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Regular Session, 2010 ENROLLED
SENATE BILL NO. 752
BY SENATOR LONG AND REPRESENTATIVES AUBERT, AUSTIN BADON,
CARMODY, CARTER, CHANDLER, CHANEY, DI XON, EDWARDS,
HARDY, HOFFMANN, RICHARDSON, RITCHIE, SCHRODER AND
PATRICIA SMITH
AN ACT1
To enact Chapter 17-F of Subtitle III of Title 39 of the Louisiana Revised Statutes of 1950,2
to be comprised of R.S. 39:1800.21 through 1800.35, relative to the creation of a3
nonprofit corporation; to provide for the financing and leasing of centers of4
excellence; to provide for its board of directors; to authorize the lease and sublease5
of the facilities; to authorize the issuance of bonds and certificates of participation;6
to empower the nonprofit corporation, the Louisiana Community and Technical7
College System and the state to take such other actions or enter into such other8
agreements as may be necessary and appropriate to carry out its responsibilities; and9
to provide for related matters.10
Be it enacted by the Legislature of Louisiana:11
Section 1. Chapter 17-F of Subtitle III of Title 39 of the Louisiana Revised Statutes12
of 1950, comprised of R.S. 39:1800.21 through 1800.35, is hereby enacted to read as13
follows:14
CHAPTER 17-F. LOUISIANA CENTERS OF15
EXCELLENCE FINANCING CORPORATION ACT16
§1800.21. Title17
This Chapter shall be referred to and may be cited as the "Louisiana18
Centers of Excellence Financing Corporation Act".19
§1800.22. Definitions20
As used in this Chapter, the following words and terms shall have the21
following meanings, unless the context clearly indicates or requires another or22
different meaning or intent:23
(1) "Annual appropriation dependency clause" shall mean a clause24
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which shall be included in any lease-purchase financing document which1
provides that if, after a diligent and good faith effort by the state to appropriate2
funds for the payment of sums due under a lease-purchase financing agreement,3
such funds are not appropriated, such lease-purchase agreement shall terminate4
in accordance with the terms of the lease-purchasing financing agreement, and5
the state shall not be liable for the payment of further sums due on such6
agreements past the then current fiscal year, provided possession of the project7
is returned to the corporation. Such lease-purchase financing document shall8
further provide that in the event of an inability to appropriate sufficient funds9
such inability shall not constitute a default under such agreement.10
(2) "Bonds" means bonds, notes, or any other evidence of indebtedness11
issued by the corporation.12
(3) "Center of excellence" means a community college or vocational13
technical facility which provides customized education and training programs14
for targeted industries that drive Louisiana's economy.15
(4) "Certificates" means certificates of participation executed and16
delivered by a trustee evidencing ownership interests in any lease entered into17
by the state or the system, as lessee, and the corporation, as lessor.18
(5) "Corporation" means the public nonprofit corporation authorized19
to be formed by this Chapter, or any corporation succeeding to the principal20
functions thereof or to which the powers conferred upon the corporation by this21
Chapter shall be given by law.22
(6) "Division of administration" means the division of administration23
created within the office of the governor by Title 39 of the Louisiana Revised24
Statutes of 1950.25
(7) "Lease-purchase financing" means the financing and acquisition of26
property by a corporation pursuant to an arrangement under which such27
corporation acquires title to property and enters into a lease-purchase28
agreement with the state providing for the leasing of the property by such29
corporation to the state and acquisition by the state at the end of the lease30 SB NO. 752 ENROLLED
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period of title to the property.1
(8) "Project" means the planning, acquisition, purchase, construction,2
renovation, improvement, equipping, or expansion of a public facility by the3
corporation, provided that no more than fifty percent of the total project cost4
shall be financed with funds provided through bonds issued pursuant to this5
Chapter. At least fifty percent of the total cost of each project shall be from6
contributions by private sources through donations of cash, immovable7
property, or equipment, or a combination thereof, or from contributions by8
parishes, municipalities, or their agencies or instrumentalities.9
(9) "Public facilities" means buildings, parking garages, and related10
facilities used or to be used as a center of excellence for students, faculty and11
staff of the Louisiana Community and Technical College System, and all land,12
buildings and movable or immovable equipment incorporated therein and13
relating thereto.14
(10) "System" means the Louisiana Community and Technical College15
System.16
§1800.23. Construction of Chapter17
A. This Chapter shall be deemed to provide a complete, additional, and18
alternative method for doing the things authorized hereby and shall be regarded19
