H*4637 Session 111 (1995-1996)
H*4637(Rat #0487, Act #0399 of 1996) General Bill, By Townsend, Allison,
Howard and D.A. Wright
Similar(S 1282)
A Bill to amend Chapter 125, Title 59, Code of Laws of South Carolina, 1976,
relating to Winthrop University, by designating Sections 59-125-10 through
59-125-120 as Article 1, entitled "general provisions", and by adding Article
3 enacting the Winthrop University Facilities Revenue Bond Act so as to
provide authority for the University to issue revenue bonds to acquire,
construct, renovate, and equip certain revenue-producing facilities, and to
provide the terms and conditions under which these bonds may be issued,
including those revenues that may be pledged for their repayment.-amended
title
02/15/96 House Introduced and read first time HJ-21
02/15/96 House Referred to Committee on Education and Public
Works HJ-23
03/28/96 House Committee report: Favorable with amendment
Education and Public Works HJ-1
04/03/96 House Debate adjourned until Tuesday, April 9, 1996 HJ-47
04/09/96 House Objection by Rep. Scott, Moody-Lawrence, Neal,
Govan, Cave, White, L. Whipper, Wright, Allison,
Townsend, Kelley, Cooper, Spearman, R. Smith,
Howard, Wells & Knotts HJ-36
04/23/96 House Amended HJ-85
04/23/96 House Read second time HJ-87
04/23/96 House Roll call Yeas-109 Nays-0 HJ-87
04/24/96 House Objection withdrawn by Rep. Cave, Scott, Govan &
White HJ-341
04/24/96 House Objection by Rep. Haskins HJ-341
04/24/96 House Read third time and sent to Senate HJ-345
04/24/96 Senate Introduced, read first time, placed on calendar
without reference SJ-42
05/16/96 Senate Amended SJ-41
05/16/96 Senate Read second time SJ-41
05/16/96 Senate Ordered to third reading with notice of
amendments SJ-41
05/22/96 Senate Amended SJ-28
05/22/96 Senate Read third time and returned to House with
amendments SJ-28
05/23/96 House Concurred in Senate amendment and enrolled HJ-63
05/30/96 Ratified R 487
06/04/96 Signed By Governor
06/04/96 Effective date 06/04/96
06/17/96 Copies available
06/17/96 Act No. 399
(A399, R487, H4637)
AN ACT TO AMEND CHAPTER 125, TITLE 59, CODE OF
LAWS OF SOUTH CAROLINA, 1976, RELATING TO WINTHROP
UNIVERSITY, BY DESIGNATING SECTIONS 59-125-10 THROUGH
59-125-120 AS ARTICLE 1, ENTITLED "GENERAL
PROVISIONS", AND BY ADDING ARTICLE 3 ENACTING
THE WINTHROP UNIVERSITY FACILITIES REVENUE BOND ACT
SO AS TO PROVIDE AUTHORITY FOR THE UNIVERSITY TO
ISSUE REVENUE BONDS TO ACQUIRE, CONSTRUCT,
RENOVATE, AND EQUIP CERTAIN REVENUE-PRODUCING
FACILITIES, AND TO PROVIDE THE TERMS AND CONDITIONS
UNDER WHICH THESE BONDS MAY BE ISSUED, INCLUDING
THOSE REVENUES THAT MAY BE PLEDGED FOR THEIR
REPAYMENT.
Be it enacted by the General Assembly of the State of South
Carolina:
Designation
SECTION 1. Sections 59-125-10 through 59-125-120 are designated
Article 1, Chapter 125 of Title 59 of the 1976 Code, and entitled
"General Provisions".
Winthrop University Facilities Revenue Bond Act
SECTION 2. Chapter 125, Title 59 of the 1976 Code is amended by
adding:
"Article 3
Winthrop University Facilities
Revenue Bond Act
Section 59-125-310. (A) The General Assembly finds that it is
desirable to provide continuing and general statutory authority for
Winthrop University to incur debt for, among other things, the purposes
of providing funds to acquire, construct, renovate, and equip certain
revenue-producing auxiliary facilities, which debt is secured by a pledge
of the revenues derived from the operation of some or all of the facilities.
Winthrop University has demonstrated need for additional funds to
provide for acquisition, construction, renovation, and equipping of these
facilities. These facilities are needed to replace or renovate aging
facilities and to provide additional facilities all to the end that the
educational environment at Winthrop University will be enhanced for the
benefit of present and potential students at Winthrop University.
