DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part of the
legislative instrument. The keyword, one-liner, abstract, and digest do not constitute part of the law
or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 155 Engrossed 2023 Regular Session Butler
Abstract: Establishes the La. Infrastructure Rural Revolving Loan Program to provide financial
assistance for eligible infrastructure projects of local governments.
Proposed law establishes a revolving loan fund in the state treasury to be known as the "La. Rural
Infrastructure Revolving Loan Program Fund", hereinafter "fund", which shall be maintained and
operated by the Dept. of the Treasury. Proposed law provides for the source of monies deposited
into the fund including the deposit of funds for the repayment of principal and interest on loans and
other obligations made to local governments financed from the fund. These funds may be used to
finance loans and obligations for projects of
local governments if reserves for expenditures for the administration of the fund that the department
deems necessary and prudent are retained in the fund.
Proposed law requires money in the fund to be invested by the state treasurer in the same manner as
money in the state general fund and requires interest earned on the investment of the money in the
fund to be credited to the fund after compliance with the requirements of present constitution relative
to the Bond Security and Redemption Fund. All unexpended and unencumbered money in the fund
at the end of a fiscal year shall remain in the fund.
Proposed law limits the maximum amount of a loan that may be funded through the revolving loan
fund to $1.5M.
Proposed law defines a "local government" for purposes of proposed law as a political subdivision
with a population of less than 15,000 according to the latest federal decennial census. Further limits
a local government to one loan from the revolving loan fund until the loan is paid in full; however,
once all of the principal, interest, and any other fees and obligations due under the loan agreement
are paid in full, the local government may apply for a new loan from the revolving loan fund.
Proposed law requires a local government to comply with all of the following in order to be eligible
for a loan pursuant to the provisions of proposed law:
(1)Demonstrate it has financial resources and a financial strategy for the duration of the lifecycle
of the project to ensure the project is sufficiently funded, maintained, and replaced as needed.
(2)Be in good-standing and comply with audit requirements provided for in present law at the
time of applying for and receiving the loan as well as during the duration of the term of the
loan. Proposed law authorizes the Dept. of the Treasury, hereinafter "Treasury", to promulgate rules in
accordance with present law (Administrative Procedure Act) as are necessary to implement the
provisions of proposed law including rules to adopt a schedule of reasonable fees and charges to pay
for the costs of administering the fund and rules to respond to emergency requests.
Proposed law requires that before a loan or other assistance may be requested from the commission,
the project shall first have been approved by the "certifying department". Designates the State Bond
Commission (SBC) as the certifying department for emergency requests.
Proposed law defines an "emergency request" as an eligible infrastructure project request submitted
by a local government between legislative sessions that is essential to alleviate conditions that are
hazardous to life, health, or property. "Emergency request" includes projects that have an anticipated
useful life of less than 20 years and a value or cost of less than $50,000 that would not otherwise
qualify for funding in an approved infrastructure program.
Proposed law, with respect to a bond, note, or other evidence of indebtedness of a local government
issued through a loan, provides for the same requirements concerning interest rates and public notice
as provided in present law concerning the adoption of a resolution or ordinance authorizing the
issuance of indebtedness.
Proposed law authorizes a local government to pledge as security for a loan and any ancillary fees
or other costs, any revenues from its general revenue fund, sales taxes, sewer user fees, assessments,
parcel fees, or ad valorem property taxes.
Proposed law exempts from taxation, any interest on bonds, notes, or other evidences of
indebtedness issued through a loan.
Proposed law for purposes of security of debt or performance obligations of debt for projects,
authorizes the commission to issue and deliver evidences of its guarantee of the debt of other entities,
and to execute pledges of the monies on deposit in the commission, including payments pursuant to
letters of credit. All evidences of indebtedness, guarantees, and pledges delivered pursuant to this
authority shall constitute limited obligations of the commission and shall not be secured by the full
faith and credit of the state.
Proposed law provides that the withdrawal of monies from the revolving loan fund to pay debt
service on any bond, note, or other evidence of indebtedness, obligation of guarantee of any debt,
or pledge to secure any debt, or fees and associated costs to administer a loan shall not constitute
or be subject to appropriation by the legislature.
Proposed law authorizes the legislative auditor to review all applications for compliance with the
provisions of proposed law.
Proposed law requires, beginning Jan. 1, 2026, and every two years thereafter, the SBC to issue a
report to the House Ways and Means Committee and the Senate Revenue and Fiscal Affairs
Committee which includes information on the number of loans approved by the commission, outstanding loan balances, including principal and interest, the status of any debt sold to provide
monies for the fund, costs incurred by the SBC to administer the fund, and the status of rules adopted
by the SBC.
Present law provides for the definition of "net state tax supported debt" and includes those issuances
excluded from the definition.
Proposed law retains present law and adds as an exclusion, any bond, note, certificate, warrant,
reimbursement obligation, or other evidence of indebtedness issued pursuant to proposed law.
Effective July 1, 2023.
(Adds R.S. 39:462.1-462.7 and R.S. 39:1367(E)(2)(b)(x))