H*3829 Session 109 (1991-1992)
H*3829(Rat #0603, Act #0513 of 1992) General Bill, By Boan, L.L. Elliott,
P.B. Harris, B.H. Harwell, W.S. Houck, Keegan, M.H. Kinon, E.L. Nettles, Scott,
J.W. Tucker and Wilkins
A Bill to amend the Code of Laws of South Carolina, 1976, by adding Chapter 5
in Title 48, relating to environmental protection and conservation, by
enacting the South Carolina Water Quality Revolving Fund Authority Act so as
to create the South Carolina Water Quality Revolving Fund Authority; to
provide for the powers of the Authority; to authorize the establishment by the
Authority of a revolving fund for the purpose of making loans to project
sponsors for the financing of wastewater treatment facilities and other clean
water projects; to authorize the Authority to issue bonds for the purpose of
providing funds for deposit to the Revolving Fund; to provide for the method
of issuance and securing of the bonds and the payment; to authorize the
deposit in the Revolving Fund of federal grants, state appropriations, loan
repayments, and other amounts available to the Authority; to authorize the
making of loans by the Authority to project sponsors and the borrowing by
project sponsors from the Authority; and to repeal Chapter 6 of Title 48,
relating to the Water Pollution Revolving Fund, and to make the provisions of
the Act severable.-amended title
04/11/91 House Introduced and read first time HJ-10
04/11/91 House Referred to Committee on Ways and Means HJ-11
03/05/92 House Committee report: Favorable with amendment Ways
and Means HJ-3
03/19/92 House Amended HJ-45
03/19/92 House Read second time HJ-46
03/19/92 House Unanimous consent for third reading on next
legislative day HJ-46
03/20/92 House Read third time and sent to Senate HJ-4
03/24/92 Senate Introduced and read first time SJ-12
03/24/92 Senate Referred to Committee on Finance SJ-12
04/15/92 Senate Committee report: Favorable Finance SJ-12
04/21/92 Senate Read second time SJ-10
04/21/92 Senate Ordered to third reading with notice of
amendments SJ-10
04/29/92 Senate Read third time and enrolled SJ-281
04/30/92 Senate Recalled from Legislative Council SJ-4
05/05/92 Senate Reconsidered SJ-7
05/27/92 Senate Read third time and enrolled SJ-74
06/04/92 Ratified R 603
07/15/92 Signed By Governor
07/15/92 Effective date 07/15/92
07/15/92 Act No. 513
08/20/92 Copies available
(R603, H3829)
AN ACT TO AMEND THE CODE OF LAWS OF SOUTH
CAROLINA, 1976, BY ADDING CHAPTER 5 IN TITLE 48,
RELATING TO ENVIRONMENTAL PROTECTION AND
CONSERVATION, BY ENACTING THE SOUTH CAROLINA WATER
QUALITY REVOLVING FUND AUTHORITY ACT SO AS TO
CREATE THE SOUTH CAROLINA WATER QUALITY REVOLVING
FUND AUTHORITY; TO PROVIDE FOR THE POWERS OF THE
AUTHORITY; TO AUTHORIZE THE ESTABLISHMENT BY THE
AUTHORITY OF A REVOLVING FUND FOR THE PURPOSE OF
MAKING LOANS TO PROJECT SPONSORS FOR THE FINANCING
OF WASTEWATER TREATMENT FACILITIES AND OTHER CLEAN
WATER PROJECTS; TO AUTHORIZE THE AUTHORITY TO ISSUE
BONDS FOR THE PURPOSE OF PROVIDING FUNDS FOR DEPOSIT
TO THE REVOLVING FUND; TO PROVIDE FOR THE METHOD OF
ISSUANCE AND SECURING OF THE BONDS AND THE PAYMENT;
TO AUTHORIZE THE DEPOSIT IN THE REVOLVING FUND OF
FEDERAL GRANTS, STATE APPROPRIATIONS, LOAN
REPAYMENTS, AND OTHER AMOUNTS AVAILABLE TO THE
AUTHORITY; TO AUTHORIZE THE MAKING OF LOANS BY THE
AUTHORITY TO PROJECT SPONSORS AND THE BORROWING BY
PROJECT SPONSORS FROM THE AUTHORITY; TO REPEAL
CHAPTER 6 OF TITLE 48, RELATING TO THE WATER POLLUTION
REVOLVING FUND AND TO MAKE THE PROVISIONS OF THE
ACT SEVERABLE.
