Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 277 First Substitute (2017GS)

Sponsor

Sen. Harper, W.

Final action

Governor Signed 3/25/2017

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• authorizes the issuance of general obligation bonds to pay for certain state highway construction or reconstruction projects;
• authorizes the issuance of general obligation bonds to pay for certain state or local highway construction or reconstruction projects in a county of the first class;
• specifies the use of general obligation bond proceeds and the manner of issuance;
• exempts certain general obligation bonds from certain debt limitation provisions;
• requires the Department of Transportation and the Transportation Commission to report the amount of bonds needed to fund certain projects in the next fiscal year to the Executive Appropriations Committee of the Legislature before the bonds may be issued; and
• makes technical changes.

Every vote on this bill

Bill text

HIGHWAY GENERAL OBLIGATION BONDS
AUTHORIZATION
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Wayne A. Harper
House Sponsor: 
____________
LONG TITLE
General Description:
This bill enacts and amends provisions relating to transportation funding.
Highlighted Provisions:
This bill:
▸ authorizes the issuance of general obligation bonds to pay for certain state highway
construction or reconstruction projects;
▸ authorizes the issuance of general obligation bonds to pay for certain state or local
highway construction or reconstruction projects in a county of the first class;
▸ specifies the use of general obligation bond proceeds and the manner of issuance;
▸ exempts certain general obligation bonds from certain debt limitation provisions;
▸ requires the Department of Transportation and the Transportation Commission to
report the amount of bonds needed to fund certain projects in the next fiscal year to
the Executive Appropriations Committee of the Legislature before the bonds may
be issued; and
▸ makes technical changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
This bill provides a special effective date.
Utah Code Sections Affected:
AMENDS:
63B-1-306
, as last amended by Laws of Utah 2009, Chapters 241 and 275
63J-3-402
, as last amended by Laws of Utah 2009, Chapters 241 and 275
72-2-121
, as last amended by Laws of Utah 2016, Chapter 12
72-2-124
, as last amended by Laws of Utah 2016, Chapters 137 and 291
ENACTS:
63B-27-101
, Utah Code Annotated 1953
63B-27-102
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
63B-1-306
 is amended to read:
63B-1-306.
Obligations issued by authority -- Limitation of liability on
obligations -- Limitation on amount of obligations issued.
(1) (a) All obligations issued by the authority under this part shall be limited
obligations of the authority and may not constitute, nor give rise to, a general obligation or
liability of, nor a charge against the general credit or taxing power of, this state or any of its
political subdivisions.
(b) This limitation shall be plainly stated upon all obligations.
(2) (a) No authority obligations incurred under this section may be issued in an amount
exceeding the difference between the total indebtedness of the state and an amount equal to
1-1/2% of the value of the taxable property of the state.
(b) Debt issued under authority of the following parts or sections may not be included
as part of the total indebtedness of the state of Utah in determining the debt limit established by
this Subsection (2):
(i) Title 63B, Chapter 6, Part 2, 1997 Highway General Obligation Bond
Authorization;
(ii) Title 63B, Chapter 6, Part 3, 1997 Highway Bond Anticipation Note Authorization;
(iii) Title 63B, Chapter 7, Part 2, 1998 Highway General Obligation Bond
Authorization;
(iv) Title 63B, Chapter 7, Part 3, 1998 Highway Bond Anticipation Note
Authorization;
(v) Title 63B, Chapter 8, Part 2, 1999 Highway General Obligation Bond
Authorization;
(vi) Title 63B, Chapter 8, Part 3, 1999 Highway Bond Anticipation Note
Authorization;
(vii) Title 63B, Chapter 9, Part 2, 2000 Highway General Obligation Bond;
(viii) Title 63B, Chapter 10, Part 1, 2001 Highway General Obligation Bonds;
(ix) Title 63B, Chapter 10, Part 2, 2001 Highway General Obligation Bond
Anticipation Notes Authorization;
(x) Title 63B, Chapter 11, Part 5, 2002 Highway General Obligation Bonds for Salt
Lake County;
(xi) Title 63B, Chapter 11, Part 6, 2002 Highway General Obligation Bond
Anticipation Notes for Salt Lake County;
(xii) Section 
63B-13-102
;
(xiii) Section 
63B-16-101
;
(xiv) Section 
63B-16-102
;
(xv) Section 
63B-18-401
; [
and
]
(xvi) Section 
63B-18-402
[
.
]
; and
(xvii) Title 63B, Chapter 27, Part 1, 2017 Highway General Obligation Bonds.
(c) Debt issued under authority of Section 
63B-7-503
 may not be included as part of
the total indebtedness of the state in determining the debt limit established by this Subsection
(2).
(3) The obligations shall be authorized by resolution of the authority, following
approval of the Legislature, and may:
(a) be executed and delivered at any time, and from time to time, as the authority may
determine;
(b) be sold at public or private sale in the manner and at the prices, either at, in excess
of, or below their face value and at the times that the authority determines;
(c) be in the form and denominations that the authority determines;
(d) be of the tenor that the authority determines;
(e) be in registered or bearer form either as to principal or interest or both;
(f) be payable in those installments and at the times that the authority determines;
(g) be payable at the places, either within or without this state, that the authority
determines;
(h) bear interest at the rate or rates, payable at the place or places, and evidenced in the
manner, that the authority determines;
(i) be redeemable before maturity, with or without premium;
(j) contain any other provisions not inconsistent with this part that are considered to be
for the best interests of the authority and provided for in the proceedings of the authority under
which the bonds are authorized to be issued; and
(k) bear facsimile signatures and seals.
(4) The authority may pay any expenses, premiums, or commissions, that it considers
necessary or advantageous in connection with the authorization, sale, and issuance of these
obligations, from the proceeds of the sale of the obligations or from the revenues of the projects
involved.
Section 2. Section 
63B-27-101
 is enacted to read:
CHAPTER 27. 2017 BONDING AND FINANCING AUTHORIZATIONS
Part 1. 2017 Highway General Obligation Bonds
 63B-27-101.
Highway bonds -- Maximum amount -- Use of proceeds for highway
projects.
(1) (a) Subject to the restriction in Subsection (1)(c), the total amount of bonds issued
under this section may not exceed $1,000,000,000.
(b) When the Department of Transportation certifies to the commission that the
requirements of Subsection 
72-2-124
(5) have been met and certifies the amount of bond
proceeds that the commission needs to provide funding for the projects described in Subsection
(2) for the current or next fiscal year, the commission may issue and sell general obligation
bonds in an amount equal to the certified amount plus costs of issuance.
(c) The commission may not issue general obligation bonds authorized under this
section if the issuance of the general obligation bonds would result in the total current
outstanding general obligation debt of the state exceeding 50% of the limitation described in
the Utah Constitution, Article XIV, Section 1.
(2) Except as provided in Subsections (3) and (4), proceeds from the issuance of bonds
shall be provided to the Department of Transportation to pay all or part of the costs of the
following state highway construction or reconstruction projects:
(a) state and federal highways prioritized by the Transportation Commission through
the prioritization process for new transportation capacity projects adopted under Section
72-1-304
, giving priority consideration for projects with a regional significance or that support
economic development within the state, including:
(i) projects that are prioritized but exceed available cash flow beyond the normal
programming horizon; or
(ii) projects prioritized in the state highway construction program; and
(b) $100,000,000 to be used by the Department of Transportation for transportation
improvements as prioritized by the Transportation Commission for projects that:
(i) have a significant economic development impact associated with recreation and
tourism within the state; and
(ii) address significant needs for congestion mitigation.
(3) Ten million dollars of the bond proceeds issued under this section shall be provided
to the Transportation Infrastructure Loan Fund created by Section 
72-2-202
 to make funds
available for a transportation infrastructure loan or transportation infrastructure assistance
under Title 72, Chapter 2, Part 2, Transportation Infrastructure Loan Fund, to the military
installation development authority created in Section 
63H-1-201
.
(4) The bond proceeds issued under this section shall be provided to the Department of
Transportation.
(5) The costs under Subsection (2) may include the costs of studies necessary to make
transportation infrastructure improvements, the costs of acquiring land, interests in land, and
easements and rights-of-way, the costs of improving sites, and making all improvements
necessary, incidental, or convenient to the facilities, and the costs of interest estimated to
accrue on these bonds during the period to be covered by construction of the projects plus a
period of six months after the end of the construction period, interest estimated to accrue on
any bond anticipation notes issued under the authority of this title, and all related engineering,
architectural, and legal fees.
(6) The commission or the state treasurer may make any statement of intent relating to
a reimbursement that is necessary or desirable to comply with federal tax law.
(7) The Department of Transportation may enter into agreements related to the projects
described in Subsection (2) before the receipt of proceeds of bonds issued under this section.
Section 3. Section 
63B-27-102
 is enacted to read:
 63B-27-102.
Highway bonds -- Maximum amount -- Use of proceeds for highway
projects.
(1) (a) Subject to the restriction in Subsection (1)(c), the total amount of bonds issued
under this section may not exceed $50,000,000.
(b) When the Department of Transportation certifies to the commission the amount of
bond proceeds that the commission needs to provide funding for the highway construction
projects described in Subsection (2), the commission may issue and sell general obligation
bonds in an amount equal to the certified amount plus costs of issuance.
(c) The commission may not issue general obligation bonds authorized under this
section if the issuance of the general obligation bonds would result in the total current
outstanding general obligation debt of the state exceeding 50% of the limitation described in
the Utah Constitution, Article XIV, Section 1.
(2) (a) Proceeds from the bonds issued under this section shall be provided to the
Department of Transportation to pay for or to provide funds to a municipality or county to pay
for the costs of right-of-way acquisition, construction, reconstruction, renovations, or
improvements to highways described in Subsection (2)(b).
(b) Bond proceeds described under Subsection (2)(a) shall be used to pay for state and
local highway projects in Salt Lake County prioritized by the county.
(c) Prior to a municipality or county receiving funds described in this Subsection (2),
the municipality or county shall certify that it will use the funds provided under this Subsection
(2) solely for the projects prioritized by the county.
(d) The costs under this Subsection (2) may include the costs of acquiring land,
interests in land, and easements and rights-of-way, the costs of improving sites, and making all
improvements necessary, incidental, or convenient to the facilities, and the costs of interest
estimated to accrue on these bonds during the period to be covered by construction of the
projects plus a period of six months after the end of the construction period, interest estimated
to accrue on any bond anticipation notes issued under the authority of this title, and all related
engineering, architectural, and legal fees.
(3) The commission or the state treasurer may make any statement of intent relating to
a reimbursement that is necessary or desirable to comply with federal tax law.
(4) The Department of Transportation may enter into agreements related to the project
before the receipt of proceeds of bonds issued under this chapter.
Section 4. Section 
63J-3-402
 is amended to read:
63J-3-402.
Debt limitation -- Vote requirement needed to exceed limitation --
Exceptions.
(1) (a) Except as provided in Subsection (1)(b), the outstanding general obligation debt
of the state may not exceed 45% of the maximum allowable appropriations limit unless
approved by more than a two-thirds vote of both houses of the Legislature.
(b) Notwithstanding the limitation contained in Subsection (1)(a), debt issued under the
authority of the following parts or sections is not subject to the debt limitation established by
this section:
(i) Title 63B, Chapter 6, Part 2, 1997 Highway General Obligation Bond
Authorization;
(ii) Title 63B, Chapter 6, Part 3, 1997 Highway Bond Anticipation Note Authorization;
(iii) Title 63B, Chapter 7, Part 2, 1998 Highway General Obligation Bond
Authorization;
(iv) Title 63B, Chapter 7, Part 3, 1998 Highway Bond Anticipation Note
Authorization;
(v) Title 63B, Chapter 8, Part 2, 1999 Highway General Obligation Bond
Authorization;
(vi) Title 63B, Chapter 8, Part 3, 1999 Highway Bond Anticipation Note
Authorization;
(vii) Title 63B, Chapter 9, Part 2, 2000 Highway General Obligation Bond;
(viii) Title 63B, Chapter 10, Part 1, 2001 Highway General Obligation Bonds;
(ix) Title 63B, Chapter 10, Part 2, 2001 Highway General Obligation Bond
Anticipation Notes Authorization;
(x) Title 63B, Chapter 11, Part 5, 2002 Highway General Obligation Bonds for Salt
Lake County;
(xi) Title 63B, Chapter 11, Part 6, 2002 Highway General Obligation Bond
Anticipation Notes for Salt Lake County [
Authorization
];
(xii) Section 
63B-13-102
;
(xiii) Section 
63B-16-101
;
(xiv) Section 
63B-16-102
;
(xv) Section 
63B-18-401
; [
and
]
(xvi) Section 
63B-18-402
[
.
]
; and
(xvii) Title 63B, Chapter 27, Part 1, 2017 Highway General Obligation Bonds.
(2) This section does not apply if contractual rights will be impaired.
Section 5. Section 
72-2-121
 is amended to read:
72-2-121.
County of the First Class Highway Projects Fund.
(1) There is created a special revenue fund within the Transportation Fund known as
the "County of the First Class Highway Projects Fund."
(2) The fund consists of money generated from the following revenue sources:
(a) any voluntary contributions received for new construction, major renovations, and
improvements to highways within a county of the first class;
(b) the portion of the sales and use tax described in Subsection 
59-12-2214
(3)(b)
deposited in or transferred to the fund;
(c) the portion of the sales and use tax described in Subsection 
59-12-2217
(2)(b) and
required by Subsection 
59-12-2217
(8)(b) to be deposited in or transferred to the fund; and
(d) a portion of the local option highway construction and transportation corridor
preservation fee imposed in a county of the first class under Section 
41-1a-1222
 deposited in or
transferred to the fund.
(3) (a) The fund shall earn interest.
(b) All interest earned on fund money shall be deposited into the fund.
(4) The executive director shall use the fund money only:
(a) to pay debt service and bond issuance costs for bonds issued under Sections
63B-16-102
 [
and
]
,
63B-18-402
, and 
63B-27-102
;
(b) for right-of-way acquisition, new construction, major renovations, and
improvements to highways within a county of the first class and to pay any debt service and
bond issuance costs related to those projects, including improvements to a highway located
within a municipality in a county of the first class where the municipality is located within the
boundaries of more than a single county;
(c) for the construction, acquisition, use, maintenance, or operation of:
(i) an active transportation facility for nonmotorized vehicles;
(ii) multimodal transportation that connects an origin with a destination; or
(iii) a facility that may include a:
(A) pedestrian or nonmotorized vehicle trail;
(B) nonmotorized vehicle storage facility;
(C) pedestrian or vehicle bridge; or
(D) vehicle parking lot or parking structure; 
(d) for fiscal year 2012-13 only, to pay for or to provide funds to a municipality or
county to pay for a portion of right-of-way acquisition, construction, reconstruction,
renovations, and improvements to highways described in Subsections 
72-2-121.4
(7), (8), and
(9);
(e) to transfer to the 2010 Salt Lake County Revenue Bond Sinking Fund created by
Section 
72-2-121.3
 the amount required in Subsection 
72-2-121.3
(4)(c) minus the amounts
transferred in accordance with Subsection 
72-2-124
(4)(a)(iv);
(f) for a fiscal year beginning on or after July 1, 2013, to pay debt service and bond
issuance costs for $30,000,000 of the bonds issued under Section 
63B-18-401
 for the projects
described in Subsection 
63B-18-401
(4)(a);
(g) for a fiscal year beginning on or after July 1, 2013, and after the department has
verified that the amount required under Subsection 
72-2-121.3
(4)(c) is available in the fund, to
transfer an amount equal to 50% of the revenue generated by the local option highway
construction and transportation corridor preservation fee imposed under Section 
41-1a-1222
 in
a county of the first class:
(i) to the legislative body of a county of the first class; and
(ii) to be used by a county of the first class for:
(A) highway construction, reconstruction, or maintenance projects; or
(B) the enforcement of state motor vehicle and traffic laws;
(h) for fiscal year 2015 only, and after the department has verified that the amount
required under Subsection 
72-2-121.3
(4)(c) is available in the fund and the transfer under
Subsection (4)(f) has been made, to transfer an amount equal to the remainder of the revenue
available in the fund for the 2015 fiscal year:
(i) to the legislative body of a county of the first class; and
(ii) to be used by a county of the first class for:
(A) highway construction, reconstruction, or maintenance projects; or
(B) the enforcement of state motor vehicle and traffic laws;
(i) for fiscal year 2015-16 only, and after the department has verified that the amount
required under Subsection 
72-2-121.3
(4)(c) is available in the fund and the transfer under
Subsection (4)(f) has been made, to transfer an amount equal to $25,000,000:
(i) to the legislative body of a county of the first class; and
(ii) to be used by the county for the purposes described in this section;
(j) for a fiscal year beginning on or after July 1, 2015, after the department has verified
that the amount required under Subsection 
72-2-121.3
(4)(c) is available in the fund and the
transfer under Subsection (4)(f) has been made, to annually transfer an amount equal to up to
42.5% of the sales and use tax revenue imposed in a county of the first class and deposited into
the fund in accordance with Subsection 
59-12-2214
(3)(b) to
:
(i) the appropriate debt service or sinking fund for the repayment of bonds issued under
Section 
63B-27-102
; and
(ii)
 the Transportation Investment Fund of 2005 created in Section 
72-2-124
 until
$28,079,000 has been deposited into the Transportation Investment Fund of 2005; 
and
(k) for a fiscal year beginning after the amount described in Subsection (4)(j) has been
repaid to the Transportation Investment Fund of 2005 until fiscal year 2030, [
and
] after the
department has verified that the amount required under Subsection 
72-2-121.3
(4)(c) is
available in the fund and the transfer under Subsection (4)(f) has been made
, and after the
bonds under Section 
63B-27-102
 have been repaid
, to annually transfer an amount equal to up
to 42.5% of the sales and use tax revenue imposed in a county of the first class and deposited
into the fund in accordance with Subsection 
59-12-2214
(3)(b):
(i) to the legislative body of a county of the first class; and
(ii) to be used by the county for the purposes described in this section.
(5) The revenues described in Subsections (2)(b), (c), and (d) that are deposited in the
fund and bond proceeds from bonds issued under Sections 
63B-16-102
 [
and
]
,
63B-18-402
,
 and
63B-27-102
 are considered a local matching contribution for the purposes described under
Section 
72-2-123
.
(6) The additional administrative costs of the department to administer this fund shall
be paid from money in the fund.
(7) Notwithstanding any statutory or other restrictions on the use or expenditure of the
revenue sources deposited into this fund, the Department of Transportation may use the money
in this fund for any of the purposes detailed in Subsection (4).
Section 6. Section 
72-2-124
 is amended to read:
72-2-124.
Transportation Investment Fund of 2005.
(1) There is created a capital projects fund entitled the Transportation Investment Fund
of 2005.
(2) The fund consists of money generated from the following sources:
(a) any voluntary contributions received for the maintenance, construction,
reconstruction, or renovation of state and federal highways;
(b) appropriations made to the fund by the Legislature;
(c) the sales and use tax revenues deposited into the fund in accordance with Section
59-12-103
;
(d) registration fees designated under Section 
41-1a-1201
; and
(e) revenues transferred to the fund in accordance with Section 
72-2-106
.
(3) (a) The fund shall earn interest.
(b) All interest earned on fund money shall be deposited into the fund.
(4) (a) Except as provided in Subsection (4)(b), the executive director may use fund
money only to pay:
(i) the costs of maintenance, construction, reconstruction, or renovation to state and
federal highways prioritized by the Transportation Commission through the prioritization
process for new transportation capacity projects adopted under Section 
72-1-304
;
(ii) the costs of maintenance, construction, reconstruction, or renovation to the highway
projects described in Subsections 
63B-18-401
(2), (3), and (4);
(iii) principal, interest, and issuance costs of bonds authorized by Section 
63B-18-401
minus the costs paid from the County of the First Class Highway Projects Fund in accordance
with Subsection 
72-2-121
(4)(f);
(iv) for a fiscal year beginning on or after July 1, 2013, to transfer to the 2010 Salt
Lake County Revenue Bond Sinking Fund created by Section 
72-2-121.3
 the amount certified
by Salt Lake County in accordance with Subsection 
72-2-121.3
(4)(c) as necessary to pay the
debt service on $30,000,000 of the revenue bonds issued by Salt Lake County;
(v) principal, interest, and issuance costs of bonds authorized by Section 
63B-16-101
for projects prioritized in accordance with Section 
72-2-125
;
(vi) all highway general obligation bonds that are intended to be paid from revenues in
the Centennial Highway Fund created by Section 
72-2-118
; and
(vii) for fiscal year 2015-16 only, to transfer $25,000,000 to the County of the First
Class Highway Projects Fund created in Section 
72-2-121
 to be used for the purposes described
in Section 
72-2-121
.
(b) The executive director may use fund money to exchange for an equal or greater
amount of federal transportation funds to be used as provided in Subsection (4)(a).
(5) (a) Before bonds authorized by Section 
63B-18-401
or 
63B-27-101
 may be issued
in any fiscal year, the department and the commission shall appear before the Executive
Appropriations Committee of the Legislature and present the amount of bond proceeds that the
department needs to provide funding for the projects identified in Subsections 
63B-18-401
(2),
(3), and (4) 
or Subsection 
63B-27-101
(3)
 for the next fiscal year.
(b) The Executive Appropriations Committee of the Legislature shall review and
comment on the amount of bond proceeds needed to fund the projects.
(6) The Division of Finance shall, from money deposited into the fund, transfer the
amount of funds necessary to pay principal, interest, and issuance costs of bonds authorized by
Section 
63B-18-401
or 
63B-27-101
 in the current fiscal year to the appropriate debt service or
sinking fund.
Section 7. 
Effective date.
This bill takes effect on July 1, 2017.
Legislative Review Note
Office of Legislative Research and General Counsel