Current StatusView additional legislative information at the LPITS web site.Bill Number: 2947 Ratification Number: 812 Act Number 682 Introducing Body: House Subject: South Carolina Resources Authority Act
(A682, R812, H2947)
AN ACT TO AMEND TITLE 11, CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING CHAPTER 37 SO AS TO ENACT THE SOUTH CAROLINA RESOURCES AUTHORITY ACT; AND TO AMEND CHAPTER 6, TITLE 48, RELATING TO THE WATER POLLUTION REVOLVING FUND, SO AS TO MAKE CHANGES TO CONFORM IT TO THE FEDERAL CLEAN WATER ACT.
Be it enacted by the General Assembly of the State of South Carolina:
Findings
SECTION 1. The General Assembly finds that there exists in South Carolina a definite need for additional sources with which to finance the present and future needs of the people of South Carolina for the undertakings authorized by this act. It has been determined that this need may be alleviated in part through the authorization to the South Carolina Resources Authority to encourage the investment of both public and private funds for these purposes and to make loans and grants available to local governments for projects approved by the Authority. Loans and grants for approved projects are necessary to promote the general health and welfare of all South Carolinians and as an incentive to foster economic growth, particularly in the rural, less developed areas of the State. The General Assembly has determined that the authorization to the Authority for this purpose is in the public interest, serves a public purpose, and promotes the health, safety, welfare, and convenience of the people of the State.
South Carolina Resources Authority Act enacted
SECTION 2. Title 11 of the 1976 Code is amended by adding:
"CHAPTER 37
South Carolina Resources Authority Act
Section 11-37-10. This chapter may be cited as the South Carolina Resources Authority Act.
Section 11-37-20. As used in this chapter, unless a different meaning clearly appears from the context:
(1) 'Authority' means the South Carolina Resources Authority.
(2) 'Bonds' means any bonds, notes, debentures, interim certificates, bond, grant or revenue anticipation notes, or any other evidence of indebtedness of the Authority.
(3) 'Capital reserve fund' means any reserve fund created and established by the Authority pursuant to this chapter.
(4) 'Cost' as applied to any project financed under the provisions of this chapter means the total of all costs incurred by the local government in carrying out all works and undertakings necessary or incidental to the accomplishment of any project. It includes, without limitation, all necessary developmental, planning and feasibility studies, surveys, plans and specifications, architectural, engineering, financial, legal, or other special services, the cost of acquisition of land and any buildings and improvements on the land, including the discharge of any obligations of the sellers of the land, buildings or improvements, site preparation and development, including demolition or removal of existing structures, construction and reconstruction, labor, materials, machinery and equipment, the reasonable costs of financing incurred by the local government in the course of the development of the project, carrying charges incurred before placing the project in service, interest on local obligations issued to finance the project to a date subsequent to the estimated date the project is to be placed in service, necessary expenses incurred in connection with placing the project in service, the funding of accounts and reserves which the Authority may require, and the cost of other items which the Authority determines to be reasonable and necessary.
(5) 'Local government' means any county, municipality, special purpose or special service district, or Commission of Public Works of the State and any private eleemosynary water companies, private eleemosynary sewer companies, and private eleemosynary companies which provide both water and sewer services.
(6) 'Local obligations' means any bonds, notes, debentures, interim certificates, bond, grant, or revenue anticipation notes, or any other evidences of indebtedness of a local government.
(7) 'Project' means any water supply, sewer system, sewage, wastewater treatment facility, or any other project hereafter committed to the Authority by subsequent enactment of the General Assembly.
(8) 'Reserve fund requirement' means, as of any particular date of computation, the amount of money designated as the minimum capital reserve fund requirement as established by the resolution of the Authority authorizing the issuance of or by the trust indenture securing any issue of bonds.
Section 11-37-30. There is created a body politic and corporate known as the South Carolina Resources Authority. The Authority is declared to be a public instrumentality of the State and the exercise by it of any power conferred in this chapter is the performance of an essential public function. The Authority consists of the members of the State Budget and Control Board.
Section 11-37-45. The Authority may receive funds from whatever source to use for the operation of the Authority, but it may not receive funds appropriated specifically for the Authority after July 1, 1989. Nothing in this section prohibits the transfer of personnel to the Authority from other state agencies.
Section 11-37-50. The Authority shall:
(1) have perpetual succession as a public body corporate and as a political subdivision of the State;
(2) adopt, 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 any instrument executed on behalf of the Authority;
(5) 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;
(6) sell, convey, mortgage, pledge, lease, exchange, transfer, and otherwise dispose of all or any part of its properties and assets;
(7) 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;
(8) procure insurance against any loss in connection with its property, assets, or activities, including insurance against liability for its acts or the acts of its employees or agents;
(9) procure insurance, guarantees, letters of credit, and other forms of collateral or security or credit support from any public or private entities, including any department, agency, or instrumentality of the United States or the State of South Carolina, for the payment of any bonds issued by it, including the power to pay premiums or fees on any insurance, guarantees, letters of credit, and other forms of collateral or security or credit support;
(10) 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;
(11) enter into agreements with any department, agency, or instrumentality of the United States or this State for the purpose of planning, regulating, and providing for the financing of any projects;
(12) collect, or authorize the trustee under any trust indenture securing any bonds to collect, amounts due under any local obligations owned by it, including taking the action required to obtain payment of any sums in default;
(13) enter into contracts or agreements for the servicing and processing of local obligations owned by it;
(14) invest or reinvest its funds as provided in Section 11-37-230 or as permitted by applicable law;
(15) unless restricted under any agreement with holders of bonds, consent to any modification with respect to the rate of interest, time, and payment of any installment of principal or interest, or any other term of any local obligations owned by it;
(16) establish and revise, amend and repeal, and collect fees and charges in connection with any activities or services rendered by the Authority; and
(17) perform any act necessary or convenient to the exercise of the powers granted or reasonably implied by this chapter.
Section 11-37-60. The Authority may borrow money and issue its bonds in amounts it determines to be 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. The total principal amount of bonds outstanding at any one time may not exceed the sum of two hundred million dollars.
Section 11-37-70. The Authority may:
(1) issue bonds to renew or pay bonds, including the interest;
(2) whenever it considers refunding expedient, refund any bonds by the issuance of new bonds, whether the bonds to be refunded have or have not matured; and
(3) issue bonds partly to refund bonds then outstanding and partly for its own purposes. The refunding bonds may be exchanged for the bonds to be refunded or they may be sold and the proceeds applied to the purchase, redemption, or payment of the bonds to be refunded. The amount of the refunding bonds issued by it may not be included in the total of outstanding bonds for purposes of the limitation on the amount of bonds which may be issued by the Authority.
Section 11-37-80. The Authority may pledge any of its revenue or funds to the payment of its bonds, subject only to any prior agreements with the holders of particular bonds which may have pledged specific money or revenue. Bonds may be secured by a pledge of any local obligation owned by the Authority, any grant, contribution, or guaranty from the United States, the State, or any corporation, association, institution, or person, any other property or assets of the Authority, or a pledge of any money, income, or revenue of the Authority from any source.
Section 11-37-90. Bonds issued by the Authority do not constitute a debt or a pledge of the faith and credit of the State of South Carolina, or any of 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 the State within the meaning of any state constitutional or statutory limitation. No member of the Authority or any 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 the State, nor any of 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 the State, or any of its political subdivisions, is pledged to the payment of the principal of or interest on the bond;
(3) the Authority does not have taxing power.
Section 11-37-100. The bonds of the Authority must be authorized by a resolution of the Authority. 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 prior to their issuance. The bonds may bear interest payable at a time and at a rate as determined by the Authority pursuant to the provisions of Section 11-9-350, including the determination 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.
