H*4313 Session 111 (1995-1996)
H*4313(Rat #0339, Act #0302 of 1996) General Bill, By R.C. Fulmer, B.D. Cain,
H.G. Hutson, Inabinett, Littlejohn, Riser and Vaughn
Similar(S 963)
A Bill to amend Title 59, Code of Laws of South Carolina, 1976, relating to
the education, by adding Chapter 147 so as to enact the Higher Education
Revenue Bond Act which prescribes the manner in which and conditions under
which research and four-year public institutions of higher education may issue
certain revenue bonds; and to amend Act 518 of 1980, as amended, relating to
the authorization to issue special obligation bonds for athletic facilities at
the University of South Carolina, so as to revise certain definitions in
regard thereto including the terms "athletic facilities" and "improvements",
to further provide for the purposes for which such bonds may be issued, to
permit the establishment of a bond reserve fund rather than require its
establishment, to further provide for the types of taxes and fees from which
these bonds and the interest theron are exempt, and to revise certain terms
and conditions in regard to the issuance of these bonds.-amended title
12/06/95 House Prefiled
12/06/95 House Referred to Committee on Ways and Means
01/09/96 House Introduced and read first time HJ-53
01/09/96 House Referred to Committee on Ways and Means HJ-53
03/14/96 House Committee report: Favorable Ways and Means HJ-6
03/20/96 House Read second time HJ-21
03/21/96 House Read third time and sent to Senate HJ-22
03/21/96 Senate Introduced, read first time, placed on calendar
without reference SJ-11
03/26/96 Senate Amended SJ-46
03/26/96 Senate Read second time SJ-46
03/26/96 Senate Ordered to third reading with notice of
amendments SJ-46
03/27/96 Senate Debate adjourned SJ-28
03/28/96 Senate Read third time and returned to House with
amendments SJ-21
04/03/96 House Concurred in Senate amendment and enrolled HJ-60
04/30/96 Ratified R 339
05/07/96 Became law without Governor's signature
05/07/96 Effective date 05/07/96
05/16/96 Copies available
05/16/96 Act No. 302
(A302, R339, H4313)
AN ACT TO AMEND TITLE 59, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO EDUCATION, BY ADDING
CHAPTER 147 SO AS TO ENACT THE HIGHER EDUCATION
REVENUE BOND ACT WHICH PRESCRIBES THE MANNER IN
WHICH AND CONDITIONS UNDER WHICH RESEARCH AND
FOUR-YEAR PUBLIC INSTITUTIONS OF HIGHER EDUCATION
MAY ISSUE CERTAIN REVENUE BONDS; AND TO AMEND ACT
518 OF 1980, AS AMENDED, RELATING TO THE
AUTHORIZATION TO ISSUE SPECIAL OBLIGATION BONDS FOR
ATHLETIC FACILITIES AT THE UNIVERSITY OF SOUTH
CAROLINA, SO AS TO REVISE CERTAIN DEFINITIONS IN
REGARD THERETO INCLUDING THE TERMS "ATHLETIC
FACILITIES" AND "IMPROVEMENTS", TO
FURTHER PROVIDE FOR THE PURPOSES FOR WHICH SUCH
BONDS MAY BE ISSUED, TO PERMIT THE ESTABLISHMENT OF
A BOND RESERVE FUND RATHER THAN REQUIRE ITS
ESTABLISHMENT, TO FURTHER PROVIDE FOR THE TYPES OF
TAXES AND FEES FROM WHICH THESE BONDS AND THE
INTEREST THEREON ARE EXEMPT, AND TO REVISE CERTAIN
TERMS AND CONDITIONS IN REGARD TO THE ISSUANCE OF
THESE BONDS.
Be it enacted by the General Assembly of the State of South
Carolina:
Higher Education Revenue Bond Act
SECTION 1. Title 59 of the 1976 Code is amended by adding:
"CHAPTER 147
Higher Education
Revenue Bond Act
Section 59-147-10. This chapter may be cited as the `Higher
Education Revenue Bond Act'.
Section 59-147-20. As used in this chapter:
(1) `board' means the board of trustees of the university;
(2) `equipment' means items with a useful life of at least fifteen
years;
(3) `facilities' means the real and personal property and equipment
specified in Section 59-147-20(2) of this chapter whether or not the
acquisition or construction thereof is financed from the proceeds of bonds
issued pursuant to this chapter;
(4) `revenues' means the revenues derived or to be derived from the
operation, sale, lease, or other disposition of the facilities; and
(5) `university' means all research and four-year public institutions of
higher education.