(B) Consideration has been given to this need and to the methods of
funding it. It has been determined to be in the best interests of the
people of this State to authorize Winthrop University to acquire,
construct, renovate, and equip additional facilities and to incur
indebtedness for these purposes which is payable from the revenues
derived from the operation of these facilities to the extent and under the
conditions provided for in this article.
Section 59-125-320. As used in this article:
(1) `Bond' or `bonds' means any note, bond, installment contract, or
other evidence of indebtedness issued pursuant to this chapter.
(2) `Winthrop' means Winthrop University.
(3) `Facilities' means any or all of the following facilities operated
to provide for the students, faculty, or staff at Winthrop: dining or food
service facilities; laundry facilities; canteen facilities; vending machines;
convenience stores; any other facilities for the sale of sundry items;
health services; book stores, parking lots and vehicle registration; and all
furniture, furnishings, and equipment in them, which are now owned by
Winthrop, or which may be acquired by Winthrop for any of these
purposes.
(4) `Revenues' of any facilities means the entire receipts of
Winthrop from the operation of the facilities. `Net revenues' means
these receipts reduced by the necessary expenses for operation and
maintenance of the facilities.
(5) `Board' means the State Budget and Control Board.
(6) `Trustees' means the Board of Trustees of Winthrop or any
successor body.
Section 59-125-330. The trustees are authorized to acquire additional
facilities and to improve and renovate existing facilities to the extent they
determine to be necessary, and the proceeds of bonds authorized by this
article are made available for that purpose. The trustees also are
authorized to refund bonds that may from time to time be outstanding
pursuant to this article by exchange or otherwise.
Section 59-125-340. Upon receiving the approval of the board and
upon review by the Joint Bond Review Committee, the trustees may from
time to time borrow such sums as may be necessary to accomplish the
purpose of this article and to evidence these borrowings by bonds issued
pursuant to this article in such aggregate principal amount as they
determine, except that notwithstanding any other provisions of this
article, there may not be outstanding at any time bonds issued pursuant to
this article in excess of twenty-five million dollars.
Section 59-125-350. Bonds issued pursuant to this article must be
payable from the revenues or the net revenues derived by Winthrop from
these facilities as designated by the trustees with respect to the bonds.
The trustees may abandon the use of any portion of the facilities or sell
or dispose of any portion of the facilities upon receipt of a written
recommendation by the chief financial officer of Winthrop to the effect
that the action shall not adversely affect the ability of Winthrop to
discharge its obligations to the holders of bonds issued pursuant to this
article and upon the further conditions as prescribed in the resolution of
the trustees providing for the issuance of bonds. The bonds issued
pursuant to this article may be further secured by the additional pledges
of other revenues or fees of Winthrop as it may be authorized to grant
pursuant to other laws of this State.
Section 59-125-360. The faith and credit of the State may not be
pledged for the payment of the principal and interest of the bonds, and
there must be on the face of each bond a statement plainly worded to that
effect. Neither the trustees nor any other person signing the bonds is
personally liable for them.
Section 59-125-370. In order to avail themselves of the authorizations
set forth in this article, the trustees shall adopt resolutions providing for
the issuance of bonds of Winthrop, within the limitations mentioned in
this article which must prescribe the tenor, terms, and conditions of the
bonds. The bonds must be issued as serial or term bonds, maturing in
equal or unequal amounts, at such times and on such occasions as the
trustees determine. The last maturing bonds of any issue must be
expressed to mature not later than fifty years from their date, and the first
maturing bonds of any issue, issued pursuant to this article, falls due
within five years from their date. They must bear such rates of interest,
payable on such occasion as the trustees prescribe, and the bonds must be
in such denominations, payable in such medium of payment, and at such
place as such resolutions prescribe. All bonds may be issued with a
provision permitting their redemption on any interest payment date before
their respective maturities. Bonds made subject to redemption before
their stated maturities may contain a provision requiring the payment of a
premium for the privilege of exercising the right of redemption in such
amount or amounts as the trustees prescribe in the resolutions authorizing
their issuance. All bonds that are subject to redemption must contain a
statement to that effect on the face of each bond. The resolutions
authorizing their issuance must contain provisions specifying the manner
of call and the notice of call that must be given.
