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7 LONG TITLE
8 Committee Note:
9 The Law Enforcement and Criminal Justice Interim Committee recommended this bill.
10 General Description:
11 This bill modifies the Public Safety Code and the Budgetary Procedures Act to establish
12 a loan program to local government entities for the purpose of providing emergency
13 disaster services.
14 Highlighted Provisions:
15 This bill:
16 ▸ creates the Local Government Emergency Response Loan Fund for the purpose of
17 providing short-term, low-interest loans to local government entities to be used for:
18 • costs incurred for providing emergency disaster services; and
19 • matching funds required to secure federal funds or grants related to a declared
20 disaster;
21 ▸ provides the criteria by which loans from the fund will be awarded;
22 ▸ provides rulemaking authority for the Division of Emergency Management to
23 administer the loan program;
24 ▸ provides that funds from the State Disaster Recovery Restricted Account may be
25 appropriated to the Local Government Emergency Response Loan Fund; and
26 ▸ provides that a specified portion of the General Fund revenue surplus be deposited
27 annually into the Local Government Emergency Response Loan Fund.
28 Money Appropriated in this Bill:
29 None
30 Other Special Clauses:
31 None
32 Utah Code Sections Affected:
33 AMENDS:
34 53-2a-602, as last amended by Laws of Utah 2013, Chapter 117 and renumbered and
35 amended by Laws of Utah 2013, Chapter 295
36 53-2a-603, as last amended by Laws of Utah 2013, Chapter 117 and renumbered and
37 amended by Laws of Utah 2013, Chapter 295
38 63J-1-314, as last amended by Laws of Utah 2013, Chapter 295
39 ENACTS:
40 53-2a-607, Utah Code Annotated 1953
41 53-2a-608, Utah Code Annotated 1953
42 53-2a-609, Utah Code Annotated 1953
43
44 Be it enacted by the Legislature of the state of Utah:
45 Section 1. Section 53-2a-602 is amended to read:
46 53-2a-602. Definitions.
47 (1) Unless otherwise defined in this section, the terms [
48
49 same as these terms are defined in Part 1, Emergency Management Act.
50 (2) As used in this part:
51 (a) "Declared disaster" means one or more events:
52 (i) within the state;
53 (ii) that occur within a limited period of time;
54 (iii) that involve:
55 (A) a significant number of persons being at risk of bodily harm, sickness, or death; or
56 (B) a significant portion of real property at risk of loss;
57 (iv) that are sudden in nature and generally occur less frequently than every three years;
58 and
59 (v) that results in:
60 (A) the president of the United States declaring an emergency or major disaster in the
61 state;
62 (B) the governor declaring a state of emergency under [
63 Disaster Response and Recovery Act; or
64 (C) the chief executive officer of a local government declaring a local emergency under
65 [
66 (b) "Disaster recovery fund" means the State Disaster Recovery Restricted Account
67 created in Section 53-2a-603.
68 (c) "Emergency preparedness" means the following done for the purpose of being
69 prepared for an emergency as defined by the division by rule made in accordance with Title
70 63G, Chapter 3, Utah Administrative Rulemaking Act:
71 (i) the purchase of equipment;
72 (ii) the training of personnel; or
73 (iii) the obtaining of a certification.
74 (d) (i) "Emergency disaster services" means the following:
75 (A) evacuation;
76 (B) shelter;
77 (C) medical triage;
78 (D) emergency transportation;
79 (E) repair of infrastructure;
80 (F) safety services, including fencing or roadblocks;
81 (G) sandbagging;
82 (H) debris removal;
83 (I) temporary bridges;
84 (J) procurement and distribution of food, water, or ice;
85 (K) procurement and deployment of generators;
86 (L) rescue or recovery;
87 (M) emergency protective measures; or
88 (N) services similar to those described in Subsections (2)(d)(i)(A) through (M), as
89 defined by the division by rule, that are generally required in response to a declared disaster.
