SB2002_H_Cmte_Amend

SECTION 1. Section 27-107-321, Mississippi Code of 1972, is amended as follows:

27-107-321. (1) (a) There is established an emergency aid to local governments loan and grant program to be administered by the Department of Finance and Administration, referred to in this section as "department," for the purpose of assisting counties, incorporated municipalities and public school districts that suffer revenue losses as a result of a natural disaster for which a state of emergency has been duly proclaimed. Loan and grant proceeds distributed to counties, incorporated municipalities and public school districts shall be considered to be, and shall be utilized by recipient in the same manner as, governmental, enterprise or internal service fund type revenues, specifically for essential government services, including the payment of debt service.

(b) The department may contract for facilities and staff needed to administer this section, including routine management, as it deems necessary. The department may advertise for or solicit proposals from public or private sources, or both, for administration of this section or any services required for administration of this section or any portion thereof. It is the intent of the Legislature that the department endeavor to ensure that the costs of administration of this section are as low as possible.

(2) (a) There is created a special fund in the State Treasury to be designated as the "Emergency Aid to Local Governments Fund," referred to in this section as "fund," which fund shall consist of money transferred from the Disaster Recovery Fund created in Section 31-17-123 and money designated for deposit therein from any other source, public or private, including, but not limited to, appropriations, bond proceeds, grants, gifts or donations. The fund shall be credited with all repayments of principal and interest derived from loans made from the fund. Unexpended amounts remaining in the fund at the end of a fiscal year shall not lapse into the State General Fund, and any interest earned or investment earnings on amounts in the fund shall be deposited to the credit of the Emergency Aid to Local Governments Fund. Monies in the fund may not be used or expended for any purpose except as authorized under this section.

(b) The department shall establish a loan and grant program by which loans and grants may be made available to counties, incorporated municipalities and public school districts, to assist those counties, incorporated municipalities and public school districts. Any governmental entity in the current fiscal year that demonstrates a projected revenue loss equal to or exceeding twenty-five percent (25%) of its governmental fund type revenues in the fiscal year prior to the occurrence of the natural disaster eligible under this section may qualify for a loan and/or grant. The interest rate on loans made under this section may vary from time to time and from loan to loan, and shall be at or below market interest rates as determined by the department. The department shall act as quickly as is practicable and prudent in deciding on any loan or grant request that it receives. No loan or grant shall be approved under this section unless the county, municipality or public school district requesting the loan or grant has exhausted all other available public or private programs to obtain funds for the revenue loss that it is projected to suffer. Such public or private programs shall include, but not be limited to, loans, grants and donations.

(c) The aggregate amount of any loans or grants received under this section by a county, incorporated municipality or public school district shall not exceed one hundred percent (100%) of the difference between the revenue received by a county, incorporated municipality or public school district from governmental fund type revenues that are used to fund essential services in the fiscal year prior to the occurrence of the natural disaster and the estimated revenue from such sources after the occurrence of the natural disaster plus available cash reserves or fund balances at the fiscal year end, as determined by the department. The State Bond Commission shall set the maximum amount of any loan or grant made under this section at an amount that will ensure the equitable distribution of the amounts available for loans and grants to the eligible governmental entities affected by the natural disaster, but in no event shall a grant exceed Three Million Dollars ($3,000,000.00) or the total aggregate amount of all grants exceed Twenty-five Million Dollars ($25,000,000.00).