Be it enacted by the General Assembly of the State of South Carolina:
Findings
SECTION 1. The General Assembly finds:
(1) This State is singularly fortunate in the quantity and quality of its
water resources, which water resources are of critical importance to the
health and welfare of the citizens of South Carolina and this state's
economy.
(2) In order to ensure the preservation of this state's water resources it
is necessary that measures be taken by various governmental entities to
provide facilities for the supply and treatment of water in order to provide
an adequate, safe, and reliable water supply system and an effective and
adequate wastewater treatment system.
(3) The Federal Water Pollution Control Act, Chapter 26, Title 33,
United States Code (the Clean Water Act), as amended by the Water
Quality Act of 1987, provides for federal grants to the states to fund state
water pollution control revolving funds and requires that the states
contribute at least twenty percent in matching funds to the revolving
fund.
(4) Pursuant to Chapter 6 of Title 48, Code of Laws of South
Carolina, 1976, the State Budget and Control Board established the State
Water Pollution Control Revolving Fund for the purpose of making loans
of the federal grant funds and state matching funds pursuant to the Clean
Water Act.
Purpose
SECTION 2. The purpose of the South Carolina Water Quality Revolving
Fund Authority Act is to establish an authority to administer the revolving
fund established pursuant to Chapter 6, Title 48 of the 1976 Code and the
loans made from the fund and to provide additional financing in the future
to local governmental units for the purpose of providing projects.
South Carolina Water Quality Revolving Funds Authority
Act
SECTION 3. Title 48 of the 1976 Code is amended by adding:
"Chapter 5
South Carolina Water Quality
Revolving Fund Authority Act
Section 48-5-10. This chapter may be cited as the South Carolina
Water Quality Revolving Fund Authority Act.
Section 48-5-20. As used in this chapter, unless a different meaning
clearly appears from the context:
(1) `Agency' means the United States Environmental Protection
Agency.
(2) `Authority' means the South Carolina Water Quality Revolving
Fund Authority.
(3) `Bonds' means bonds, notes, debentures, interim certificates,
commercial paper, bond, grant, or revenue anticipation notes, or any other
evidence of indebtedness of the authority.
(4) `Clean water act' means the Federal Water Pollution Control Act,
Chapter 26, Title 33, United States Code, as modified or amended, and a
successor, substitute, or replacement provisions of law, and the rules and
regulations promulgated under it.
(5) `Department' means the South Carolina Department of Health and
Environmental Control.
(6) `Fund' means the water pollution control revolving loan fund
originally established pursuant to Section 48-6-20 and comprising monies
derived from capitalization grants pursuant to the Clean Water Act and
associated state match money, as well as repayments of all principal and
interest on loans made from the fund and any other money committed to
the fund.
(7) `Loan' means a loan from the authority to a project sponsor for the
purpose of financing all or a portion of the cost of a project.
(8) `Loan agreement' means a written agreement between the
authority and a project sponsor with respect to a loan.
(9) `Loan obligation' means a bond, note, or other evidence of
obligation issued by a project sponsor to evidence its indebtedness under a
loan agreement with respect to a loan.
(10) `Project' means:
(a) publicly owned treatment works, or the capacity or rights to the
capacity of a publicly owned treatment work, including any devices and
systems used in the storage, treatment, recycling, and reclamation of
municipal sewage or industrial wastes of a liquid nature or necessary to
recycle or reuse water at the most economical cost over the estimated life
of the works, including intercepting sewers, outfall sewers, sewage
collection systems, pumping, power, and other equipment and their
appurtenances; extensions, improvements, remodeling, additions and
alterations thereof; elements essential to provide a reliable recycled supply
such as standby treatment units; and any works, including site acquisition
of the land that will be an integral part of the treatment process (including
land used for the storage of treated wastewater in land treatment systems
before land application), or is used for ultimate disposal of residues
resulting from the treatment and any other method or system for
preventing, abating, reducing, storing, treating, separating, or disposing of
municipal waste, including storm water runoff and waste in combined
storm water and sanitary sewer systems;
(b) management programs authorized under the Clean Water
Act;
(c) development and implementation of a conservation and
management plan authorized under the Clean Water Act; and
(d) other projects as the authority and the department determine
are permissible uses of the fund under the terms of the Clean Water Act to
the extent then applicable.
(11) `Project sponsor' means a county, municipality, special purpose,
or special service district, commissioners of public works, or any other
public body or agency of the State which may own or operate a project;
this term includes any combination of two or more of these entities acting
jointly to construct, own, or operate a project.
Section 48-5-30. There is created the South Carolina Water Quality
Revolving Fund Authority. The authority is a public instrumentality of
this State and the exercise by it of a power conferred in this chapter is the
performance of an essential public function. The members of the State
Budget and Control Board comprise the authority.
Section 48-5-40. The authority has all powers necessary, useful, or
appropriate to fund, invest, use, and administer the fund, including, but not
limited to, the power to:
(1) have perpetual succession as a public body corporate and as a
political subdivision of the State;
(2) adopt, promulgate, amend, and repeal bylaws and regulations not
inconsistent with this chapter for the administration of its affairs and the
implementation of its functions in accordance with the provisions of
Chapter 23 of Title 1;
(3) sue and be sued in its own name;
(4) have an official seal and alter it at will although the failure to
affix the seal does not affect the validity of an instrument executed on
behalf of the authority;
(5) make and service loans, enter into loan agreements, accept and
enforce loan obligations, and provide other forms of financial assistance
permitted by this chapter;
(6) make and execute contracts and all other instruments and
agreements necessary or convenient for the performance of its duties and
the exercise of its powers and functions;
(7) establish (a) policies and procedures for the making and
administration of loans and (b) fiscal controls and accounting procedures
to ensure proper accounting and reporting by the authority and project
sponsors;
(8) sell, convey, mortgage, pledge, lease, exchange, transfer, and
otherwise dispose of all or any part of its properties and assets;
(9) hire staff and employ agents, advisers, consultants, and other
employees, including attorneys, financial advisers, engineers, and other
technical advisers and public accountants and determine their duties and
compensation;
(10) procure insurance against a loss in connection with its property,
assets, or activities including insurance against liability for its acts or the
acts of its employees or agents;
(11) procure insurance, guarantees, letters of credit, and other forms of
collateral or security or credit support from a public or private entity,
including a department, agency, or instrumentality of the United States or
of this State, for the payment of bonds issued by it, including the power to
pay premiums or fees on insurance, guarantees, letters of credit, and other
forms of collateral or security or credit support;
(12) receive and accept from any source aid, grants, and contributions
of money, property, labor, or other things of value to be used to carry out
the purposes of this chapter subject to the conditions upon which the aid,
grants, or contributions are made;
(13) enter into agreements with a department, agency, or
instrumentality of the United States or of this State for the purpose of
planning and providing for the financing of projects;
(14) collect, or authorize the trustee under a trust indenture securing
bonds to collect, amounts due under the loan agreement or loan obligation,
including taking the action required to obtain payment of sums in
default;
(15) enter into contracts or agreements for the servicing and processing
of loan agreements or loan obligations;
(16) invest or reinvest its funds as permitted by applicable law;
(17) unless restricted under an agreement with holders of bonds,
consent to a modification with respect to the rate of interest, time, and
payment of an installment of principal or interest, or other term of a loan
agreement or loan obligation;
(18) establish and revise, amend and repeal, and collect fees and
charges in connection with activities or services rendered by the
authority;
(19) perform an act necessary or convenient to the exercise of the
powers granted or reasonably implied by this chapter; and
(20) disburse monies from the fund to the department and the authority
for program, project, loan and fund management.
Section 48-5-50. (A) The fund established pursuant to the former
provisions of Chapter 6 of Title 48 is continued in existence and held and
administered by the authority in accordance with the provisions of this
chapter and policies, rules, regulations, directives, and agreements as may
be promulgated or entered into by the authority pursuant to this chapter.
Earnings on balances in the fund must be credited to the fund. Amounts
remaining in the fund at the end of a fiscal year accrue only to the credit of
the fund. Amounts in the fund must be available in perpetuity for the
purpose of providing financial assistance in accordance with the
provisions of this chapter and the Clean Water Act.
(B) There must be deposited in the fund:
(1) federal capitalization grants and awards or other federal
assistance received by the department under authority of the Clean Water
Act for purposes of the fund;
(2) funds appropriated by the General Assembly for deposit to
the fund;
(3) payments received from a project sponsor in repayment of a
loan, including amounts withheld by the State Treasurer and paid to the
authority pursuant to Section 48-5-170;
(4) net proceeds of bonds issued by the authority;
(5) interest or other income earned on the investment of monies
in the fund; and
(6) additional monies made available from public or private
sources for the purposes for which the fund has been established.
The authority may establish accounts and subaccounts within the fund
as considered desirable to effectuate the purposes of this chapter, to
comply with the provisions of a bond resolution, or to meet a requirement
of the Clean Water Act.
(C) Amounts in the fund may be used only:
(1) to make loans to project sponsors in accordance with
provisions of this chapter and the Clean Water Act;
(2) to buy or refinance debt obligations of project sponsors at or
below market rates, if the debt obligations were incurred after March 7,
1985;
(3) to guarantee, or purchase insurance for, bonds, notes, or
other evidences of obligation issued by a project sponsor for the purpose
of financing all or a portion of the cost of a project, if the action improves
credit market access or reduces interest rates;
(4) as a source of revenue or security for the payment of
principal and interest on bonds issued by the authority if the proceeds of
the sale of the bonds are deposited in the fund;
(5) to earn interest on fund accounts;
(6) for the reasonable costs of administering the fund and
conducting activities under the Clean Water Act; and
(7) for any other purpose authorized by the Clean Water
Act.
Section 48-5-60. The department may:
(1) promulgate regulations with authority input, to effectuate the
provisions of this chapter and the Clean Water Act;
(2) develop a priority system with authority input which ensures
consistency with the Clean Water Act for the fund;
(3) prepare an annual plan in accordance with the Clean Water Act
after providing for input from the authority and public comment and
review;
(4) receive monies from the fund for program and project
management activities of the fund; and
(5) enter into binding agreements with the agency as necessary to
effect the implementation of this chapter.
Section 48-5-70. (A) All project sponsors may borrow money from
the authority through loan agreements and the issuance of loan obligations
in favor of the authority. Project sponsors may enter into and issue the
agreements and evidences of indebtedness comprising the loan agreements
and loan obligations in accordance with the provisions of this chapter, and
no further statutory authorization is required for the issuance and delivery
by project sponsors of their loan obligations. All project sponsors entering
into loan agreements and issuing loan obligations to the authority may
perform any acts, take any action, adopt any proceedings, and make and
carry out any contracts with the authority which are contemplated by this
chapter. The contracts need not be identical among all project sponsors
but may be structured as determined by the authority according to the
needs of the contracting project sponsors and the authority.
(B) In addition to the authorizations contained in this chapter, all
other statutes permitting project sponsors to borrow money and issue
obligations, including both general obligation and revenue bonds, may be
utilized by project sponsors borrowing money from the authority to the
extent considered necessary or useful by the project sponsor in connection
with a loan agreement and the issuance, securing, or sale of its loan
obligation to the authority.
Section 48-5-80. (A) Subject to the requirements of subsections (B)
and (C) of this section, the authority may borrow money and issue its
bonds, including refunding bonds, in amounts it determines necessary or
convenient to provide funds to carry out its purposes and powers and to
pay all costs and expenses incurred in connection with the issuance of
bonds.
(B) At or before the delivery of bonds by the authority, the authority
shall, by resolution of the authority, certificate of an officer or employee
of the authority or other manner as the authority determines, establish with
respect to all bonds of the authority then outstanding and then proposed to
be delivered that, following the period during which interest on bonds or
loan obligations is capitalized, either:
(1) the ratio of all assets, including, without limitation, loan
obligations, reserves, and any amounts to be received pursuant to an
agreement with the agency held, or to be held, as security for all the bonds
to the principal amount of all the bonds is not less than 1.10 to 1; or
(2) the ratio of anticipated annual receipts to be derived from
assets described in (1), above, to debt service on all the bonds is estimated
to be not less than 1.10 to 1.
(C) With respect to bonds, or that portion of an issue of bonds, issued
to refund outstanding bonds of the authority, in lieu of the requirements of
subsection (B) of this section, the bonds may be issued if the authority
establishes with respect to the issuing of the bonds that debt service with
respect to the refunding bonds is not expected to exceed debt service with
respect to the refunded bonds in a year in which the refunded bonds were
outstanding.
Section 48-5-90. The authority may pledge its revenues or funds to
the payment of its bonds, subject only to prior agreement with the holders
of particular bonds which may have pledged specific money or revenue.
Bonds may be secured by a pledge of a loan obligation owned by the
authority, a grant, contribution, or guaranty from the United States, the
State, or a corporation, association, institution or person, other property or
assets of the authority, or a pledge of money, income, or revenue of the
authority from any source.
Section 48-5-100. Bonds issued by the authority do not constitute a
debt or a pledge of the faith and credit of this State or its political
subdivisions other than the authority, but are payable solely from the
revenue, money, or property of the authority as provided for in this
chapter. The bonds issued do not constitute an indebtedness of this State
within the meaning of a constitutional or statutory limitation. No
members of the authority or a person executing bonds of the authority is
liable personally on the bonds by reason of their issuance or execution.
Each bond issued under this chapter must contain on its face a statement
to the effect that:
(1) neither this State, nor its political subdivisions, nor the authority
is obligated to pay the principal of or interest on the bond or other costs
incident to the bond except from the revenue, money, or property of the
authority pledged;
(2) neither the faith and credit nor the taxing power of this State, or
its political subdivisions, is pledged to the payment of the principal of or
interest on the bonds;
(3) the authority does not have taxing power.
Section 48-5-110. (A) The bonds of the authority must be authorized
by a resolution of the authority and must be in the form and executed in
the manner provided in the resolution. The bonds must bear the date and
mature at the time which the resolution provides, except that no bond may
mature more than thirty years from its date of issue. The bonds may be in
the denominations, be executed in the manner, be payable in the medium
of payment, be payable at the place and at the time, and be subject to
redemption or repurchase and contain other provisions determined by the
authority before their issuance. The bonds may bear interest payable at a
time and at a rate as determined by the authority, including the
determination of interest rates by agents designated by the authority under
guidelines established by it. Bonds may be sold by the authority at public
or private sale at the price it determines and approves.
(B) Bonds may be secured by a trust indenture between the authority
and a corporate trustee, which may be the State Treasurer or a bank having
trust powers or a trust company, designated by the State Treasurer doing
business in South Carolina. A trust indenture may contain provisions for
protecting and enforcing the rights and remedies of the bondholders which
are reasonable and proper, including covenants setting forth the duties of
the authority in relation to the exercise of its powers and the custody,
safekeeping, and application of its money. The authority may provide by
the trust indenture for the payment of the proceeds of the bonds and all or
any part of the revenues of the authority to the trustee under the trust
indenture or to some other depository, and for the method of its
disbursement with safeguards and restrictions prescribed by it.
(C) A resolution or trust indenture pursuant to which bonds are issued
may contain provisions which are part of the contract with the holders of
the bonds as to such matters relating to the terms of the bonds or the
security or protection of the holders of the bonds which the authority
considers appropriate.
Section 48-5-120. A pledge made by the authority is valid and binding
from the time the pledge is made. The revenue, money, or property
pledged and thereafter received by the authority is immediately subject to
the lien of the pledge without physical delivery or further act. The lien of
a pledge is valid and binding as against all parties having claims of any
kind in tort, contract, or otherwise against the authority, irrespective of
whether the parties have notice of the pledge. No recording or filing of
the resolution authorizing the issuance of bonds, the trust indenture
securing bonds, or other instrument including filings under the Uniform
Commercial Code is necessary to create or perfect a pledge or security
interest granted by the authority to secure bonds, but the record of the
proceedings relative to the issuance of any bonds must be filed as
prescribed by Section 11-15-20.