Section 59-147-30. Subject to the approval of the State Budget and
Control Board by resolution duly adopted, the university may issue
revenue bonds of the university for the purpose of financing or
refinancing in whole or in part the cost of acquisition, construction,
reconstruction, renovation and improvement of land, buildings, and other
improvements to real property and equipment for the purpose of
providing facilities serving the needs of the university including, but not
limited to, dormitories, apartment buildings, dwelling houses, bookstore
and other university operated stores, laundry, dining halls, cafeterias,
parking facilities, student recreational, entertainment and fitness related
facilities, inns, conference and other nondegree educational facilities and
similar auxiliary facilities of the university and any other facilities which
are auxiliary to any of the foregoing excluding, however, athletic
department projects which primarily serve varsity athletic teams of the
university.
Section 59-147-40. Revenue bonds issued under this chapter must be
authorized by a resolution or resolutions of the board of the university.
The resolution of the university may, in the discretion of the board,
contain provisions which shall constitute a part of the contract between
the university and the several holders of the bonds, as to any of the
following:
(1) the custody, security, use, expenditure, or application of the
proceeds of the bonds including, without limitation, the use of bond
proceeds to pay the cost of acquisition, construction, reconstruction or
renovation of facilities, expenses of issuance of the bonds, interest on the
bonds for such period of time as the board may determine and the cost of
bond insurance or other credit enhancement and to fund reserves
established with respect to the bonds;
(2) the acquisition, renovation, construction, reconstruction, or
completion of the facilities for which the bonds are issued;
(3) the use, regulation, operation, maintenance, insurance, or
disposition of the facilities the revenues from which are pledged to secure
payments with respect to the bonds or restrictions on the exercise of the
powers of the board to dispose of or to limit or regulate the use of such
facilities;
(4) the payment of the principal of, redemption premium, if any, or
interest on the bonds and the sources and the methods of the payment,
the rank or priority of the bonds as to any lien or security or the
acceleration of the maturity of the bonds;
(5) the use and disposition of the revenues including, without
limitation, the pledging, setting aside, or depositing with a trustee all or
part of the revenues to secure the payment of the principal of, redemption
premium, if any, and interest on the bonds and the payment of expenses
of operation and maintenance of the facilities;
(6) the setting aside out of bond proceeds, the revenues or other
available funds of reserves or sinking funds and the source, custody,
security, regulation, and disposition of them;
(7) the determination of the revenues, subject to the provisions of
Section 59-147-110 or other available funds to be pledged as security for
payments with respect to the bonds and for the expenses of operation and
maintenance of the facilities;
(8) the fixing, establishment, collection, and enforcement of the
rentals, fees, or other charges from students, faculty members, and others
using or being served by, or having the right to use or be served by, the
facilities the revenues from which are pledged to secure payments with
respect to the bonds and the disposition and application of the revenues
so charged and collected;
(9) limitations on the issuance of additional bonds or any other
obligations or the incurrence of indebtedness payable from the same
revenues from which the bonds are payable;
(10) rules to ensure the use of the facilities by students or members
of the faculty of the university to the maximum extent to which the
building or equipment is capable of serving the students or faculty
members;
(11) the procedure, if any, by which the terms of any covenant or
contract with, or duty to, the holders of the bonds may be amended or
abrogated, the amount of bonds to which the holders of which must
consent, and the manner in which the consent may be given or
evidenced; and
(12) any other matter or course of conduct which, by recital in the
resolution or resolutions authorizing or providing for the bonds, is
declared to further secure the payment of the principal of or the interest
on the bonds or to further the purposes for which the facilities are being
acquired, constructed, reconstructed, renovated, or equipped and the
bonds being issued.
Section 59-147-50. Revenue bonds may be issued in one or more
series at such prices, may bear such date or dates, may mature at such
time or times, not exceeding forty years from their respective date, may
bear interest at such fixed or variable rate or rates, may be payable in
such medium of payment and at such place or places, may be in such
denomination or denominations, may be in such form, either coupon or
registered and either certified or uncertified, may carry such registration
privileges, may be subject to such terms of redemption before maturity,
with or without premium, and may contain such terms, covenants, and
conditions as the resolution authorizing the issuance of the bonds may
provide. Except as otherwise specified in the authorizing resolution, the
bonds shall be fully negotiable within the meaning of and for all the
purposes of the Uniform Commercial Code.
Section 59-147-60. The bonds shall be exempt from all state, county,
municipal, and school taxes and franchise and license fees.
Section 59-147-70. The bonds must be signed in the corporate name
of the university by the manual or facsimile signature of the acting
chairman of the board of the university, under the corporate seal of the
university attested by the manual or facsimile signature of the acting
secretary of the board. Any interest coupons attached to the bonds must
be signed by the facsimile signatures of these officers. The bonds may
be issued notwithstanding that any of the officials signing them or whose
facsimile signatures appear on the coupons have ceased to hold office at
the time of the issue or at the time of the delivery of the bonds to the
purchaser.
Section 59-147-80. The bonds must be sold at public or private sale
upon such terms and conditions as the board of the university considers
advisable.
Section 59-147-90. The board or its proper administrative officers
shall file with the State Treasurer within thirty days from the date of
their issuance a complete description of all obligations entered into by the
board, with the rates of interest, maturity dates, annual payments, and all
pertinent data.
Section 59-147-100. All provisions of a resolution authorizing or
providing for the issuance of the bonds in accordance with Section
59-147-40 and of the covenants and agreements constitute valid and
legally binding contracts between the university and the several holders
of the bonds, regardless of the time of issuance of the bonds, and are
enforceable by the holder or holders by mandamus or other appropriate
action, suit, or proceeding at law or in equity in any court of competent
jurisdiction.
Section 59-147-110. The bonds must be made payable solely from all
or such portion of the revenues as the university in its discretion may
designate pursuant to the authorizing resolution and also from any other
available funds of the university designated by the university pursuant to
the authorizing resolution except funds of the university derived from
appropriations received from the General Assembly and any tuition funds
pledged to the repayment of state institution bonds. The use of academic
fees must be approved by the university's board. The bonds are not
general obligations of the State. Neither the members of the board nor
any person signing the bonds shall be personally liable for the bonds.
No bonds may be issued pursuant to this chapter unless an identified
source or sources of revenue are designated for the repayment of the
bonds.
Section 59-147-120. This chapter may not be construed as allowing
any research or four-year public institution of higher education to issue
any revenue bonds of a type not otherwise allowed by law for the
particular institution as of December 31, 1995."
USC Athletic Facility Bond provisions revised
SECTION 2. A. Items (2), (3), (7), and (9) of Section 9A., Act 518 of
1980, as amended by Section 2, Act 545 of 1986, are further amended to
read:
"(2) The term `athletic facilities' means all facilities designated
by the university as athletic facilities now owned or hereafter acquired by
the university.
(3) The term `Bond Reserve Fund' means the special fund which may
be established by the trustees pursuant to this act, which must be in the
custody of the State Treasurer and which is primarily established for the
purpose of providing a reserve with which to meet the payment of the
principal of and interest on bonds issued pursuant to this act in the event
that payments otherwise required for the Debt Service Fund are
insufficient to meet the payment of the principal and interest as and when
they become due and payable. Monies in the Bond Reserve Fund also
may be used to pay costs of athletic facilities in accordance with the
provisions of subsections N. and P. of this section.
(7) The term `improvements' means:
(i) the enlargement of and improvements to Carolina Stadium
including all necessary equipment paid for with the proceeds of bonds;
or
(ii) improvements to any other athletic facilities; or
(iii) the acquisition, construction, reconstruction, renovation, or
equipping of any other athletic facility.
(9) Reserved."
B. Section 9C. of Act 518 of 1980, as last amended by Section 2, Act
545 of 1986, is further amended to read:
"C. May Issue Bonds.
Subject to obtaining the approval of the state board expressed by
resolution duly adopted, the trustees are authorized to issue from time to
time not exceeding twenty million dollars of bonds for the purpose of
acquiring, constructing, reconstructing, renovating, or equipping athletic
facilities. If the trustees, in authorizing the issuance of bonds pursuant to
this section, prescribe by resolution that there must be on deposit in the
Bond Reserve Fund certain sums at the time of the delivery of the bonds,
the trustees are empowered to utilize a portion of the proceeds of any
series of bonds issued pursuant to this section in order to meet the
requirement."
C. The penultimate paragraph of Section 9N. of Act 518 of 1980, as
last amended by Section 4, Act 545 of 1986, is further amended to
read:
"Whenever the Bond Reserve Fund, if any, exceeds the reserve
required for bonds then outstanding the trustees are empowered with the
approval of the state board to withdraw the excess and apply it to other
athletic facilities or improvements or for any other corporate purpose of
the university."
D. Subsection P.(1) of Section 9 of Act 518 of 1980 is amended to
read:
"(1)(a) To use proceeds of the bonds to acquire, construct,
reconstruct, or renovate athletic facilities, to pay the cost of issuance of
the bonds, to pay the cost of bond insurance and other credit
enhancement and defray the cost of interest accruing on the bonds for
such time as determined by the trustees.
(b) To covenant and agree throughout the life of the bonds, that the
admission fee and the special student fee must be imposed, maintained,
and revised when necessary, in such amount, without limitation as to
rate, as is sufficient to meet the payment of the principal of and interest
on the bonds as they become due, and to create the reserve, if any,
required by such resolutions for outstanding bonds in the Bond Reserve
Fund. The Bond Reserve Fund, except as provided, must be used only to
meet the payment of the principal of and interest on the bonds when
monies in the Debt Service Fund is insufficient, and must be maintained
in a manner to ensure it's availability for such purposes. Whenever the
Debt Service Fund shall equal all payments of principal and interest due
and to become due in the then current fiscal year, and the Bond Reserve
Fund, if any, shall exceed the reserve prescribed for bonds then
outstanding, the State Treasurer with the approval of the trustees and the
state board may apply such excess to the defeasance of bonds then
outstanding in the manner prescribed by Section T. in this
section."
E. Subsection P.(10) of Section 9 of Act 518 of 1980, as last amended
by Section 5, Act 545 of 1986, is further amended to read:
"(10) To operate and maintain all athletic facilities in good
repair."
F. Subsections G., I., L., N.(2), and O. of Section 9, Act 518 of 1980 are
amended to read:
"G. Bonds must be issued as serial or term bonds at such
prices, maturing in equal or unequal amounts at such times and on such
occasions and must be in denominations as the trustees determine. They
shall bear such rate or rates of interest, payable on such occasions as the
trustees shall prescribe, and are payable in such medium of payment, and
at such place or places as such resolutions prescribe. Bonds may be
issued with provisions permitting their redemption before their stated
maturity at such time and under such conditions as the trustees prescribe.
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 or redemption, in such amount as the trustees
prescribe. Bonds that are subject to redemption shall contain a statement
to that effect on the face of each bond. Any resolution authorizing
redeemable bonds shall contain provisions, specifying the manner of call
for redemption and the notice thereof that must be given.
I. Bonds and all interest to become due on them are exempt from all
state, county, municipal, and school taxes, and franchise and license
fees.
L. Bonds must be disposed of in such manner as the trustees
determine, except that no sale privately negotiated without public
advertisement shall be made unless the approval of the state board shall
be obtained. If the trustees elect to sell the bonds at public sale, at least
one advertisement of the sale shall appear in a financial paper published
in the City of New York, State of New York, or in a newspaper of
general circulation in South Carolina not less than seven days before the
occasion fixed for the opening of bids.
N. (2) The trustees may establish the Bond Reserve Fund. At the
time of the issuance of any bonds pursuant to this section, the trustees
may prescribe by resolution the required sums which must be deposited
and maintained in the Bond Reserve Fund.
O. The trustees are empowered to deposit, in either the Debt Service
Fund, or in the Bond Reserve Fund, before the issuance of any bonds,
monies derived from other sources, including funds raised by the athletic
department of the university. The trustees further are empowered to
deposit in either the Debt Service Fund or Bond Reserve Fund, at any
time proceeds from the sale of any athletic revenue bonds and any other
athletic funds available to the university. They also are empowered
throughout the life of the bonds to make payments from such other
sources to the Debt Service Fund or into the Bond Reserve Fund. In
calculating the amount or rate of the admission fee and special student
fee for any year, the trustees may take into account monies then actually
paid into the Debt Service Fund from such other sources which are then
available to meet the payment of the principal of and interest on the
bonds for such fiscal year."
Time effective
SECTION 3. This act takes effect upon approval by the Governor.
Became law without the signature of the Governor -- 5/7/96. |