as supplemental and additional to powers conferred by other laws.20
B. To the extent that the provisions of this Chapter are inconsistent with21
the provisions of R.S. 12:202.1, or any other provisions of any general statute22
or special act or parts thereof, the provisions of this Chapter shall be deemed23
controlling.24
§1800.24. Functions of corporation25
There is hereby authorized the formation and incorporation of a26
nonprofit corporation, the purpose of which shall be the financing of the design,27
acquisition, purchase, construction, renovation, improvement, equipping or28
expansion of centers of excellence to be leased to the Louisiana Community and29
Technical Colleges System and used as centers of excellence. However, the30 SB NO. 752 ENROLLED
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financing of such centers of excellence shall be in addition to any other funds or1
appropriations provided to the Louisiana Community and Technical College2
System, and such financing shall not displace, replace, supplant, or prevent3
funding for such system or system's projects from the capital outlay act or4
appropriations acts.5
§1800.25. Membership of board of directors; vacancies; compensation;6
expenses7
A. The corporation shall be governed by a board of seven directors8
comprised as follows:9
(1) The governor, or his designee.10
(2) The commissioner of administration, or his designee.11
(3) The president of the Senate, or his designee.12
(4) The speaker of the House of Representatives, or his designee.13
(5) The secretary of the Louisiana Department of Economic14
Development, or his designee.15
(6) The president of the Louisiana Community and Technical College16
System, or his designee.17
(7) The executive director of the Workforce Commission, or his designee.18
B. Members of the board of directors shall serve without compensation,19
but the corporation may reimburse such members for necessary expenses20
incurred in the discharge of their duties. Members of the legislature serving on21
the board shall receive the same per diem and travel reimbursement for22
attending meetings of the board as is normally provided for members of the23
legislature.24
C. Members of the board of directors shall elect a president, a secretary-25
treasurer and such other officers as shall be deemed necessary and appropriate.26
§2800.26. Applicable laws to corporation27
A. The corporation shall be subject to the Public Records Law, the Open28
Meetings Law, the Bond Validation Procedures Law, and the Code of29
Governmental Ethics. The corporation shall follow all provisions of R.S.30 SB NO. 752 ENROLLED
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38:2211 et seq., when utilized by the system as a financing vehicle for the1
construction, renovation, or expansion of public facilities. With the approval2
of the commissioner of administration, projects shall either be included in the3
annual capital outlay act or obtain legislative approval as provided in R.S.4
39:112(G). Projects shall be administered by the office of facility planning and5
control in accordance with the provisions of R.S. 39:121 through 128.6
B. In any action for damages for an offense or quasi offense against the7
corporation, its officers, or employees, the corporation, its officers, or employees8
shall be entitled to assert any defense or limitation available to the state or an9
agency thereof, including but not limited to the provisions of Part XV of10
Chapter 32 of Title 13 of the Louisiana Revised Statutes of 1950.11
C. In any claim or lawsuit against the corporation or its officers or12
employees for damages arising out of personal injury or death of an official or13
employee of the state, its agencies, boards or commissions, the exclusive,14
compulsory and obligatory relief shall be limited to the remedies and relief15
afforded under Chapter 10 of Title 23 of the Louisiana Revised Statutes of 1950,16
including but not limited to R.S. 23:1034.17
§1800.27. Powers18
A. In addition to the powers granted it by the General Nonprofit19
Corporation Law, Title 12 of the Louisiana Revised Statutes of 1950, the20
corporation shall have power to undertake any project, to provide for the21
financing thereof, and in connection therewith:22
(1) To receive and accept from any agency of the United States or any23
agency of the state of Louisiana or any municipality, parish, or other political24
subdivision thereof, or from any individual, association, or corporation gifts,25
grants, or donations of monies or other property for achieving any other26
purposes of this Chapter.27
(2) To finance, own, lease as lessee or lessor a public facility or facilities28
owned or leased by the corporation and to enter into contracts for any or all29
such purposes, including contracts for the acquisition, purchase, construction,30 SB NO. 752 ENROLLED
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renovation, improvement, equipping, or expansion of such public facility or1
facilities owned or leased by the corporation.2
(3) To receive and accept from any source loans, contributions, or grants3
for or in aid of a project, or the financing thereof in either money, property,4