90 (ii) "Emergency disaster services" does not include:
91 (A) emergency preparedness; or
92 (B) notwithstanding whether or not a county participates in the Wildland Fire
93 Suppression Fund created in Section 65A-8-204, any fire suppression or presuppression costs
94 that may be paid for from the Wildland Fire Suppression Fund if the county participates in the
95 Wildland Fire Suppression Fund.
96 (e) "Governing body" means:
97 (i) for a county, city, or town, the legislative body of the county, city, or town;
98 (ii) for a local district, the board of trustees of the local district; and
99 (iii) for a special service district:
100 (A) the legislative body of the county, city, or town that established the special service
101 district, if no administrative control board has been appointed under Section 17D-1-301; or
102 (B) the administrative control board of the special service district, if an administrative
103 control board has been appointed under Section 17D-1-301.
104 (f) "Local district" [
105 Section 17B-1-102.
106 (g) "Local fund" means a local government disaster fund created in accordance with
107 Section 53-2a-605.
108 (h) "Local government" means:
109 (i) a county;
110 (ii) a city or town; or
111 (iii) a local district or special service district that:
112 (A) operates a water system;
113 (B) provides transportation service;
114 (C) provides, operates, and maintains correctional and rehabilitative facilities and
115 programs for municipal, state, and other detainees and prisoners;
116 (D) provides consolidated 911 and emergency dispatch service;
117 (E) operates an airport; or
118 (F) operates a sewage system.
119 (i) "Special fund" means a fund other than a general fund of a local government that is
120 created for a special purpose established under the uniform system of budgeting, accounting,
121 and reporting.
122 (j) "Special service district" [
123 defined in Section 17D-1-102.
124 (k) "State's prime interest rate" means the average interest rate paid by the state on
125 general obligation bonds issued during the most recent fiscal year in which bonds were sold.
126 Section 2. Section 53-2a-603 is amended to read:
127 53-2a-603. State Disaster Recovery Restricted Account.
128 (1) (a) There is created a restricted account in the General Fund known as the "State
129 Disaster Recovery Restricted Account."
130 (b) The disaster recovery [
131 (i) money deposited into the disaster recovery fund in accordance with Section
132 63J-1-314;
133 (ii) money appropriated to the disaster recovery fund by the Legislature; and
134 (iii) any other public or private money received by the division that is:
135 (A) given to the division for purposes consistent with this section; and
136 (B) deposited into the disaster recovery fund at the request of:
137 (I) the division; or
138 (II) the person or entity giving the money.
139 (c) The Division of Finance shall deposit interest or other earnings derived from
140 investment of [
141 (2) Subject to being appropriated by the Legislature, money in the disaster recovery
142 [
143 (a) (i) subject to Section 53-2a-606, in any fiscal year the division may expend or
144 commit to expend an amount that does not exceed $250,000, in accordance with Section
145 53-2a-604, to fund costs to the state of emergency disaster services in response to a declared
146 disaster;
147 (ii) subject to Section 53-2a-606, in any fiscal year the division may expend or commit
148 to expend an amount that exceeds $250,000, but does not exceed $1,000,000, in accordance
149 with Section 53-2a-604, to fund costs to the state of emergency disaster services in response to
150 a declared disaster if the division:
151 (A) before making the expenditure or commitment to expend, obtains approval for the
152 expenditure or commitment to expend from the governor;
153 (B) subject to Subsection (5), provides written notice of the expenditure or
154 commitment to expend to the speaker of the House of Representatives, the president of the
155 Senate, the Division of Finance, and the Office of the Legislative Fiscal Analyst no later than
156 72 hours after making the expenditure or commitment to expend; and
157 (C) makes the report required by Subsection 53-2a-606(2);
158 (iii) subject to Section 53-2a-606, in any fiscal year the division may expend or commit
159 to expend an amount that exceeds $1,000,000, but does not exceed $3,000,000, in accordance
160 with Section 53-2a-604, to fund costs to the state of emergency disaster services in response to
161 a declared disaster if, before making the expenditure or commitment to expend, the division:
162 (A) obtains approval for the expenditure or commitment to expend from the governor;
163 and
164 (B) submits the expenditure or commitment to expend to the Executive Appropriations
165 Committee in accordance with Subsection 53-2a-606(3); and
166 (iv) in any fiscal year the division may expend or commit to expend an amount that
167 does not exceed $150,000 to fund expenses incurred by the National Guard if:
168 (A) in accordance with Section 39-1-5, the governor orders into active service the
169 National Guard in response to a declared disaster; and
170 (B) the money is not used for expenses that qualify for payment as emergency disaster
171 services; [
172 (b) subject to being appropriated by the Legislature, money not described in
173 Subsections (2)(a)(i), (ii), and (iii) may be expended or committed to be expended to fund costs
174 to the state directly related to a declared disaster that are not costs related to:
175 (i) emergency disaster services;
176 (ii) emergency preparedness; or
177 (iii) notwithstanding whether a county participates in the Wildland Fire Suppression
178 Fund created in Section 65A-8-204, any fire suppression or presuppression costs that may be
179 paid for from the Wildland Fire Suppression Fund if the county participates in the Wildland
180 Fire Suppression Fund[
181 (c) to fund the Local Government Emergency Response Loan Fund created in Section
182 53-2a-607.
