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Regular Session, 2011
SENATE BILL NO. 253
BY SENATOR JACKSON
BONDS. Provides relative to the issuance of bonds by public trusts. (8/15/11)
AN ACT1
To amend and reenact R.S. 9:2347(A)(1), (H), and (M), relative to the issuance of bonds by2
public trusts; to provide for the publication of the notice of intention to issue bonds,3
notes, or other evidences of indebtedness by a public trust; to provide for the sale of4
bonds, notes and other evidences of indebtedness by a public trust; to provide that5
property owned by certain public trusts authorized to issue bonds to finance projects,6
is public and used for a public purpose; and to provide for related matters.7
Be it enacted by the Legislature of Louisiana:8
Section 1. R.S. 9:2347(A)(1), (H), and (M) are hereby amended and reenacted to9
read as follows: 10
ยง2347. Bonds of public trust 11
A. To provide funds for and to fulfill and achieve its authorized public12
functions or purposes, a public trust may incur debt and issue bonds, notes or other13
evidences of indebtedness, hereinafter referred to collectively as "bonds" subject to14
the following: 15
(1) If the beneficiary of the public trust is a parish, municipality, or a political16
or governmental subdivision thereof, and such bonds or other debt obligations are17 SB NO. 253
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issued for the purpose of providing, constructing, expanding, or altering public1
facilities which are to be operated, maintained, or administered by any such parish,2
municipality, or political or governmental subdivision thereof, such bonds shall be3
approved by a vote of a majority of the qualified electors of the beneficiary who vote4
in a special election held for that purpose in the manner provided by Subtitle II,5
Chapter 4, Part II of Title 39 Chapter 6-A of Title 18 (R.S. 18:1281 et seq.) of the6
Louisiana Revised Statutes of 1950. Furthermore, in all other cases, if the beneficiary7
of the trust is a parish, municipality, or a political or governmental subdivision8
thereof, all bonds and other debt obligations shall be issued only after the trust has9
adopted an appropriate resolution giving notice of its intention to issue such bonds10
or other debt obligations, which resolution shall include a general description of the11
bonds or other debt obligations to be issued and the security therefor, and notice of12
this intention shall be published once a week for four two weeks in a newspaper in13
the locality of the beneficiary or in the parish where it is located, the first publication14
to appear at least thirty days before the public meeting of the trust at which the trust15
will meet in open and public session to hear any objections to the proposed issuance16
of such bonds or other debt obligations. The notice of intent so published shall state17
the date, time, and place of the public hearing and shall state, and the law is hereby18
declared to be, that if at such hearing a petition duly signed by electors of the19
beneficiary in a number not less than five per cent of the electors of the beneficiary20
voting at the last special or general election object to the issuance of the proposed21
bonds or other debt obligations, then such bonds or other debt obligations shall not22
be issued until approved by a vote of a majority of the qualified electors of the23
beneficiary who vote in a special election held for the purpose in the manner24
provided by Subtitle II, Chapter 4, Part II of Title 39 Chapter 6-A of Title 18 (R.S.25
18:1281 et seq.) of the Louisiana Revised Statutes of 1950. Any such petition shall26
be accompanied by a certificate of the parish registrar of voters certifying that the27
signers of the petition are qualified electors of the beneficiary and the number of28
signers amounts to not less than five per cent of the electors in said beneficiary in29 SB NO. 253
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number, voting at the last special or general election. Prior to the publication of the1
notice of intention required hereinabove, the contents of said notice of intention shall2
be approved by the State Bond Commission. All bonds and other debt obligations3
issued hereunder for the purpose of providing, developing, securing and improving4
the water storage, treatment, supply and distribution services and facilities and5
sanitary and storm sewer collection, disposal, treatment and drainage services and6
facilities, shall be issued in accordance with the provisions of Subpart B or C, Part7
I of Chapter 10, Title 33 of the Louisiana Revised Statutes of 1950, and/or any and8
all other laws of the state pertaining to revenue bonds for public utilities.9
* * *10
H. All bond issues of a public trust shall be submitted to and approved by the11
State Bond Commission prior to the issuance and delivery of said bonds. All bonds12
of a public trust shall be sold by the State Bond Commission such public trust.13
Provided, bonds of a public trust issued in connection with any projects or facilities14
of the trust for the provisions of industrial, manufacturing, or other economic15
development facilities and activities shall be sold in accordance with the provisions16
of R.S. 39:991, et seq., subject to the requirement that a notice of intent to sell such17
bonds shall be published at least seven days in advance of the sale date. After18
approval by the State Bond Commission as required herein and at least seven days19
prior to the sale of such bonds by the State Bond Commission , the public trust shall20
cause to be published a notice of sale in a newspaper of general circulation in the21
parish of the beneficiary's situs, or if the state or any state agency be the beneficiary,22
such publication shall be in the official state journal, and in a financial journal or23
newspaper containing a section devoted to municipal bond news published in either24
New Orleans, Louisiana, or New York, New York. This notice of sale shall state if25
any proposals have been made for the purchase of the bonds and that other proposals26
will be considered and that the proposal most advantageous to the issuer will be27
accepted at the time of the sale. After adoption of the resolution or other proceedings28
authorizing the sale of bonds, said resolution or other proceedings shall be published29 SB NO. 253
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in a newspaper of general circulation in the parish of the beneficiary's situs, or, if the1
state or any state agency be the beneficiary, such publication shall be in the official2
state journal. For a period of thirty days from the date of publication of the notice of3
sale, any person or persons in interest shall have the right to contest the legality of4