labor, or other things of value.5
(4) To mortgage all or any portion of its interest in a public facility or6
facilities and the property on which any such public facility or facilities are7
located, whether owned or thereafter acquired, including the granting of a8
security interest in any property, corporeal or incorporeal, and to assign or9
pledge all or any portion of its interest in property, corporeal or incorporeal,10
and the revenues therefrom.11
(5) To lease for a term not to exceed forty years to the system or to the12
state of Louisiana, through the division of administration, the project being13
financed or public facilities conveyed to the corporation in connection with such14
financing, upon such terms and conditions as are mutually agreeable and both15
parties deem proper, however, any and all such agreements shall contain an16
annual appropriation dependency clause, and to charge and collect rents17
therefor and to terminate any such lease upon the failure of the lessee to comply18
with any of the obligations thereof; to include in any such lease, if it shall so19
desire, provisions that the lessee thereof shall have options to renew the term of20
the lease for such period or periods and at such rent as shall be determined by21
the corporation or to purchase any or all of the public facilities, or that upon22
payment of all of the indebtedness incurred by the corporation for the financing23
of such project, then the corporation shall convey any or all of the public24
facilities to the state of Louisiana on behalf of the system with or without25
consideration. The system or the state of Louisiana, through the division of26
administration, may enter into a lease for immovable or movable property with27
the corporation, whether as lessee or lessor, pursuant to this Chapter.28
(6) To obtain, or aid in obtaining, from any department or agency of the29
United States or the state of Louisiana, including the office of risk management30 SB NO. 752 ENROLLED
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or any private company, any insurance or guarantee as to, or of, or for the1
payment or repayment of, interest or principal, or both, or any part thereof, on2
any lease or obligation or any instrument evidencing or securing the same, made3
or entered into pursuant to the provisions of this Chapter and to assign any4
such insurance or guarantee as security for the corporation's bonds.5
(7) To enter into any trust agreement or agreements providing, among6
other matters, for the execution and delivery of certificates in any lease between7
the state or a third party and the corporation.8
(8) To participate in any capacity with new market tax credit financing9
and other tax credits.10
(9) To enter into any and all agreements or contracts, execute any and11
all instruments, and do and perform any and all acts or things necessary,12
convenient, or desirable for the purposes of the corporation or to carry out any13
power expressly given in this Chapter.14
B. In addition to the powers granted it by law, the system or the state of15
Louisiana, through the division of administration, shall have the power:16
(1) To enter into a negotiated lease or leases with the corporation of any17
public facility for a term not to exceed forty years upon such terms and18
conditions as it shall deem proper, however, such agreements shall contain an19
annual appropriation dependency clause.20
(2) To sublease any such leased public facilities to any political21
subdivision or public body of the state of Louisiana or to any commission,22
entity, or regional authority created under or by intergovernmental cooperation23
under the laws of the state of Louisiana; provided that no such sublease shall24
relieve the sublessor of its obligations under its lease from the corporation25
relating to the subleased public facilities.26
(3) Notwithstanding the provisions of R.S. 41:1211 et seq., to negotiate27
a lease or leases to the corporation of land owned by the system or by the state28
for a period not to exceed forty years upon such terms and conditions as it shall29
deem proper.30 SB NO. 752 ENROLLED
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C. Any political subdivision or public body of the state of Louisiana or1
any public commission, entity, or regional authority created under the law of2
the state of Louisiana may, with the prior approval of the division of3
administration, enter into a sublease of public facilities from the system or the4
state of Louisiana.5
§1800.28. Bonds6
A. The corporation is authorized, from time to time, to issue its bonds7
in order to provide for achieving any of its purposes under this Chapter.8
B. Except as may otherwise be expressly provided by this corporation,9
each of its bonds shall be payable from lawfully available funds, including but10
not limited to any revenues or monies of the corporation available therefor and11
not otherwise pledged, subject only to any agreements with the holders of12
particular bonds pledging any particular revenues or monies. Such bonds shall13
be and are deemed to be for all purposes negotiable instruments, subject only14
