General Assembly |
File No. 545 |
February Session, 2006 |
House of Representatives, April 18, 2006
The Committee on Finance, Revenue and Bonding reported through REP. STAPLES of the 96th Dist., Chairperson of the Committee on the part of the House, that the substitute bill ought to pass.
AN ACT CONCERNING THE BONDING PROCESS.
Be it enacted by the Senate and House of Representatives in General Assembly convened:
Section 1. Subsection (g) of section 3-20 of the 2006 supplement to the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(g) (1) With the exception of refunding bonds, whenever a bond act empowers the State Bond Commission to authorize bonds for any project or purpose or projects or purposes, and whenever the State Bond Commission finds that the authorization of such bonds will be in the best interests of the state, it shall authorize such bonds by resolution adopted by the approving vote of at least a majority of said commission. No such resolution shall be so adopted by the State Bond Commission unless it finds that there has been filed with it (A) any human services facility colocation statement to be filed with the Secretary of the Office of Policy and Management, if so requested by the secretary, pursuant to section 4b-23, as amended; (B) a statement from the Commissioner of Agriculture pursuant to section 22-6, for projects which would convert twenty-five or more acres of prime farmland to a nonagricultural use; (C) prior to the meeting at which such resolution is to be considered, any capital development impact statement required to be filed with the Secretary of the Office of Policy and Management; [and] (D) a statement as to the full cost of the project or purpose when completed and the estimated operating cost for any structure, equipment or facility to be constructed or acquired; and (E) such requests and such other documents as it or said bond act require, provided no resolution with respect to any school building project financed pursuant to section 10-287d, as amended, or any interest subsidy financed pursuant to section 10-292k, as amended, shall require the filing of any statements pursuant to subparagraph (A), (B), (C), [or] (D) or (E) of this subdivision and provided further any resolution requiring a capital impact statement shall be deemed not properly before the State Bond Commission until such capital development impact statement is filed. Any such resolution so adopted by the State Bond Commission shall recite the bond act under which said commission is empowered to authorize such bonds and the filing of all requests and other documents, if any, required by it or such bond act, and shall state the principal amount of the bonds authorized and a description of the purpose or project for which such bonds are authorized. Such description shall be sufficient if made merely by reference to a numbered subsection, subdivision or other applicable section of such bond act.
(2) The agenda of each meeting shall be made available to the members of the commission not later than [four] five business days prior to the meeting at which such agenda is to be considered. The day of the meeting shall count as one of the business days. The agenda of each meeting, or any supporting documents included with such agenda, shall include a reference to the statute or public or special act which is the source of any funds to be used for any project on such agenda, including any contingency funds and any reuse or reallocation of funds previously approved for any other use or project, and a notation of the outside source from which any funds for any such project were received, if any. The secretary of the commission shall provide the members with copies of any agreement entered into by the state with any private entity receiving bond funds in connection with any item on the agenda. Any item on the agenda that is revised after its placement thereon, or any supplemental item that is proposed for the agenda subsequent to the time such agenda has been agreed upon, shall be tabled and held for consideration for inclusion on a subsequent agenda.
(3) Upon adoption of a resolution, the principal amount of the bonds authorized therein for such purpose or project shall be deemed to be an appropriation and allocation of such amount for such purpose or project, respectively, and subject to approval by the Governor of allotment thereof and to any authorization for such project or purpose that may otherwise be required, contracts may be awarded and obligations incurred with respect to any such project or purpose in amounts not in the aggregate exceeding such authorized principal amount, notwithstanding that such contracts and obligations may at a particular time exceed the amount of the proceeds from the sale of such bonds theretofore received by the state. In any such resolution so adopted, the State Bond Commission may include provision for the date or dates of such bonds, the maturity of such bonds and, notwithstanding the provisions of any bond act taking effect prior to July 1, 1973, provision for either serial or term, sinking fund or other reserve fund requirements, if any, due dates of the interest thereon, the form of such bonds, the denominations and designation of such bonds, registration, conversion and transfer privileges and the terms of redemption with or without premium and the date and manner of sale of such bonds, provisions for the consolidation of such bonds with other bonds including refunding bonds for the purpose of sale as provided in subsection (h) of this section, limitations with respect to the interest rate or rates on such bonds, provisions for receipt and deposit or investment of the good faith deposit pending delivery of such bonds and such other terms and conditions of such bonds and of the issuance and sale thereof as the State Bond Commission may determine to be in the best interest of the state, provided the State Bond Commission may delegate to the Treasurer all or any part of the foregoing powers in which event the Treasurer shall exercise such powers until the State Bond Commission, by adoption of a resolution prior to exercise of such powers by the Treasurer shall elect to reassume the same. Such powers shall be exercised from time to time in such manner as the Treasurer shall determine to be in the best interests of the state and the Treasurer shall file a certificate of determination setting forth the details thereof with the secretary of the State Bond Commission on or before the date of delivery of such bonds, the details of which were determined by the Treasurer in accordance with such delegation.
