S*48 Session 111 (1995-1996)
S*0048(Rat #0094, Act #0055 of 1995) General Bill, By Leatherman, Elliott,
Giese, Leventis, Rankin, M.T. Rose and Wilson
Similar(H 3002)
A Bill to amend the Code of Laws of South Carolina, 1976, by adding Section
11-27-110 so as to provide that the principal amount of a lease purchase or
financing agreement is subject to the constitutional debt limit for political
subdivisions and that payments made by the state under such an agreement are
deemed general obligation debt service for purposes of the constitutional debt
service limit on the State, to provide that the calculation of the limitation
on general obligation bonded indebtedness for future general obligation bond
issues must include the principal balance of any outstanding financing
agreement; and to amend the 1976 Code by adding Section 59-17-120 so as to
provide that school bonds called before maturity may be reissued only if the
payoff amount and the amount necessary to service the reissued bonds does not
increase by more than eight percent in a year the debt service on the original
bonded indebtedness and does not exceed the district's debt limit.-amended
title
09/19/94 Senate Prefiled
09/19/94 Senate Referred to Committee on Finance
01/10/95 Senate Introduced and read first time SJ-24
01/10/95 Senate Referred to Committee on Finance SJ-24
02/22/95 Senate Committee report: Favorable with amendment
Finance SJ-10
02/23/95 Senate Amended SJ-8
02/28/95 Senate Read second time SJ-19
02/28/95 Senate Ordered to third reading with notice of
amendments SJ-19
03/01/95 Senate Read third time and sent to House SJ-10
03/02/95 House Introduced, read first time, placed on calendar
without reference HJ-14
03/15/95 House Debate adjourned until Tuesday, March 21, 1995 HJ-15
03/21/95 House Committed to Committee on Ways and Means HJ-11
04/12/95 House Committee report: Favorable Ways and Means HJ-10
04/20/95 House Objection by Rep. Walker HJ-45
04/20/95 House Debate interrupted HJ-46
04/20/95 House Objection by Rep. Herdklotz, Allison, Littlejohn,
Davenport, Lanford, Wells, Wilder & Stoddard HJ-48
04/26/95 House Objection withdrawn by Rep. Lanford HJ-114
05/03/95 House Objection withdrawn by Rep. Wells & Stoddard HJ-79
05/04/95 House Objection withdrawn by Rep. Davenport HJ-28
05/09/95 House Objection withdrawn by Rep. Herdklotz HJ-181
05/09/95 House Objection by Rep. Wright & Harrell HJ-181
05/09/95 House Read second time HJ-220
05/09/95 House Roll call Yeas-78 Nays-5 HJ-220
05/10/95 House Read third time and enrolled HJ-88
06/06/95 Ratified R 94
06/07/95 Signed By Governor
06/12/95 Effective date 06/12/95
08/10/95 Copies available
08/10/95 Act No. 55
(A55, R94, S48)
AN ACT TO AMEND THE CODE OF LAWS OF SOUTH
CAROLINA, 1976, BY ADDING SECTION 11-27-110 SO AS TO
PROVIDE THAT THE PRINCIPAL AMOUNT OF A LEASE
PURCHASE OR FINANCING AGREEMENT IS SUBJECT TO THE
CONSTITUTIONAL DEBT LIMIT FOR POLITICAL SUBDIVISIONS
AND THAT PAYMENTS MADE BY THE STATE UNDER SUCH AN
AGREEMENT ARE DEEMED GENERAL OBLIGATION DEBT
SERVICE FOR PURPOSES OF THE CONSTITUTIONAL DEBT
SERVICE LIMIT ON THE STATE, TO PROVIDE THAT THE
CALCULATION OF THE LIMITATION ON GENERAL
OBLIGATION BONDED INDEBTEDNESS FOR FUTURE GENERAL
OBLIGATION BOND ISSUES MUST INCLUDE THE PRINCIPAL
BALANCE OF ANY OUTSTANDING FINANCING AGREEMENT;
AND TO AMEND THE 1976 CODE BY ADDING SECTION
59-17-120 SO AS TO PROVIDE THAT SCHOOL BONDS CALLED
BEFORE MATURITY MAY BE REISSUED ONLY IF THE PAYOFF
AMOUNT AND THE AMOUNT NECESSARY TO SERVICE THE
REISSUED BONDS DOES NOT INCREASE BY MORE THAN
EIGHT PERCENT IN A YEAR THE DEBT SERVICE ON THE
ORIGINAL BONDED INDEBTEDNESS AND DOES NOT EXCEED
THE DISTRICT'S DEBT LIMIT.
Be it enacted by the General Assembly of the State of South
Carolina:
Debt limit
SECTION 1. Chapter 27, Title 11 of the 1976 Code is amended by
adding:
"Section 11-27-110. (A) As used in this section:
(1) `asset' means any real property and permanent improvements
thereon including structures, buildings, and fixtures;
(2) `bond act' means:
(a) the county bond act, as contained in Chapter 15 of Title 4;
(b) the municipal bond act, as contained in Article 5, Chapter 21
of Title 5;
(c) the school bond act as contained in Article 1, Chapter 71 of
Title 59;
(d) the provisions contained in Articles 3 and 5 of Chapter 11 of
Title 6 pertaining to special purpose districts;
(e) any provision of law by which the State may issue obligations
secured in whole or in part by the full faith, credit, and taxing power of
the State; and
(f) any other law, general or special, providing for the issuance of
general obligation bonds by the State or any of its political
subdivisions;
(3) `constitutional debt limit' for the State or any political
subdivision of the State which has the power to incur general obligation
bonded indebtedness, means the limitation of the principal amount of
general obligation bonded indebtedness specified in Article X of the
Constitution;
(4) `enterprise financing agreement' means a financing agreement
entered into to provide an asset for a governmental enterprise the
revenues from which are expected to be sufficient to pay the amounts
due under the financing agreement;
(5) `financing agreement' means any contract entered into after
December 31, 1995, under the terms of which a governmental entity
acquires the use of an asset which provides:
(a) for payments to be made in more than one fiscal year, whether
by the stated term of the contract or under any renewal provisions,
optional or otherwise;
(b) that the payments thereunder are divided into principal and
interest components or which contain any reference to any portion of any
payment under the agreement being treated as interest; and
(c) that title to the asset will be in the name of or be transferred to
the governmental entity if all payments scheduled or provided for in the
financing agreement are made, but the term excludes any contracts
entered into in connection with issues of general obligation bonds or
revenue bonds issued pursuant to authorization provided in Article X of
the Constitution;
(6) `governmental enterprise' means any activity undertaken by a
governmental entity which derives revenues from or because of the
activity on a basis other than the exercise of the power of taxation by
that governmental entity;
(7) `governmental entity' means:
(a) the State, whose general obligation debt service payments are
limited pursuant to Section 13, Article X of the Constitution; or
(b) any political subdivision of the State including a municipality,
county, school district, special purpose district, or similar entity, whose
general obligation debt is limited as provided in Sections 14 and 15, in
Article X of the Constitution;
(8) `limited bonded indebtedness' means the amount of bonded
indebtedness that may be incurred by a governmental entity without a
referendum or, where the context requires, the amount of such
indebtedness then outstanding; and
(9) `principal balance' means the total amount, excluding any
amount characterized as interest, payable as of any time of consideration
under any financing agreement, including any renewals or extensions of
the agreement.
(B) A governmental entity described in subsection (A)(7)(b) of this
section may not enter into a financing agreement, other than an enterprise
financing agreement, a lease purchase agreement for energy efficiency
products as provided for in Section 48-52-660, or a guaranteed energy
savings contract as provided for in Section 48-52-670, if the principal
balance of the financing agreement, when added to the principal amount
of limited bonded indebtedness outstanding on the date of execution of
the financing agreement exceeds eight percent of the assessed value of
taxable property in the jurisdiction of the governmental entity unless the
financing agreement is approved by a majority of the electors voting on
the agreement in a referendum duly called for this purpose by the
governmental entity.
(C) If a governmental entity described in subsection (A)(7)(b) of this
section has outstanding any financing agreement, other than an enterprise
financing agreement on the date of issuance of any limited bonded
indebtedness pursuant to any bond act, the amount of this limited bonded
indebtedness plus the amount of all other limited bonded indebtedness of
the governmental entity, when added to the principal balance under any
financing agreement or agreements of the governmental entity must not
exceed the amount of the governmental entity's constitutional debt limit
unless this bonded indebtedness is approved by a majority of the electors
voting on the bonded indebtedness in a referendum duly called for this
purpose by the governmental entity. This requirement applies
notwithstanding any other provision of any bond act and is in addition to
the terms and conditions specified in any bond act.
(D) A payment made by the State pursuant to a financing agreement is
deemed general obligation debt service subject to the debt service
limitation provided in Section 13, Article X of the Constitution."
Reissue of school bonds
SECTION 2. Chapter 17, Title 59 of the 1976 Code is amended by
adding:
"Section 59-17-120. Bonds issued by a school district under the
bonded indebtedness limitation of Article X, Section 15(7)(a) of the
South Carolina Constitution and called before the maturity date only may
be reissued if the amount required to service the reissuance and to pay
off the called bonds does not:
(1) increase by more than eight percent in any one year the amount of
the district's budget needed to service the original bonded indebtedness;
or
(2) exceed the debt limit of the district."
Time effective
SECTION 3. This act takes effect upon approval by the Governor.
Approved the 7th day of June, 1995. |