(d) A county or public school district that receives a loan from the fund shall pledge for repayment of the loan any part of the homestead exemption annual tax loss reimbursement to which it may be entitled under Section 27-33-77, as may be required by the department. An incorporated municipality that receives a loan from the fund or the emergency fund shall pledge for repayment of the loan any part of the sales tax revenue distribution to which it may be entitled under Section 27-65-75 or any part of the homestead exemption annual tax loss reimbursement to which it may be entitled under Section 27-33-77, as may be required by the department. All recipients of such loans shall establish a dedicated source of revenue for repayment of the loan. Before any county, incorporated municipality or public school district shall receive any loan, it shall have executed with the department a loan agreement evidencing that loan, a copy of which shall be filed by the department with the State Tax Commission. The loan agreement shall not be construed to prohibit any recipient from prepaying any part or all of the funds received. The repayment schedule in each loan agreement shall provide for (i) monthly payments, (ii) semiannual payments or (iii) other periodic payments. The loan agreement shall provide for the repayment of all funds received from the fund within not more than three (3) years. The State Tax Commission shall, at the direction of the department, withhold semiannually from counties, incorporated municipalities and public school districts and monthly from incorporated municipalities, from the amount to be remitted to the county, municipality or public school district, the sum necessary to pay all or a portion of the periodic payments for the loan.

(e) Any county, incorporated municipality or public school district which receives a loan from the state for that purpose but which is not eligible to pledge for repayment under the provisions of paragraph (d) of this subsection, shall repay that loan by making payments each month to the State Treasurer through the Department of Finance and Administration for and on behalf of the department according to Section 7-7-15, to be credited to the fund in lieu of pledging homestead exemption annual tax loss reimbursement or sales tax revenue distribution.

Loan repayments shall be according to a repayment schedule contained in each loan agreement as provided in paragraph (d) of this subsection.

(f) Evidences of indebtedness which are issued pursuant to this section shall not be deemed indebtedness within the meaning specified in Section 21-33-303 with regard to cities and incorporated towns, in Section 19-9-5 with regard to counties and in Section 37-59-5 with regard to public school districts.

(g) The State Auditor, upon request of the department, shall audit the receipts and expenditures of acounty, an incorporated municipality or a public school district if loan repayments appear to be in arrears, and if the Auditor finds that the county, incorporated municipality or public school district is in arrears in those repayments, the Auditor shall immediately notify the executive director of the department who may take any action as may be necessary to enforce the terms of the loan agreement, including liquidation and enforcement of the security given for repayment of the loan, and the executive director of the department may, in his discretion, notify the State Tax Commission to withhold all future payments to the county, incorporated municipality or school district of homestead exemption annual tax loss reimbursements under Section 27-33-77 and/or all sums allocated to the incorporated municipality under Section 27-65-75, until such time as the county, incorporated municipality or public school district is again current in its loan repayments as certified by the department.

(h) All monies deposited in the fund shall be used only for providing the loans and grants authorized under this section. In addition, any amounts in the fund may be used to defray the reasonable costs of administering the fund; however, no monies in the fund which are to be used for grant purposes may be used to defray any costs of administering the fund or program. The department is authorized to use amounts available to it from the fund to contract for those facilities and staff needed to administer and provide routine management for the funds and loan program.

(3) In administering this section the department shall have the following powers and duties:

(a) To supervise the use of all funds made available under this section;

(b) To promulgate rules and regulations, to make variances and exceptions thereto, and to establish procedures in accordance with this section for the implementation of the loan and grant program;

(d) To maintain, in accordance with generally accepted government accounting standards, an accurate record of all monies in the fund made available to counties, incorporated municipalities and public school districts under this section;

(e) To file annually with the Legislature a report detailing how monies in the fund were distributed during the preceding fiscal year to each county, incorporated municipality and public school district.

(4) The State Bond Commission, at one time, or from time to time, may declare the necessity for funds for the purposes provided in this section, including the costs incident to the administration of the loan and grant program. Upon approval by the State Bond Commission, the department is authorized to transfer any necessary amount from the Disaster Recovery Fund created in Section 31-17-123 to the fund in ample time to discharge such loans, grants and incidental costs.

(5) The department is authorized, without further process of law, to certify the necessity for warrants and is authorized and directed to issue such warrants, in such amounts as may be necessary to make loans and grants under the program authorized by this section.

(6) After any state funds in the fund are no longer needed for the particular purpose for which they were appropriated, deposited or transferred into the fund, the department shall transfer those state funds back to the particular fund or funds in the State Treasury from which they were appropriated or transferred into the fund, upon certification of the State Fiscal Officer that the state funds are not currently needed.

