1     
TRANSPORTATION BONDING AMENDMENTS

2     
2023 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Karen Kwan

5     
House Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9          This bill modifies provisions related to general obligation bonds.
10     Highlighted Provisions:
11          This bill:
12          ▸     removes bonding authorization for some sections of double tracking for the
13     FrontRunner commuter rail and related provisions; and
14          ▸     makes technical changes.
15     Money Appropriated in this Bill:
16          None
17     Other Special Clauses:
18          None
19     Utah Code Sections Affected:
20     AMENDS:
21          63B-31-101, as last amended by Laws of Utah 2021, First Special Session, Chapter 8
22          72-2-131, as last amended by Laws of Utah 2021, Chapter 387
23     

24     Be it enacted by the Legislature of the state of Utah:
25          Section 1. Section 63B-31-101 is amended to read:
26          63B-31-101. General obligation bonds -- Maximum amount -- Use of proceeds for
27     projects.

28          (1) (a) Subject to the restriction in Subsection (1)(c), the total amount of bonds issued
29     under this section may not exceed $264,000,000 for acquisition and construction proceeds, plus
30     additional amounts as provided in Subsection (1)(b).
31          (b) When the Department of Transportation certifies to the commission the amount of
32     bond proceeds needed to provide funding for the projects described in this section, the
33     commission may issue and sell general obligation bonds in an amount equal to the certified
34     amount, plus additional amounts necessary to pay costs of issuance, to pay capitalized interest,
35     and to fund any existing debt service reserve requirements, not to exceed 1% of the certified
36     amount.
37          (c) The commission may not issue general obligation bonds authorized under this
38     section if the issuance of the general obligation bonds would result in the total current
39     outstanding general obligation debt of the state exceeding 50% of the limitation described in
40     the Utah Constitution, Article XIV, Section 1.
41          (2) Proceeds from the bonds issued under this section shall be provided to the
42     Department of Transportation to pay for, or to provide funds in accordance with this section to
43     pay for, the costs of right-of-way acquisition, construction, reconstruction, renovations, or
44     improvements with respect to projects described in this section.
45          (3) It is the intent of the Legislature that as transportation projects are prioritized under
46     Section 72-2-124, the Transportation Commission give consideration to projects beyond the
47     normal programming horizon.
48          [(4) (a) Two hundred thirty-two million dollars of the proceeds of bonds issued under
49     this section shall be used to double track strategic sections of the FrontRunner commuter rail
50     system, to be repaid from the Transit Transportation Investment Fund under Subsection
51     72-2-124(9).]
52          [(b) The issuance of the bonds for the purpose described in Subsection (4)(a) is
53     contingent upon the establishment of an agreement between the Department of Transportation
54     and the Utah Transit Authority whereby the Utah Transit Authority agrees to pay $5,000,000
55     per year for 15 years toward repayment of the bonds.]
56          [(5)] (4) (a) Twenty-nine million dollars of the proceeds of bonds issued under this
57     section shall be provided to the Department of Transportation to pass through to Brigham City
58     to be used for a Forest Street rail bridge project in Brigham City.

59          (b) Payments shall be made from the Rail Transportation Restricted Account created in
60     Section 72-2-131, from the amount designated under Subsection 72-2-131(4)(c), in the amount
61     per year of the principal and interest payments due under the bonds issued under Subsection
62     [(5)(a)] (4)(a) until those bonds have been repaid in full.
63          [(6)] (5) (a) Three million dollars of the proceeds of bonds issued under this section
64     shall be provided to the Department of Transportation to pass through to the city of North Salt
65     Lake for an environmental study for a grade separation at 1100 North in North Salt Lake.
66          (b) Payments shall be made from the Rail Transportation Restricted Account created in
67     Section 72-2-131, from the amount designated under Subsection 72-2-131(4)(b), in the amount
68     per year of the principal and interest payments due under the bonds issued under Subsection
69     [(6)(a)] (5)(a) until those bonds have been repaid in full.
70          [(7)] (6) The costs under Subsection (2) may include the costs of studies necessary to
71     make transportation infrastructure improvements, the costs of acquiring land, interests in land,
72     and easements and rights-of-way, the costs of improving sites and making all improvements
73     necessary, incidental, or convenient to the facilities, and the costs of interest estimated to
74     accrue on these bonds during the period to be covered by construction of the projects plus a
75     period of six months after the end of the construction period, interest estimated to accrue on
76     any bond anticipation notes issued under the authority of this title, and all related engineering,
77     architectural, and legal fees.
78          [(8)] (7) The commission or the state treasurer may make any statement of intent
79     relating to a reimbursement that is necessary or desirable to comply with federal tax law.
80          [(9) The Department of Transportation may enter into agreements related to the
81     projects described in Subsection (4) before the receipt of proceeds of bonds issued under this
82     section.]
83          Section 2. Section 72-2-131 is amended to read:
84          72-2-131. Rail Transportation Restricted Account -- Grants for railroad crossing
85     safety.
86          (1) As used in this section, "eligible entity" means:
87          (a) a public entity; or
88          (b) a private entity that is exempt from federal income taxation under Section
89     501(c)(3), Internal Revenue Code.

90          (2) There is created in the Transit Transportation Investment Fund, created in Section
91     72-2-124, the Rail Transportation Restricted Account.
92          (3) The account shall be funded by:
93          (a) appropriations to the account by the Legislature;
94          (b) private contributions;
95          (c) donations or grants from public or private entities; and
96          (d) interest earned on money in the account.
97          (4) Upon appropriation, the department shall:
98          (a) use an amount equal to 10% of the money deposited into the account to provide
99     grants in accordance with Subsection (5);
100          (b) use an amount equal to 10% of the money deposited into the account to pay:
101          (i) the costs of performing environmental impact studies in connection with
102     construction, reconstruction, or renovation projects related to railroad crossings on class A,
103     class B, or class C roads; or
104          (ii) the appropriate debt service or sinking fund for the repayment of bonds issued
105     under Subsection [63B-31-101(6)] 63B-31-101(5); and
106          (c) use the remaining money deposited into the account to pay:
107          (i) the costs of construction, reconstruction, or renovation projects related to railroad
108     crossings on class A, class B, or class C roads;
109          (ii) debt service related to a project described in Subsection (4)(b); or
110          (iii) the appropriate debt service or sinking fund for the repayment of bonds issued
111     under Subsection [63B-31-101(5)] 63B-31-101(4).
112          (5) (a) The department may award grants to one or more eligible entities to be used for
113     the purpose of improving safety at railroad crossings on class A, class B, or class C roads.
114          (b) An eligible entity may use grant money for any expense related to improving safety
115     at railroad crossings on class A, class B, or class C roads, including:
116          (i) signage; and
117          (ii) safety enhancements to a railroad crossing.
118          (c) The department shall prioritize, in the following order, grants to applicants that
119     propose projects impacting railroad crossings that:
120          (i) have demonstrated safety concerns, including emergency services access; and

121          (ii) have high levels of vehicular and pedestrian traffic.