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S.B. 172






Chief Sponsor: John L. Valentine

House Sponsor: Keven J. Stratton

             8      LONG TITLE
             9      General Description:
             10          This bill modifies a provision relating to the use of bond proceeds by political
             11      subdivisions.
             12      Highlighted Provisions:
             13          This bill:
             14          .    prohibits political subdivisions from using bond proceeds for specified purposes
             15      beyond a limited time period.
             16      Money Appropriated in this Bill:
             17          None
             18      Other Special Clauses:
             19          None
             20      Utah Code Sections Affected:
             21      AMENDS:
             22          11-14-103, as last amended by Laws of Utah 2007, Chapter 10
             24      Be it enacted by the Legislature of the state of Utah:
             25          Section 1. Section 11-14-103 is amended to read:
             26           11-14-103. Bond issues authorized -- Purposes -- Use of bond proceeds.
             27          (1) Any local political subdivision may, in the manner and subject to the limitations

             28      and restrictions contained in this chapter, issue its negotiable bonds for the purpose of paying
             29      all or part of the cost of:
             30          (a) acquiring, improving, or extending any one or more improvements, facilities, or
             31      property that the local political subdivision is authorized by law to acquire, improve, or extend;
             32          (b) acquiring, or acquiring an interest in, any one or more or any combination of the
             33      following types of improvements, facilities, or property to be owned by the local political
             34      subdivision, either alone or jointly with one or more other local political subdivisions, or for
             35      the improvement or extension of any of those wholly or jointly owned improvements, facilities,
             36      or properties:
             37          (i) public buildings of every nature, including without limitation, offices, courthouses,
             38      jails, fire, police and sheriff's stations, detention homes, and any other buildings to
             39      accommodate or house lawful activities of a local political subdivision;
             40          (ii) waterworks, irrigation systems, water systems, dams, reservoirs, water treatment
             41      plants, and any other improvements, facilities, or property used in connection with the
             42      acquisition, storage, transportation, and supplying of water for domestic, industrial, irrigation,
             43      recreational, and other purposes and preventing pollution of water;
             44          (iii) sewer systems, sewage treatment plants, incinerators, and other improvements,
             45      facilities, or property used in connection with the collection, treatment, and disposal of sewage,
             46      garbage, or other refuse;
             47          (iv) drainage and flood control systems, storm sewers, and any other improvements,
             48      facilities, or property used in connection with the collection, transportation, or disposal of
             49      water;
             50          (v) recreational facilities of every kind, including without limitation, athletic and play
             51      facilities, playgrounds, athletic fields, gymnasiums, public baths, swimming pools, camps,
             52      parks, picnic grounds, fairgrounds, golf courses, zoos, boating facilities, tennis courts,
             53      auditoriums, stadiums, arenas, and theaters;
             54          (vi) convention centers, sports arenas, auditoriums, theaters, and other facilities for the
             55      holding of public assemblies, conventions, and other meetings;
             56          (vii) roads, bridges, viaducts, tunnels, sidewalks, curbs, gutters, and parking buildings,
             57      lots, and facilities;
             58          (viii) airports, landing fields, landing strips, and air navigation facilities;

             59          (ix) educational facilities, including without limitation, schools, gymnasiums,
             60      auditoriums, theaters, museums, art galleries, libraries, stadiums, arenas, and fairgrounds;
             61          (x) hospitals, convalescent homes, and homes for the aged or indigent; and
             62          (xi) electric light works, electric generating systems, and any other improvements,
             63      facilities, or property used in connection with the generation and acquisition of electricity for
             64      these local political subdivisions and transmission facilities and substations if they do not
             65      duplicate transmission facilities and substations of other entities operating in the state prepared
             66      to provide the proposed service unless these transmission facilities and substations proposed to
             67      be constructed will be more economical to these local political subdivisions; or
             68          (c) new construction, renovation, or improvement to a state highway within the
             69      boundaries of the local political subdivision or an environmental study for a state highway
             70      within the boundaries of the local political subdivision.
             71          (2) Except as provided in Subsection (1)(c), any improvement, facility, or property
             72      under Subsection (1) need not lie within the limits of the local political subdivision.
             73          (3) A cost under Subsection (1) may include:
             74          (a) the cost of equipment and furnishings for such improvements, facilities, or
             75      property;
             76          (b) all costs incident to the authorization and issuance of bonds, including engineering,
             77      legal, and fiscal advisers' fees;
             78          (c) costs incident to the issuance of bond anticipation notes, including interest to accrue
             79      on bond anticipation notes;
             80          (d) interest estimated to accrue on the bonds during the period to be covered by the
             81      construction of the improvement, facility, or property and for 12 months after that period; and
             82          (e) other amounts which the governing body finds necessary to establish bond reserve
             83      funds and to provide working capital related to the improvement, facility, or property.
             84          (4) The proceeds from bonds issued on or after May 14, 2013 may not be used:
             85          (a) for operation and maintenance expenses more than one year after the bonds are
             86      issued; or
             87          (b) for capitalization of interest more than five years after the bonds are issued.

Legislative Review Note
    as of 2-6-13 11:12 AM

Office of Legislative Research and General Counsel

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