the notice of sale, resolution or other proceedings authorizing the issuance of the5
bonds and the legality of the bond issue for any cause, after which time no one shall6
have any cause or right of action to contest the legality of said resolution or other7
proceedings or of the bonds authorized thereby for any cause whatsoever. If no suit,8
action or proceedings are begun contesting the validity of the bonds within the thirty9
days herein prescribed, the authority to issue the bonds and to provide for the10
payment thereof, the legality thereof and of all of the provisions of the resolution or11
other proceedings authorizing the issuance of the bonds shall be conclusively12
presumed, and no court shall have authority to inquire into such matters. Such bonds13
shall have all the qualities of negotiable instruments under the law merchant and the14
commercial laws of the state of Louisiana.15
* * *16
M. The property of any public trust, having as its beneficiary the a parish,17
municipality, or a political or governmental subdivision thereof of Jefferson,18
which is authorized under its trust indenture to engage in or issue bonds to finance19
projects for substantially all of the public purposes set forth in R.S. 9:2341(B)(1),20
acquired or held for one or more of said purposes, is hereby declared to be public21
property used for essential public and governmental purposes. Accordingly, such22
public trust, and all of its properties at any time owned by it and the income23
therefrom and all bonds issued by it and the income therefrom, shall be exempt from24
all taxes of the parish or municipality, the state, or any political subdivision thereof25
or any other taxing body, provided, however, that such public trust may require the26
lessee of each of the projects of the public trust to pay annually to parish or27
municipal taxing authorities or to any other taxing body, through the normal28
collecting agency, a sum in lieu of ad valorem taxes to compensate such authorities29 SB NO. 253
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for any services rendered by them to such projects, which sum shall not be in excess1
of the ad valorem taxes such lessee would have been obligated to pay to such2
authorities had it been the owner of such project during the period for which such3
payment is made. Such payments to be made in lieu of taxes together with any fees4
and charges of such public trust, to the extent in the aggregate they do not exceed the5
amount of taxes that would be paid if the lessee were the owner, shall constitute6
statutory impositions within the meaning of R.S. 47:2128. No provision of this7
Subsection shall become effective until approved by resolution of the Jefferson8
Parish Council parish, municipality, or a political or governmental subdivision9
thereof which is the beneficiary of such public trust.10
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Martha S. Hess.
DIGEST
Present law provides for the creation of public trusts to issue obligations and to provide
funds for the furtherance and accomplishment of any authorized public function or purpose
of the state or of any parish, municipality, political or governmental subdivision, or any other
governmental unit in the state in real or personal property.
Proposed law retains present law.
Present law provides that a public trust may incur debt and issue bonds, notes, or other
evidences of indebtedness to provide funds to fulfill and achieve its authorized public
functions or purposes, and provides that if the beneficiary of the public trust is a parish,
municipality, or a political or governmental subdivision thereof, all bonds or other debt
obligations shall only be issued after the public trust has adopted a resolution giving notice
of its intention to issue such bonds, and notice of this intention shall be published once a
week for four weeks in a newspaper in the locality of the beneficiary or in the parish where
it is located, with the first publication to appear at least 30 days before the public meeting
of the trust to hear any objections to the proposed issuance of the bonds.
Proposed law retains present law except that proposed law reduces the required publication
from once a week for four weeks to once a week for two weeks.
Present law provides for the electorate to approve the issuance of bond issues of certain
public trusts in certain circumstances. Proposed law makes technical change to update
citations for the procedure for bond elections from Subtitle II, Chapter 4, Part II of Title 39
of the La. Revised Statutes of 1950 to Chapter 6-A of Title 17 of the La. Revised Statutes
of 1950.
Present law requires that prior to the publication of the required notice of intention, the
contents of said notice of intention shall be approved by the State Bond Commission.
Proposed law deletes present law.
Present law requires that all bond issues of a public trust shall be submitted to and approved
by the State Bond Commission prior to the issuance and sale of the bonds by the State Bond SB NO. 253
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Commission.
Proposed law retains present law requirement that all bond issues of a public trust be
submitted to and approved by the State Bond Commission prior to the issuance and sale of
the bonds, but proposed law changes the seller of the bonds from the State Bond
Commission to the public trust.
Present law provides that the property of a public trust having Jefferson Parish as its
beneficiary which is authorized under its trust indenture to engage in or issue bonds to
finance projects for substantially all of the public purposes set forth in R.S. 9:2341(B)(1),
which is acquired or held for one or more of said purposes, is public property used for
essential public and governmental purposes. Provides that, accordingly, such public trust,
its properties and income, and bonds it issues and income from such bonds are exempt from
all taxes of the parish or municipality, the state, or any political subdivision thereof or any
other taxing body. Present law further provides that such public trust may require the lessee
of each of the projects of the public trust to pay annually to parish or municipal taxing
authorities or to any other taxing body, through the normal collecting agency, a sum in lieu
of ad valorem taxes to compensate such authorities for any services rendered by them to
such projects. Further provides that new law shall not become effective until approved by
a resolution of the Jefferson Parish Council.
Proposed law retains present law but deletes references to Jefferson Parish and makes
present law applicable to any public trust, having as its beneficiary a parish, municipality,
or a political or governmental subdivision thereof.
Effective on August 15, 2011.
(Amends R.S. 9:2347(A)(1), (H) and (M))