(4) On or before January 1, 2007, and annually thereafter, the Secretary of the Office of Policy and Management shall submit a report to the joint standing committee of the General Assembly having cognizance of matters relating to finance, revenue and bonding, which report shall update, for all outstanding bond allocations, the statement required under subparagraph (D) of subdivision (1) of this subsection.
[(4)] (5) The State Bond Commission may authorize the Commissioner of Economic and Community Development to defer payments of interest or principal, or a portion thereof, in the case of a troubled loan, as defined in subdivision (1) of subsection (e) of section 8-37x, made by the commissioner under any provision of the general statutes.
Sec. 2. Subsection (a) of section 32-383 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(a) All provisions of section 3-20, as amended by this act, or the exercise of any right or power granted thereby which are not inconsistent with the provisions of sections 32-382 to 32-385, inclusive, are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to said sections, and temporary or interim notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20 and from time to time renewed provided no filings required by [subdivisions (1) and (2)] subparagraphs (A) and (B) of subdivision (1) of subsection (g) of said section 3-20 shall be required. Such bonds shall mature at such time or times not exceeding thirty years from either their respective dates or the estimated completion date of the stadium facility as referred to in subdivision (5) of section 32-397, as may be provided in or pursuant to the resolution or resolutions of the State Bond Commission authorizing such bonds. None of said bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization, which is signed by the secretary stating such terms and conditions as said commission, in its discretion, may require. Such bonds issued pursuant to section 32-382 shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on such bonds, including temporary or interim notes, as the same become due, and accordingly and as part of the contract of the state with the holders of such bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made including with respect to interest on temporary or interim notes and principal thereof to the extent not funded with renewals thereof or bonds, and the Treasurer shall pay such principal and interest as the same become due.
Sec. 3. Subsection (c) of section 32-614 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(c) All provisions of section 3-20, as amended by this act, or the exercise of any right or power granted thereby which are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to said section 3-20, and temporary or interim notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20, and from time to time renewed provided no filings required by [subdivisions (1) and (2)] subparagraphs (A) and (B) of subdivision (1) of subsection (g) of said section 3-20 shall be required. Such bonds shall mature at such time or times not exceeding twenty years from either their respective dates. None of said bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization, which is signed by the Secretary of the Office of Policy and Management stating such terms and conditions as said commission, in its discretion, may require. Such bonds issued pursuant to this section shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on such bonds, including temporary or interim notes, as the same become due, and accordingly and as part of the contract of the state with the holders of such bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made including with respect to interest on temporary or interim notes and principal thereof to the extent not funded with renewals thereof or bonds, and the State Treasurer shall pay such principal and interest as the same become due.
Sec. 4. Subsection (c) of section 32-616 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(c) All provisions of section 3-20, as amended by this act, or the exercise of any right or power granted thereby which are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to said section 3-20, and temporary or interim notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20, and from time to time renewed provided no filings required by [subdivisions (1) and (2)] subparagraphs (A) and (B) of subdivision (1) of subsection (g) of said section 3-20 shall be required. Such bonds shall mature at such time or times not exceeding twenty years from either their respective dates. None of said bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization, which is signed by the Secretary of the Office of Policy and Management stating such terms and conditions as said commission, in its discretion, may require. Such bonds issued pursuant to section 32-614, as amended by this act, shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on such bonds, including temporary or interim notes, as the same become due, and accordingly and as part of the contract of the state with the holders of such bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made including with respect to interest on temporary or interim notes and principal thereof to the extent not funded with renewals thereof or bonds, and the State Treasurer shall pay such principal and interest as the same become due.
Sec. 5. Subsection (d) of section 32-652 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(d) All provisions of section 3-20, as amended by this act, and the exercise of any right or power granted thereby which is not inconsistent with the provisions of this section, are hereby adopted and shall apply to all bonds authorized pursuant to this section, and temporary or interim notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20 and from time to time renewed provided no filings required by [subdivisions (1) and (2)] subparagraphs (A) and (B) of subdivision (1) of subsection (g) of said section 3-20 shall be required.
Sec. 6. Subsection (e) of section 32-653 of the general statutes is repealed and the following is substituted in lieu thereof (Effective from passage):
(e) All provisions of section 3-20, as amended by this act, and the exercise of any right or power granted thereby which is not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized pursuant to this section and temporary or interim notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20 and from time to time renewed provided no filings required by [subdivisions (1) and (2)] subparagraphs (A) and (B) of subdivision (1) of subsection (g) of said section 3-20 shall be required.