183 (3) The state treasurer shall invest money in the disaster recovery fund according to
184 Title 51, Chapter 7, State Money Management Act.
185 (4) (a) Except as provided in Subsections (1) and (2), the money in the disaster
186 recovery fund may not be diverted, appropriated, expended, or committed to be expended for a
187 purpose that is not listed in this section.
188 (b) Notwithstanding Section 63J-1-410, the Legislature may not appropriate money
189 from the disaster recovery fund to eliminate or otherwise reduce an operating deficit if the
190 money appropriated from the disaster recovery fund is expended or committed to be expended
191 for a purpose other than one listed in this section.
192 (c) The Legislature may not amend the purposes for which money in the disaster
193 recovery fund may be expended or committed to be expended except by the affirmative vote of
194 two-thirds of all the members elected to each house.
195 (5) The division:
196 (a) shall provide the notice required by Subsection (2)(a)(ii) using the best available
197 method under the circumstances as determined by the division; and
198 (b) may provide the notice required by Subsection (2)(a)(ii) in electronic format.
199 Section 3. Section 53-2a-607 is enacted to read:
200 53-2a-607. Creation and administration.
201 (1) (a) There is created an enterprise fund known as the Local Government Emergency
202 Response Loan Fund.
203 (b) The division as defined in Section 53-2a-103 is the administrator of the fund.
204 (2) The fund consists of:
205 (a) money appropriated to the fund by the Legislature;
206 (b) money received for the repayment of loans made from the fund;
207 (c) interest earned on the fund; and
208 (d) money deposited into the fund in accordance with Section 63J-1-314.
209 (3) The money in the fund shall be invested by the state treasurer according to the
210 procedures and requirements of Title 51, Chapter 7, State Money Management Act, except that
211 all interest or other earnings derived from money in the fund shall be deposited into the fund.
212 (4) Local government entities may apply through the division for a short-term loan
213 from the fund for the purposes provided in Section 53-2a-608, provided that the local
214 government entity:
215 (a) agrees to the terms of the loan; and
216 (b) is not in default on any other state loans administered by the Division of Finance or
217 any other state agency.
218 (5) The division may not loan out:
219 (a) more than 50% of the total account balance available at the time that a loan request
220 is made by a local government entity; or
221 (b) an amount that will leave the fund balance at less than $10,000,000.
222 Section 4. Section 53-2a-608 is enacted to read:
223 53-2a-608. Purposes and criteria for loans.
224 (1) Money in the fund shall be used by the department, as prioritized by the director,
225 only to:
226 (a) provide loans to local government entities for:
227 (i) the costs incurred by a local government entity for providing emergency disaster
228 services as defined in Section 53-2a-602; or
229 (ii) providing any state or local matching funds to secure federal funds or grants related
230 to a declared disaster, as defined in Section 53-2a-602; and
231 (b) pay the Division of Finance for the costs of administering the fund, providing loans,
232 and obtaining repayments of loans.
233 (2) The division shall establish the terms and conditions of the loans and the repayment
234 schedule consistent with the following criteria:
235 (a) the interest rate charged and the maximum payback period on all loans shall be:
236 (i) the state's prime interest rate at the time of loan closing, plus zero percent, with a
237 maximum payback period of 10 years if the applicant has reserved an average of 90% to 100%
238 of the amount authorized in Section 53-2a-605 over the previous five fiscal years;
239 (ii) the state's prime interest rate at the time of loan closing, plus 2%, with a maximum
240 payback period of five years if the applicant has reserved an average of 70% up to 90% of the
241 amount authorized in Section 53-2a-605 over the previous five fiscal years; or
242 (iii) the state's prime interest rate at the time of loan closing, plus 4%, with a maximum
243 payback period of three years if the applicant has reserved an average of 50% up to 70% of the
244 amount authorized in Section 53-2a-605 over the previous five fiscal years; and
245 (b) the division may not authorize a loan from this fund on any terms or conditions to
246 local government entities that have reserved an average of less than 50% of the amount
247 authorized in Section 53-2a-605 over the previous five fiscal years.
248 (3) If the division receives multiple loan applications concurrently, priority shall be
249 given to applicants based on the extent of their participation in the reserve account authorized
250 in Section 53-2a-605.
251 Section 5. Section 53-2a-609 is enacted to read:
252 53-2a-609. Division to make rules to administer the loan program.
253 In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
254 division shall make rules establishing:
255 (1) form, content, and procedure for loan and grant applications;
256 (2) criteria and procedures for prioritizing loan and grant applications;
257 (3) requirements and procedures for securing loans and grants;
258 (4) procedures for making loans;
259 (5) procedures for administering and ensuring repayment of loans, including late
260 payment penalties; and
261 (6) procedures for recovering on defaulted loans.
262 Section 6. Section 63J-1-314 is amended to read:
263 63J-1-314. Deposits related to the Disaster Recovery Funding Act.
264 (1) As used in this section, "operating deficit" means that, at the end of the fiscal year,
265 the unassigned fund balance in the General Fund is less than zero.
266 (2) Except as provided under [
267 fiscal year, the Division of Finance shall, after the transfer of General Fund revenue surplus has
268 been made to the Medicaid Growth Reduction and Budget Stabilization Account, as provided
269 in Section 63J-1-315, and the General Fund Budget Reserve Account, as provided in Section
270 63J-1-312, transfer an amount into the State Disaster Recovery Restricted Account, created in
271 Section 53-2a-603, from the General Fund revenue surplus as defined in Section 63J-1-312,
272 calculated by:
273 (a) determining the amount of General Fund revenue surplus after the transfer to the
274 Medicaid Growth Reduction and Budget Stabilization Account under Section 63J-1-315 and
275 the General Fund Budget Reserve Account under Section 63J-1-312;
276 (b) calculating an amount equal to the lesser of:
277 (i) 25% of the amount determined under Subsection (2)(a); or
278 (ii) 6% of the total of the General Fund appropriation amount for the fiscal year in
279 which the surplus occurs; and
280 (c) adding to the amount calculated under Subsection (2)(b) an amount equal to the
281 lesser of:
282 (i) 25% more of the amount described in Subsection (2)(a); or
283 (ii) the amount necessary to replace, in accordance with this Subsection (2)(c), any
284 amount appropriated from the State Disaster Recovery Restricted Account within 10 fiscal
285 years before the fiscal year in which the surplus occurs if:
286 (A) a surplus exists; and
287 (B) the Legislature appropriates money from the State Disaster Recovery Restricted
288 Account that is not replaced by appropriation or as provided in this Subsection (2)(c).
289 (3) Notwithstanding Subsection (2), if, at the end of a fiscal year, the Division of
290 Finance determines that an operating deficit exists, the division shall reduce the transfer to the
291 State Disaster Recovery Restricted Account by the amount necessary to eliminate the operating
292 deficit.
293 (4) Notwithstanding Subsection (2):
294 (a) for the period beginning July 1, 2015, and ending June 30, 2020, the Division of
295 Finance shall transfer to the Local Government Emergency Response Loan Fund 25% of the
296 amount to be transferred into the State Disaster Recovery Restricted Account as provided in
297 Subsection (2)(b); and
298 (b) on and after July 1, 2020, the Division of Finance shall transfer to the Local
299 Government Emergency Response Loan Fund 10% of the amount to be transferred into the
300 State Disaster Recovery Restricted Account as provided in Subsection (2)(b).
Legislative Review Note
Office of Legislative Research and General Counsel