First Substitute H.B. 46

Representative Curtis Oda proposes the following substitute bill:

1 DISASTER RECOVERY FUNDING
2 2007 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Curtis Oda
5 Senate Sponsor: Sheldon L. Killpack
6 Cosponsors:
7 Douglas C. Aagard
8 Sheryl L. Allen
9 Roger E. Barrus
10 Ralph Becker
11 Jackie Biskupski
12 DeMar Bud Bowman
13 D. Gregg Buxton
14 David Clark
15 Stephen D. Clark
16 Tim M. Cosgrove
17 Bradley M. Daw
18 Glenn A. Donnelson
19 Carl W. DuckworthJames A. Dunnigan
Ben C. Ferry
Janice M. Fisher
Julie Fisher
Lorie D. Fowlke
Craig A. Frank
Gage Froerer
James R. Gowans
Keith Grover
Wayne A. Harper
Neal B. Hendrickson
Christopher N. Herrod
Gregory H. Hughes
Fred R. HunsakerEric K. Hutchings
Christine A. Johnson
Brad King
Rebecca D. Lockhart
Karen W. Morgan
Michael E. Noel
Paul Ray
Phil Riesen
Jennifer M. Seelig
Kenneth W. Sumsion
Aaron Tilton
Larry B. Wiley
Carl Wimmer
Scott L Wyatt 20
21 LONG TITLE
22 General Description:
23 This bill modifies provisions related to funding state and local government recovery
24 efforts in cases of declared disasters.
25 Highlighted Provisions:
26 This bill:
27 . addresses emergency expenditures by local governments;
28 . transitions current loan programs for disasters to the Disaster Recovery Funding
29 Act;

30 . modifies the duties of the Division of Emergency Services and Homeland Security;
31 . enacts the Disaster Recovery Funding Act including:
32 . enacting definitions;
33 . creating the State Disaster Recovery Restricted Account;
34 . directing the division to address state emergency disaster services;
35 . authorizing local governments to create local disaster funds; and
36 . requiring reporting;
37 . addresses the governor's powers in cases of emergency;
38 . provides for deposits into the state disaster recovery funds;
39 . coordinates the state disaster recovery fund with funds outside the act;
40 . addresses limitations on spending; and
41 . makes technical and conforming amendments.
42 Monies Appropriated in this Bill:
43 None
44 Other Special Clauses:
45 None
46 Utah Code Sections Affected:
47 AMENDS:
48 10-5-118, as enacted by Chapter 34, Laws of Utah 1983
49 10-6-129, as last amended by Chapter 52, Laws of Utah 1981
50 17-36-27, as enacted by Chapter 22, Laws of Utah 1975
51 53-2-102.5, as last amended by Chapter 89, Laws of Utah 2006
52 53-2-104, as last amended by Chapter 214, Laws of Utah 2005
53 63-5a-8, as last amended by Chapter 14, Laws of Utah 2002
54 63-38c-103, as last amended by Chapter 1, Laws of Utah 2005, First Special Session
55 63-38f-904, as renumbered and amended by Chapter 148, Laws of Utah 2005
56 ENACTS:
57 53-2-401, Utah Code Annotated 1953
58 53-2-402, Utah Code Annotated 1953
59 53-2-403, Utah Code Annotated 1953
60 53-2-404, Utah Code Annotated 1953

61 53-2-405, Utah Code Annotated 1953
62 53-2-406, Utah Code Annotated 1953
63 63-38-2.7, Utah Code Annotated 1953
64
65 Be it enacted by the Legislature of the state of Utah:
66 Section 1. Section 10-5-118 is amended to read:
67 10-5-118. Emergency expenditures.
68 (1) The council, on determining that an emergency exists, such as widespread damage
69 from fire, flood, or earthquake, and that the emergency necessitates the expenditure of money
70 in excess of the budget of the general fund, may amend the budget and authorize such
71 expenditures as may be reasonably necessary to meet the emergency.
72 (2) Except to the extent provided for in Title 53, Chapter 2, Part 4, Disaster Recovery
73 Funding Act, a council of a town may not expend monies in the town's local fund for an
74 emergency, if the town creates a local fund under Title 53, Chapter 2, Part 4, Disaster Recovery
75 Funding Act.
76 Section 2. Section 10-6-129 is amended to read:
77 10-6-129. Emergency expenditures.
78 [In the event] (1) If the governing body of a city determines that an emergency exists,
79 such as widespread damage from fire, flood, or earthquake, and that the emergency necessitates
80 the expenditure of money in excess of the budget of the general fund, the governing body may
81 by resolution amend the budget and authorize such expenditures and incur such deficits in the
82 fund balance of the general fund as may be reasonably necessary to meet the emergency.
83 (2) Except to the extent provided for in Title 53, Chapter 2, Part 4, Disaster Recovery
84 Funding Act, the governing body of a city may not expend monies in the city's local fund for an
85 emergency, if the city creates a local fund under Title 53, Chapter 2, Part 4, Disaster Recovery
86 Funding Act.
87 Section 3. Section 17-36-27 is amended to read:
88 17-36-27. Emergency expenditures -- Deficit.
89 (1) If the governing body determines that an emergency exists, such as widespread
90 damage from fire, flood, or earthquake, and that the expenditure of money in excess of the
91 general fund budget is necessary, it may make such expenditures and incur such deficits as

92 reasonably necessary to meet the emergency.
93 (2) Except to the extent provided for in Title 53, Chapter 2, Part 4, Disaster Recovery
94 Funding Act, the governing body of the county may not expend monies in the county's local
95 fund for an emergency, if the county creates a local fund under Title 53, Chapter 2, Part 4,
96 Disaster Recovery Funding Act.
97 Section 4. Section 53-2-102.5 is amended to read:
98 53-2-102.5. Loan program for disasters prior to Disaster Recovery Funding Act.
99 [(1) The director may make loans to local governments as provided in this section
100 when:]
101 [(a) the governor has issued a proclamation declaring a state of emergency because of a
102 natural disaster;]
103 [(b) the Legislature has appropriated monies to the division explicitly for that purpose;
104 and]
105 [(c) threats to the public health and safety, or damages to flood control systems or the
106 transportation infrastructure exist.]
107 [(2) (a) In order to qualify for loans under this section, the county and each political
108 subdivision within the county shall:]
109 [(i) pass a resolution that:]
110 [(A) requests a loan;]
111 [(B) identifies the loan amount that is requested; and]
112 [(C) describes, in as much detail as possible, how the entity will spend the loan
113 proceeds; and]
114 [(ii) complete the application for funds provided by the director.]
115 [(b) Each political subdivision other than the county shall submit a copy of its
116 resolution and application to the county legislative body.]
117 [(c) The county legislative body shall file with the director:]
118 [(i) a letter identifying the total loan amount sought by the county and its political
119 subdivisions; and]
120 [(ii) a copy of the county's resolution and application and a copy of the resolution and
121 application of each political subdivision seeking loan funds.]
122 [(3) (a) To the extent appropriated funds are available, the director shall prepare a

123 promissory note lending the county the total amount requested by the county for itself and its
124 political subdivisions.]
125 [(b) Except as required in Subsections (8) and (9), the director shall ensure that the
126 promissory note contains:]
127 [(i) a requirement that the principal on the note is due on the May 1 in the calendar year
128 two years after the year in which the note is signed;]
129 [(ii) terms that require repayment of the principal on the note be made to the General
130 Fund Budget Reserve Account established in Section 63-38-2.5 ; and]
131 [(iii) terms that limit the use of note proceeds to the repair and reconstruction of
132 infrastructures owned by local governments located within the county.]
133 [(c) After an authorized representative of the county signs the promissory note, the
134 director shall disburse the loan funds to the county.]
135 [(4) The county and any participating political subdivision may not use loan proceeds
136 for costs:]
137 [(a) that could have been paid from other available funding sources if the county or
138 participating political subdivision had applied for those funds; or]
139 [(b) to compensate private businesses or private persons for damages incurred in the
140 disaster by those private businesses or persons.]
141 [(5) After receiving the loan proceeds from the state, the county shall, before
142 disbursing loan proceeds to the other county political subdivisions, obtain signed promissory
143 notes from each participating political subdivision that include terms substantially similar to
144 the terms contained in the promissory note signed by the county.]
145 [(6) The county shall, on behalf of itself and any participating political subdivision, file
146 a report with the director every three months, that:]
147 [(a) specifies each project on which loan funds were expended, classified by the name
148 of the local entity that expended the funds; and]
149 [(b) identifies the amount expended for that project.]
150 [(7) If the county or one of its participating political subdivisions has not expended or
151 committed the funds by the date that the promissory note is due, the county or participating
152 political subdivision shall return the unused or uncommitted funds to the director for redeposit
153 into the fund.]

154 [(8)] (1) (a) For each promissory note issued under this section that is unpaid on May
155 1, 2006, the director shall issue a new promissory note to replace the existing promissory note:
156 [(a)] (i) for the principal amount of the unpaid promissory note without accrued
157 interest, if any;
158 [(b)] (ii) due on or before June 30, 2007; and
159 [(c)] (iii) with no interest rate.
160 (b) For a promissory note issued under this section that is unpaid as of April 30, 2007,
161 the division shall ensure that when the principal on the promissory note is repaid, the
162 repayment is made to the State Disaster Recovery Restricted Account created in Section
163 53-2-403 .
164 [(9)] (2) The director shall ensure that each promissory note issued under this section
165 that is funded by monies appropriated and available for disaster loans as of January 1, 2006, are
166 due on or before June 30, 2007.
167 (3) The Division of Finance shall transfer by no later than June 30, 2007, any monies
168 repaid under this section to the General Fund Budget Reserve Account established in Section
169 63-38-2.5 to the State Disaster Recovery Restricted Account created in Section 53-2-403 .
170 Section 5. Section 53-2-104 is amended to read:
171 53-2-104. Division duties -- Powers.
172 (1) The division shall:
173 (a) respond to the policies of the governor and the Legislature;
174 (b) perform functions relating to emergency services and homeland security matters as
175 directed by the commissioner;
176 (c) prepare, implement, and maintain programs and plans to provide for:
177 (i) prevention and minimization of injury and damage caused by disasters;
178 (ii) prompt and effective response to and recovery from disasters;
179 (iii) identification of areas particularly vulnerable to disasters;
180 (iv) coordination of hazard mitigation and other preventive and preparedness measures
181 designed to eliminate or reduce disasters;
182 (v) assistance to local officials, state agencies, and the business and public sectors, in
183 developing emergency action plans;
184 (vi) coordination of federal, state, and local emergency activities;

185 (vii) coordination of emergency operations plans with emergency plans of the federal
186 government;
187 (viii) coordination of search and rescue activities;
188 (ix) coordination of rapid and efficient communications in times of emergency; and
189 (x) other measures necessary, incidental, or appropriate to this part; [and]
190 (d) coordinate with local officials, state agencies, and the business and public sectors in
191 developing, implementing, and maintaining a state energy emergency plan in accordance with
192 Section 53-2-110 [.]; and
193 (e) administer Part 4, Disaster Recovery Funding Act, in accordance with that part.
194 (2) The division may consult with the Legislative Management Committee, the Judicial
195 Council, and legislative and judicial staff offices to assist them in preparing emergency
196 succession plans and procedures under Title 63, Chapter 5b, Emergency Interim Succession
197 Act.
198 Section 6. Section 53-2-401 is enacted to read:
199 Part 4. Disaster Recovery Funding Act
200 53-2-401. Title.
201 This part is known as the "Disaster Recovery Funding Act."
202 Section 7. Section 53-2-402 is enacted to read:
203 53-2-402. Definitions.
204 (1) Unless otherwise defined in this section, the terms defined in Part 1, Emergency
205 Services and Homeland Security Act, shall have the same meaning for this part.
206 (2) As used in this part:
207 (a) Subject to Subsections (2)(a)(ii), "declared disaster" means one or more events:
208 (i) within the state;
209 (ii) that occur within a limited period of time;
210 (iii) that involve:
211 (A) a significant number of persons being at risk of bodily harm, sickness, or death; or
212 (B) a significant portion of real property at risk of loss;
213 (iv) that are sudden in nature and generally occur less frequently than every three years;
214 and
215 (v) that results in:

216 (A) the president of the United States declaring an emergency or major disaster in the
217 state;
218 (B) the governor declaring a state of emergency under Title 63, Chapter 5a, Disaster
219 Response and Recovery; or
220 (C) the chief executive officer of a local government declaring a local emergency under
221 Title 63, Chapter 5a, Disaster Response and Recovery.
222 (b) "Disaster recovery fund" means the State Disaster Recovery Restricted Account
223 created in Section 53-2-403 .
224 (c) "Emergency preparedness" means the following done for the purpose of being
225 prepared for an emergency as defined by the division by rule made in accordance with Title 63,
226 Chapter 46a, Utah Administrative Rulemaking Act:
227 (i) the purchase of equipment;
228 (ii) the training of personnel; or
229 (iii) the obtaining of a certification.
230 (d) (i) "Emergency disaster services" means the following that are of a temporary basis:
231 (A) evacuation;
232 (B) shelter;
233 (C) medical triage;
234 (D) emergency transportation;
235 (E) repair of infrastructure;
236 (F) safety services, including fencing or roadblocks;
237 (G) sandbagging;
238 (H) emergency debris removal;
239 (I) temporary bridges;
240 (J) procurement and distribution of food, water, or ice;
241 (K) procurement and deployment of generators;
242 (L) rescue or recovery; or
243 (M) services similar to those described in Subsections (2)(d)(i)(A) through (L), as
244 defined by the division by rule, that are generally required within the first 96 hours of a
245 declared disaster.
246 (ii) "Emergency disaster services" does not include:

247 (A) emergency preparedness; or
248 (B) notwithstanding whether or not a county participates in the Wildland Fire
249 Suppression Fund created in Section 65A-8-6.1 , any fire suppression or presuppression costs
250 that may be paid for from the Wildland Fire Suppression Fund if the county participates in the
251 Wildland Fire Suppression Fund.
252 (e) "Local fund" means a local government disaster fund created in accordance with
253 Section 53-2-405 .
254 (f) "Local government" means a county, city, or town.
255 (g) "Special fund" means a fund other than a general fund of a local government that is
256 created for a special purpose established under the uniform system of budgeting, accounting,
257 and reporting.
258 Section 8. Section 53-2-403 is enacted to read:
259 53-2-403. State Disaster Recovery Restricted Account.
260 (1) (a) There is created a restricted account in the General Fund known as the "State
261 Disaster Recovery Restricted Account."
262 (b) The disaster recovery fund shall consist of:
263 (i) monies deposited into the disaster recovery fund in accordance with Section
264 53-2-102.5 ;
265 (ii) monies deposited into the disaster recovery fund in accordance with Section
266 63-38-2.7 ;
267 (iii) monies appropriated to the disaster recovery fund by the Legislature;
268 (iv) any other public or private monies received by the division that are:
269 (A) given to the division for purposes consistent with this section; and
270 (B) deposited into the disaster recovery fund at the request of:
271 (I) the division; or
272 (II) the person giving the monies; and
273 (v) interest or other earnings derived from the disaster recovery fund.
274 (c) Monies in the disaster recovery fund may only be used as follows:
275 (i) without the monies being appropriated by the Legislature, in any fiscal year the
276 division may use $100,000 to fund, in accordance with Section 53-2-405 , costs to the state of
277 emergency disaster services in response to a declared disaster; and

278 (ii) subject to being appropriated by the Legislature, monies not described in
279 Subsection (1)(c)(i) may be used to fund costs to the state directly related to a declared disaster
280 that are not costs related to:
281 (A) emergency disaster services;
282 (B) emergency preparedness; or
283 (C) notwithstanding whether or not a county participates in the Wildland Fire
284 Suppression Fund created in Section 65A-8-6.1 , any fire suppression or presuppression costs
285 that may be paid for from the Wildland Fire Suppression Fund if the county participates in the
286 Wildland Fire Suppression Fund.
287 (3) The state treasurer shall invest monies in the disaster recovery fund according to
288 Title 51, Chapter 7, State Money Management Act, except that the state treasurer shall deposit
289 all interest or other earnings derived from the disaster recovery fund into the disaster recovery
290 fund.
291 (4) (a) Except as provided in Subsection (1), the monies in the disaster recovery fund
292 may not be diverted, appropriated, or used for a purpose that is not listed in this section.
293 (b) Notwithstanding Section 63-38-3.6 , the Legislature may not appropriate monies
294 from the disaster recovery fund to eliminate or otherwise reduce an operating deficit if the
295 monies appropriated from the disaster recovery fund are used for a purpose other than one
296 listed in this section.
297 (c) The Legislature may not amend the purposes for which monies in the disaster
298 recovery fund may be used except by the affirmative vote of two-thirds of all the members
299 elected to each house.
300 Section 9. Section 53-2-404 is enacted to read:
301 53-2-404. Emergency disaster services.
302 (1) Subject to this section and Section 53-2-403 , the division shall use monies
303 described in Subsection 53-2-403 (1)(c)(i) to fund costs to the state of emergency disaster
304 services.
305 (2) Monies may be paid by the division under this section to government entities and
306 private persons providing emergency disaster services are subject to Title 63, Chapter 56, Utah
307 Procurement Code.
308 Section 10. Section 53-2-405 is enacted to read:

309 53-2-405. Local government disaster funds.
310 (1) (a) Subject to this section and notwithstanding anything to the contrary contained in
311 Title 10, Utah Municipal Code, or Title 17, Counties, the legislative body of a local
312 government may create and maintain by ordinance a special fund known as a local government
313 disaster fund.
314 (b) The local fund shall consist of:
315 (i) subject to the limitations of this section, monies transferred to it in accordance with
316 Subsection (2);
317 (ii) any other public or private monies received by the local government that are:
318 (A) given to the local government for purposes consistent with this section; and
319 (B) deposited into the local fund at the request of:
320 (I) the legislative body of the local government; or
321 (II) the person giving the monies; and
322 (iii) interest or income realized from the local fund.
323 (c) Interest or income realized from the local fund shall be deposited into the local
324 fund.
325 (d) Monies in a local fund may be:
326 (i) deposited or invested as provided in Section 51-7-11 ; or
327 (ii) transferred by the local government treasurer to the state treasurer under Section
328 51-7-5 for the state treasurer's management and control under Title 51, Chapter 7, State Money
329 Management Act.
330 (e) (i) The monies in a local fund may accumulate from year to year until the local
331 government legislative body determines to spend any money in the local fund for one or more
332 of the purposes specified in Subsection (3).
333 (ii) Monies in a local fund at the end of a fiscal year:
334 (A) shall remain in the local fund for future use; and
335 (B) may not be transferred to any other fund or used for any other purpose.
336 (2) The amounts transferred to a local fund may not exceed 10% of the total estimated
337 revenues of the local government for the current fiscal period that are not restricted or
338 otherwise obligated.
339 (3) Monies in the fund may only be used to fund the services and activities of the local

340 government creating the local fund in response to:
341 (a) a declared disaster within the boundaries of the local government;
342 (b) the aftermath of the disaster that gave rise to a declared disaster within the
343 boundaries of the local government; and
344 (c) subject to Subsection (5), emergency preparedness.
345 (4) (a) A local fund is subject to this part and:
346 (i) in the case of a town, Title 10, Chapter 5, Uniform Fiscal Procedures Act for Utah
347 Towns, except for:
348 (A) in addition to the funds listed in Section 10-5-106 , the mayor shall prepare a
349 budget for the local fund;
350 (B) Section 10-5-119 addressing termination of special funds does not apply to a local
351 fund; and
352 (C) the council of the town may not authorize an interfund loan under Section
353 10-5-120 from the local fund;
354 (ii) in the case of a city, Title 10, Chapter 6, Uniform Fiscal Procedures Act for Utah
355 Cities, except for:
356 (A) in addition to the funds listed in Section 10-6-109 , the mayor shall prepare a
357 budget for the local fund;
358 (B) Section 10-6-131 addressing termination of special funds does not apply to a local
359 fund; and
360 (C) the governing body of the city may not authorize an interfund loan under Section
361 10-6-132 from the local fund; and
362 (iii) in the case of a county, Title 17, Chapter 36, Uniform Fiscal Procedures Act for
363 Counties, except for:
364 (A) Section 17-36-29 addressing termination of special funds; and
365 (B) the governing body of the county may not authorize an interfund loan under
366 Section 17-36-30 from the local fund.
367 (b) Notwithstanding Subsection (4)(a), transfers of monies to a local fund or the
368 accumulation of monies in a local fund do not affect any limits on fund balances, net assets, or
369 the accumulation of retained earnings in any of the following of a local government:
370 (i) a general fund;

371 (ii) an enterprise fund;
372 (iii) an internal service fund; or
373 (iv) any other fund.
374 (5) (a) A local government may not expend during a fiscal year more than 10% of the
375 monies budgeted to be deposited into a local fund during that fiscal year for emergency
376 preparedness.
377 (b) The amount described in Subsection (5)(a) shall be determined before the adoption
378 of the tentative budget.
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