to the provisions of such bonds for registration.15
C.(1) The corporation's bonds may be issued as serial bonds or as term16
bonds, or the corporation, in its discretion, may issue bonds of both types. The17
issuance of all bonds shall be authorized by resolution of the board of directors18
and shall bear such date or dates, mature at such time or times, not exceeding19
forty years from their respective dates, bear interest at such rate or rates, be20
payable at such time or times, be in such denominations, be in such form, carry21
such registration privileges, be executed in such manner, be payable in lawful22
money of the United States of America at such place or places, and be subject23
to such terms of redemption, as the indenture, trust agreement, or resolution24
relating to such bonds may provide. The corporation's bonds may be sold by25
the corporation at public or private sale, for such price or prices and upon such26
terms and conditions as the corporation shall determine. The corporation may27
sell any bonds at a price below the par value thereof; provided, however, that28
the discount shall not exceed six percent of the par value thereof. Pending29
preparation of the definitive bonds, the corporation may issue interim receipts30 SB NO. 752 ENROLLED
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or certificates or temporary bonds which shall be exchanged for such definitive1
bonds.2
(2) Bonds of the corporation shall not be invalid because of any3
irregularity or defect in the proceedings or in the issuance and sale thereof and4
shall be incontestable in the hands of a bona fide purchaser or holder. The5
corporation, after authorizing the issuance of bonds by resolution, shall publish6
once in a newspaper of general circulation in the parish in which the7
corporation is domiciled, a notice of intention to issue the bonds. The notice8
shall include a description of the bonds and the security therefor. Within thirty9
days after the publication, any person in interest may contest the legality of the10
resolution, any provision of the bonds to be issued pursuant to it, the provisions11
securing the bonds, and the validity of all other provisions and proceedings12
relating to the authorization and issuance of the bonds. If no action or13
proceeding is instituted within the thirty days, no person may contest the14
validity of the bonds, the provisions of the resolution pursuant to which the15
bonds were issued, the security of the bonds, or the validity of any other16
provisions or proceedings relating to their authorization and issuance, and the17
bonds shall be presumed conclusively to be legal. Thereafter, no court shall18
have authority to inquire into such matters.19
D. Any resolution or resolutions authorizing the issuance of any bonds20
or any issue of bonds may contain provisions, which shall be part of the contract21
with the holders of the bonds so authorized, as to pledging or assigning all or22
any part of the revenues of a project or any revenue-producing contract or23
contracts made by the corporation with any agency, department, corporation,24
or other person, public or private, to secure the payment of the bonds or of any25
particular issue of bonds.26
E. Neither the members of the board of directors of the corporation or27
any person executing the bonds shall be liable personally on the bonds or be28
subject to any personal liability or accountability by reason of the issuance29
thereof.30 SB NO. 752 ENROLLED
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§1800.29. Bonds; security; trust agreement; indenture; ancillary contracts;1
interest rate swap agreements2
A. In the discretion of the corporation, any bonds issued by it may be3
secured by a trust agreement or indenture by and between the corporation and4
a corporate trustee, which may be any trust company or bank having the5
powers of a trust company within or without the state. Such trust agreement6
or indenture or the resolution providing for the issuance of such bonds may7
pledge or assign the revenues to be received from any lease of the public8
facilities. A Form UCC-1 need not be filed. Such trust agreement, indenture,9
or resolution providing for the issuance of such bonds may contain such10
provisions for protecting and enforcing the rights and remedies of the11
bondholders as may be reasonable and proper and not in violation of law. Any12
such trust agreement, indenture, or resolution may set forth the rights and13
remedies of the bondholders and of the trustee or trustees and may restrict the14
individual right of action of bondholders. In addition to the foregoing, any such15
trust agreement, indenture, or resolution may contain such other provisions as16
the corporation may deem reasonable and proper for the security of17
bondholders.18
B. (1) The corporation may enter into, amend, or terminate, as it19
determines to be necessary or appropriate, any ancillary contracts:20
(a) To facilitate the issuance, sale, resale, purchase, repurchase or21
payments of bonds, including without limitation bond insurance, letters of22
credit, guaranty agreements, surety bonds, and liquidity facilities.23
