Page 1 of 3 Coding: Words which are struck through are deletions from existing law; words in boldface type and underscored are additions. Regular Session, 2014 ENROLLED SENATE BILL NO. 384 BY SENATOR LAFLEUR AN ACT1 To enact R.S. 39:1438, relative to Louisiana municipal securities; to require that municipal2 securities of public entities comply with the continuing disclosure rules of the United3 States Securities and Exchange Commission; to provide definitions; to provide for4 recordkeeping and audit procedures associated with continuing disclosure; and to5 provide for related matters.6 Be it enacted by the Legislature of Louisiana:7 Section 1. R.S. 39:1438 is hereby enacted to read as follows: 8 ยง1438. Issuers of securities; continuing disclosure requirements; audit9 requirements10 A. Definitions. For purposes of this Section:11 (1) "Auditor" means the legislative auditor or any private accounting12 firm which prepares the annual financial audit of a public entity under rules of13 the legislative auditor regarding the audit of governmental entities, quasi-14 governmental entities, or entities otherwise subject to public audit by the15 legislative auditor.16 (2) "Continuing disclosure agreement" means any agreement entered17 into by an obligated person which sets forth the continuing disclosure18 obligations of such obligated person pursuant to the SEC rule.19 (3) "EMMA" means the Electronic Municipal Market Access system20 maintained by the Municipal Securities Rulemaking Board.21 (4) "Issuer" means any "issuer of municipal securities" as defined in the22 SEC rule.23 (5) "Municipal securities" means any securities which are issued by a24 public entity which are subject to continuing disclosure under the SEC rule.25 (6) "Obligated person" has the meaning defined in the SEC rule.26 (7) "Public entity" means the state, its agencies, departments, boards,27 ACT No. 463 SB NO. 384 ENROLLED Page 2 of 3 Coding: Words which are struck through are deletions from existing law; words in boldface type and underscored are additions. commissions, parishes, municipalities, school boards, special districts, special1 authorities, and any other political subdivision or other entity created by any2 of the foregoing.3 (8) "SEC rule" means the municipal securities continuing disclosure rule4 of the United States Securities and Exchange Commission codified as Section5 240.15c2-12 of Title 17 of the Code of Federal Regulations, together with all6 corresponding rules, updates, notices, and interpretations of the United States7 Securities and Exchange Commission and the Municipal Securities Rulemaking8 Board, as may be amended from time to time.9 B. Findings and purpose. The legislature recognizes that public entities10 often act as issuer or obligated persons of municipal securities and therefore are11 often subject to the SEC rule, which was established in order to provide12 municipal securities investors with more timely and transparent access to13 financial and other material information while such securities remain14 outstanding. The legislature finds that the continuing disclosure requirements15 of the SEC rule are in the public interest, and now desires to establish16 procedures to provide for compliance and audit with respect to municipal17 securities issued in the state.18 C. Recordkeeping. (1) Every public entity shall continuously maintain:19 (a) A list of all Louisiana municipal securities for which the public entity20 is the issuer or an obligated person.21 (b) A copy of all continuing disclosure agreements to which the public22 entity is a party.23 (c) If, pursuant to a continuing disclosure agreement to which the public24 entity is a party, the public entity is responsible for filing notices of changes in25 bond ratings, a list of current ratings for such securities, if any.26 (2) All records required to be kept by a public entity under this Section27 shall be subject to inspection by the public entity's auditor.28 D. Audit. As part of its annual financial audit of a public entity, a public29 entity's auditor shall:30 SB NO. 384 ENROLLED Page 3 of 3 Coding: Words which are struck through are deletions from existing law; words in boldface type and underscored are additions. (1) Review the public entity's compliance with the recordkeeping1 requirements of this Section.2 (2) Review a sample of the public entity's filings on EMMA to determine3 if such filings are in compliance with the continuing disclosure agreements to4 which the public entity is a party.5 PRESIDENT OF THE SENATE SPEAKER OF THE HOUSE OF REPRESENTATIVES GOVERNOR OF THE STATE OF LOUISIANA APPROVED: