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Regular Session, 2012
SENATE BILL NO. 543
BY SENATOR RISER AND REPRESENTATIVE FANNIN
FUNDS/FUNDING. Authorizes the issuance of bonds secured by funds in the State
Highway Improvement Fund. (gov sig)
AN ACT1
To amend and reenact the introductory paragraph of R.S. 48:196(A) and to enact R.S.2
48:196.1, relative to the issuance of bonds; to authorize the State Bond Commission3
to issue bonds secured by monies in the State Highway Improvement Fund; to4
provide for the use of the proceeds of the bonds; to provide for a special fund; to5
provide for certain requirements and limitations on the issuance of bonds; to provide6
for a procedure to contest the validity of issuance of the bonds; to provide for the7
rights of bondholders; to authorize the issuance of refunding bonds; to provide for8
an effective date; and to provide for related matters.9
Be it enacted by the Legislature of Louisiana:10
Section 1. The introductory paragraph of R.S. 48:196(A) is hereby amended and11
reenacted and R.S. 48:196.1 is hereby enacted to read as follows: 12
§196. State Highway Improvement Fund13
A. There is hereby created, as a special fund in the state treasury, the State14
Highway Improvement Fund, hereinafter referred to as the "fund". The source of15
monies in this fund shall be registration and license fees and taxes collected by the16
state pursuant to R.S. 47:462, and as provided in R.S. 47:481, in such amounts as17 SB NO. 543
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remain after payment of amounts due on bonds and related expenses as1
provided in the documents pursuant to which the bonds were issued under the2
provisions of R.S. 49:196.1. Beginning July 1, 2007, and each fiscal year thereafter,3
after satisfaction of the requirements of the provisions of R.S. 49:196.1 and4
compliance with the requirements of Article VII, Section 9(B) of the Constitution of5
Louisiana, and after making the allocation for state highway fund No. 2, the treasurer6
shall deposit into the fund the following amounts:7
* * *8
§ 196.1. Bonds9
A. Without reference to any provision of the laws of Louisiana, and as10
a grant of power in addition to any other general or special law, the Louisiana11
State Bond Commission, herein after the "commission", on behalf of the12
Department of Transportation and Development, may issue bonds, notes,13
certificates or other evidences of indebtedness, hereinafter collectively referred14
to as "the bonds", for the purpose of funding projects set forth in Subsection C15
of Section 196 of this Part XI-A, and pledge monies in the fund for the payment16
of the principal and interest of such bonds. The commission is further17
authorized, in its discretion, to pledge all or any part of any gift, grant,18
donation, or other sum of money, aid, or assistance from the United States, the19
state, or any political subdivision thereof, unless otherwise restricted by the20
terms thereof, all or any part of the proceeds of bonds, credit agreements,21
instruments, or any other money of the commission, from whatever source22
derived, for the further securing of the payment of the principal and interest of23
the bonds. Any bonds issued pursuant to the provisions hereof shall constitute24
revenue bonds under Article VII, Section 6 of the Louisiana Constitution, and25
such bonds shall be payable solely from an irrevocable pledge and dedication26
of the registration and license fees and taxes collected by the state and deposited27
into the fund, or other fees, rates, rentals, charges, grants or other receipts or28
income derived by or in connection with an undertaking, facility, project, or any29 SB NO. 543
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combination thereof, without a pledge of the full faith and credit of the state,1
hereinafter referred to as "revenues".2
B. In accordance with the provisions of Article VII, Section (9)(A)(6) of3
the constitution of Louisiana there is hereby established a special fund for the4
purpose of providing for the securitization of any bonds which may be issued5
pursuant to the provision of this Section which shall include requirements for6
reserves and credit enhancement devices, all as may be provided in any7
resolution, trust agreement, indenture or other instrument pursuant to which8
such bonds were issued. The fund shall be administered by a trustee as9
designated by the State Bond Commission. The source of monies for the fund10
shall be the registration and license fees and taxes on trucks and trailers11
collected by the state pursuant to R.S. 47:492, and as provided in R.S. 47:481.12
All revenues received from such registration license fees and taxes as are13
necessary to provide for all requirements associated with the bonds as provided14
in this Section shall be classified and set aside in a separately identifiable fund15
or account outside of the state treasury but maintained by the state treasury and16
such revenues shall be assigned and pledged to the trustee under the documents17
pursuant to which the bonds were issued for the benefit of the holders of the18
bonds. Only after satisfaction of all requirements of this Section, shall any19
monies received by the state from the registration and license fees and taxes on20
trucks and trailers pursuant to R.S. 47:462, and as provided in R.S. 47:481, be21
available for any other purposes, and specifically for the provisions of R.S.22
48:196.23
C. Bonds issued under the provisions of this Section shall not be deemed24
to constitute a pledge of the full faith and credit of the state or of any25
governmental unit thereof. All such bonds shall contain a statement on their26
face substantially to the effect that neither the full faith and credit of the state27
nor the full faith and credit of any public entity of the state are pledged to the28
payment of the principal of or the interest on such bonds. The issuance of29 SB NO. 543
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bonds under the provisions of this Section shall not directly, indirectly, or1
contingently obligate the state or any governmental unit of the state to levy any2
taxes whatever therefor or to make any appropriation for their payment.3
D. Bonds shall be authorized by a resolution of the commission and shall4
be of such series, bear such date or dates, mature at such time or times, bear5
interest at such rate or rates, including but not limited to fixed, variable, or zero6
rates, be payable at such time or times, be in such denominations, be in such7
form, carry such registration and exchangeability privilege, be payable in such8
medium of payment and at such place or places, be subject to such terms of9
redemption prior to maturity at such price or prices as determined by the10
commission, and be entitled to such priority on the revenues as such resolution11
or resolutions may provide.12
E. Bonds shall be sold by the commission at public sale by competitive13
bid or negotiated private sale and at such price as the commission may14
determine to be in the best interest of the commission and the state.15
F. The issuance of the bonds shall not be subject to any limitations,16
except R.S. 39:1367 relative to the calculation of "net state tax supported debt",17
requirements, or conditions contained in any other law, and bonds may be18
issued without obtaining the consent of any political subdivision of the state or19
of any agency, commission or instrumentality of the state. The bonds shall be20
issued in compliance with the provisions of this Section.21
G. For a period of thirty days after the date of publication of a notice of22
intent to issue bonds in the official journal of the commission authorizing the23
issuance of bonds hereunder, any person in interest shall have the right to24
contest the legality of the resolution and the legality of the bond issue for any25
cause, but after that time no one shall have any cause or right of action to26
contest the legality of the resolution or of the bonds or the security therefor for27
any cause whatsoever. If no suit, action or proceeding is begun contesting the28
validity of the resolution, the bonds or the security therefor within the thirty29 SB NO. 543
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days herein prescribed, the authority to issue the bonds and to provide for the1
payment thereof, the legality thereof, and of all of the provisions of the2
resolution authorizing the issuance of the bonds shall be conclusively presumed3
to be legal and shall be incontestable. Any notice of intent so published shall set4
forth in reasonable detail the purpose of the bonds, the security therefor, and5
the parameters of amount, duration and interest rates. Any suit to determine6
the validity of bonds issued by the commission shall be brought only in7
accordance with the provisions of R.S. 13:5121 et seq.8
H. All bonds issued pursuant to this Section shall have all the qualities9
of negotiable instruments under the commercial laws of the state.10
I. Any pledge of the revenues or other monies made by the commission11
shall be valid and binding from the time when the pledge is made. The revenues12
or monies so pledged and thereafter received by the commission shall13
immediately be subject to the lien of such pledge without any physical delivery14
thereof or further act, and the lien of any such pledge shall be valid and binding15
as against all parties having claims of any kind in tort, contract, or otherwise16
against the commission irrespective of whether such parties have notice thereof.17
Any trust agreement or other instrument by which a pledge is created need not18
be filed or recorded except in the official records of the commission.19
J. Neither the member of the commission nor any person executing the20
bonds shall be liable personally for the bonds or be subject to any personal21
liability or accountability by reason of the issuance thereof.22
K. Bonds of the commission, their transfer, and the income thereof shall23
at all times be exempt from all taxation by the state or any political subdivision24
thereof, and may or may not be exempt for federal income tax purposes. The25
bonds issued pursuant to this Section shall be and are hereby declared to be26
legal and authorized investments for banks, savings banks, trust companies,27
building and loan associations, insurance companies, fiduciaries, trustees and28
guardians. Such bonds shall be eligible to secure the deposit of any and all29 SB NO. 543
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public funds of the state and any and all public funds of municipalities,1
parishes, school districts, or other political corporations or subdivisions of the2
state. Such bonds shall be lawful and sufficient security for said deposits to the3
extent of their value. When any bonds shall have been issued pursuant to4
Subsection A of this Section, neither the legislature, the state, nor any other5
entity may act to impair any obligation or contract for the benefit of the holders6
of the bonds or discontinue or decrease the fees, taxes, rates or other revenues7
pledged to the payment of the bonds authorized hereunder or permit to be8
discontinued or decreased said revenues in anticipation of the collection of9
which such bonds have been issued, or in any way make any change in the10
allocation and dedication of any fee, rate or other revenues which would11
diminish the amount of the revenues to be received by the commission, until all12
such bonds shall have been retired as to principal and interest, and there is13
hereby vested in the holders from time to time of such bonds a contract right in14
the provisions of this Section.15
L. The commission may provide by resolution for the issuance of16
refunding bonds pursuant to R.S. 39:1444 et seq.17
M. The holders of any bonds issued hereunder shall have such rights and18
remedies as may be provided in the resolution or trust agreement authorizing19
the issuance of the bonds, including but not by way of limitation, appointment20
of a trustee for the bondholders and any other available civil action to compel21
compliance with the terms and provisions of the bonds and the resolution or22
trust agreement.23
N. Subject to the agreements with the holders of bonds, all proceeds of24
bonds and all revenues pledged under a resolution or trust agreement25
authorizing or securing such bonds shall be deposited and held in trust in a fund26
or funds separate and apart from all other funds of the state treasury or of the27
department. Subject to the resolution or trust agreement, the trustee shall hold28
the same for the benefit of the holders of the bonds for the application and29 SB NO. 543
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disposition thereof solely to the respective uses and purposes provided in such1
resolution or trust agreement.2
O. The commission is authorized to employ all professionals it deems3
necessary in the issuance of the bonds.4
P. The commission is authorized to enter into any and all agreements or5
contracts, execute any and all instruments, and do and perform any and all acts6
necessary, convenient, or desirable for the issuance of the bonds or to carry out7
any power expressly given in this Section.8
Q. Any other provision of law to the contrary notwithstanding, any9
revenues deposited in the bond fund that are pledged to the repayment of any10
bonds issued in accordance with this Section may be collected and disbursed in11
accordance with the documents pursuant to which such bonds were issued.12
Section 2. If any provision of this Act or the application thereof is held invalid, such13
invalidity shall not affect other provisions or applications of this Act which can be given14
effect without the invalid provisions or applications, and to this end the provisions of this15
Act are hereby declared severable.16
Section 3. All laws or parts of law in conflict herewith are hereby repealed.17
Section 4. This Act shall become effective upon signature by the governor or, if not18
signed by the governor, upon expiration of the time for bills to become law without signature19
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If20
vetoed by the governor and subsequently approved by the legislature, this Act shall become21
effective on the day following such approval.
The original instrument and the following digest, which constitutes no part
of the legislative instrument, were prepared by Danielle Doiron.
DIGEST
Present law provides for the State Highway Improvement Fund of which the source of
monies is registration and license fees and taxes on trucks and trailers.
Proposed law provides that the source of monies in the fund are in amounts as remain after
payment of amounts due on bonds and related expenses as provided in the documents
pursuant to which the bonds were issued under the proposed law.
Present law provides that the treasurer shall deposit monies into the fund after compliance SB NO. 543
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with the requirements of Article VII, Section 9(B) of the La. Const. related to the Bond
Security and Redemption Fund, and after making the allocation for state highway fund No.
2.
Proposed law changes present law to provide that monies are deposited into the fund
according to present law after the satisfaction of the requirements of the bonds related to
proposed law.