(7) At least five (5) days before any public ceremony to announce the award of a grant to a county, municipality or public school district under this section, the department shall notify all of the members of the Mississippi House of Representatives and Mississippi Senate whose districts include any portion of the county, municipality or school district to which the grant is being made.

(8) The department shall include the following language at a prominent location on any documents prepared by the department in connection with a grant made under this section that are to be provided to the county, municipality or school district to which the grant is made or to the public: "The funds for this grant were made available by the Mississippi Legislature."

SECTION 2. The Legislature hereby finds that Hurricane Katrina resulted in a natural catastrophe severely impacting the State of Mississippi and many of the political subdivisions of the state. The Legislature hereby determines that the issuance of general obligation bonds of the state to provide funds to pay the principal of, interest on and premium, if any, on qualified bonds, notes, certificates of indebtedness, and other debt obligations of the state is in all respects a public and governmental purpose to protect and/or improve the credit rating of the state, that this purpose is a public purpose, that the state will be performing an essential governmental function and meeting a public obligation in the exercise of the powers conferred upon it by this act, is a permitted use of the funds and credit of the state, will result in economic and financial benefits to the state and the political subdivisions of the state, and will provide relief from the consequences of Hurricane Katrina.

SECTION 3. As used in Sections 2 through 17 of this act:

(a) "Bonds" means the gulf tax credit bonds, notes or other evidences of indebtedness of the state issued pursuant to the provisions of Sections 2 through 17 of this act.

(b) "Commission" means the State Bond Commission.

(c) "Debt service" means the payment of principal of, interest on, premium, if any, sinking or reserve funds or other requirements, costs or expenses due and payable on general obligation bonds, notes, certificates of indebtedness, or other written general obligations for the repayment of borrowed money of the state during the state's fiscal year ending June 30, 2007.

(d) "Fund" means the Tax Credit Bond Proceeds Fund.

(e) "Gulf Opportunity Zone Act" means the Gulf Opportunity Zone Act of 2005 enacted by the United States Congress in response to Hurricanes Katrina, Rita and Wilma.

(f) "Gulf Tax Credit Bonds" means general obligation bonds of the state or other general obligations of the state issued pursuant to the provisions of this act and the Gulf Opportunity Zone Act.

(g) "Natural catastrophe" means the consequences of Hurricane Katrina on the state and the resulting fiscal emergency caused to exist in the state.

(h) "Qualified Bond" means any general obligation of the State which was outstanding on August 28, 2005, as defined in and subject to the limitations imposed by the Gulf Opportunity Zone Act.

(i) "State" means the State of Mississippi.

(j) "This act" means Sections 2 through 17 of this act.

SECTION 4. (1) (a) A special fund, to be designated as the "Tax Credit Bond Proceeds Fund," is created within the State Treasury. The fund shall be maintained by the State Treasurer

as a separate and special fund, separate and apart from the General Fund of the state. Unexpended amounts remaining in the fund at the end of a fiscal year shall not lapse into the state's General Fund, and any interest earned or investment earnings on amounts in the fund shall be deposited into such fund and used as provided in Section 5 of this act.

(b) There shall be deposited into the fund the proceeds of the bonds issued pursuant to Section 5 of this act and the money pledged to meet the state matching requirement under the Gulf Opportunity Zone Act as provided in Section 6 of this act.

(2) Money deposited into the fund shall be used solely as provided in this act and the Gulf Opportunity Zone Act to make debt service payments on qualified bonds of the state.

(3) All money deposited into the fund shall be expended in accordance with the provisions of this act and the Gulf Opportunity Zone Act.