Section 48-5-130. Subsequent amendments to this chapter may not
limit the rights vested in the authority with respect to agreements made
with, or remedies available to, the holders of bonds issued under this
chapter before the enactment of the amendments until the bonds, with all
premiums and interest on them, and all costs and expenses in connection
with the proceeding by or on behalf of the holders, are fully met and
discharged.
Section 48-5-140. The authority in performing an essential
governmental function in the exercise of the powers conferred upon it is
not required to pay taxes or assessments upon property or upon its
operations or the income from them, or taxes or assessments upon property
or loan obligation acquired or used by the authority or upon the income
from them. Bonds issued by the authority, the transfer of bonds, and the
income from them, are free from taxation and assessment of every kind by
this State, and by the project sponsors and other political subdivisions of
this State.
Section 48-5-150. The bonds issued by the authority are legal
investments in which all public officers or public bodies of the State, its
political subdivisions, all municipalities and political subdivisions, all
insurance companies and associations and other persons carrying on
insurance business, all banks, bankers, banking associations, trust
companies, savings banks, savings associations, including savings and
loan association investment companies, and other persons carrying on a
banking business, all administrators, guardians, executors, trustees, and
other fiduciaries, and all other persons who are now or may be authorized
in the future to invest in bonds or other obligations of this State, may
invest funds in their control or belonging to them. The bonds of the
authority are also securities which may be deposited with and received by
all public officers and bodies of this State or an agency or political
subdivision of this State and all municipalities and public corporations for
a purpose for which the deposit of bonds or other obligations of this State
is now or may later be required by law.
Section 48-5-160. The authority shall submit, following the close of
each fiscal year, an annual report of its activities for the preceding year to
the Governor and to the members of the General Assembly. The authority
in cooperation with the department shall also submit an annual report to
the agency in accordance with requirements of the Clean Water Act. The
State Auditor or, upon his approval, an independent certified public
accountant shall perform an audit of the books and accounts of the
authority at least once in each fiscal year.
Section 48-5-170. If at any time a project sponsor fails to effect the
punctual payment of an amount payable by the project sponsor to the
authority pursuant to a loan agreement or other agreement between the
project sponsor and the authority, the State Treasurer shall, upon
notification by the authority of the failure by the project sponsor to make
the payment, and subject to the withholding of amounts pursuant to Article
X, Section 14, Paragraph (5) of the Constitution of this State, withhold
from the project sponsor sufficient monies from a state appropriation to
the project sponsor and apply so much as necessary to the payment of the
amount. All appropriations for project sponsors are subject to the
provisions of this section.
Section 48-5-180. The provisions of this chapter must be liberally
construed to the end that its beneficial purposes may be effectuated. No
proceeding, notice, or approval is required for the issuance of bonds of the
authority or loan obligations by a project sponsor or instruments or the
security for the bonds or loan obligation, except as provided in this
chapter. If the provisions of this chapter are inconsistent with the
provisions of any other law, general, special, or local, the provisions of
this chapter are controlling."
Repeal
SECTION 4. Chapter 6, Title 48 of the 1976 Code is repealed.
Severability
SECTION 5. If any provision of the South Carolina Water Quality
Revolving Fund Authority Act is held or determined to be
unconstitutional, invalid, or otherwise unenforceable by a court of
competent jurisdiction, it is the intention of the General Assembly that the
provision is, or is deemed to be, severable from the remaining provisions
of the act and that the holding does not invalidate or render unenforceable
any other provision of the act.
Time effective
SECTION 6. This act takes effect upon approval by the Governor.
In the Senate House June 4, 1992.
Nick A. Theodore,
President of the Senate
Robert J. Sheheen,
Speaker of the House of
Representatives
Approved the 15th day of July, 1992.
Carroll A. Campbell, Jr.,
Governor
Printer's Date -- August 17, 1992 -- S.
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