This act shall take effect as follows and shall amend the following sections: | ||
Section 1 |
from passage |
3-20(g) |
Sec. 2 |
from passage |
32-383(a) |
Sec. 3 |
from passage |
32-614(c) |
Sec. 4 |
from passage |
32-616(c) |
Sec. 5 |
from passage |
32-652(d) |
Sec. 6 |
from passage |
32-653(e) |
FIN |
Joint Favorable Subst. |
The following fiscal impact statement and bill analysis are prepared for the benefit of members of the General Assembly, solely for the purpose of information, summarization, and explanation, and do not represent the intent of the General Assembly or either House thereof for any purpose:
OFA Fiscal Note
Agency Affected |
Fund-Effect |
FY 07 $ |
FY 08 $ |
Policy & Mgmt., Off. |
GF - Cost |
30,000 |
30,000 |
Note: GF=General Fund
Explanation
The bill requires various agencies, for which the Bond Commission authorizes a bond, to file a statement with the commission as to the full cost of the project or purpose when completed and the estimated operating cost for any structure, equipment or facility to be constructed or acquired. Whereas, most agencies currently prepare such an analysis, most agencies will not incur any costs. The Office of Policy and Management (OPM) may incur costs to develop these cost estimates for changes in private provider rates resulting from non-profit entities receiving bond funds. It is anticipated that OPM will require no more than one half-time staff person with an annual salary of $30,000. It should be noted that sHB 5007, the budget bill, as favorably reported by the Appropriations Committee contains $335,000 for additional staff. It is uncertain if these funds would be available for this purpose.
The bill requires OPM to report on all outstanding bond allocations, which results in no fiscal impact on the agency as such information is monitored by the agency. The bill makes a variety of other changes that have no fiscal impact.
The annualized ongoing fiscal impact identified above would continue into the future subject to inflation.
OLR Bill Analysis
AN ACT CONCERNING THE BONDING PROCESS.
This bill:
1. requires the Office of Policy and Management (OPM) secretary to issue the agenda for State Bond Commission meetings sooner;
2. requires any item that is revised after being placed on the agenda, or proposed to be added to an agenda that has been agreed on, to be held for a future agenda;
3. requires the OPM secretary to provide the commission with copies of agreements with private entities receiving bond funds in connection with an item;
4. adds to statements that must be filed with the commission before it approves bond allocations;
5. requires the OPM secretary to provide annual cost updates to the Finance, Revenue and Bonding Committee on outstanding bond allocations; and
6. makes technical changes (§§ 2-6).
EFFECTIVE DATE: Upon passage
BOND COMMISSION AGENDAS
The bill requires meeting agendas to be available to commission members at least five, rather than at least four, business days before a meeting. It requires any item that is either revised after being placed on an agenda, or proposed for an agenda after the agenda is agreed on, to be tabled and held for consideration for a future agenda. (The bill does not say who agrees on the agendas.)
INFORMATION REQUIRED BEFORE BOND ALLOCATIONS
The bill requires the OPM secretary, in addition to the information and supporting documents already required for agenda items, to give commission members a copy of any agreement between the state and a private entity receiving bond funds in connection with an agenda item.
It also adds to the statements that must be filed with the commission before it may approve a bond allocation for a particular project or purpose. In addition to the currently required statements concerning human service facility colocation and farmland and capital development impacts, the bill requires the commission to have received a statement of the (1) full completed cost of the project or purpose receiving the allocation and (2) estimated operating cost of any structure, facility, or equipment being built or acquired.
ANNUAL COST UPDATE
Starting January 1, 2007, the bill requires the OPM secretary to file an annual report with the Finance, Revenue and Bonding Committee that updates, for all outstanding bond allocations, (1) the full completed cost of the project or purpose that received the allocation and (2) the estimated operating costs of any structure, facility, or equipment being built or acquired.
BACKGROUND
State Bond Commission
The State Bond Commission is a 10-member executive-legislative committee consisting of the governor, treasurer, comptroller, attorney general, the OPM secretary, public works commissioner, and the co-chairs and ranking members of the Finance, Revenue and Bonding Committee. The commission meets periodically (usually monthly) to allocate bonds the General Assembly has authorized to particular projects. The governor chairs the commission and controls its agenda. The OPM secretary acts as the commission's secretary and keeps its records and minutes.
COMMITTEE ACTION
Finance, Revenue and Bonding Committee
Joint Favorable Substitute
Yea |
45 |
Nay |
4 |
(04/03/2006) |