SECTION 5. (1) The commission, at one time, or from time to time, may declare by resolution the necessity for the issuance of general obligation bonds or other general obligations of the state to provide funds for the relief of a natural catastrophe through the payment of debt service on qualified bonds of the state. The commission shall act as the issuing agent for the bonds authorized under this act, prescribe the form of the bonds, issue and sell the bonds so authorized to be sold, pay all fees and costs incurred in such issuance and sale from the money on deposit in the Tax Credit Bond Proceeds Fund, and do any and all other things necessary and advisable in connection with the issuance and sale of such bonds. The bonds authorized to be issued pursuant hereto shall be issued as gulf tax credit bonds as provided in the Gulf Opportunity Zone Act, shall bear interest at a rate of zero percent (0%), shall mature not more than two (2) years from their date of issuance, shall be issued before January 1, 2007, and shall entitle the owner of the bonds to a credit against federal taxation to the extent allowed by and in accordance with the provisions of the Gulf Opportunity Zone Act. Such bonds may be issued in one or more series, may bear such date or dates, may be in such denominations, may be sold at public or private sale, from time to time, in such manner and at such price as may be determined by the commission to be most advantageous, at par, or at any discount (which sale shall be on such terms and in such manner as the commission shall determine), and may contain such other terms and covenants (including, without limitation, covenants for the security and better marketability of such bonds), as may be provided by resolution of the commission. The commission is authorized and empowered to pay the costs that are incident to the sale, issuance and delivery of the bonds authorized under this act from the proceeds derived from the sale of such bonds or from other lawfully available funds. Pursuant to the provisions of this act, the commission may enter into such agreements as may be necessary in connection with the sale and issuance of such bonds. The total amount of bonds issued under this act shall not exceed One Hundred Million Dollars ($100,000,000.00). No bonds shall be issued under this act from and after January 1, 2007.

(2) Any investment earnings on amounts deposited into the special fund created in Section 4 of this act shall be used to pay debt service or used as otherwise directed by the commission in accordance with applicable federal and state law and in accordance with the proceedings authorizing the issuance of such bonds.

(3) Bonds issued by the commission pursuant to this act must comply with and satisfy the requirements for the issuance of "Gulf Tax Credit Bonds" pursuant to the Gulf Opportunity Zone Act.

SECTION 6. To satisfy the state matching requirement of the Gulf Opportunity Zone Act in connection with the gulf tax credit bonds authorized to be issued by this act, the commission is hereby authorized to pledge, as of the date of the issuance of the gulf tax credit bonds, any funds of the state available for debt service or any other available funds of the state to make debt service payments on qualified bonds of the state in an amount equal to the face amount of the gulf tax credit bonds issued pursuant to Section 5 of this act. Upon issuance of the gulf tax credit bonds, the funds of the state pledged to satisfy the state matching requirement of the Gulf Opportunity Zone Act shall be deposited in the fund and used to make debt service payments on qualified bonds of the state in accordance with this act and the Gulf Opportunity Zone Act. The State Treasurer, acting on behalf of the commission, is authorized to use all money on deposit in the fund to make debt service payments in accordance with the provisions of this act and the Gulf Opportunity Zone Act.

SECTION 7. The bonds authorized by this act shall be signed by the chairman of the commission, or by his facsimile signature, and the official seal of the commission shall be affixed thereto, attested by the secretary of the commission. The interest coupons, if any, to be attached to such bonds may be executed by the facsimile signatures of such officers. Whenever any such bonds shall have been signed by the officials designated to sign the bonds who were in office at the time of such signing but who may have ceased to be such officers before the sale and delivery of such bonds, or who may not have been in office on the date such bonds may bear, the signatures of such officers upon such bonds and coupons shall nevertheless be valid and sufficient for all purposes and have the same effect as if the person so officially signing such bonds had remained in office until their delivery to the purchaser, or had been in office on the date such bonds may bear. However, notwithstanding anything in this act to the contrary, such bonds may be issued as provided in the Registered Bond Act.

SECTION 8. All bonds issued under this act shall be fully negotiable in accordance with their terms and shall be "securities" within the meaning of Article 8 of the Uniform Commercial Code, subject to the provisions of such bonds pertaining to registration. It shall not be necessary to file financing statements or continuation statements to protect the lien and pledge granted by the state to the holders of any bonds issued under this act.

