2007 Regular Session
To: Ways and Means
By: Representative Reeves
AN ACT TO AMEND SECTION 17-1-23, MISSISSIPPI CODE OF 1972, TO AUTHORIZE LOCAL GOVERNING AUTHORITIES TO REQUIRE A DEVELOPER AGREEMENT UNDER WHICH THE DEVELOPER OF A NEW SUBDIVISION AGREES TO IMPOSE A DEVELOPMENT FEE ON THE PROPERTY BEING DEVELOPED ON BEHALF OF THE LOCAL SCHOOL DISTRICT; TO BRING FORWARD SECTION 37-7-485, MC'72, WHICH IS THE SCHOOL PROPERTY DEVELOPMENT ACT OF 2005, AND SECTION 37-7-487, MC'72, WHICH AUTHORIZES SCHOOL DISTRICTS TO PLEDGE REVENUES GENERATED FROM PROPERTY IN THE SCHOOL DISTRICT FOR THE REPAYMENT OF DEBT, FOR PURPOSES OF POSSIBLE AMENDMENT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Section 17-1-23, Mississippi Code of 1972, is amended as follows:
17-1-23. (1) When new subdivisions are laid out, the governing authority of each municipality or county may, before allowing dedication, impose such terms as may be deemed necessary to make the provisions of Sections 17-1-1 through 17-1-27, inclusive, effective, and such governing authorities may receive easements in the land affected whereby such sections may be made effective. The governing authority of each municipality or county also may require a developer agreement with the local school district, as authorized under Section 37-7-487(4), to enhance the educational facilities and services provided within the subdivision and school district.
(2) The board of supervisors of any county may order that no plat of a subdivision shall be recorded until it has been approved by the board of supervisors, and the board of supervisors shall have power to require the installation of utilities and laying out of streets in subdivisions or to accept performance bonds in lieu thereof; the board of supervisors of any county bordering on the State of Tennessee having a population of more than sixty-seven thousand nine hundred (67,900) but less than seventy thousand (70,000) according to the 1990 federal census and having a land area of more than four hundred seventy (470) square miles but less than five hundred (500) square miles may also, in lieu thereof, require the deposit of monies with the county which shall be placed in a special interest-bearing account in the county treasury, and such board of supervisors at the appropriate time shall spend monies from such account solely for the purpose of constructing or improving the roads and other infrastructure within the subdivision with respect to which the deposit or deposits were made.
(3) The governing authorities of a municipality may provide that any person desiring to subdivide a tract of land within the corporate limits shall submit a map and plat of such subdivision, and a correct abstract of title of the land platted, to said governing authorities, to be approved by them before the same shall be filed for record in the land records of the county; and where the municipality has adopted an ordinance so providing, no such map or plat of any such subdivision shall be recorded by the chancery clerk unless same has been approved by said governing authorities. In all cases where a map or plat of the subdivision is submitted to the governing authorities of a municipality, and is by them approved, all streets, roads, alleys and other public ways set forth and shown on said map or plat shall be thereby dedicated to the public use, and shall not be used otherwise unless and until said map or plat is vacated in the manner provided by law, notwithstanding that said streets, roads, alleys or other public ways have not been actually opened for the use of the public.
(4) If the owner of any land which shall have been laid off, mapped or platted as a city, town or village, or addition thereto, or subdivision thereof, or other platted area, whether inside or outside a municipality, desires to alter or vacate such map or plat, or any part thereof, he may petition the board of supervisors of the county or the governing authorities of the municipality for relief in the premises, setting forth the particular circumstances of the case and giving an accurate description of the property, the map or plat of which is to be vacated or altered and the names of the persons to be adversely affected thereby or directly interested therein. However, before taking such action, the parties named shall be made aware of the action and must agree in writing to the vacation or alteration. Failure to gain approval from the parties named shall prohibit the board of supervisors or governing authorities from altering or vacating the map or plat, or any part thereof. Any alterations of a plat or map must be recorded in the appropriate location and a note shall be placed on the original plat denoting the altered or revised plat. No land shall be subdivided nor shall the map or plat of any land be altered or vacated in violation of any duly recorded covenant running with the land.
