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S1157aa....................................by LOCAL GOVERNMENT AND TAXATION
SCHOOL DISTRICTS - BONDS - Amends existing law to delete the requirement
that school district bonds be issued within two years from the date of the
bond election; to provide that school bonds may be sold at public or
private sale; and to authorize the sale of school bonds by electronic
bidding.
02/12 Senate intro - 1st rdg - to printing
02/13 Rpt prt - to Loc Gov
02/20 Rpt out - rec d/p - to 2nd rdg
02/21 2nd rdg - to 3rd rdg
02/26 Recommitted to Loc Gov
03/02 Rpt out - to 14th Ord
03/08 Rpt out amen - to engros
03/09 Rpt engros - 1st rdg - to 2nd rdg as amen
03/12 2nd rdg - to 3rd rdg as amen
03/13 3rd rdg as amen - PASSED - 29-1-5
AYES -- Andreason, Boatright, Bunderson, Burtenshaw, Cameron,
Danielson, Darrington, Davis, Deide, Dunklin, Frasure, Geddes,
Goedde, Ingram, Ipsen, Keough, King-Barrutia, Lodge, Noh, Richardson,
Risch, Sandy, Schroeder, Sorensen, Stegner, Stennett, Thorne,
Wheeler, Whitworth
NAYS -- Bartlett(Branch)
Absent and excused -- Brandt, Hawkins, Lee, Sims, Williams
Floor Sponsor -- Thorne
Title apvd - to House
03/14 House intro - 1st rdg - to Rev/Tax
03/20 Rpt out - rec d/p - to 2nd rdg as amen
03/21 2nd rdg - to 3rd rdg as amen
03/26 3rd rdg as amen - PASSED - 67-0-3
AYES -- Barraclough, Barrett, Bedke, Bell, Bieter, Black, Boe, Bolz,
Bruneel, Callister, Campbell, Chase, Clark, Collins, Crow, Cuddy,
Deal, Denney, Ellis, Ellsworth, Eskridge, Field(13), Field(20),
Gagner, Gould, Hadley, Hammond, Hansen, Harwood, Henbest(Farley),
Higgins, Hornbeck, Jaquet, Jones, Kellogg, Kendell, Kunz, Lake,
Langford, Loertscher, Mader, Marley, McKague, Meyer, Montgomery,
Mortensen, Moss, Moyle, Pearce, Pomeroy, Raybould, Ridinger, Roberts,
Robison, Sali, Schaefer, Sellman, Shepherd, Smith, Smylie, Stevenson,
Stone, Tilman, Trail, Wood, Young, Mr. Speaker
NAYS -- None
Absent and excused -- Bradford, Pischner, Wheeler
Floor Sponsor -- Raybould
Title apvd - to Senate
03/28 To enrol
Rpt enrol - Pres signed
03/29 Sp signed - to Governor
04/04 Governor signed
Session Law Chapter 336
Effective: 04/04/01
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature First Regular Session - 2001
IN THE SENATE
SENATE BILL NO. 1157
BY LOCAL GOVERNMENT AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO SCHOOL DISTRICT BONDS; AMENDING SECTION 33-1103, IDAHO CODE, TO
3 STRIKE THE REQUIREMENT THAT BONDS BE ISSUED WITHIN TWO YEARS FROM THE DATE
4 OF THE BOND ELECTION AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION
5 33-1111, IDAHO CODE, TO PROVIDE THAT SCHOOL BONDS MAY BE SOLD AT PUBLIC OR
6 PRIVATE SALE AND TO AUTHORIZE THE SALE OF SCHOOL BONDS BY ELECTRONIC BID-
7 DING; AND DECLARING AN EMERGENCY.
8 Be It Enacted by the Legislature of the State of Idaho:
9 SECTION 1. That Section 33-1103, Idaho Code, be, and the same is hereby
10 amended to read as follows:
11 33-1103. DEFINITIONS -- BONDS -- LIMITATION ON AMOUNT -- ELECTIONS TO
12 AUTHORIZE ISSUANCE. For the purposes of this chapter the following definitions
13 shall have the meanings specified: "Market value for assessment purposes"
14 means the amount of the last preceding equalized assessment of all taxable
15 property within the school district on the tax rolls completed and available
16 as of the date of approval by the electorate in the school bond election.
17 "Aggregate outstanding indebtedness" means the total sum of unredeemed out-
18 standing bonds, minus all moneys in the bond interest and redemption fund or
19 funds accumulated for the redemption of such outstanding bonds, and minus the
20 sum of all taxes levied for the redemption of such bonds, with the exception
21 of that portion of such tax levies required for the payment of interest on
22 bonds, which taxes remain uncollected. "Issue," "issued," or "issuance" means
23 a formal delivery of bonds to any purchaser thereof and payment therefor to
24 the school district.
25 The board of trustees of any school district, upon approval of a majority
26 thereof, may submit to the qualified school district electors of the district
27 the question as to whether the board shall be empowered to issue negotiable
28 coupon bonds of the district in an amount and for a period of time to be named
29 in the notice of election.
30 An elementary school district which employs not less than six (6) teach-
31 ers, or a school district operating an elementary school or schools, and a
32 secondary school or schools, or issuing bonds for the acquisition of a second-
33 ary school or schools, may issue bonds in an amount not to exceed five per
34 centum percent (5%) of the market value for assessment purposes thereof, less
35 the aggregate outstanding indebtedness; and no other school district shall
36 issue bonds in an amount to exceed at any time two per centum percent (2%) of
37 the market value for assessment purposes thereof less the aggregate outstand-
38 ing indebtedness. The market value for assessment purposes, the aggregate out-
39 standing indebtedness and the unexhausted debt-incurring power of the district
40 shall each be determined as of the date of approval by the electors in the
41 school bond election.
42 Notice of the bond election shall be given, the election shall be con-
43 ducted and the returns thereof canvassed, and the qualifications of electors
2
1 voting or offering to vote shall be, as provided in sections 33-401 -- through
2 33-406, Idaho Code.
3 The question shall be approved only if the percentage of votes cast at
4 such election were cast in favor thereof is that which now, or may hereafter
5 be, set by the Cconstitution of the Sstate of Idaho. Upon such approval of the
6 issuance of bonds, the same may be issued at any time within two (2) years
7 from after the date of such election.
8 SECTION 2. That Section 33-1111, Idaho Code, be, and the same is hereby
9 amended to read as follows:
10 33-1111. SALE OF BONDS. School bonds may be sold at private sale, as pro-
11 vided in section 57-232, Idaho Code, or may be sold at public sale as herein-
12 after provided.
13 If the bonds are sold at public sale tThe board of trustees shall give
14 notice of its intent to sell a bond issue.
15 The notice shall be published once in a newspaper published in this state,
16 at least one (1) week prior to the day bids are opened. Said notice shall
17 describe the issue of bonds; shall state that the board of trustees will
18 receive sealed bids until a specified day and hour; and that said bids will be
19 opened at a regular or special meeting of the board at a time and place to be
20 named in the notice. Said notice may require such deposits of forfeits as the
21 board may deem necessary.
22 At the meeting held at the time and place named in the notice, the board
23 of trustees shall open the bids, and may sell the same to whomever shall make
24 the bid most advantageous to the school district, and the deposits of the
25 unsuccessful bidders shall thereupon be returned to them. Should the success-
26 ful bidder fail or refuse to tender payment of the amount required for the
27 purchase of the issue within ten (10) days after tender to him of the executed
28 bonds and a certified copy of the bond proceedings, his deposit shall be for-
29 feited; and the board may in its judgment accept the bid next most advanta-
30 geous, or readvertise the issue as before, or sell the bonds at private sale.
31 The board of trustees may reject any or all bids, and sell the bonds at
32 private sale when this is found to be in the best interest of the district.
33 In lieu of receiving sealed bids, the board of trustees may provide for
34 the public sale of bonds by electronic bidding as provided in section 57-233,
35 Idaho Code.
36 No school bond shall at any time be sold at less than its par value.
37 SECTION 3. An emergency existing therefor, which emergency is hereby
38 declared to exist, this act shall be in full force and effect on and after its
39 passage and approval.
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature First Regular Session - 2001
Moved by Thorne
Seconded by Ipsen
IN THE SENATE
SENATE AMENDMENT TO S.B. NO. 1157
1 AMENDMENTS TO SECTION 2
2 On page 2 of the printed bill, in line 11, following "Code," insert:
3 "after notice as hereinafter provided,"; and following line 12, insert:
4 "If bonds are sold at private sale, notice of the intention to sell such
5 bonds at private sale shall be published once in the name of the issuer in a
6 newspaper of general circulation within the issuer's boundaries at least three
7 (3) days prior to the time scheduled by the issuer for approving the private
8 sale of such bonds. Failure to comply with this requirement shall not invali-
9 date the sale of the bonds, so long as the issuer has made a good faith effort
10 to comply.".
|||| LEGISLATURE OF THE STATE OF IDAHO ||||
Fifty-sixth Legislature First Regular Session - 2001
IN THE SENATE
SENATE BILL NO. 1157, As Amended
BY LOCAL GOVERNMENT AND TAXATION COMMITTEE
1 AN ACT
2 RELATING TO SCHOOL DISTRICT BONDS; AMENDING SECTION 33-1103, IDAHO CODE, TO
3 STRIKE THE REQUIREMENT THAT BONDS BE ISSUED WITHIN TWO YEARS FROM THE DATE
4 OF THE BOND ELECTION AND TO MAKE TECHNICAL CORRECTIONS; AMENDING SECTION
5 33-1111, IDAHO CODE, TO PROVIDE THAT SCHOOL BONDS MAY BE SOLD AT PUBLIC OR
6 PRIVATE SALE AND TO AUTHORIZE THE SALE OF SCHOOL BONDS BY ELECTRONIC BID-
7 DING; AND DECLARING AN EMERGENCY.
8 Be It Enacted by the Legislature of the State of Idaho:
9 SECTION 1. That Section 33-1103, Idaho Code, be, and the same is hereby
10 amended to read as follows:
11 33-1103. DEFINITIONS -- BONDS -- LIMITATION ON AMOUNT -- ELECTIONS TO
12 AUTHORIZE ISSUANCE. For the purposes of this chapter the following definitions
13 shall have the meanings specified: "Market value for assessment purposes"
14 means the amount of the last preceding equalized assessment of all taxable
15 property within the school district on the tax rolls completed and available
16 as of the date of approval by the electorate in the school bond election.
17 "Aggregate outstanding indebtedness" means the total sum of unredeemed out-
18 standing bonds, minus all moneys in the bond interest and redemption fund or
19 funds accumulated for the redemption of such outstanding bonds, and minus the
20 sum of all taxes levied for the redemption of such bonds, with the exception
21 of that portion of such tax levies required for the payment of interest on
22 bonds, which taxes remain uncollected. "Issue," "issued," or "issuance" means
23 a formal delivery of bonds to any purchaser thereof and payment therefor to
24 the school district.
25 The board of trustees of any school district, upon approval of a majority
26 thereof, may submit to the qualified school district electors of the district
27 the question as to whether the board shall be empowered to issue negotiable
28 coupon bonds of the district in an amount and for a period of time to be named
29 in the notice of election.
30 An elementary school district which employs not less than six (6) teach-
31 ers, or a school district operating an elementary school or schools, and a
32 secondary school or schools, or issuing bonds for the acquisition of a second-
33 ary school or schools, may issue bonds in an amount not to exceed five per
34 centum percent (5%) of the market value for assessment purposes thereof, less
35 the aggregate outstanding indebtedness; and no other school district shall
36 issue bonds in an amount to exceed at any time two per centum percent (2%) of
37 the market value for assessment purposes thereof less the aggregate outstand-
38 ing indebtedness. The market value for assessment purposes, the aggregate out-
39 standing indebtedness and the unexhausted debt-incurring power of the district
40 shall each be determined as of the date of approval by the electors in the
41 school bond election.
42 Notice of the bond election shall be given, the election shall be con-
43 ducted and the returns thereof canvassed, and the qualifications of electors
2
1 voting or offering to vote shall be, as provided in sections 33-401 -- through
2 33-406, Idaho Code.
3 The question shall be approved only if the percentage of votes cast at
4 such election were cast in favor thereof is that which now, or may hereafter
5 be, set by the Cconstitution of the Sstate of Idaho. Upon such approval of the
6 issuance of bonds, the same may be issued at any time within two (2) years
7 from after the date of such election.
8 SECTION 2. That Section 33-1111, Idaho Code, be, and the same is hereby
9 amended to read as follows:
10 33-1111. SALE OF BONDS. School bonds may be sold at private sale, as pro-
11 vided in section 57-232, Idaho Code, after notice as hereinafter provided, or
12 may be sold at public sale as hereinafter provided.
13 If bonds are sold at private sale, notice of the intention to sell such
14 bonds at private sale shall be published once in the name of the issuer in a
15 newspaper of general circulation within the issuer's boundaries at least three
16 (3) days prior to the time scheduled by the issuer for approving the private
17 sale of such bonds. Failure to comply with this requirement shall not invali-
18 date the sale of the bonds, so long as the issuer has made a good faith effort
19 to comply.
20 If the bonds are sold at public sale tThe board of trustees shall give
21 notice of its intent to sell a bond issue.
22 The notice shall be published once in a newspaper published in this state,
23 at least one (1) week prior to the day bids are opened. Said notice shall
24 describe the issue of bonds; shall state that the board of trustees will
25 receive sealed bids until a specified day and hour; and that said bids will be
26 opened at a regular or special meeting of the board at a time and place to be
27 named in the notice. Said notice may require such deposits of forfeits as the
28 board may deem necessary.
29 At the meeting held at the time and place named in the notice, the board
30 of trustees shall open the bids, and may sell the same to whomever shall make
31 the bid most advantageous to the school district, and the deposits of the
32 unsuccessful bidders shall thereupon be returned to them. Should the success-
33 ful bidder fail or refuse to tender payment of the amount required for the
34 purchase of the issue within ten (10) days after tender to him of the executed
35 bonds and a certified copy of the bond proceedings, his deposit shall be for-
36 feited; and the board may in its judgment accept the bid next most advanta-
37 geous, or readvertise the issue as before, or sell the bonds at private sale.
38 The board of trustees may reject any or all bids, and sell the bonds at
39 private sale when this is found to be in the best interest of the district.
40 In lieu of receiving sealed bids, the board of trustees may provide for
41 the public sale of bonds by electronic bidding as provided in section 57-233,
42 Idaho Code.
43 No school bond shall at any time be sold at less than its par value.
44 SECTION 3. An emergency existing therefor, which emergency is hereby
45 declared to exist, this act shall be in full force and effect on and after its
46 passage and approval.
STATEMENT OF PURPOSE
RS 11013
Idaho law currently requires that all school district general
obligation bonds be sold at competitive bid sale. Cities and some other local government entities may sell revenue bonds at
negotiated sale, and State agencies such as the State Treasurer, the Student Loan Fund, Housing Agency, Water Resources, etc., are permitted to negotiate their bond issues.
The purpose of the proposed legislation is to add a marketing
option to school districts. School districts are currently
compelled to offer their bonds at public auction. In today s
marketplace of volatile interest rates, picking a date to hold an auction of bonds can arbitrarily subject the entity to market swings of 50 basis points or more (Note: 100 basis points equals one percent) . The only recourse currently available to the unit of local government is to reject all bids and in some cases negotiate, or readvertise for bids with the same delay and the same risk in arbitrarily picking another date. In addition, competitive bid sale is inappropriate for the recently-authorized Qualified Zone Academy Bonds, which do not bear interest.
The legislation also authorizes competitive sale by electronic bidding as another option for school districts.
FISCAL IMPACT
None to the General Fund, but may result in savings to local taxpayers.
Contact
Name: Barbara Strickfaden
Idaho Bankers Association
Phone: 208 342 8282
STATEMENT OF PURPOSE/FISCAL NOTE S 115