(b) To attempt to hedge risk or achieve a desirable effective interest rate24
or cash flow, subject to the approval of the State Bond Commission.25
(2) The determination of the board, so approved, that an ancillary26
contract or the amendment or termination thereof is necessary or appropriate27
as aforesaid shall be conclusive. Such contracts shall be made upon the terms28
and conditions established by the board and approved by the State Bond29
Commission, including without limitation provisions as to security, default,30 SB NO. 752 ENROLLED
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termination, payment, remedy and consent to service of process.1
C. The corporation may enter into, amend or terminate, any swap2
contract that it determines to be necessary or appropriate to place the3
obligations or investments of the corporation, as represented by the bonds or4
the investment of their proceeds, in whole or in part, on the interest rate, cash5
flow or other basis desired by the board, which contract may include without6
limitation contracts commonly known as interest rate swap agreements, futures7
or contracts providing for payments based on levels of, or changes in, interest8
rates, and any other derivative product, subject to approval of the State Bond9
Commission, including specific approval of the necessity, amount, and the10
recipient of fees or other charges associated with any of the contracts,11
agreements, or products. The determination of the board, so approved, that a12
swap contract or the amendment or termination thereof is necessary or13
appropriate as aforesaid shall be conclusive. These contracts and arrangements14
may contain such payment, security, default, remedy, and other terms and15
conditions as determined by the board and approved by the State Bond16
Commission, after giving due consideration to the creditworthiness of the17
counterparty or other obligated party, including any rating by any nationally18
recognized rating agency, and any other criteria as may be appropriate.19
§1800.30. Bonds and certificates; payment; no liability of state or political20
subdivision21
Neither bonds nor certificates shall be deemed to constitute a debt or22
liability of the state of Louisiana or of any agency, board, or political23
subdivision thereof or a pledge of the full faith and credit of the state of24
Louisiana or of any such agency, board, or political subdivision.25
§1800.31. Refunding bonds26
The corporation may provide for the issuance of its bonds for the27
purpose of refunding any bonds or any series of bonds then outstanding,28
including the payment of any redemption premium thereon and any interest29
accrued or to accrue to the date of redemption and purchase or maturity of30 SB NO. 752 ENROLLED
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such bonds. All such refunding bonds shall be subject to the provisions of this1
Chapter in the same manner and to the same extent as other bonds issued2
pursuant to this Chapter.3
§1800.32. Bonds and certificates as legal investments4
Bonds and certificates are hereby made securities in which all banks,5
bankers, savings banks, trust companies, and other persons carrying on a6
banking business, all insurance companies, insurance associations, and other7
persons carrying on an insurance business, and all administrators, executors,8
guardians, trustees, and other fiduciaries, and all other persons whatsoever who9
now are or may hereafter be authorized to invest in bonds or other obligations10
of the state of Louisiana may properly and legally invest any funds, including11
capital belonging to them or within their control, and such bonds and12
certificates are hereby made securities which may properly and legally be13
deposited with and received by any state or municipal officers or agency of the14
state of Louisiana for any purpose for which the deposit of bonds or other15
obligations of the state of Louisiana is now or may hereafter be authorized by16
law.17
§1800.33. Bonds and certificates; freedom from taxation18
Any bonds and certificates, their transfer, and the income therefrom19
shall at all times be free from taxation of every kind by the state of Louisiana20
and by all political subdivisions in the state of Louisiana.21
§1800.34. Excess earnings22
Any net earnings of the corporation beyond that necessary for23
retirement of any bonds issued by the corporation or to implement the purposes24
of this Chapter shall inure to the benefit only of the state of Louisiana.25
§1800.35. Dissolution of corporation; title to the property to vest in successor26
Upon dissolution of the corporation, title to all property owned by the27
corporation shall vest in the successor corporation created by the legislature, if28
any, if such successor corporation qualifies under Section 103 of the Federal29
Internal Revenue Code of 1986, as amended, to issue obligations the interest on30 SB NO. 752 ENROLLED
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which is exempt from federal income taxation. If no such successor corporation1
is so created, title to such property shall vest in the state of Louisiana.2
PRESIDENT OF THE SENATE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: