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Regular Session, 2014 ENROLLED
SENATE BILL NO. 118
BY SENATORS DORSEY-COLOMB AND WALSWORTH
AN ACT1
To enact R.S. 39:1357, relative to fiscal administrators for political subdivisions; to establish2
the Fiscal Administrator Revolving Loan Fund as a special fund in the state treasury;3
to provide for the deposit of certain monies into the fund; to provide for the uses of4
monies in the fund; to authorize certain political subdivisions to borrow from the5
fund; to provide the terms and conditions of such borrowing; to provide for an6
effective date; and to provide for related matters.7
Be it enacted by the Legislature of Louisiana:8
Section 1. R.S. 39:1357 is hereby enacted to read as follows:9
ยง1357. Fiscal Administrator Revolving Loan Fund10
A. There is hereby established a revolving fund in the state treasury to11
be known as the "Fiscal Administrator Revolving Loan Fund", hereinafter12
referred to as the "fund", which shall be maintained and operated by the13
Department of the Treasury. The source of monies deposited in and credited14
to the fund shall be all grants, gifts, and donations received by the state for the15
purpose of funding fiscal administrators; any money appropriated by the16
legislature to the fund; the repayment of principal of and interest on loans and17
other obligations made to political subdivisions financed from the fund; and18
other revenues as may be provided by law.19
B. Money in the fund shall be invested by the state treasurer in the same20
manner as money in the state general fund. Interest earned on the investment21
of the money in the fund shall be credited to the fund after compliance with the22
requirements of Article VII, Section 9(B) relative to the Bond Security and23
Redemption Fund. All unexpended and unencumbered money in the fund at24
the end of a fiscal year shall remain in the fund.25
ACT No. 735 SB NO. 118 ENROLLED
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C. Notwithstanding any provisions of law to the contrary, and in1
addition to the authority to borrow money or incur debt under any other2
provisions of law, any political subdivision for which a fiscal administrator is3
in the process of being appointed or which has been appointed as provided in4
this Chapter, is hereby authorized to borrow money from and incur debt5
payable to the fund in accordance with the provisions of this Section. Such6
borrowing shall be subject to the approval of:7
(1) The legislative auditor, the attorney general, and the state treasurer.8
(2) The fiscal administrator, if one has been appointed by the court.9
(3) The district court having jurisdiction over the fiscal administration.10
(4) The State Bond Commission.11
D. The monies in the fund shall be appropriated and used only for the12
purpose of providing financial assistance to a political subdivision for which a13
court has appointed a fiscal administrator as provided in this Chapter by14
providing a source of funds from which the political subdivision may borrow in15
order to pay the costs and expenses associated with the independent fiscal16
administration of the political subdivision, including but not limited to all costs17
and expenses incurred by the fiscal administrator, the legislative auditor, the18
attorney general, the state treasurer, and any other persons engaged in19
connection with the independent fiscal administration.20
E. Each loan shall be evidenced by a bond, note, or other evidence of21
indebtedness of the borrower issued to represent an obligation to repay a loan22
from the fund and shall be authorized and issued pursuant to a resolution or23
ordinance of the governing authority of such entity, which shall prescribe the24
form and details thereof, including the terms, security for, manner of execution,25
repayment schedule, and redemption features thereof. Any such resolution or26
ordinance shall set forth the maximum principal amount, the maximum interest27
rate, which shall be at an interest rate that is less than or equal to the market28
interest rate, as determined by the Department of the Treasury, the maximum29
redemption premium, if any, and the maximum term of such indebtedness.30 SB NO. 118 ENROLLED
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F. All resolutions or ordinances authorizing the issuance of bonds, notes,1
or other evidence of indebtedness of a political subdivision hereunder shall be2
published once in the official journal of the borrower. It shall not be necessary3
to publish exhibits to such resolution or ordinance, but such exhibits shall be4
made available for public inspection at the offices of the governing authority of5
the borrower at reasonable times and such fact shall be stated in the6
publication. For a period of thirty days after the date of such publication, any7
persons in interest may contest the legality of the resolution or ordinance8
authorizing such evidence of indebtedness and any provisions thereof made for9
the security and payment thereof. After such thirty-day period, no one shall10
have any cause or right of action to contest the regularity, formality, legality, or11
effectiveness of the resolution or ordinance and the provisions thereof or of the12
bonds, notes, or other evidence of indebtedness authorized thereby for any13
cause whatsoever. If no suit, action, or proceeding is begun contesting the14
validity of the bonds, notes, or other evidence of indebtedness authorized15
pursuant to the resolution or ordinance within the thirty days prescribed in this16
Subsection, the authority to issue the bonds, notes, or other evidence of17
indebtedness, or to provide for the payment thereof, and the legality thereof,18
and all of the provisions of the resolution or ordinance and the evidence of19
indebtedness shall be conclusively presumed, and no court shall have authority20
or jurisdiction to inquire into any such matter.21
G. The Department of the Treasury may by suit, action, mandamus, or22
other proceedings, protect and enforce any covenant relating to and the security23
provided in connection with any indebtedness issued pursuant to this Section,24
and may by suit, action, mandamus, or other proceedings enforce and compel25
performance of all of the duties required to be performed by the governing body26
and officials of any borrower hereunder and in any proceedings authorizing the27
issuance of such bonds or other evidences of indebtedness.28
H. Monies in, credited to the account of, or to be received by the Fiscal29
Administrator Revolving Loan Fund shall be expended in a manner consistent30 SB NO. 118 ENROLLED
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with the terms and conditions of the loans made from the fund.1
I. The repayment of principal of and interest on loans and other2
obligations made to political subdivisions financed from the Fiscal3
Administrator Revolving Loan Fund shall be deposited into the Fiscal4
Administrator Revolving Loan Fund and may be used to finance loans and5
obligations to other political subdivisions for which a fiscal administrator is6
appointed pursuant to this Chapter, provided that reserves for expenditures for7
the administration of the fund that the Department of the Treasury deems8
necessary and prudent may be retained in the fund.9
J. The Department of the Treasury shall be authorized to enter into10
contracts and other agreements in connection with the operation of the fund11
and the department is authorized to adopt rules and regulations in accordance12
with the Administrative Procedure Act to implement the provisions of this13
Section.14
Section 2. This Act shall become effective upon signature by the governor or, if not15
signed by the governor, upon expiration of the time for bills to become law without signature16
by the governor, as provided by Article III, Section 18 of the Constitution of Louisiana. If17
vetoed by the governor and subsequently approved by the legislature, this Act shall become18
effective on the day following such approval.19
PRESIDENT OF THE SENATE
SPEAKER OF THE HOUSE OF REPRESENTATIVES
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: