View Bill Status
View Bill Text
View Statement of Purpose / Fiscal Impact
H0292.........................................by TRANSPORTATION AND DEFENSE
TRANSPORTATION - Adds to and amends existing law to provide that the Idaho
Housing and Finance Association may issue bonds or notes to finance state
transportation infrastructure projects that have been approved and
recommended by the Idaho Transportation Board and have been approved by the
germane transportation committees of the Legislature as satisfying a
substantial statewide interest; and to provide for repayment of the bonds,
interest and related costs using federal highway funds allocated annually
to the state of Idaho, providing that debt service does not exceed twenty
percent of anticipated annual revenues from federal highway transportation
funds.
03/03 House intro - 1st rdg - to printing
03/04 Rpt prt - to W/M
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 292
BY TRANSPORTATION AND DEFENSE COMMITTEE
1 AN ACT
2 RELATING TO TRANSPORTATION PROJECT FINANCING; AMENDING CHAPTER 1, TITLE 40,
3 IDAHO CODE, BY THE ADDITION OF A NEW SECTION 40-108, IDAHO CODE, TO DEFINE
4 "GARVEE"; AMENDING CHAPTER 3, TITLE 40, IDAHO CODE, BY THE ADDITION OF A
5 NEW SECTION 40-315, IDAHO CODE, TO SET FORTH POWERS AND DUTIES OF THE
6 IDAHO TRANSPORTATION BOARD RELATING TO FEDERALLY-FUNDED HIGHWAY PROJECT
7 FINANCING; AMENDING SECTION 40-702, IDAHO CODE, TO PROVIDE THAT THE STATE
8 HIGHWAY ACCOUNT SHALL INCLUDE CERTAIN FEDERAL SURFACE TRANSPORTATION
9 FUNDS; AMENDING SECTION 40-707, IDAHO CODE, TO PROVIDE FOR APPROPRIATION
10 OF FEDERAL SURFACE TRANSPORTATION MONEYS IN THE STATE HIGHWAY ACCOUNT;
11 AMENDING CHAPTER 7, TITLE 40, IDAHO CODE, BY THE ADDITION OF A NEW SECTION
12 40-718, IDAHO CODE, TO ESTABLISH THE GARVEE CAPITAL PROJECT FUND AND THE
13 GARVEE DEBT SERVICE FUND; AMENDING SECTION 67-6201, IDAHO CODE, TO EXPAND
14 THE PURPOSE OF THE IDAHO HOUSING AND FINANCE ASSOCIATION AND TO MAKE A
15 TECHNICAL CORRECTION; AMENDING SECTION 67-6205, IDAHO CODE, TO DEFINE THE
16 TERMS "MUNICIPALITY," "STATE," "STATE BODY," "TRANSPORTATION BOARD,"
17 "TRANSPORTATION DEPARTMENT" AND "TRANSPORTATION PROJECT"; AMENDING SECTION
18 67-6206, IDAHO CODE, TO PROVIDE ADDITIONAL POWERS OF THE IDAHO HOUSING AND
19 FINANCE ASSOCIATION; AMENDING SECTION 67-6210, IDAHO CODE, TO PROVIDE THAT
20 IDAHO TRANSPORTATION BOARD AND LEGISLATIVE APPROVAL AUTHORIZING NOTES OR
21 BONDS OR ANY ISSUE THEREOF MAY CONTAIN PROVISIONS WHICH SHALL BE PART OF A
22 CONTRACT, TO PROVIDE THAT THE ASSOCIATION SHALL NOT ISSUE BONDS OR NOTES
23 TO FINANCE TRANSPORTATION PROJECTS UNLESS CERTAIN CONDITIONS ARE MET AND
24 TO PLACE LIMITS ON REISSUE OF BONDS AND NOTES; PROVIDING SEVERABILITY; AND
25 DECLARING AN EMERGENCY.
26 Be It Enacted by the Legislature of the State of Idaho:
27 SECTION 1. That Chapter 1, Title 40, Idaho Code, be, and the same is
28 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
29 ignated as Section 40-108, Idaho Code, and to read as follows:
30 40-108. DEFINITIONS -- G.
31 (1) "GARVEE" means grant anticipation revenue vehicle, a debt financing
32 instrument which enables states to finance state transportation infrastructure
33 projects and to pay debt service and other bond-related expenses with future
34 federal-aid highway apportionments.
35 SECTION 2. That Chapter 3, Title 40, Idaho Code, be, and the same is
36 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
37 ignated as Section 40-315, Idaho Code, and to read as follows:
38 40-315. POWERS AND DUTIES -- FEDERALLY-FUNDED HIGHWAY PROJECT FINANCING.
39 In order to address the increasing need for timely improvements to Idaho's
40 highway transportation infrastructure, the board may:
41 (1) Enter into agreements with the Idaho housing and finance association
2
1 in connection with the funding of highway transportation projects qualifying
2 for reimbursement from federal funds.
3 (2) Approve and recommend federal highway transportation projects to the
4 Idaho housing and finance association for financing by the association. Such
5 federal highway transportation projects shall be eligible for federal-aid
6 debt financing under chapter 1, title 23, United States Code, and approval by
7 the federal highway administration as an advanced construction (AC) project
8 thereunder.
9 (3) Prior to issuance by the Idaho housing and finance association of any
10 bonds or notes to finance highway transportation projects, certify to the
11 association that sufficient federal transportation funds are available to make
12 any payments required for such bonds or notes. The board shall limit debt ser-
13 vice on federally-funded highway project financing to twenty percent (20%) of
14 anticipated annual revenues from federal transportation funds for highway
15 developments.
16 (4) Prior to issuance by the Idaho housing and finance association of any
17 bonds or notes to finance highway transportation projects, the board shall
18 present the project-specific proposal to a joint meeting of the house trans-
19 portation and defense committee and the senate transportation committee of the
20 legislature. Approval of the legislative committees must be established on the
21 issue of whether or not the project and the proposed bonding therefor, satisfy
22 the requirement for advancing a substantial statewide interest. With a quorum
23 from each committee in attendance, during a regular legislative session or a
24 special joint meeting of the two (2) germane transportation committees called
25 specifically for said purpose, legislative approval shall be by a majority of
26 votes cast by each committee in favor of a motion supporting the project-
27 specific, bond financing proposal of the Idaho transportation board on the
28 issue of whether or not a substantial statewide interest is satisfied. The
29 motion and the committees' vote on the motion shall be recorded in the minutes
30 of the meeting and shall serve to verify the committees' decision on whether
31 or not the proposed project advances a substantial statewide interest. The
32 board may present more than one (1) project and its related bonding proposal
33 at a joint meeting of the germane committees.
34 (5) No issue of bonds or notes by the Idaho housing and finance associa-
35 tion shall be reissued, extended, rewritten, or in any way altered from the
36 original issue unless both the board and the legislature have approved the
37 action. Legislative approval for the purpose of this subsection (5) shall be
38 by resolution duly passed by both houses of the legislature.
39 (6) By June 30 of each year, the board shall submit a report to the leg-
40 islature concerning projects currently under construction using the bond
41 financing as authorized by the provisions of this section. The board shall
42 annually certify that debt service does not exceed twenty percent (20%) of
43 anticipated annual revenues from federal transportation funds for highway
44 developments.
45 SECTION 3. That Section 40-702, Idaho Code, be, and the same is hereby
46 amended to read as follows:
47 40-702. STATE HIGHWAY ACCOUNT -- ESTABLISHMENT. For the purpose of carry-
48 ing out the provisions of this title, there is established in the dedicated
49 fund of the state treasury an account to be known as the state highway
50 account, which account shall include:
51 (1) All moneys received by the state treasurer for deposit to the state
52 highway account.
53 (2) All fines, penalties and forfeitures incurred and collected for
3
1 violations of the provisions of this title, except as otherwise provided.
2 (3) All donations to the state from any source for the construction and
3 improvement of highways.
4 (4) All moneys received from local boards under joint contracts for the
5 construction of state highways.
6 (5) All federal surface transportation funds received from the United
7 States government including, but not limited to, funds received pursuant to
8 chapter 1 of title 23, United States Code, for the national highway systems
9 program, the surface transportation program, the highway bridge program, the
10 minimum guarantee program, the federal lands highway program and other similar
11 programs under successor laws.
12 (6) Other moneys which may be provided by law for the construction and
13 improvement of state highways.
14 (67) Interest earned on the investment of idle moneys in the state high-
15 way account shall be paid to the state highway account.
16 SECTION 4. That Section 40-707, Idaho Code, be, and the same is hereby
17 amended to read as follows:
18 40-707. APPROPRIATION OF MONEYS IN STATE HIGHWAY ACCOUNT. (1) From fed-
19 eral funds in the state highway account, there are hereby continually allo-
20 cated and appropriated such amounts as from time to time shall be certified by
21 the Idaho housing and finance association as necessary for payment of princi-
22 pal, interest and other amounts required for transportation bonds or notes of
23 the Idaho housing and finance association in accordance with chapter 62, title
24 67, Idaho Code, which amounts shall be transferred to the GARVEE debt service
25 fund established in section 40-718, Idaho Code.
26 (2) Federal funds within the state highway account not needed for such
27 bonds or notes shall then be applied as set forth in subsection (3) of this
28 section. The board may, but is not obligated to, use any nonfederal funds in
29 the state highway account to pay any match as required for receipt of federal
30 funds and such match may include the payment of construction or financing
31 costs.
32 (3) One-half of one percent (.5%) of the moneys in the state highway
33 account may be utilized to encourage the use of recycled materials including,
34 but not limited to, recycled glass, reclaimed asphalt, asphalt containing
35 recycled plastic, recycled rubber tires and paper in highway construction and
36 maintenance projects. All other moneys at any time in the state highway
37 account, except those as are otherwise required by law to be placed in the
38 state highway redemption account, are hereby appropriated for the purpose of
39 defraying the expenses, debts and costs incurred in carrying out the powers
40 and duties of the highway board as provided by law, and for defraying adminis-
41 trative expenses of the department, including salaries of the board, the sal-
42 ary of the director, and salaries and wages of employees of the department and
43 board and expenses for traveling. Communication supplies, equipment, fixed
44 charges and all other necessary expenses of the department and board, not
45 otherwise provided for and all claims against the state highway account shall
46 be examined by the department and certified to the state controller, who
47 shall, upon approval of the board of examiners, draw his warrant against the
48 state highway account for all bills and claims allowed by the board.
49 SECTION 5. That Chapter 7, Title 40, Idaho Code, be, and the same is
50 hereby amended by the addition thereto of a NEW SECTION, to be known and des-
51 ignated as Section 40-718, Idaho Code, and to read as follows:
4
1 40-718. GARVEE FUNDS ESTABLISHED -- CAPITAL PROJECT FUND -- DEBT SERVICE
2 FUND. (1) There is established in the state treasury a fund known as the
3 "GARVEE Capital Project Fund" which shall include:
4 (a) Any draw by the board of proceeds from the transportation bonds or
5 notes issued by the Idaho housing and finance association in accordance
6 with chapter 62, title 67, Idaho Code.
7 (b) Interest earned on the investment of idle moneys in the GARVEE capi-
8 tal project fund shall be paid to the GARVEE capital project fund.
9 Disbursements from this fund shall be made for projects in accordance with
10 chapter 3, title 40, Idaho Code. All moneys in the fund are hereby continually
11 appropriated to the department.
12 (2) There is established in the state treasury a fund known as the
13 "GARVEE Debt Service Fund" for the purpose of paying the principal, interest
14 and other amounts required for transportation bonds or notes of the Idaho
15 housing and finance association in accordance with chapter 62, title 67, Idaho
16 Code. The fund shall include:
17 (a) Amounts transferred from the state highway account upon certification
18 by the Idaho housing and finance association to the state controller,
19 state treasurer and the board as necessary for payment of principal,
20 interest and other amounts required for transportation bonds or notes.
21 (b) Interest earned on the investment of idle moneys in the GARVEE debt
22 service fund shall be paid to the GARVEE debt service fund.
23 Disbursements from this fund shall be made for the payment of principal,
24 interest and other amounts required for transportation bonds or notes. All
25 moneys in the fund are hereby continually appropriated to the department.
26 SECTION 6. That Section 67-6201, Idaho Code, be, and the same is hereby
27 amended to read as follows:
28 67-6201. PURPOSE. It is hereby declared:
29 (a) That within the state there is a shortage of safe or sanitary dwell-
30 ing accommodations available which persons of low incomes can afford and that
31 such persons are forced to occupy overcrowded and congested dwelling accommo-
32 dations; that the aforesaid conditions cause an increase in and spread of dis-
33 ease and crime, and constitute a menace to the health, safety, morals and wel-
34 fare of the residents of the state and impair economic values; that these con-
35 ditions necessitate excessive and disproportionate expenditures of public
36 funds for crime prevention and punishment, public health and safety, fire and
37 accident protection, and other public services and facilities.
38 (b) That private enterprise has not been able to provide, without assis-
39 tance, an adequate supply of safe and sanitary dwellings at prices or rents
40 which persons and families of low income can afford, or to achieve rehabilita-
41 tion of much of the present low-income housing. It is imperative that the sup-
42 ply of housing for persons and families of low income be increased and that
43 coordination and cooperation among private enterprise, state and local govern-
44 ment be encouraged to sponsor, build and rehabilitate residential housing for
45 such persons and families.
46 (c) That the clearance, replanning and reconstruction of the areas in
47 which unsanitary or unsafe housing conditions exist, and the providing of safe
48 and sanitary dwelling accommodations for persons of low incomes (which
49 dwelling-accommodations need not be solely for persons of low incomes in
50 order to avoid concentrations of such persons in specific localities), are
51 public uses, and uses and purposes for which public money may be spent and
52 private property acquired, and are governmental functions.
53 (d) It is also declared and the legislature hereby finds that charitable,
5
1 educational, human service, cultural and other purposes pursued by nonprofit
2 corporations are important public functions and public purposes that should be
3 encouraged and that financing of nonprofit facilities for these purposes
4 should be encouraged, without using state funds or lending the credit of the
5 state, through the issuance of nonrecourse revenue bonds and the lending of
6 the proceeds thereof to nonprofit corporations to promote their purposes.
7 (e) It is further declared that in this state:
8 (1) There exists an inadequate supply of funds at interest rates suffi-
9 ciently low to enable persons engaged in agriculture in this state, par-
10 ticularly beginning farmers and ranchers, to pursue agricultural opera-
11 tions at present levels;
12 (2) That such inability to pursue agricultural operations lessens reduces
13 the supply of agricultural commodities available to fulfill the needs of
14 the citizens of this state;
15 (3) That such inability to continue operations decreases available
16 employment in the agricultural sector of the state and results in unem-
17 ployment and its attendant problems;
18 (4) That such conditions prevent the acquisition of an adequate capital
19 stock of farm and ranch equipment and machinery, therefore impairing the
20 productivity of agricultural land;
21 (5) That such conditions are conducive to consolidation of acreage of
22 agricultural land with fewer individuals living and farming and ranching
23 on the traditional family farm and ranch;
24 (6) That these conditions result in a loss in population, unemployment
25 and movement of persons from rural to urban areas accompanied by added
26 costs to communities for creation of new public facilities and services;
27 (7) That there have been recurrent shortages of funds from private market
28 sources at reasonable rates of interest;
29 (8) That these shortages have made the sale and purchase of agricultural
30 land to beginning farmers and ranchers a virtual impossibility in many
31 parts of the state;
32 (9) That the ordinary operations of private enterprise have not in the
33 past corrected these conditions; and
34 (10) That a stable supply of adequate funds for agricultural financing is
35 required to encourage beginning farmers and ranchers in an orderly and
36 sustained manner and to reduce the problems described herein.
