HB 7321 — AN ACT ESTABLISHING A CREDIT REVENUE BOND PROGRAM.

General Assembly   RaisedSubstitute Bill No.

7321 January Session, 2017   LCO*_____HB07321FIN___042817____* No.AN ACT ESTABLISHING A CREDIT REVENUE BOND PROGRAM.

6201   *06201_______FIN* Referred to Committee on FINANCE, REVENUE AND BONDING   Introduced by:

  (FIN)   AN ACT ESTABLISHING A CREDIT REVENUE BOND PROGRAM.

(NEW) (Effective from passage) (a) As used in this section, the following terms shall have the following meanings, unless the context clearly indicates a different meaning or intent:

(2) "Collection agent" means the financial institution acting as the trustee or agent for the trustee tothat receivereceives the pledged revenues directed by the state to be paid to it by taxpayers;

(3) "Debt service requirements" means (A) the(i) principal and interest with respect to bonds, the(ii) interest with respect to bond anticipation notesnotes, and the(iii) unrefunded principal with respect to bond anticipation notes, (B) the purchase price of bonds and bond anticipation notes whichthat are subject to purchase or redemption at the option of the bondowner or noteowner, (C) the amounts, if any, required to establish or maintain reserves, sinking funds or other funds or accounts at the respective levels required to be established or maintained therein in accordance with the proceedings authorizing the issuance of bonds, (D) expenses of issuance and administration with respect to bonds and bond anticipation notes, as determined by the Treasurer, (E) the amounts, if any, becoming due and payable under a reimbursement agreement or similar agreement entered into pursuant to authority granted under the proceedings authorizing the issuance of bonds and bond anticipation notes, and (F) any other costs or expenses deemed by the Treasurer to be necessary or proper to be paid in connection with the bonds and bond anticipation notes, including, without limitation, the cost of any credit facility, including, but not limited to, a letter of credit or policy of bond insurance, issued by a financial institution pursuant to an agreement approved bypursuant to the proceedings authorizing the issuance of bonds and bond anticipation notes;

(6) "Proceedings" means the proceedings of the State Bond Commission authorizing the issuance of bonds pursuant to this section, the provisions of any resolution or trust indenture securing bonds, whichthat provisions are incorporated into such proceedings, the provisions of any other documents or agreements whichthat are incorporated into such proceedings and, to the extent applicable, a certificate of determination filed by the Treasurer in accordance with this section;

(b) Whenever any general statute or public or special act, whether adoptedenacted beforebefore, on or after the effective date of this section, shallauthorizes have authorized general obligation bonds of the state to be issued for any purpose, such general statute or public or special act shall be deemed to have authorized such bonds to be issued as either general obligation bonds or credit revenue bonds under this section.

(6) Provisions regarding the rights and remedies available in case of a default to the bondowners, or any trustee under any contract, loan agreement, document, instrument or trust indenture, including the right to appoint a trustee to represent their interests upon occurrence of an event of default, as defined in said proceedings, providedprovided, that if any bonds shall be secured by a trust indenture, the respective owners of such bonds or notes shall have no authority except as set forth in such trust indenture to appoint a separate trustee to represent them, and provided further that no such right or remedy shall allow principal and interest on such bonds to be accelerated;

and provided further,further that the state may change the rate of withholding taxes, calculation of amounts to which the rate applies, including exemptions and deductions so long as any such change, had it been in effecteffect, would not have reduced the withholding taxes for any twelve consecutive months within the preceding fifteen months to less than an amount three times the maximum debt service payable on bonds issued and outstanding under this section for the current or any future fiscal year.

(r) (1) Prior to July 1, 2019, net earnings of investments of proceeds of bonds issued pursuant to section 3-20 of the general statutes or pursuant to this section and such funds and accrued interest and premiums on the issuance of such bonds shall,shall be deposited to the credit of the General Fund, after (A) payment of any expenses incurred by the Treasurer or State Bond Commission in connection with such issuance, or (B) application to interest on bonds, notes or other obligations of the state,state. be deposited to the credit of the General Fund.

(2) On and after July 1, 2019, notwithstanding subsection (f) of section 3-20 of the general statutes, (A) net earnings of investments of proceeds of bonds issued pursuant to section 3-20 of the general statutes or pursuant to this section and such funds and accrued interest on the issuance of such bonds shall, after payment of any expenses incurred by the Treasurer or State Bond Commission with such issuance, be deposited to the credit of the General Fund, and (B) premiums, net of any original issue discount, on the issuance of such bonds shall, after payment of any expenses incurred by the Treasurer or State Bond Commission in connection with such issuance, be deposited at the direction of the Treasurer to the credit of an account or fund to fund all or a portion of any purpose or project authorized by the State Bond Commission pursuant to any bond act up to the amount authorized by the State Bond Commission, provided the bonds for such purpose or project are unissued, and provided further that the certificate of determination the Treasurer files with the secretary of the State Bond Commission for such authorized bonds sets forth the amount of the deposit applied to fund each such purpose and project.

Upon such recording by the TreasurerTreasurer, such bonds shall be deemed to have been issued, retired and no longer authorized for issuance or outstanding for the purposes of section 3-21 of the general statutes, as amended by this act, and for the purpose of aligning the funding of such authorized purpose and project with amounts generated by net premiums, but shall not constitute an actual bond issuance or bond retirement for any other purposes including, but not limited to, financial reporting purposes.

3 July 1, 2017 3-21(a) Statement of Purpose:Legislative Commissioners:

ToIn establishSection a1(a), "shall" was deleted for consistency with standard drafting conventions, in Section 1(a)(2), "to receive" was changed to "that receives" for clarity, Section 1(a)(3)(A) was divided into clauses and "the" was deleted throughout for clarity, in Section 1(a)(3)(B), "which" was changed to "that" for consistency with standard drafting conventions, in Section 1(a)(3)(F), "approved by" was changed to "approved pursuant to" for clarity, in Section 1(a)(6), "which provisions" was changed to "that" for clarity and "agreements which" was changed to "agreements that" for consistency with standard drafting conventions, in Section 1(b), "adopted" was changed to "enacted" for accuracy, "before or after" was changed to "before, on or after" for clarity and "shall have authorized" was changed to "authorizes" for consistency with standard drafting conventions, in Section 1(g)(6), "provided that" was changed to "provided," and "provided further that" was changed to "provided further" for clarity, in Section 1(m), "provided further, that" was changed to "provided further" for clarity, in Section 1(r)(1), "be deposited to the credit revenueof bondthe program.General Fund" was moved to after "shall" for clarity, and in Section 1(r)(2), "provided further that" was changed to "provided further" for clarity.

[ProposedFIN deletionsJoint areFavorable enclosedSubst. in brackets.

Proposed-LCO additions  are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]