Proposed law provides for the Louisiana State Bond Commission (the "commission"), on
behalf of the Department of Transportation and Development, to issue bonds, notes,
certificates or other evidences of indebtedness ("bonds"), for the purpose of funding projects
set forth in present law, and pledge monies in the fund for the payment of the principal and
interest of such bonds. The commission is further authorized by proposed law, in its
discretion, to pledge all or any part of any gift, grant, donation, or other sum of money, aid,
or assistance from the United States, the state, or any political subdivision thereof, unless
otherwise restricted by the terms thereof, all or any part of the proceeds of bonds, credit
agreements, instruments, or any other money of the commission, from whatever source
derived, for the further securing of the payment of the principal and interest of the bonds.
Any bonds issued pursuant to proposed law are revenue bonds under Article VII, Section 6
of the La. Constitution, and are payable solely from an irrevocable pledge and dedication of
the registration and license fees and taxes collected by the state and deposited into the fund,
or other fees, rates, rentals, charges, grants or other receipts or income derived by or in
connection with an undertaking, facility, project, or any combination thereof, without a
pledge of the full faith and credit of the state, hereinafter referred to as "revenues".
Proposed law provides that in accordance with the provisions of Article VII, Section
(9)(A)(6) of the La. Const., a special fund is established for the purpose of providing for the
securitization of any bonds which may be issued pursuant to the provision of proposed law
which shall include requirements for reserves and credit enhancement devices, all as may
be provided in any resolution, trust agreement, indenture or other instrument pursuant to
which such bonds were issued. The fund shall be administered by a trustee as designated
by the State Bond Commission. The source of monies for the fund shall be the registration
and license fees and taxes on trucks and trailers. All revenues received from such
registration license fees and taxes as are necessary to provide for all requirements associated
with the bonds as provided in proposed law shall be classified and set aside in a separately
identifiable fund or account outside of the state treasury but maintained by the state treasury
and such revenues shall be assigned and pledged to the trustee under the documents pursuant
to which the bonds were issued for the benefit of the holders of the bonds. Only after
satisfaction of all requirements of proposed law, shall any monies received by the state from
the registration and license fees and taxes on trucks and trailers, be available for any other
purposes, and specifically for the provisions related to the State Highway Improvement
Fund.
Proposed law provides that the bonds issued are not to be deemed to constitute a pledge of
the full faith and credit of the state or of any governmental unit. All such bonds shall contain
a statement on their face substantially to the effect that neither the full faith and credit of the
state nor the full faith and credit of any public entity of the state are pledged to the payment
of the principal of or the interest on such bonds. The issuance of bonds under the provisions
of proposed law do not directly, indirectly, or contingently obligate the state or any
governmental unit of the state to levy any taxes or to make any appropriation for their
payment.
Proposed law provides that the bonds are to be authorized by a resolution of the commission
and shall be of such series, bear such date or dates, mature at such time or times, bear
interest at such rate or rates, including but not limited to fixed, variable, or zero rates, be
payable at such time or times, be in such denominations, be in such form, carry such
registration and exchangeability privilege, be payable in such medium of payment and at
such place or places, be subject to such terms of redemption prior to maturity at such price SB NO. 543
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or prices as determined by the commission, and be entitled to such priority on the revenues
as such resolution or resolutions may provide.
Proposed law provides that the bonds are to be sold by the commission at public sale by
competitive bid or negotiated private sale and at such price as the commission may
determine to be in the best interest of the commission and the state.
Proposed law provides that the issuance of the bonds are not subject to any limitations,
except that the bonds are included in the calculation of "net state tax supported debt",
requirements or conditions contained in any other law, and bonds may be issued without
obtaining the consent of any political subdivision of the state or of any agency, commission
or instrumentality of the state. The bonds shall be issued in compliance with the provisions
of proposed law.