(5) Subdivision regulation under this section shall not conflict with Article VII of the Chickasaw Trail Economic Development Compact described in Section 57-36-1.
SECTION 2. Section 37-7-485, Mississippi Code of 1972, is brought forward as follows:
37-7-485. (1) This section shall be referred to as the "School Property Development Act of 2005." It is the intent of the Legislature that this section shall provide school boards with an alternative optional method of disposal of surplus school property that may generate greater returns to the district than a public disposal sale, or to promote or stimulate economic development within the school district or to promote, stabilize or enhance property and tax values within the school district.
(2) The school board of any school district shall be authorized and empowered, in its discretion, to sell, convey or exchange a partial interest, undivided interest or any other interest in real property (other than sixteenth section public school trust land), in whole or in part, for a nonoperational interest in any proposed development of the property, including ownership of shares of a domestic corporation or a membership interest in a limited liability company or a limited partnership interest, any of which is organized for the operation of any project, development or activity that, in the discretion of the school board, will have the potential for fostering economic development activities, increasing property values, increasing student development or enhancing public safety. The school board may contract with any other governmental entity, university or community college, corporation, person or other legal entity for the development, design, construction, financing, ownership or operation of any project, development or activity and may issue notes, leases, bonds or other written obligations to finance such activities. The school board may pledge any revenues or taxes it is to receive from such sale, conveyance or exchange, including any shares of a corporation or membership interest in a limited liability company or limited partnership interest under this subsection or under Sections 37-7-471 through 37-7-483, to secure the repayment of any notes, leases (excluding leases of sixteenth section public school trust land), bonds or other written obligations of the district issued under any provision of state law. Any such pledge of revenues or other monies shall be valid and binding from the date the pledge is made; such revenues or other monies so pledged and thereafter received by the school district shall immediately be subject to the lien of such pledge without any physical delivery thereof or further act, and the lien of any such pledge shall be valid and binding as against all parties having claims of any kind in tort, contract or otherwise against the school district irrespective of whether such parties have notice thereof. Neither the resolutions, contracts or any other instrument by which a pledge is created need be recorded. Any debt secured in whole or in part by a pledge of such revenues or other monies shall not be subject to or included in any debt limitation imposed on the issuance of such debt. This subsection (2) shall not be construed to apply to sixteenth section public school trust land.
(3) The school board shall use sound business practices when executing exchanges as provided in this section. The school board may utilize the services of the Mississippi Development Authority, the local planning and development district or the Board of Trustees of State Institutions of Higher Learning when executing exchanges as provided in this section. The local school board shall require, in any project exceeding Two Hundred Thousand Dollars ($200,000.00) that the party with whom the school board is contracting shall provide the following information, at a minimum:
(a) A two-year business plan (which shall include pro forma balance sheets, income statements and monthly cash flow statements);
(b) Financial statements and tax returns for the three (3) years immediately prior to the date the contract is formed;
(c) Credit reports on all persons or entities with a twenty percent (20%) or greater interest in the entity;
(d) Data supporting the expertise of the entity's principals;
(e) A cost benefit analysis of the project performed by the Mississippi Development Authority, a state institution of higher learning or other entity selected by the local school board; and
(f) Any other information required by the local school board.
This subsection (3) shall not be construed to apply to sixteenth section public school trust land.
(4) The local school board shall make public record any final and signed contract created under this section.
(5) No person involved in any economic development project entered into by a school board under the provisions of this section shall be related by consanguinity or affinity within the third degree to any member of the school board or the superintendent or any assistant superintendent of the school district, nor shall any such person have an interest in any business or have an economic relationship with any member of the school board or the superintendent or any assistant superintendent of the school district.
(6) No person, or any agent, subsidiary or parent corporation or firm owned in whole or in part by the person shall be eligible to bid or otherwise participate in the construction, contracting, or subcontracting on any project or part thereof for which the person has been hired to perform construction program management services. Any contract for public construction that violates this provision shall be void and against the public policy of the state. For purposes of this subsection, the term "construction program management services" means a set of management and technical services rendered by a person or firm to a public sector building owner during the predesign, design, construction, or post-construction phases of new construction, demolition, alteration, repair, or renovation projects. These services include any one or more of the following: project planning, budgeting, scheduling, coordination, design management, construction administration, or facility occupancy actions, but shall not include any component of the actual construction work. The term does not include the services performed by the general contractor who is engaged to perform the construction work, or services customarily performed by licensed architects or registered engineers.
