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5 AN ACT RELATING TO HIGHWAYS; ESTABLISHING THE STATE TRANSPORTATION
6 INFRASTRUCTURE BANK REVOLVING LOAN FUND; SPECIFYING DUTIES,
7 PROCEDURES, AND LIMITATIONS RELATING TO THE FUND AND FUND MONIES;
8 ESTABLISHING RULEMAKING AUTHORITY; AUTHORIZING THE ISSUANCE OF
9 REVENUE BONDS UNDER CERTAIN CONDITIONS; AND PROVIDING AN EFFECTIVE
11 This act affects sections of Utah Code Annotated 1953 as follows:
13 63-65-2, as last amended by Chapter 334, Laws of Utah 1995
15 27-18-101, Utah Code Annotated 1953
16 27-18-102, Utah Code Annotated 1953
17 27-18-103, Utah Code Annotated 1953
18 27-18-104, Utah Code Annotated 1953
19 27-18-105, Utah Code Annotated 1953
20 27-18-106, Utah Code Annotated 1953
21 27-18-107, Utah Code Annotated 1953
22 27-18-108, Utah Code Annotated 1953
23 Be it enacted by the Legislature of the state of Utah:
24 Section 1. Section 27-18-101 is enacted to read:
26 27-18-101. Title.
27 This chapter shall be known as the "Transportation Infrastructure Bank Act."
1 Section 2. Section 27-18-102 is enacted to read:
2 27-18-102. Definitions.
3 As used in this chapter:
4 (1) "Fund" means the Transportation Infrastructure Bank Fund created under Section
6 (2) "Infrastructure assistance" means any use of fund moneys, except an infrastructure
7 loan, to provide financial assistance for transportation projects, including to finance leases, fund
8 reserves, make grants, make interest buy-down grants, pay issuance costs or provide credit
9 enhancement or other security for bonds, leases, or loans obtained by a public entity to finance
10 transportation projects.
11 (3) "Infrastructure loan" means a loan of fund monies to finance a transportation project.
12 (4) "Public entity" means a state agency, county, municipality, special district, or an
13 intergovernmental entity organized under state law.
14 (5) "Transportation project" means a project to improve the state transportation systems
15 and includes the costs of acquisition, construction, reconstruction, rehabilitation, equipping, and
17 Section 3. Section 27-18-103 is enacted to read:
18 27-18-103. Transportation Infrastructure Bank Fund -- Creation -- Use of monies.
19 (1) There is created a revolving loan fund entitled the Transportation Infrastructure Bank
21 (2) The fund consists of monies generated from the following revenue sources:
22 (a) appropriations made to the fund by the Legislature;
23 (b) federal monies and grants that are deposited in the fund;
24 (c) monies transferred to the fund by the commission from other monies available to the
26 (d) state grants that are deposited in the fund;
27 (e) contributions or grants from any other private or public sources for deposit into the
28 fund; and
29 (f) all monies collected from repayments of fund monies used for infrastructure loans or
30 infrastructure assistance.
31 (3) (a) The fund shall earn interest.
1 (b) All interest earned on fund monies shall be deposited into the fund.
2 (4) Monies in the fund shall be used by the department, as prioritized by the commission,
3 only to:
4 (a) provide infrastructure loans or infrastructure assistance;
5 (b) pay the costs of issuing infrastructure bonds, including related costs, in accordance
6 with Title 63, Chapter 65, State Financing Consolidation Act;
7 (c) pay or fund the principal, interest, redemption premium, reserves, and credit
8 enhancements for infrastructure bonds; and
9 (d) pay the department for the costs of administering the fund, providing infrastructure
10 loans or infrastructure assistance, monitoring transportation projects, and obtaining repayments
11 of infrastructure loans or infrastructure assistance.
12 (5) (a) The commission may establish separate accounts in the fund for infrastructure
13 loans, infrastructure assistance, bond reserves, debt service payments for bonds, administrative and
14 operating expenses, or any other purpose to implement this part.
15 (b) In accordance with Title, 63, Chapter 46a, Utah Administrative Rulemaking Act, the
16 commission may make rules governing how the fund and its accounts may be held by an escrow
17 agent or bond trustee.
18 (6) Fund monies shall be invested by the state treasurer as provided in Title 51, Chapter
19 7, State Money Management Act, and the earnings from the investments shall be credited to the
20 fund as designated by the commission.
21 Section 4. Section 27-18-104 is enacted to read:
22 27-18-104. Loans and assistance -- Authority -- Rulemaking.
23 (1) Monies in the fund may be used by the department, as prioritized by the commission,
24 to make infrastructure loans or to provide infrastructure assistance to any public entity for any
25 purpose consistent with any applicable constitutional limitation.
26 (2) In accordance with Title, 63, Chapter 46a, Utah Administrative Rulemaking Act, the
27 commission shall make rules providing procedures and standards for making infrastructure loans
28 and providing infrastructure assistance.
29 Section 5. Section 27-18-105 is enacted to read:
30 27-18-105. Issuing revenue bonds -- Authority -- Procedures -- Limitations -- Cap.
31 (1) If the department determines that it is necessary or desirable to issue infrastructure
1 revenue bonds to provide monies for the fund, the department, through the commission, shall ask
2 the state treasurer to issue the infrastructure revenue bonds.
3 (2) If the state treasurer determines that the infrastructure bonds shall be issued, the state
4 treasurer may:
5 (a) authorize and issue infrastructure revenue bonds, including refunding bonds, in
6 accordance with Title 63, Chapter 65, State Financing Consolidation Act, to provide monies for
7 the fund;
8 (b) enter into an agreement with bond underwriters, trustees, financial advisers, bond
9 counsel, and any other person to implement this chapter; and
10 (c) exercise any power granted under Title 63, Chapter 65, State Financing Consolidation
11 Act, in connection with the infrastructure revenue bonds authorized in this section.
12 (3) (a) The infrastructure revenue bonds are payable solely from all or a portion of the
13 monies deposited in the fund and the state treasurer may pledge fund monies to secure the bonds.
14 (b) The state treasurer, department, or commission may not pledge or encumber any
15 monies of the state other than those authorized in this chapter or Title 63, Chapter 65, State
16 Financing Consolidation Act, to be deposited in the fund.
17 (4) (a) The department, with the approval of the commission, may enter into covenants for
18 the benefit of the infrastructure revenue bond owners regarding the use of monies in the fund,
19 providing of infrastructure assistance, and the collection of infrastructure loans. The covenants
20 shall be binding upon the state in accordance with their terms and shall be enforceable against the
21 state by the bond owners.
22 (b) An owner of the infrastructure revenue bonds authorized under this section may not
23 compel any exercise of the taxing power of the state to pay the bonds or their interest, or to enforce
24 payment of the bonds against any property of the state, except fund monies pledged to pay the
25 bonds and monies that the commission, the department, or any agency agrees to use to repay
26 infrastructure loans made under this chapter.
27 (c) The infrastructure revenue bonds authorized under this section may not constitute a
28 charge, lien, or encumbrance, legal or equitable, upon the property of the state, except fund monies
29 pledged to pay the bonds and monies that the commission, the department, or any agency agrees
30 to use to repay infrastructure loans made under this chapter.
31 (d) The infrastructure revenue bonds authorized under this section may not constitute a
1 debt of the state or a lending of the credit of the state within the meaning of any constitutional or
2 statutory limitation.
3 (5) The total principal amount of infrastructure revenue bonds issued under this section
4 at any time may not exceed $200,000,000.
5 Section 6. Section 27-18-106 is enacted to read:
6 27-18-106. Loan program procedures -- Repayment.
7 (1) A public entity may obtain an infrastructure loan from the department, upon approval
8 by the commission, by entering into a loan contract with the department secured by legally issued
9 bonds, notes, or other evidence of indebtedness validly issued under state law, including pledging
10 all or any portion of a revenue source to the repayment of the loan.
11 (2) The public entity shall repay the infrastructure loan in accordance with the loan
12 contract from any of the following sources:
13 (a) transportation project revenues, including special assessment revenues;
14 (b) general funds of the public entity;
15 (c) monies withheld under Subsection (5); or
16 (d) any other legally available revenues.
17 (3) An infrastructure loan contract with a public entity may provide that a portion of the
18 proceeds of the loan may be applied to fund a reserve fund to secure the repayment of the loan or
19 to secure the repayment of revenue bonds issued to finance the loan.
20 (4) Before obtaining an infrastructure loan, a municipality shall:
21 (a) publish its intention to obtain an infrastructure loan at least once in accordance with
22 the publication of notice requirements under Section 11-14-21; and
23 (b) adopt an ordinance or resolution authorizing the infrastructure loan.
24 (5) (a) If a public entity fails to comply with the terms of its infrastructure loan contract,
25 the department may seek any legal or equitable remedy to obtain compliance or payment of
27 (b) If a public entity fails to make infrastructure loan payments when due, the state shall,
28 at the request of the department, withhold an amount of monies due to the public entity and deposit
29 the withheld monies in the fund to pay the amounts due under the contract.
30 (c) The department may elect when to request the withholding of monies under this
31 Subsection (5).
1 (6) All loan contracts, bonds, notes, or other evidence of indebtedness securing the loan
2 contracts shall be held, collected, and accounted for in accordance with Section 63-65-4.
3 Section 7. Section 27-18-107 is enacted to read:
4 27-18-107. Loan contracts of state agencies.
5 (1) (a) Notwithstanding Sections 53B-21-113 and 63A-1-112, a state agency may obtain
6 an infrastructure loan.
7 (b) A state agency may contract to repay an infrastructure loan from the monies which are
8 appropriated to the agency and may pledge all or any portion of those monies to repay the loan.
9 (c) A state agency's infrastructure loan may not constitute a debt of the state or lending the
10 credit of the state within the meaning of any constitutional or statutory limitation.
11 (2) The terms of an infrastructure loan contract shall bind the state and a state agency, and
12 the state agency shall unconditionally repay the loan from the monies the agency has pledged
13 under the terms of the loan contract.
14 Section 8. Section 27-18-108 is enacted to read:
15 27-18-108. Department authority to contract.
16 The department may, upon approval of the commission:
17 (1) make all contracts, execute all instruments, and do all things necessary or convenient
18 to provide financial assistance for transportation projects in accordance with this chapter or to
19 perform covenants and to secure infrastructure bonds; and
20 (2) enter into and perform the contracts and agreements with entities concerning the
21 planning, construction, lease, or other acquisition, installation, or financing of transportation
23 Section 9. Section 63-65-2 is amended to read:
24 63-65-2. Definitions.
25 As used in this chapter:
26 (1) "Agency bonds" means any bond, note, contract, or other evidence of indebtedness
27 representing loans or grants made by authorizing agencies.
28 (2) "Authorizing agency" means the board, person, or unit with legal responsibility for
29 administering and managing revolving loan funds.
30 (3) "Revenue bonds" means any special fund revenue bonds issued by the state treasurer
31 on behalf of the state pursuant to Section 63-65-8.
1 (4) "Revolving Loan Funds" means:
2 (a) the Water Resources Conservation and Development Fund, created in Section
4 (b) the Water Resources Construction Fund, created in Section 73-10-8;
5 (c) the Water Resources Cities Water Loan Fund, created in Section 73-10-22;
6 (d) the Clean Fuel Conversion Funds, created in Title 9, Chapter 1, Part 7, Clean Fuels
7 Conversion Program;
8 (e) the Water Development Security Account and its subaccounts created in Section
10 (f) the Agriculture Resource Development Fund, created in Section 4-18-6;
11 (g) the Utah Rural Rehabilitation Fund, created in Section 4-19-4;
12 (h) the Permanent Community Impact Fund, created in Section 9-4-303; [
13 (i) the Petroleum Storage Tank Loan Fund, created in Section 19-6-405.3; and
14 (j) the Transportation Infrastructure Bank Fund, created in Section 27-18-103.
15 Section 10. Effective date.
16 If approved by two-thirds of all the members elected to each house, this act takes effect
17 upon approval by the governor, or the day following the constitutional time limit of Utah
18 Constitution Article VII, Section 8, without the governor's signature, or in the case of a veto, the
19 date of veto override.
Legislative Review Note
as of 2-19-97 12:03 PM
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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