d) The chairman of the Senate Revenue and Fiscal Affairs Committee, or17
his designee.18
(e) The chief economist of the Legislative Fiscal Office.19
(2) The chairman of the House Committee on Appropriations, or his20
designee, shall serve as chair of the committee for the first two years and then the21
chairman of the Senate Committee on Finance, or his designee, shall serve as22
chairman for the next two years. Subsequently, the chairmanship shall rotate23
between the House and Senate committees every two years.24 ENROLLEDHB NO. 1397
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(3) The committee shall meet at least once annually, upon the call of the1
chair, no later than the first day of March.2
(4) The secretary of the Department of Natural Resources, the secretary of3
the Department of Revenue, the commissioner of administration, and the state4
treasurer shall be available to the committee for the research relative to mineral5
revenue contracts as provided for in this Section.6
(5) No later than the first of May each year, the committee shall report any7
findings and recommendations to the Revenue Estimating Committee, which shall8
consider any recommendations at their first meeting following receipt of such report.9
A. B. The state treasurer, on behalf of the state, shall contract with respect10
to contracts commonly known as commodity or other swap agreements, forward11
payment conversion agreements, futures, or contracts providing for payments based12
on levels of or changes in commodity prices, contracts to exchange cash flows or a13
series of payments or contracts, including without limitation options, puts, or calls14
to hedge payment, rate, spread, or similar exposure and other devices in order to15
establish a firm price for all or part of the anticipated mineral production subject to16
state severance tax and royalty contract, subject to, and in accordance with, the17
following limitations, restrictions, and procedure:18
(1) Such action has been recommended by the Revenue Estimating19
Conference to the Joint Legislative Committee on the Budget.20
(2) The recommendation of the Revenue Estimating Conference has been21
reviewed by the Joint Legislative Committee on the Budget and the committee has22
recommended the state treasurer enter into such contracts based on criteria23
established by the committee which may direct that a portion of any revenue gain24
associated with a contract be set aside or used to purchase risk protection to cover25
any risk associated with the contract.26
(3) All swap agreements, forward conversion agreements, future contract27
contracts, or other contract contracts authorized in this Section have been selected28
by the state treasurer through a request for proposal or bid process and any swap29 ENROLLEDHB NO. 1397
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bank selected is at least "AA" rated according to industry standards or rated1
according to other standards adopted by the Mineral Income Advisory Committee.2
(4) The proposed contract has been submitted for review and comment to the3
attorney general who for the purposes of this Section shall be considered and shall4
act as legal counsel for the Joint Legislative Committee on the Budget.5
B. C. The Joint Legislative Committee on the Budget may require that6
appropriate insurance is purchased to ensure performance of the contract.7
C. D. In no event shall any contract authorized pursuant to this Section be8
for a period longer than one year, whether calendar or fiscal.9
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: