Current Status Bill Number:624 Ratification Number:138 Act Number:74 Type of Legislation:General Bill GB Introducing Body:Senate Introduced Date:19970408 Primary Sponsor:Setzler All Sponsors:Setzler, Ryberg, Lander, Wilson and Drummond Drafted Document Number:jic\6054htc.97 Date Bill Passed both Bodies:19970527 Date of Last Amendment:19970522 Governor's Action:U Became law without signature of Governor Date of Governor's Action:19970611 Subject:Joint municipal water systems, approval of governing body to incur debt, Political Subdivisions, Water and Sewer
Body Date Action Description Com Leg Involved
______ ________ _______________________________________ _______ ____________
------ 19970630 Act No. A74
------ 19970611 Unsigned, became law without
signature of Governor
------ 19970604 Ratified R138
Senate 19970527 Concurred in House amendment,
enrolled for ratification
House 19970523 Read third time, returned to House
with amendment
House 19970522 Read second time, unanimous consent
for third reading on the next
Legislative day
House 19970522 Amended
House 19970520 Debate adjourned until
Thursday, 19970522
House 19970514 Debate adjourned until
Tuesday, 19970520
House 19970513 Debate adjourned until
Wednesday, 19970514
House 19970507 Debate adjourned until
Tuesday, 19970513
House 19970501 Debate adjourned until
Tuesday, 19970506
House 19970430 Debate adjourned until
Thursday, 19970501
House 19970429 Recalled from Committee 25 HJ
House 19970416 Introduced, read first time, 25 HJ
referred to Committee
Senate 19970415 Read third time, sent to House
Senate 19970410 Read second time, notice of
general amendments
Senate 19970410 Amended
Senate 19970408 Introduced, read first time,
placed on Calendar without reference
View additional legislative information at the LPITS web site.
(A74, R138, S624)
AN ACT TO AMEND SECTIONS 6-25-20, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DEFINITIONS FOR JOINT MUNICIPAL WATER SYSTEMS, SO AS TO REVISE THE MEANING OF THE TERMS "REVENUE BONDS" AND "BONDS"; TO AMEND SECTION 6-25-100, AS AMENDED, RELATING TO POWERS OF JOINT MUNICIPAL WATER SYSTEMS, SO AS TO ALLOW BONDS OR NOTES ISSUED TO A JOINT SYSTEM TO BE PAID FROM OTHER FUNDS AS MAY BE AVAILABLE, TO PROVIDE FOR A TWO-THIRDS VOTE REQUIREMENT OF THE COMMISSIONERS TO BORROW MONEY AND ISSUE BONDS OR NOTES FOR PAYMENT, AND TO ALLOW MEMBERS OF A JOINT SYSTEM TO PRESCRIBE, AS THEY CONSIDER NECESSARY, ADDITIONAL PROCEDURES AND REQUIREMENTS WHICH GOVERN THE ISSUANCE OF ANY NOTES OR BONDS; TO AMEND SECTION 6-25-110, RELATING TO AUTHORIZATION OF A JOINT SYSTEM TO INCUR DEBT AND ISSUE BONDS, SO AS TO ALLOW A JOINT SYSTEM TO USE OTHER SOURCES OF FUNDS AVAILABLE TO IT TO PAY FOR ISSUED BONDS AND TO REVISE THE MANNER IN WHICH JOINT SYSTEM PROJECTS ARE APPROVED; TO AMEND SECTION 6-25-111, RELATING TO ISSUANCE, SALE, AND EXECUTION OF BONDS BY JOINT SYSTEMS, SO AS TO FURTHER PROVIDE FOR THE APPROVAL PROCESS REQUIRED FOR PROJECTS REQUIRED TO BE FINANCED BY SUCH BONDS; TO AMEND SECTION 6-25-113, RELATING TO SOURCES FROM WHICH JOINT SYSTEM BONDS ARE PAYABLE, SO AS TO ALLOW A MEMBER COUNTY OR MUNICIPALITY TO PROVIDE A PLEDGE OF ALL OR PART OF ANY REVENUES DERIVED AS PAYMENTS IN LIEU OF TAXES WITH RESPECT TO A PROJECT; TO AMEND SECTION 6-25-120, RELATING TO PAYMENT OF NOTES, OBLIGATIONS, OR BONDS, SO AS TO REQUIRE ONLY REVENUES AND OTHER FUNDS AVAILABLE TO THE JOINT SYSTEM TO BE USED TO PAY OR PLEDGED TO THE AMOUNT OF ANY NOTES, OBLIGATIONS, OR BONDS; AND TO AMEND SECTION 6-25-128, RELATING TO CONTRACTS BETWEEN MUNICIPALITIES AND JOINT SYSTEMS, SO AS TO ALLOW A MUNICIPALITY UNDER CONTRACT FOR THE PURCHASE OF CAPACITY AND OUTPUT FROM A JOINT SYSTEM TO PAY FROM REVENUES DERIVED FROM THE OWNERSHIP AND OPERATION OF THE WATER SYSTEM AND FROM OTHER SOURCES OF FUNDS AS MAY BE AVAILABLE, INCLUDING ANY AMOUNTS RECEIVED AS PAYMENTS IN LIEU OF TAXES.
Be it enacted by the General Assembly of the State of South Carolina:
Findings
SECTION 1. The General Assembly finds that:
(1) The availability of water and sewer services to assist economic development and to provide for the health, safety, and welfare of its people is a very critical matter for this State.
(2) It is appropriate to make it possible for members of joint municipal water systems to utilize certain sources of revenues available to them, including payments in lieu of taxes, to assist in the development of additional water and sewer treatment capacity and the provision of collection and distribution lines.
(3) It is desirable to facilitate a joint water system in accommodating the desires of its members in projects and financings that affect only those members.
Terms revised
SECTION 2. Section 6-25-20(g) of the 1976 Code, is amended to read:
"(g) 'Revenue bonds' and 'bonds' mean bonds, notes, certificates, or other obligations of a joint system issued pursuant to the provisions of this chapter and include refinancing or refunding same, but which must be paid solely from the revenues and other sources of funds available to a joint system. The term 'revenues' includes all sources of funds which are revenues to the joint system, regardless of the source of the funds, from any other party obligated to the joint system."
Payment sources and procedures revised
SECTION 3. Section 6-25-100(n) of the 1976 Code, as last amended by Part II, Section 91B of Act 145 of 1995, is further amended to read:
"(n) To borrow money and issue bonds or notes of the joint system to be paid solely from revenues of the system and such other funds as may be available therefor with a favorable vote of two-thirds of the commissioners. No bonds or notes may be issued the payment for which is dependent upon contracts or agreements with a member except with the approval of the governing body of such member, by resolution or ordinance of the governing body of such member. However, the requirements of this item are satisfied and no further action is required with respect to any bonds or notes issued to finance a project which has been approved by the governing body of such members as provided in Section 6-25-110. The approval of any notes or bonds under this chapter shall include any issuance in one or more series and any refunding or refinancing of them so that only the original issuance of the debt must be approved. The members of a joint system may prescribe additional procedures and requirements as they determine appropriate for the issuance of any notes or bonds in the bylaws of any joint system."
Payment of bonds; approval of project
SECTION 4. Section 6-25-110 of the 1976 Code is amended to read:
"Section 6-25-110. A joint system may incur debt for any of its purposes and may issue bonds pledging to the payment as to both principal and interest the revenues, or any portion, derived or to be derived from all or any of its projects and any additions and betterments or extensions or contributions or advances from its members or other sources of funds available to it. No joint system shall undertake any project required to be financed, in whole or in part, with the proceeds of bonds without the approval of the governing bodies of each member which is obligated or to be obligated under any contract for the payment of amounts to be pledged as security therefor and a favorable vote of two-thirds of all commissioners."
Approval process revised
SECTION 5. Section 6-25-111(C) of the 1976 Code is amended to read:
"(C) Bonds may be issued under provisions of this chapter without obtaining the consent or approval of the State or any political subdivision or any agency, commission, or instrumentality of them, but no joint system shall undertake any project required to be financed, in whole or in part, with the proceeds of bonds without the approval of the governing bodies of members as prescribed in Section 6-25-110."
Pledge of revenues authorized
SECTION 6. Section 6-25-113 of the 1976 Code is amended to read:
"Section 6-25-113. The bonds are special obligations of the joint system issuing them. The principal of, premium, if any, and interest on the bonds are not payable from the general funds of the joint system, nor do they constitute a legal or equitable pledge, charge, lien, or encumbrance upon any of its property or upon any of its income, receipts, or revenues, except the funds which are pledged under the resolution authorizing the bonds or the trust agreement securing the bonds. Neither the faith and credit nor the taxing power of the State or any municipality is, or may be, pledged for the payment of the principal of or interest on the bonds, and no holder of the bonds has the right to compel the exercise of the taxing power by the State or any municipality or the forfeiture of any of its property in connection with any default. However, the provisions of this section do not affect the ability of any member county or municipality from providing a pledge of all or part of any revenues derived as payments in lieu of taxes with respect to a project. Every bond must recite in substance that the principal of and interest on the bond is payable solely from the revenues and other funds pledged to its payment and that the joint system is not obligated to pay the principal or interest except from such revenues and funds so pledged."
Other available revenues may be pledged or paid
SECTION 7. Section 6-25-120 of the 1976 Code is amended to read:
"Section 6-25-120. In borrowing money or the issuance of bonds or notes, or other obligations, there may not be pledged the full faith, credit, or taxing power of any member of the joint system, but only revenues and
other funds available to the system must be used to pay or pledged to the payment of any notes, obligations, or bonds."
Payments from other sources of funds; no pledge of full faith and credit
SECTION 8. Section 6-25-128 of the 1976 Code is amended to read:
"Section 6-25-128. Any municipality may contract to buy from the joint system water required for its present or future requirements, including the capacity and output, or a portion or share of one or more specified projects. As the creation of a joint system is an alternative method whereby a municipality may obtain the benefits and assume the responsibilities of ownership in a project, any contract may provide that the municipality so contracting is obligated to make the payments required by the contract whether or not a project is completed, operable, or operating notwithstanding the suspension, interruption, interference, reduction, or curtailment of the output of a project or the water contracted for, and that the payments under the contract are not subject to any reduction, whether by offset or otherwise, and are not conditioned upon the performance or nonperformance of the joint system or any other members of the joint system under the contract or any other instrument. Any contract with respect to the sale or purchase of capacity or output, or a portion or share of them, of a project entered into between a joint system and its member municipalities may also provide that if one or more of the municipalities default in the payment of its or their obligations with respect to the purchase of the capacity or output, or a portion or share of them, in that event the remaining member municipalities which are purchasing capacity and output under the contract are required to accept and pay for and are entitled proportionately to and may use or otherwise dispose of the capacity or output which was to be purchased by the defaulting municipality.
Any contracts with respect to the sale or purchase of capacity and output from a project may extend for a period not exceeding fifty years from the date of the contract and may be renewable and extended upon terms as the parties may agree for not exceeding an additional fifty years; and the execution and effectiveness is not subject to any authorizations or approvals by the State or any agency, commission, or instrumentality or political subdivision of them.
Payments by a municipality under any contract for the purchase of capacity and output from a joint system may be made from the revenues derived from the ownership and operation of the water system of the municipality or from such other sources of funds as may be available, including any amounts received as payments in lieu of taxes. However, no municipality may pledge its full faith, credit, and taxing power to secure its obligations to the joint system or the bonds of the joint system. A municipality is obligated to fix, charge, and collect rents, rates, fees, and charges for water and other services, facilities, and commodities sold, furnished, or supplied through its water system sufficient to provide revenues adequate to meet its obligations under any contract and to pay any and all other amounts payable from or constituting a charge and lien upon the revenues, including amounts sufficient to pay the principal of and interest on general obligation bonds, if any, heretofore or hereafter issued by the municipality for purposes related to its water system.
Any municipality which is a member of a joint system may furnish the joint system with money derived from the ownership and operation of its water system or facilities and provide the joint system with personnel, equipment, and property, both real and personal, and from any other sources legally available to it for such purposes. Any municipality may also provide any services to a joint system.
Any member of a joint system may contract for, advance, or contribute funds derived from the ownership and operation of its water system or facilities or from any other sources legally available to it to a joint system as may be agreed upon by the joint system and the member, and the joint system shall repay the advances or contributions from the proceeds of bonds, from operation revenues, or from any other funds of the joint system, together with interest as may be agreed upon by the member and the joint system."
Time effective
SECTION 9. This act takes effect upon approval by the Governor.
Became law without the signature of the Governor -- 6/11/97.