37 (f) It is hereby further declared that:
38 (1) The growth of the economy of this state has prompted new and ever-
39 increasing uses of public highways, roads, and other transportation infra-
40 structure, and that the existing transportation infrastructure of this
41 state and its municipalities cannot adequately accommodate such greatly
42 increased uses;
43 (2) One (1) of the major concerns of the citizens of this state is the
44 ability of the state and its municipalities to address the long-term
45 transportation infrastructure needs of this state and its municipalities
46 that are critical to the continued growth of the state's economy and the
47 maintenance of citizens' quality of life;
48 (3) Utilizing bonds or notes to finance projects for transportation in-
49 frastructure results in significant cost savings to the state and its
50 municipalities, since such transportation projects can be completed at
51 present day costs and at an accelerated pace, but such bonds and notes
52 need to be issued promptly in order to realize these cost savings; and
53 (4) It is reasonable and necessary to utilize such bonds or notes for the
54 financing of transportation projects which meet criteria for advancing a
55 substantial statewide interest. To safeguard substantial statewide inter-
6
1 est, such interest shall be determined by the affirmative action of the
2 germane legislative committees pursuant to section 40-315, Idaho Code.
3 (g) It is hereby further declared that all of the foregoing are public
4 purposes and uses for which public moneys may be borrowed, expended or granted
5 and that such activities are governmental functions and serve a public purpose
6 in improving or otherwise benefiting the people of this state; that the neces-
7 sity of enacting the provisions hereinafter set forth is in the public inter-
8 est and is hereby so declared as a matter of express legislative determina-
9 tion.
10 SECTION 7. That Section 67-6205, Idaho Code, be, and the same is hereby
11 amended to read as follows:
12 67-6205. DEFINITIONS. The following terms, wherever used or referred to
13 in this chapter, shall have the following respective meanings, unless a dif-
14 ferent meaning clearly appears from the context:
15 (a) "Association" or "housing association" shall mean the Idaho housing
16 and finance association created by section 67-6202, Idaho Code.
17 (b) "Housing project" shall mean any work or undertaking:
18 (1) To demolish, clear or remove buildings from any slum area; such work
19 or undertaking may embrace the adoption of such area to public purposes,
20 including parks or other recreational or community purposes; or
21 (2) To construct, sell, lease, finance, improve, operate or otherwise
22 provide decent, safe and sanitary urban or rural dwellings, apartments or
23 other living accommodations for persons of low income; such work or under-
24 taking may include buildings, land, equipment, facilities and other real
25 or personal property which are necessary, convenient or desirable appurte-
26 nances, such as, but not limited to, streets, sewers, water service,
27 parks, site preparation, gardening, administrative, community, health,
28 recreational, and welfare or other purposes; or
29 (3) To accomplish a combination of the foregoing. The term "housing proj-
30 ect" also may be applied to the planning of the buildings and improve-
31 ments, for either single or multi-family housing, the acquisition of prop-
32 erty, the demolition of existing structures, the construction, reconstruc-
33 tion, rehabilitation, alteration and repair of the buildings and improve-
34 ments and all other work in connection therewith.
35 (c) "Governing body" shall mean the city council, board of commissioners,
36 board of trustees or other body having charge of the locality in which the
37 association desires to undertake a housing project.
38 (d) "Federal government" shall include the United States of America, or
39 any other agency or instrumentality, corporate or otherwise, of the United
40 States of America.
41 (e) "City" shall mean any city in the state of Idaho, including each city
42 having a special charter.
43 (f) "County" or "counties" shall include all counties in the state of
44 Idaho as designated in chapter 1, title 31, Idaho Code.
45 (g) "Clerk" shall mean the clerk of the city or county as the case may be
46 or the officer charged with the duties customarily imposed on such clerk.
47 (h) "Area of operation" shall mean the state of Idaho.
48 (i) "Slum" shall mean any area where dwellings predominate which, by rea-
49 son of dilapidation, overcrowding, lack of ventilation, light or sanitary
50 facilities or any combination of these factors, are detrimental to safety,
51 health or morals.