Section 59-125-380. The bonds authorized by this article and all
interest to become due on them have the tax-exempt status prescribed by
Section 12-2-50.
Section 59-125-390. It is lawful for all executors, administrators,
guardians, and fiduciaries, all sinking fund commissions, the board, as
trustee of the South Carolina Retirement System, and all other
governmental entities within this State to invest any monies in their
hands in the bonds.
Section 59-125-400. The bonds and coupons, if any, attached to the
bonds, are executed manually or by facsimile in the name of Winthrop in
the manner and by persons as the trustees from time to time determine,
and the seal of Winthrop must be affixed to or impressed or reproduced
on each bond. Any coupons attached to the bonds must be authenticated
by the facsimile signature of one or more of the persons signing the
bonds. The bonds, in the discretion of the trustees, may be registerable
as to principal and interest on books kept for them by or on behalf of
Winthrop, including by a corporate registrar. The delivery of the
executed bonds is valid notwithstanding changes in officers or in the seal
occurring after the execution. Notwithstanding the foregoing, the bonds,
in the discretion of the trustees, may be issued as fully registered
noncertificated book-entry securities.
Section 59-125-410. The bonds must be disposed of in such manner
as the trustees determine, except that no sale, privately negotiated without
public advertisement, may be made unless the approval of the board is
obtained. If the trustees elect to sell the bonds at public sale, at least one
advertisement of them must appear in some newspaper of general
circulation in this State not less than seven days before the date fixed for
the opening of bids. The bonds may be sold at such discount or for such
premium as may be determined by the trustees or their designee as being
in the best interest of Winthrop.
Section 59-125-420. To the end that the payment of the principal and
interest of the bonds authorized by this article is secured adequately, the
trustees of Winthrop may:
(1) issue bonds in such amount within the limitations provided for in
this article as the trustees consider necessary. It is lawful for the trustees
to use a portion of the principal proceeds derived from any sale of bonds,
except bonds issued to effect refunding of outstanding bonds, to meet the
payment of interest on the bonds for a period equal to the period of
construction of the facilities to be financed with the proceeds of such
bonds plus a period not exceeding six months. It is recognized by the
General Assembly that until the facilities to be constructed with the
proceeds of the loan are completed, an undue burden may be imposed
upon the existing revenues at that time;
(2) pledge the revenues or the net revenues of the facilities as
designated by the trustees in connection with the issuance of the bonds
whether then or after that time to be existing and to pledge any otherwise
available gifts, grants, or donations to Winthrop for the payment of the
principal of and interest on the bonds as they respectively mature.
However, any surplus of the revenues or net revenues available after the
payment of costs of operation and maintenance of the facilities and of
debt service on the bonds, and the establishment of any debt service
reserve obligation under the proceedings providing for the issuance of the
bonds, is placed in a contingency and improvement fund for the facilities
in order to restore depreciated or obsolete items of the facilities, to make
improvements to the facilities, to defray the cost of unforeseen
contingencies with regard to the facilities, to prevent defaults under such
bonds, or to redeem any of the bonds;
(3) further secure the bonds with a pledge of any additional
revenues or fees of Winthrop as may be authorized under other laws of
this State;
(4) covenant that no facilities owned by Winthrop may be used free
of charge, or to specify and limit the facilities which may be used free of
charge;
(5) covenant to establish and maintain a system of rules as will
ensure the continuous use and occupancy of the facilities whose revenues
are pledged to secure any bonds;
(6) covenant that an adequate schedule of charges be established and
maintained for the facilities designated by the trustees, whose revenues or
net revenues are pledged to secure the bonds, to the extent necessary to
produce sufficient revenues to:
(a) pay the cost of operating and maintaining the facilities, whose
revenues or net revenues are pledged for the payment of the bonds,
including the cost of fire, extended coverage and use, and occupancy
insurance;
(b) pay the principal and interest of the bonds as they respectively
become due;
(c) create and at all times maintain an adequate debt service reserve
fund to meet the payment of the principal and interest; and
(d) create and at all times maintain an adequate reserve for
contingencies and for major repairs and replacement.
(7) covenant against the mortgaging or disposing of the facilities
designated by the trustees, whose revenues or net revenues are pledged
for the payment of the bonds, and against permitting or suffering any lien
to be created on them equal or superior to the lien created for the benefit
of such bonds. The trustees are empowered to discontinue the use of or
demolish obsolete facilities and to reserve the right, under the terms they
prescribe, to issue additional bonds on a parity with the bonds authorized
by this article, if at some later date they obtain legislative authorization
for the issuance of additional bonds;
(8) covenant as to the use of the proceeds derived from the sale of
any bonds issued pursuant to this article;
(9) provide for the terms, form, registration, exchange, execution,
and authentication of bonds, and for the replacement of lost, destroyed,
or mutilated bonds;
(10) make covenants with respect to the use of the facilities to be
constructed with the proceeds of the bonds authorized by this article and
of the other facilities whose revenues must be pledged for the payment of
the bonds;
(11) covenant that all revenues or net revenues of the particular
facilities pledged for the payment of the bonds must be segregated into
special funds and that the funds must be used solely for the purposes for
which they are intended and for no other purpose;
(12) covenant for the mandatory redemption of bonds on the terms
and conditions as the resolutions authorizing the bonds prescribe;
(13) provide for early defeasance of bonds through the establishment
of special escrow accounts maintained by a corporate trustee, which may
be the State Treasurer, of cash or United States government obligations,
or obligations of agencies of them, which escrows may be funded with
proceeds of bonds issued under the provisions of this article or revenues
or other funds available to Winthrop;
(14) prescribe the procedure, if any, by which the terms of the
contract with the bondholders may be amended, the number of bonds
whose holders must consent to it, and the manner in which consent is
given;
(15) covenant as to the maintenance of the facilities, whose revenues
must be pledged for the payment of the bonds, the insurance to be
carried on them, and the use and disposition of proceeds from any
insurance policy;
(16) prescribe the events of default and the terms and conditions upon
which all or any bonds become or may be declared due before maturity
and the terms and conditions upon which the declaration and its
consequences may be waived;
(17) impose a statutory lien upon the facilities designated by the
trustees, the revenues or net revenues of which must be pledged to secure
the bonds. The lien must extend to the facilities, to their appurtenances
and extension, to their additions, improvements, and enlargements to the
extent specified in the resolutions and must inure to the benefit of the
holders of the bonds secured by the lien. The facilities remain subject to
the statutory lien until the payment in full of the principal and interest of
the bonds. A holder of a bond, or any of the coupons representing
interest on them, either at law or in equity, by suit, action, mandamus, or
other proceedings, may protect and enforce the statutory lien, and by suit,
action, mandamus, or other proceedings may enforce and compel
performance of all duties of the trustees, including the fixing of sufficient
rates, the proper segregation of the revenues, and the proper application
of them. However, the statutory lien may not be construed to give the
bond or coupon holder authority to compel the sale of any of the
facilities or any part of them;
(18) covenant that if there is a default in the payment of the principal
of or interest upon any of the bonds, a court having jurisdiction in any
proper action may appoint a receiver to administer and operate the
facilities designated by the trustees, whose revenues or net revenues are
pledged for the payment of the bonds, with power to fix rates and
charges for the facilities, sufficient to provide for the payment of the
expense of operating and maintaining the facilities, and to apply the
income and revenues of the facilities to the payment of the bonds and the
interest on them;
(19) establish on or before the delivery of any bonds issued pursuant
to this article a debt service reserve fund and to cause it to be deposited
with a corporate trustee, who may be the State Treasurer, and to that end,
the trustees are empowered to utilize any monies available for that
purpose, including revenues previously accumulated from the facilities
before the issuance of bonds. In the discretion of the trustees, in lieu of
cash, the debt service reserve fund may be funded with a surety bond,
insurance policy, letter of credit, line of credit, or similar guarantee. At
the discretion of the trustees, Winthrop may purchase an insurance policy
insuring payment of both principal and interest on any issuance of bonds
under the provisions of this article;
(20) appoint a corporate trustee, who may be the State Treasurer, or
paying agent to whom must be paid all or any portion of the revenues or
net revenues pledged to the payment of the bonds or derived from the
operation of the facilities, and to prescribe the manner in which these
revenues or net revenues must be utilized and disposed of. The corporate
trustee shall serve in a fiduciary capacity as trustee for the bondholders
under the resolutions of the trustees authorizing the issuance of
bonds.
Section 59-125-430. No time limit is set for the issuance of bonds
pursuant to this article."
Time effective
SECTION 3. This act takes effect upon approval by the Governor.
Approved the 4th day of June, 1996. |