S.B. 114

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INTERLOCAL COOPERATION ACT AMENDMENTS
2 1997 GENERAL SESSION
3 STATE OF UTAH
4 Sponsor: Leonard M. Blackham
5 AN ACT RELATING TO CITIES, COUNTIES, AND LOCAL TAXING UNITS; MODIFYING
6 DEFINITIONS; MODIFYING THE ENERGY OUTPUT REQUIREMENT IN AN OFFER
7 FOR A POWER SALES CONTRACT; MODIFYING THE REQUIREMENT FOR ENERGY
8 OUTPUT AVAILABLE FOR USE WITHIN THE STATE; EXEMPTING COMMERCIAL
9 PROJECT ENTITIES FROM PARTS OF THE GOVERNMENT RECORDS ACCESS AND
10 MANAGEMENT ACT; AND MAKING TECHNICAL CORRECTIONS.
11 This act affects sections of Utah Code Annotated 1953 as follows:
12 AMENDS:
13 11-13-3, as last amended by Chapters 88 and 305, Laws of Utah 1995
14 11-13-5.5, as last amended by Chapter 207, Laws of Utah 1996
15 Be it enacted by the Legislature of the state of Utah:
16 Section 1. Section 11-13-3 is amended to read:
17 11-13-3. Definitions.
18 As used in this chapter:
19 (1) "Board" means the Permanent Community Impact Fund Board created by Section
20 9-4-304, and its successors.
21 (2) "Candidate" means the state of Utah and any county, municipality, school district,
22 prosecution district, special district, or any other political subdivision of the state of Utah or its
23 authorized agent or any one or more of them.
24 (3) "Commercial project entity" means a project entity, defined in Subsection (7), that:
25 (a) has no taxing authority; and
26 (b) is not supported in whole or in part by and does not expend or disburse tax revenues.
27 [(3)] (4) "Direct impacts" means an increase in the need for any public facilities or services

1 that is attributable to the project, except impacts resulting from the construction or operation of
2 any facility owned by others that is used to furnish fuel, construction, or operation materials for
3 use in the project.
4 [(4)] (5) (a) "Facilities," "services," or "improvements" mean facilities, services, or
5 improvements of any kind or character provided by a candidate with respect to any one or more
6 of the following:
7 (i) flood control;
8 (ii) storm drainage;
9 (iii) government administration;
10 (iv) planning and zoning;
11 (v) buildings and grounds;
12 (vi) education;
13 (vii) health care;
14 (viii) parks and recreation;
15 (ix) police and fire protection;
16 (x) prosecution of violations of state criminal statutes;
17 (xi) defense of individuals prosecuted for violations of state criminal statutes;
18 (xii) transportation;
19 (xiii) streets and roads;
20 (xiv) utilities;
21 (xv) culinary water;
22 (xvi) sewage disposal;
23 (xvii) social services;
24 (xviii) solid waste disposal;
25 (xix) economic development or new venture investment fund; and
26 (xx) library.
27 (b) "Facilities" and "improvements" includes entire facilities and improvements or
28 interests in facilities or improvements.
29 [(5)] (6) "Project" means an electric generating and transmission project owned by a legal
30 or administrative entity created under this chapter and shall include any electric generating
31 facilities, transmission facilities, fuel or fuel transportation facilities, or water facilities owned by

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1 that entity and required for that project.
2 [(6)] (7) "Project entity" means a legal or administrative entity created under this chapter
3 which owns a project and which sells the capacity, services, or other benefits from it.
4 [(7)] (8) "Public agency" means:
5 (a) any political subdivision of this state including, but not limited to, cities, towns,
6 counties, school districts, and special districts of various kinds;
7 (b) the state of Utah or any department, division, or agency of the state of Utah;
8 (c) any agency of the United States;
9 (d) any political subdivision or agency of another state including any interlocal
10 cooperation or joint powers agency formed under the authority of the law of another state; and
11 (e) any Indian tribe, band, nation, or other organized group or community which is
12 recognized as eligible for the special programs and services provided by the United States to
13 Indians because of their status as Indians.
14 [(8)] (9) "State" means a state of the United States and the District of Columbia.
15 Section 2. Section 11-13-5.5 is amended to read:
16 11-13-5.5. Contract by public agencies to create new entities to provide services --
17 Powers and duties of new entities -- Generation of electricity.
18 (1) Any two or more public agencies of Utah may agree to create a separate legal or
19 administrative entity to accomplish the purpose of their joint or cooperative action, including the
20 undertaking and financing of a facility or improvement to provide the service contemplated by that
21 agreement.
22 (2) (a) The separate legal or administrative entity created under the authority of this section
23 is a political subdivision of Utah and may:
24 (i) own, acquire, construct, operate, maintain, and repair or cause to be constructed,
25 operated, maintained, and repaired any facility or improvement set forth in the agreement;
26 (ii) borrow money, incur indebtedness, and issue revenue bonds or notes for the purposes
27 for which it was created;
28 (iii) offer, issue, and sell warrants, options, or other rights related to:
29 (A) the bonds or notes issued by the entity; and
30 (B) any rights or interests pertaining to the bonds or notes;
31 (iv) assign, pledge, or otherwise convey as security for the payment of any bonded

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1 indebtedness, the revenues, and receipts from the facility, improvement, or service; or
2 (v) sell or contract for the sale of the product of the service or other benefits from the
3 facility or improvement to public agencies within or without the state on whatever terms that it
4 considers to be in the best interest of its participants.
5 (b) The assignment, pledge, or other conveyance specified in Subsection (2)(a)(iii) may
6 rank prior in right to any other obligation except taxes or payments in lieu of taxes payable to the
7 state or its political subdivisions.
8 (3) (a) Any entity formed to construct any electrical generation facility shall, at least 150
9 days before adoption of the bond resolution for financing the project, offer to enter into firm or
10 withdrawable power sales contracts to suppliers of electric energy within Utah who are existing
11 and furnishing services in this state at the time that the offer is made.
12 (b) That offer must be:
13 (i) accepted within 120 days from the date offered or it will be considered rejected; and
14 (ii) for not less than 50% of its energy output.
15 [(c) For any electrical generation facility for which construction begins after April 21,
16 1987, that offer shall be for not less than 25% of its energy output.]
17 [(d)] (c) The demand by those electric energy suppliers or the amounts deliverable to any
18 electric energy supplier or a combination of them may not exceed the amount allowable by the
19 United States Internal Revenue Service in a way that would result in a change in or a loss of the
20 tax exemption from federal income tax for the interest paid, or to be paid, under any bonds or
21 indebtedness created or incurred by any entity formed under this section.
22 [(e) In no event may the energy output available for use within this state be less than 20%
23 of the total output.]
24 [(f)] (d) For any electrical generation facility [for which construction begins after April
25 21, 1987], the amount of energy output available within this state may not be less than 5% of the
26 total output.
27 (4) Subsection (3) applies only to the construction and operation of a facility to generate
28 electricity.
29 (5) Any entity formed to construct and operate facilities for the generation of electricity
30 and any entity formed to facilitate the transmission or supply of electrical power under this section
31 may include within the agreement creating the entity provisions authorizing any public agency

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1 located within a contiguous state to:
2 (a) participate as a member of the project entity if it enters into an agreement in accordance
3 with Section 11-13-11; and
4 (b) vote on any issues affecting that public agency's interests, if the public agency enters
5 into the agreement required by Subsection (5)(a).
6 (6) A commercial project entity is not subject to Title 63, Chapter 2, Parts 2 and 3,
7 Government Records Access and Management Act.




Legislative Review Note
as of 10-11-96 9:18 AM

A limited legal review of this bill raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel

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