(7) This section shall be supplemental and additional to any powers conferred by other laws on school districts. However, this act shall not grant any authority to a school board to issue debt in any amount that is not otherwise expressly provided for by law, and shall not grant any authority to impose, levy or collect any tax that is not otherwise expressly provided for by law.
(8) If a school board exercises its option to enter into a development agreement or other contract under this act or to transfer any property or interest therein to a third party for purposes of future development, the following conditions shall apply:
(a) The board shall have the express authority to retain a deed of trust or such other security interest in the property in an amount equal at least to the value of the property at the time of such transfer, less any consideration paid by the developer or other parties;
(b) The liability of the school board and the school district under any such development agreement shall be limited to the value of any retained property interest in the development agreement or the property that is the subject of the development agreement. Neither the school board nor the district shall be liable to any party nor shall it indemnify or hold harmless any party for any liabilities, obligations, losses, damages, penalties, settlements, claims, actions, suits, proceedings or judgments of any kind and nature, costs, expenses, or attorney's fees incurred by such party or parties for any act or action arising out of, or in connection with any development agreement entered into by the school board, other than the value of the retained ownership interest in the property that was conveyed under such development agreement.
(9) Before entering into any transaction as provided in this section, the school board members shall certify that they are in compliance with Section 25-4-25 regarding filings of statements of economic interest with the Mississippi Ethics Commission and that they will receive no direct or indirect pecuniary benefit as a result of the transaction or be in violation of the provisions of Section 25-4-105 regarding the improper use of official position.
(11) Any property developed by a school district under this section shall be deemed to be for "school purposes" or for "educational purposes."
SECTION 3. Section 37-7-487, Mississippi Code of 1972, is brought forward as follows:
37-7-487. (1) Notwithstanding any other provision of law, a school district may estimate the amount of revenues, as defined herein, to be generated from any parcel or parcels of any type of property within the school district and may irrevocably pledge such revenues to the repayment of any debt or other obligation which the district may issue or incur under Sections 37-59-1 et seq., 37-59-101 et seq., 37-7-351 et seq., 31-7-13(e), 31-7-14, 37-7-471 et seq. and 37-7-485 et. seq.
(2) Any district that pledges revenues under the provisions of this section shall annually appropriate an amount of such revenues, other than the avails of any special tax otherwise levied to pay debt service on bonds or notes of the district, to pay the debt or other obligations for which the revenues are pledged. Any debt or obligation secured by a pledge of revenues under this section shall not be subject to any debt limit or annual appropriation limitation imposed by any other statute. To further secure the school district's pledge, the district may irrevocably instruct the appropriate tax assessor or collector to irrevocably transfer on behalf of the district the pledged amount from any ad valorem tax collections, other than any special tax levy specifically imposed to pay debt service on any bonds or notes of the district, directly to a paying agent, trustee or other third party responsible for paying the debt or obligation of the district. Upon receipt of such written instructions, the appropriate tax assessor or collector shall transfer the pledged revenues as directed in writing by the school district.
(3) The term revenues, as used in this section, shall mean revenues of all types, including ad valorem tax collections, other than collections from special levies specifically levied to pay debt service on any bonds or notes of the school district, lease or development revenues, and any special development fees imposed by a developer of property within the school district as provided herein.
(4) Any school district may enter into an agreement with a developer pursuant to which the developer agrees to impose a development fee, in the amount and in the manner agreed to by the district and the developer, on property being developed within the district by the developer. The term of any such agreement shall not exceed fifty (50) years. Upon the agreement being recorded in the land records of the chancery clerk of the county in which the property is located, the development fee shall become a lien on the property subject to the agreement between the developer and the district and shall be payable by all owners of the subject property at the same time and in the same manner, and the payment of such fee shall be enforced by the taxing authority in the same manner as other ad valorem taxes levied on the property.
(5) Nothing in this section shall be construed as giving school districts additional debt or to levy any additional taxes other than as allowed by this section or as otherwise provided by law.
SECTION 4. This act shall take effect and be in force from and after July 1, 2007.