The State Treasurer shall issue the bonds of the Authority not later than sixty days upon the resolution of the Authority authorizing the issuance of the bonds. The Authority must only
issue bonds for those projects recommended to the Authority by the Water Resources Coordinating Council as established in Section 11-37-200.
Section 11-37-105. In addition to the amount of bonds authorized by the Authority, the State Treasurer shall include in the bond issue any fees and costs incurred by the Jobs Economic Development Authority to receive, research, investigate, and process any applications for projects not to exceed one hundred thousand dollars in any one fiscal year. The Jobs Economic Development Authority shall submit quarterly requests for reimbursement by the Authority for costs incurred.
Section 11-37-110. (A) Bonds may be secured by a trust indenture between the Authority and a corporate trustee, which may be the State Treasurer or any bank having trust powers or any 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. All expenses incurred in performing the obligations of the Authority under the trust indenture may be treated as part of its operating expenses.
(B) Any 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:
(1) pledging all or any part of the revenue of the Authority to secure the payment of the bonds;
(2) pledging all or any part of the assets of the Authority including local obligations owned by it to secure the payment of the bonds;
(3) the use and disposition of the gross income from, and payment of the principal of, and interest on local obligations owned by the Authority;
(4) the establishment of reserves, sinking funds, and other funds and accounts, and their regulation and disposition;
(5) limitations on the purposes to which the proceeds from the sale of the bonds may be applied, and limitations pledging the proceeds to secure the payment of the bonds;
(6) limitations on the issuance of additional bonds, the terms upon which additional bonds may be issued and secured, and the refunding of outstanding or other bonds;
(7) the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds, if any, the holders of which must consent to, and the manner in which any consent may be given;
(8) limitations on the amount of money to be expended by the Authority for its operating expenses;
(9) vesting in a trustee property, rights, powers, and duties as the Authority may determine, limiting or abrogating the right of bondholders to appoint a trustee, and limiting the rights, powers, and duties of the trustee;
(10) defining the acts or omissions which constitute a default, the obligations or duties of the Authority to the holders of the bonds, and the rights and remedies of the holders of the bonds in the event of default, including as a matter of right the appointment of a receiver, and all other rights generally available to creditors;
(11) requiring the Authority or the trustee under the trust indenture to take any and all other action to obtain payment of all sums required to eliminate any default as to any principal of and interest on local obligations owned by the Authority or held by a trustee, which may be authorized by the laws of this State; and
(12) any other matter relating to the terms of the bonds or the security or protection of the holders of the bonds which may be considered appropriate.
Section 11-37-120. Any 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 any physical delivery or further act. The lien of any 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 any other instrument including filings under the Uniform Commercial Code is necessary to create or perfect any pledge or security interest granted by the Authority to secure any 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 11-37-130. The Authority, subject to agreements with bondholders as may then exist, may purchase outstanding bonds of the Authority with any available funds, at any reasonable price. If the bonds are then redeemable, the price shall not exceed the redemption price then applicable plus accrued interest to the next interest payment date.
Section 11-37-140. Bonds of the Authority must be in a form and must be executed in a manner prescribed by the Authority.
Section 11-37-150. In the event that any of the members or officers of the Authority cease to be members before the delivery of any bonds signed by them, their signatures or authorized facsimile signatures are nevertheless valid and sufficient for all purposes as if they had remained in office until the delivery of the bonds.
Section 11-37-160. Subsequent amendments to this chapter may not limit the rights vested in the Authority with respect to any 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 any proceeding by or on behalf of the holders, are fully met and discharged.