SECTION 9. The bonds issued under the provisions of this act are general obligations of the State of Mississippi, and for the payment thereof the full faith and credit of the State of Mississippi is irrevocably pledged. If the funds appropriated by the Legislature are insufficient to pay the principal of such bonds as they become due, then the deficiency shall be paid by the State Treasurer from any funds in the State Treasury not otherwise appropriated. All such bonds shall contain recitals on their faces substantially covering the provisions of this section.

SECTION 10. The bonds authorized under this act may be issued without any other proceedings or the happening of any other conditions or things other than those proceedings, conditions and things which are specified or required by this act. Any resolution providing for the issuance of bonds under the provisions of this act shall become effective immediately upon its adoption by the commission, and any such resolution may be adopted at any regular or special meeting of the commission by a majority of its members.

SECTION 11. The bonds authorized under the authority of this act may be validated in the Chancery Court of the First Judicial District of Hinds County, Mississippi, in the manner and with the force and effect provided by Chapter 13, Title 31, Mississippi Code of 1972, for the validation of county, municipal, school district and other bonds. The notice to taxpayers required by such statutes shall be published in a newspaper published or having a general circulation in the City of Jackson, Mississippi.

SECTION 12. Any holder of bonds issued under the provisions of this act may, either at law or in equity, by suit, action, mandamus or other proceeding, protect and enforce any and all rights granted under this act, or under such resolution, and may enforce and compel performance of all duties required by this act to be performed, in order to provide for the payment of such bonds.

SECTION 13. All bonds issued under the provisions of this act shall be legal investments for trustees and other fiduciaries, and for savings banks, trust companies and insurance companies organized under the laws of the state, and such bonds shall be legal securities which may be deposited with and shall be received by all public officers and bodies of this state and all municipalities and political subdivisions for the purpose of securing the deposit of public funds.

SECTION 14. Bonds issued under the provisions of this act and income, if any, therefrom shall be exempt from all taxation in the State of Mississippi. In addition, the amount of credit determined in accordance with the provisions of the Gulf Opportunity Zone Act and received by a holder of the bonds issued under the provisions of this act shall not be included in the income of such holder for state income tax purposes.

SECTION 15. The proceeds of the bonds issued under this act shall be used solely for the purposes herein provided, including the costs incident to the issuance and sale of such bonds.

SECTION 16. The State Treasurer is authorized, without further process of law, to certify to the Department of Finance and Administration the necessity for warrants, and the Department of Finance and Administration is authorized and directed to issue such warrants, in such amounts as may be necessary to pay when due the principal of all bonds issued under this act; and the State Treasurer shall forward the necessary amount to the designated place or places of payment of such bonds in ample time to discharge such bonds on the due dates thereof.

SECTION 17. This act shall be deemed to be full and complete authority for the exercise of the powers granted in this act, but this act shall not be deemed to repeal or to be in derogation of any existing law of this state.

SECTION 18. Section 31-17-123, Mississippi Code of 1972, is amended as follows:

31-17-123. (1) The intent of the Legislature is to authorize borrowing funds under the provisions of Sections 31-17-101 through 31-17-123 to offset any temporary cash flow deficiencies and should not be construed to authorize the borrowing of any funds in an amount that cannot be repaid during the fiscal year in which the funds are borrowed.

(2) (a) Notwithstanding any provision of this chapter to the contrary, in the event that the State Fiscal Officer and the State Treasurer make a determination that (i) state-source special funds are not sufficient to cover deficiencies in the General Fund, (ii) the State of Mississippi is unable to repay special fund borrowing within the fiscal year in which it was borrowed, or (iii) state-source funds are insufficient for disaster support and/or assistance purposes due to Hurricanes Katrina and/or Rita; and that the State Bond Commission makes a determination that such deficiency, inability to repay, or insufficiency is the result of a state of emergency within the State of Mississippi, the State Bond Commission is authorized to obtain a line of credit, in an amount not to exceed Five Hundred Million Dollars ($500,000,000.00), from a commercial lender, investment banking group or a consortium of either, or both. The length of indebtedness under this subsection shall not extend past three (3) years following the origination of the line of credit. The line of credit shall be authorized and approved by the State Bond Commission and shall have such terms and details as may be provided by resolution of the State Bond Commission. Loan proceeds shall be received and disbursed by the State Treasurer and deposited into the Disaster Recovery Fund, a special fund hereby created in the State Treasury, and shall be used to cover deficiencies in the General Fund, to repay special fund borrowing and/or to cover any insufficiency in disaster support and/or assistance. Monies remaining in the Disaster Recovery Fund at the end of a fiscal year shall not lapse into the State General Fund, but shall remain in the Disaster Recovery Fund and any interest earned or investment earnings on amounts in the Disaster Recovery Fund shall remain in the fund.

