SB 4 — Temporarily revises provisions governing public borrowing. (BDR 30-19)

(ReprintedSenate withBill amendmentsNo. adopted on July 14, 2020) FIRST REPRINT S.B.

44–Committee Sof ENATEthe BWhole ILLNCHAPTER.......... O.

4–COMMITTEE OF THE W HOLE JULY 9, 2020 ____________ Referred to Committee of the Whole SUMMARY—Temporarily revises provisions governing public borrowing.

(BDR 30-19) FISCAL NOTE:

Effect on Local Government:

No.

Effect on the State:

Yes.

~ EXPLANATION – Matter in bolded italics is new;

matter between brackets [omitted material] is material to be omitted.

LegislativeLegiExisting Counsel’slaw Digest:requires the State Treasurer to make payments for the redemption of outstanding bonds, the interest thereon and any bank service charges from the Consolidated Bond Interest and Redemption Fund.

Existing(NRS law349.110) Section 2 of this bill temporarily removes the term “bank service charges” and, instead, requires the State Treasurer to make payments for thebond redemptionadministrative expenses, including expenses incurred to administer an interim debenture line of credit, notes or bonds, from the Consolidated Bond Interest and Redemption Fund.

(NRS 349.110) Section 2 of thise bill temporarily removes the term “bank service charges” and, instead, requires the State Treasurer to make payments for bond administrative expenses, including expenses incurred to administer an interim debenture line of credit, notes or bonds, from the Consolidated Bond Interest and Redemption Fund.

(NRS 349.227) Until June 30, 2021, section 3 of this bill authorizes an act or resolution to include such terms if the act or resolution is for the issuance of securities bearing interest at a variable rate of interest or securities with a term of 270 days or less issued as commercial paper under a program for the issuance of commercial paper to be used for certain parameterspurposes. for the interest rate if it is to be fixed by an agent.ution to specify - *SB4_R1* – 2 – Existing law authorizes certain entities, before the sale of bonds, to delegate to the State Treasurer the authority to sign a contract for the purchase of the bonds or to accept a binding bid for the bonds, subject to certain requirements.

Section 3 also temporarily requires such an act or resolution to specify parameters for the interest rate if it is to be fixed by an agent.

the State Treasurer the authority to sign a contract for the purchase of the bonds oro to accept a binding bid for the bonds, subject to certain requirements.

Existing law authorizes the State to issue general obligation interim debentures and special obligation interim debentures to evidence certain amounts borrowed byesby the State.

(NRS 349.318) Until June 30, 2021, section 5 of this bill authorizes such interim debentures to be in the form of a note, bond or line of credit agreement, the proceeds of which are used for the general operations of the State or to pay the, the costs of a project.

Until June 30, 2021, section 1 of this Financebill: if the State Treasurer determines that the cash balance in the State Generalof Fund has fallen below 25 percent of its lowest average monthly balance for the immediately preceding 36 months or that the cash balance in the State General Fund is insufficient to meet expected future obligations anticipated to be paid within the immediately succeeding 120 days;

and(1) (2) requires the State BoardTreasurer ofto Financesubmit toa determinecertification to the existenceState Board of eitherFinance ofif thosethe circumstancesState and,Treasurer ifdetermines so,that authorizesthe cash balance in the State BoardGeneral ofFund Financehas tofallen issuebelow general25 obligationpercent interimof debenturesits operationslowest ofaverage monthly balance for the State,immediately providedpreceding that36 themonths aggregateor principalthat amountthe ofcash anybalance suchalin interimthe debenturesState outstandingGeneral atwithin onethe timeimmediately cannotsucceeding exceed120 $150,000,000.days;

Existingand law(2) requires anthe interimState debentureBoard toof mature- within31st 5Special yearsSession and(2020) requires– 2 – Finance to determine the proceedsexistence of either of those circumstances and, if so, and special obligation interim debentures tofor bethe usedpurpose toof defraypaying for the costgenerals operations of athe project.State, provided that the aggregate principal amount of any such interim debentures outstanding at one time cannot exceed $150,000,000.

Existing law requires an interim debenture to mature within 5 years and project.

THEEXPLANATION PEOPLE– OFMatter THEin STATEbolded OFitalics NEVADA,is REPRESENTEDnew; IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Sectionmatter 1.between brackets [omitted material] is material to be omitted.

THE SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:D IN Section 1.

If at any time the State Treasurer determines that the cash balance in the State General Fund has fallen below 25 percent of its lowest average monthly balance for the immediately preceding 36 months or that the cash balance in the State General Fund is insufficient to meet expected future obligations anticipated to be paid within the immediately succeeding 120 calendar days, the State Treasurer shall submit a certification of that fact to the State Board of Finance.

- *SB4_R1* – 3 – 2.

If the State Board of Finance determines that the cash balance in the State General Fund has fallen below 25 percent of its lowest average monthly balance for the immediately preceding 36 months or that the cash balance in the State General Fund is insufficient to meet expected future obligations anticipated to be paid within the immediately succeeding 120 days, the State Board of Finance may issue general obligation interim debentures payable from taxes or special obligation interim debentures, which may be in the form of a line of credit, note or bond as provided by NRS 349.318, for the purpose of paying for the general operations of the State, at any time or from time to time, in a face amount of not more than $150,000,000.

- 31st Special Session (2020) – 3 – 3.

Any determination made by the State Board of Finance pursuant to subsectionsub4.ctiProceeds 2from isthe conclusive.sale of interim debentures issued pursuant to this section must be deposited in the State General Fund.

4.

Proceeds from the sale of interim debentures issued pursuant to this section must be deposited in the State General Fund.

349.110any 1.outstanding bonds in the name of the State of Nevada, the State Treasurer shall make payment for redemption of such bonds, the interest thereon and any [bank service charges] bond administrative expenses from the Consolidated Bond Interest and Redemption Fund.

After March 28, 1939, so long as there shall be any outstanding bonds in the name of the State of Nevada, the State Treasurer shall make payment for redemption of such bonds, the interest thereon and any [bank service charges] bond administrative - *SB4_R1* – 4 – expenses from the Consolidated Bond Interest and Redemption Fund.

[The] In the case of securities bearing interest at a variable rate of interest, or in the case of securities with a term of- 27031st daysSpecial orSession less(2020) issued– as4 commercial– paper under a program for the issuance of commercial paper to fund the costs of a project, to be deposited into the State General Fund and used for the general operations of the State or to refinance any previously issued commercial paper or other securities, the act or resolution authorizing the issuance of any state securities or any trust indenture or other instrument appertaining thereto may fix a rate or rates of interest or provide for the determination of the rate or rates from time to time by a designated agent according to the procedure specified in that resolution or other instrument.

The Commission may enter into an agreement with a third party for an assurance of payment of the principal of, the interest on, or premiums, if any, due in connection with any state securities issued by the Commission.

The obligation of the Commission totoies reimburse that third party for any advances made pursuant to that agreement may be provided in that agreement, recited in those securities or evidenced by another instrument as designated in the act or resolution authorizing the issuance of those securities or any other instrument appertaining thereto.

- *SB4_R1* – 5 – (a) The rate of interest on the bonds;

(b)be Thecalled datesfor onredemption whichbefore andmaturity;at which the pricesbonds may (c) The price at which the bonds maywill be calledsold; for redemption before maturity;

(c) The price at which the bonds will be sold;