Section 11-37-170. (A)(1) The Authority may create and establish one or more capital reserve funds and may pay into each capital reserve fund any:
(a) monies appropriated and made available by the State for the purpose of such a fund;
(b) proceeds of the sale of bonds of the Authority to the extent provided in the resolution authorizing the issuance of, or the trust indenture securing, the bonds; and
(c) other monies which may be made available to the Authority for the purpose of such a fund from any other source. All monies held in any capital reserve fund, except as provided in this chapter, must be used solely for the payment, when due, of the principal of, and interest on the bonds secured in whole or in part by such a fund. If monies in any such fund are less than the reserve fund requirement established upon the issuance of any bonds for the fund, the Authority may not use the monies for any optional purchase or redemption of bonds until the reserve fund requirement is fully restored. Any income or interest earned on, or increment to, any capital reserve fund due to its investment may be transferred by the Authority to its other funds or accounts if it does not reduce the amount in the capital reserve fund below the reserve fund requirement.
(2) The Authority may not at any time issue bonds secured in whole or in part by any capital reserve fund, if upon the issuance, the amount in the capital reserve fund is less than the reserve fund requirement unless it, at the time of issuance of the bonds, deposits in the fund an amount which, together with the amount then in the fund, is not less than the fund's reserve fund requirement.
(B) The Authority may create and establish other funds as necessary or desirable for its corporate purposes.
(C) Nothing in this section may be construed as limiting the power of the Authority to issue bonds not secured by a capital reserve fund.
Section 11-37-180. The Authority, with any funds of the Authority available for such a purpose, may purchase and acquire, on terms and in a form determined by the Authority, local obligations to finance or refinance the cost of any project. Prior to entering into any agreement with the Authority, the local government must demonstrate to the satisfaction of the Authority that traditional financing sources are not available for the entire project. Two letters of declination, from financial institutions normally engaged in this financing, satisfy this requirement. The Authority may pledge to the payment of any bonds all or any portion of the local obligations purchased. The Authority, subject to any pledge, may also sell any local obligations so purchased and apply the proceeds of the sale to the purchase of other local obligations for financing or refinancing the cost of any project or for any other of its corporate purposes.
The Authority may require, as a condition to the purchase of any local obligation, the local government issuing an obligation to perform any of the following:
(1) establish and collect rents, rates, fees, and charges to produce revenue sufficient to pay all or a specified portion of:
(a) the costs of operation, maintenance, replacement, renewal, and repairs of the project;
(b) any outstanding indebtedness incurred for the purposes of the project, including the principal of and interest on the local obligations issued by the local government to the Authority; and
(c) any amounts necessary to create and maintain any required reserve, including any rate stabilization fund considered necessary or appropriate by the Authority to offset the need, in whole or part, for future increases in rents, rates, fees, or charges.
(2) create and maintain a special fund for the payment of the principal of and interest on any local obligations and any other amounts becoming due under any agreement entered into in connection with the local obligation, or for the operation, maintenance, repair, or replacement of the project or any portions of it or other property of the local government, and deposit into any fund amounts sufficient to make any payments as they become due and payable;
(3) create and maintain other special funds as required by the Authority; and
(4) perform other acts, including the conveyance of real and personal property together with all right, title, and interest in the property to the Authority, or take other actions considered necessary or desirable by the Authority to secure payment of the principal of and interest on the local obligations and to provide for the remedies for the Authority or other holder of the local obligations in the event of any default by the local government in the payment, including, without limitation, any of the following:
(a) the procurement of insurance, guarantees, letters of credit, and other forms of collateral, security, liquidity arrangements or credit supports for local obligations from any source, public or private, and the payment of premiums, fees, or other charges;
(b) the payment of the allocable shares of local governments, as determined by the Authority, of any costs, fees, charges, or expenses attributable to insurance, guarantees, letters of credit, and other forms of collateral, security, liquidity arrangements, or credit supports incurred in connection with the issuance of bonds by the Authority to acquire local obligations of one or more local governments. The determination of the allocable shares may be made by the Authority on any reasonable basis;
(c) the combination of one or more projects, or the combination of one or more projects with one or more other undertakings, facilities, utilities, or systems, for the purpose of operations and financing, and the pledging of the revenues from the combined projects, undertakings, facilities, utilities, and systems to secure local obligations issued in connection with the combination or any part of it;
(d) the payment of the allocable shares of the local governments, as determined by the Authority on any reasonable basis, of rate stabilization funds established or required by the Authority in connection with the issuance of bonds by the Authority to acquire local obligations of two or more local governments.
All local governments issuing and selling local 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 participants in financings of the Authority, but may be structured as determined by the Authority according to the needs of the contracting local governments and the Authority.
All statutes permitting local governments to borrow money and issue bonds (including both general obligation and revenue bonds) may be utilized by any local government borrowing money from the Authority to the full extent permitted by the Constitution and the statutes.
Section 11-37-190. The State may make, but is not required to make, grants of money or property to the Authority for the purpose of enabling it to carry out its corporate purposes and for the exercise of its powers, including deposits to capital reserve funds. This section may not be construed to limit any other power to make grants to the Authority.
Section 11-37-200. (A) There is established by this section the Water Resources Coordinating Council which shall establish the priorities for all sewer, wastewater treatment, and water supply facility projects addressed in this chapter, except as otherwise established by Section 48-6-40. The council shall consist of a representative of the Governor, the Commissioner of the Department of Health and Environmental Control, the Executive Director of the Water Resources Commission, the Director of the Division of Local Government of the Budget and Control Board, the Chairman of the Coordinating Council on Economic Development, the Chairman of the Jobs Economic Development Authority, the Chairman of the Joint Bond Review Committee, the Chairman of the House Ways and Means Committee, and the Chairman of the Senate Finance Committee. These representatives may designate a person to serve in their place on the council, and the Governor shall appoint the chairman from among the membership of the council for a one-year term. The council shall establish criteria for the review of applications for projects. Not less often than annually, the council shall determine its priorities for projects. The council after evaluating applications shall notify the Authority of the priority projects. The South Carolina Jobs Economic Development Authority shall provide the staff to receive, research, investigate, and process applications for projects made to the coordinating council and assist in the formulating of priorities. Upon notification by the council, the Authority shall proceed under the provisions of this chapter. The Authority may consider applications for projects based upon the existence of a documented emergency consistent with regulations that may be promulgated by the Authority. In determining which local governments are to receive grants, the local governments shall provide not less than a fifty percent match for any project. The Authority may provide financing for the local matching funds on terms and conditions determined by the Authority.
(B) The duties of the Water Resources Coordinating Council are:
(1) establish procedures for receipt of applications;
(2) in cooperation with the Authority, establish criteria for funding priorities. These criteria, in compliance with the provisions of Chapter 23 of Title 1, must include, but are not limited to, the following factors:
(a) regional development - the need for multi-jurisdictional projects and the cooperation and coordination for regional economic development projects;
(b) development potential - the degree to which economic development activity can be stimulated in any given area and infrastructure used as a proactive economic development tool;
(c) economic impact - the degree to which jobs and income can be generated if the infrastructure improvements were made;
(d) local commitment and initiative - the availability of the local fifty percent match and local recognition of complimentary infrastructure needs including, but not limited to, such needs as transportation;
(e) infrastructure need - the degree to which specific infrastructure problems can be addressed and solved;
(f) area economic need - the degree of local 'distress' and need for economic assistance, particularly in less developed or rural areas of the State;
(g) creditworthiness - the financial soundness of the infrastructure project, including the availability or lack of other funds to finance the infrastructure project;
(h) public health and welfare - to meet public health and welfare requirements within the local area;
(3) provide to the Authority, on an as-needed basis, technical assistance from their respective agencies for purposes of screening funding applications;
(4) establish the funding priorities. The Authority may not deviate from the priorities established by the council except for emergency projects as previously described. When setting its priorities, the council shall establish a set-aside of not less than ten percent of available funds approved in that year to meet unforeseen needs. After having set its priorities, the council shall review the priorities as necessary but not less than once during the year, and the council may adjust the priorities as they consider necessary.
Section 11-37-210. The Authority in performing an essential governmental function in the exercise of the powers conferred upon it is not required to pay any taxes or assessments upon any project or any property or upon any of its operations or the income from them, or any taxes or assessments upon any project or any property or local obligation acquired or used by the Authority or upon the income from them. Any bonds issued by the Authority, the transfer of bonds, and the income from them, is free from taxation and assessment of every kind by the State and by the local governments and other political subdivisions of the State.
Section 11-37-220. 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 the 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 the State or any agency or political subdivision of the State and all municipalities and public corporations for any purpose for which the deposit of bonds or other obligations of the State is now or may later be required by law.
Section 11-37-230. All money of the Authority, except as otherwise authorized by law or provided in this chapter, must be deposited with and invested by the State Treasurer. Funds of the Authority not needed for immediate use or disbursement, including any funds held in any capital reserve fund, may be invested by the State Treasurer in obligations or securities which are declared to be legal obligations by the provisions of Chapter 5 of Title 6, Section 11-9-660, and Section 11-9-661.
Section 11-37-240. 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. Each report shall set forth a complete operating and financial statement of the Authority during the fiscal year it covers. 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 11-37-250. The provisions of this chapter must be liberally construed to the end that its beneficial purposes may be effectuated. No proceedings, notice, or approval is required for the issuance of any bonds of the Authority or any instruments or the security thereof, except as provided in this chapter. Insofar as 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.
Section 11-37-260. If at any time any local government fails to effect the punctual payment of the principal of or interest on its local obligations, the State Treasurer shall withhold from the local government sufficient monies from any state appropriation to the local government and apply so much as is necessary to the payment of the principal of and interest on the local obligation of the government. All appropriations of local governments of the State are subject to the provisions of this section. If the local government does not receive state aid in an amount necessary to repay the obligation, the Comptroller General may levy and require the applicable county treasurer to collect and remit to the Authority an ad valorem tax sufficient to meet the obligation."
Water Pollution Revolving Fund
SECTION 3. Chapter 6, Title 48 of the 1976 Code, as added by Section 31, Part II, Act 170 of 1987, is amended to read:
"CHAPTER 6
Water Pollution Revolving Fund
Section 48-6-10. As used in this chapter:
(1) 'Department' means the South Carolina Department of Health and Environmental Control.
(2) 'Authority' means the South Carolina Budget and Control Board.
(3) 'Agency' means the United States Environmental Protection Agency.
(4) 'Council' means the Water Resources Coordinating Council established pursuant to Section 11-37-200.
(5) 'Project sponsor' means any county, municipality, intermunicipal, interstate, state agency, or special purpose district as defined in the Federal Clean Water Act and associated regulations.
(6) 'Fund' means the money initially derived from capitalization grants pursuant to the Federal 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 as may be committed to the fund.
(7) 'Loan agreement' means the agreement made between a project sponsor and the Authority which provides for state assistance to the project sponsor and for the repayment thereof by the project sponsor.
(8) 'Priority system' means the priority ranking system utilized by the department to rank proposed wastewater projects pursuant to the Federal Clean Water Act.
(9) 'Project' means any undertaking for the treatment and disposal of wastewater, or other project as defined under the Clean Water Act and approved in the department's annual work plan and approved by the agency.
(10) 'State grants' means money to be made available to local units for the purpose of defraying costs incidental to any eligible project.
(11) 'Special tax' means the ad valorem tax to be imposed upon all taxable property of the project sponsor by reason of the requirements of any loan agreement.
Section 48-6-20. (A) There is created a revolving fund program. The Authority shall manage funds and administer loans from the fund. Funds must be used only:
(1) to make loans to project sponsors in accordance with specifications of this act;
(2) to buy or refinance the debt obligation of a project sponsor at or below market rates, where a debt obligation was incurred after March 7, 1985;
(3) to guarantee, or purchase insurance for, local obligations where such action would improve credit market access or reduce interest rates;
(4) as a source of revenue or security for the payment of principal and interest on revenue or general obligation bonds issued if the proceeds of the sale of the bonds will be deposited in the fund;
(5) to provide loan guarantees for similar revolving funds established by the project sponsor;
(6) to earn interest on fund accounts; and
(7) for the reasonable costs of the Authority
and the department for administering the fund and conducting activities under this act.
(B) (1) The department shall deposit in the fund federal money allocated for the purpose of establishing a State Revolving Fund pursuant to the Federal Clean Water Act.
(2) The Authority shall deposit in the fund state money appropriated to carry out the provisions of this chapter in a manner consistent with and to the extent necessary to match those federal funds allocated to the State under the provisions of the Federal Clean Water Act for the purpose of making loans to project sponsors.
(3) The Authority shall deposit in the fund all receipts from the repayment of loans made pursuant to this chapter.
Section 48-6-30. Earnings on balances in the fund must be credited to the fund. Money remaining in the fund at the end of any fiscal year accrues only to the credit of the fund. Fund balances must be awarded in perpetuity.
Section 48-6-40. The department is empowered to:
(1) promulgate regulations, with Authority input, to effectuate the provisions of this chapter. Initial regulations must be promulgated within twelve months of the effective date of this chapter;
(2) develop a priority system as specified in Title II of the Federal Clean Water Act and to rank projects for which priority questionnaires have been received. This priority system shall at a minimum ensure consistency with the Federal Clean Water Act;
(3) coordinate with the council on setting funding priorities for those state and federal funds not specified by the Clean Water Act;
(4) prepare an annual plan for agency approval in accordance with the Federal Clean Water Act after providing for input from the Authority and public comment and review;
(5) enter into binding agreements as necessary with the agency to effect the implementation of this chapter.
Section 48-6-50. The Authority is empowered to:
(1) manage the fund;
(2) ensure that state money which constitutes the twenty percent match of agency funds is deposited to the fund upon or prior to the receipt of agency funds;
(3) enter into loan agreements with project sponsors and ensure that the loan agreements are properly executed;
(4) assist project sponsors in developing capital financing plans;
(5) establish fiscal controls and accounting procedures to ensure proper accounting of funds;
(6) collect fees from project sponsors;
(7) deposit in the fund all receipts from the repayment of loans made pursuant to this act;
(8) disperse monies from the fund to the department and the Authority for fund and program management;
(9) prepare an annual report with input from the department for the Governor and General Assembly, and make an annual report to the agency in accordance with the requirements of the Federal Clean Water Act;
(10) coordinate with the department to enter jointly into binding agreements with the agency to effect implementation of this chapter.
Section 48-6-60. All project sponsors are empowered to:
(1) undertake projects;
(2) make application for and to receive assistance;
(3) comply with regulations relating to the receipt and disposition of money of the fund;
(4) apply for and receive state grants;
(5) enter into loan agreements;
(6) comply with all terms and conditions of any loan agreement.
Section 48-6-70. (A) Criteria for loans under this chapter must be developed by the department in concert with the Authority and shall include relevant provisions of federal and state law and regulations.
(B) The loan agreement must be written by the project sponsor such that, upon any failure of the project sponsor to make payment to the Authority in accordance with the time schedule fixed by the repayment schedule of the amount prescribed by the schedule, the Authority may without further action require the State Treasurer and the Comptroller General to pay to the Authority the amount of other state aid as the project sponsor unit may become entitled to until all delinquent payments under the repayment schedule, plus interest from the date of each delinquency at the rate of six percent a year, have been paid. In the event the project sponsor is a special purpose district and receives no other state aid, the agreement must prescribe that the Comptroller General may levy and require the applicable county treasurer to collect and remit to the Authority a special tax required by the loan agreement.
The claim of the State against other state aid of a defaulting project sponsor is a first lien."
Time effective
SECTION 4. This act takes effect upon approval by the Governor.