(b) As security for the repayment of the principal and interest on the line of credit provided for in paragraph (a) of this subsection, the full faith, credit and resources of the State of Mississippi are hereby irrevocably pledged.

(c) Upon approval of the State Fiscal Officer, the Director of the Mississippi Emergency Management Agency is authorized to use amounts from the line of credit to match federal funds, and for personnel, call-back wages, base and overtime wages, travel, per diem and other out-of-pocket expenses incurred as a result of Hurricanes Katrina and/or Rita.

(d) This subsection (2) shall be complete authority for the borrowing authorized hereunder and shall not be subject to the limitations provided in the other provisions of this chapter or otherwise under state law.

(e) The State Treasurer shall notify the Legislative Budget Office and the State Department of Finance and Administration of each transfer into and out of the Disaster Recovery Fund on a quarterly basis.

SECTION 19. Section 3, Chapter 534, Laws of 2006, is amended as follows:

Section 3. There is hereby created in the State Treasury a special fund, separate and apart from any other special fund, to be designated as the Hurricane Disaster Reserve Fund. The State Fiscal Officer shall transfer from the State General Fund into the Hurricane Disaster Reserve Fund an amount equal to Two Hundred Sixty-eight Million Dollars ($268,000,000.00) during the period beginning July 1, 2006, and ending June 30, 2007.

The funds transferred herein to the Hurricane Disaster Reserve Fund shall be utilized to defray the state's share of any nonfederal matching requirements for Federal Emergency Management Agency grants associated with Hurricane Katrina and other disasters. Unexpended funds remaining in the Hurricane Disaster Reserve Fund at the end of the fiscal year shall not lapse into the State General Fund but shall remain in the fund and any interest earned or investment earnings on amounts in the Hurricane Disaster Reserve Fund shall remain in the fund; however, any interest earned or investment earnings on amounts in the fund during fiscal years 2007 and 2008 shall be transferred by the State Treasurer to the Emergency Aid to Local Governments Fund created in Section 27-107-1.

Funds deposited into the Hurricane Disaster Reserve Fund shall be used only for the purposes specified in this section, and as long as the provisions of this section remain in effect, no other expenditure, appropriation or transfer of funds in the Hurricane Disaster Reserve Fund shall be made except by act of the Legislature making specific reference to the Hurricane Disaster Reserve Fund as the source of those funds.

SECTION 20. Section 6, Chapter 17, Laws of 2006, is amended as follows:

Section 6. Of the funds appropriated under the provisions of Section 2, Two Million Eight Hundred Thirty-nine Thousand Nine Hundred Eight Dollars ($2,839,908.00) shall be derived from the Budget Contingency Fund created in Section 27-103-301, Mississippi Code of 1972, and not more than One Hundred Million Dollars ($100,000,000.00) shall be derived from the proceeds of the sale of the bonds authorized in Sections 2 through 17 of Senate Bill No. ____, 2006 First Extraordinary Session, and deposited into the Tax Credit Bond Proceeds Fund created in Section 4 of Senate Bill No. ____, 2006 First Extraordinary Session, for the purpose of paying maturing bonds and interest on the full faith and credit bonds of the State of Mississippi.

SECTION 21. Upon passage of this act, the State Fiscal Officer shall transfer One Hundred Million Dollars ($100,000,000.00) from the Budget Contingency Fund created in Section 27-103-301 to the Disaster Recovery Fund created in Section 31-17-123.

SECTION 22. This act shall take effect and be in force from and after its passage.