Proposed law provides that for a period of 30 days after the date of publication of a notice
of intent to issue bonds in the official journal of the commission authorizing the issuance of
bonds hereunder, any person in interest shall have the right to contest the legality of the
resolution and the legality of the bond issue for any cause, but after that time no one shall
have any cause or right of action to contest the legality of the resolution or of the bonds or
the security therefor for any cause whatsoever. If no suit, action or proceeding is begun
contesting the validity of the resolution, the bonds or the security therefor within the 30 days
herein prescribed, the authority to issue the bonds and to provide for the payment thereof,
the legality thereof, and of all of the provisions of the resolution authorizing the issuance of
the bonds shall be conclusively presumed to be legal and shall be incontestable. Any notice
of intent so published shall set forth in reasonable detail the purpose of the bonds, the
security therefor, and the parameters of amount, duration and interest rates. Any suit to
determine the validity of bonds issued by the commission shall be brought only in
accordance with the provisions of R.S. 13:5121 et seq.
Proposed law provides that all bonds issued pursuant to proposed law shall have all the
qualities of negotiable instruments under the commercial laws of the state.
Proposed law provides that any pledge of the revenues or other monies made by the
commission shall be valid and binding from the time when the pledge is made. The
revenues or monies so pledged and thereafter received by the commission shall immediately
be subject to the lien of such pledge without any physical delivery thereof or further act, and
the lien of any such pledge shall be valid and binding as against all parties having claims of
any kind in tort, contract, or otherwise against the commission irrespective of whether such
parties have notice thereof. Any trust agreement or other instrument by which a pledge is
created need not be filed or recorded except in the official records of the commission.
Proposed law provides that neither the member of the commission nor any person executing
the bonds shall be liable personally for the bonds or be subject to any personal liability or
accountability by reason of the issuance thereof.
Proposed law provides that bonds of the commission, their transfer, and the income thereof
are exempt from all taxation by the state or any political subdivision thereof, and may or
may not be exempt for federal income tax purposes. The bonds issued pursuant to proposed
law are legal and authorized investments for banks, savings banks, trust companies, building
and loan associations, insurance companies, fiduciaries, trustees and guardians. Such bonds
are eligible to secure the deposit of any and all public funds of the state and any and all
public funds of municipalities, parishes, school districts, or other political corporations or
subdivisions of the state. Such bonds are lawful and sufficient security for said deposits to
the extent of their value. When any bonds shall have been issued pursuant to proposed law,
neither the legislature, the state, nor any other entity may act to impair any obligation or
contract for the benefit of the holders of the bonds or discontinue or decrease the fees, taxes,
rates or other revenues pledged to the payment of the bonds authorized hereunder or permit
to be discontinued or decreased said revenues in anticipation of the collection of which such SB NO. 543
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bonds have been issued, or in any way make any change in the allocation and dedication of
any fee, rate or other revenues which would diminish the amount of the revenues to be
received by the commission, until all such bonds shall have been retired as to principal and
interest, and there is hereby vested in the holders from time to time of such bonds a contract
right in the provisions of proposed law.
Proposed law provides that the commission may provide by resolution for the issuance of
refunding bonds.
Proposed law provides that the holders of the bonds have such rights and remedies as may
be provided in the resolution or trust agreement authorizing the issuance of the bonds,
including but not by way of limitation, appointment of a trustee for the bondholders and any
other available civil action to compel compliance with the terms and provisions of the bonds
and the resolution or trust agreement.
Proposed law provides that subject to the agreements with the holders of bonds, all proceeds
of bonds and all revenues pledged under a resolution or trust agreement authorizing or
securing such bonds shall be deposited and held in trust in a fund or funds separate and apart
from all other funds of the state treasury or of the department. Subject to the resolution or
trust agreement, the trustee shall hold the same for the benefit of the holders of the bonds for
the application and disposition thereof solely to the respective uses and purposes provided
in such resolution or trust agreement.
Proposed law provides that the commission is authorized to employ all professionals it
deems necessary in the issuance of the bonds.
Proposed law provides that the commission is authorized to enter into any and all agreements
or contracts, execute any and all instruments, and do and perform any and all acts necessary,
convenient, or desirable for the issuance of the bonds or to carry out any power expressly
given proposed law.
Proposed law provides that any other provision of law to the contrary notwithstanding, any
revenues deposited in the bond fund that are pledged to the repayment of any bonds issued
in accordance with proposed law may be collected and disbursed in accordance with the
documents pursuant to which such bonds were issued.
Effective upon signature by the governor or lapse of time for gubernatorial action.
(Amends R.S. 48:196(A) intro. para.; adds R.S. 48:196.1)