52 (j) "Person of low-income" means persons deemed by the association,
53 including those defined as "elderly" in the United States Housing Act of 1937
7
1 [42 U.S.C., sec. 1437--1437dd], as amended, to require assistance available
2 under this act on account of insufficient personal or family income, to pay
3 the rents or carrying charges required by the unaided operation of private
4 enterprise in providing an adequate supply of decent, safe and sanitary hous-
5 ing and in making such determination the association shall take into consider-
6 ation, without limitation, such factors as:
7 (1) The amount of the total income of such persons available for housing
8 needs;
9 (2) The size of the family;
10 (3) The cost and condition of housing facilities available;
11 (4) Standards established for various federal programs determining eligi-
12 bility based on income of such persons; and
13 (5) The ability of such persons to compete successfully in the normal
14 housing market and to pay the amounts at which private enterprise is pro-
15 viding decent, safe and sanitary housing.
16 (k) "Bonds," "notes" or "bond anticipation notes," and "obligations"
17 shall mean any bonds, notes, interim certificates, debentures or other evi-
18 dences of financial indebtedness issued by the association pursuant to this
19 chapter.
20 (l) "Real property" shall include all lands, including improvements and
21 fixtures thereon, and property of any nature, appurtenant thereto, or used in
22 connection therewith, and every estate, interest and right, legal or equita-
23 ble, therein, including terms for years and liens by way of judgment, mortgage
24 or otherwise and the indebtedness secured by such liens.
25 (m) "Housing authority" or "authority" means a housing authority estab-
26 lished pursuant to the "housing authorities and cooperation law" constituting
27 chapter 19, title 50, Idaho Code.
28 (n) "Rent" shall mean the periodic payment made by a person of low-income
29 in a housing project whether such money is being used as rent, or for the
30 development of equity by such person.
31 (o) "Interim financing" means a short-term construction loan for planning
32 and/or development of residential housing for persons of low-income and other
33 persons which loan shall run until financing can be assumed through other fed-
34 eral, state or private financing.
35 (p) "Housing sponsor" means individuals, joint ventures, partnerships,
36 limited partnerships, public bodies, trusts, firms, associations, or other
37 legal entities or any combination thereof, and corporations, cooperatives, and
38 condominiums, approved by the association as qualified either to own, con-
39 struct, acquire, rehabilitate, operate, manage or maintain a housing project,
40 subject to the regulatory powers of the association and other terms and condi-
41 tions set forth in this chapter. A "housing sponsor" shall be either a
42 "limited profit" sponsor or a "nonprofit" sponsor.
43 (q) "Mortgage lender" means any bank or trust company, savings bank,
44 mortgage company, mortgage banker, credit union, national banking associa-
45 tion, savings and loan association, building and loan association, life insur-
46 ance company, and any other financial institution authorized to transact busi-
47 ness in the state.
48 (r) "Mortgage loan" means an interest-bearing obligation secured by a
49 deed of trust, a mortgage, bond, note, or other instrument which is a lien on
50 property in the state except in the case of loans insured by the federal hous-
51 ing administration or the association and which are made for the rehabilita-
52 tion or improvement of existing dwellings; in such case the loans need not be
53 secured by an instrument constituting a lien on property in the state.
54 (s) "Mixed income housing project" means a housing project which contains
55 dwellings occupied or to be occupied by persons of low-income constituting at
8
1 least twenty percent (20%) of such occupancy.
2 (t) "Facilities" means land, rights in land, buildings, structures,
3 equipment, landscaping, utilities, approaches, roadways and parking, handling
4 and storage areas, and portions of any of the foregoing and similar ancillary
5 facilities.
6 (u) "Nonprofit corporation" means a nonprofit corporation organized and
7 operating in accordance with Idaho law or a nonprofit corporation organized
8 and operating in accordance with comparable laws within another state or ter-
9 ritory of the United States.
10 (v) "Nonprofit facilities" means facilities owned or used by a nonprofit
11 corporation for a nonprofit purpose of the corporation; provided that facili-
12 ties for health facilities which may be funded pursuant to chapter 14, title
13 39, Idaho Code, shall not be included in this definition, except for such
14 health facilities as may be specifically approved by the Idaho health facili-
15 ties authority. Facilities owned or used, consistent with its nonprofit pur-
16 pose, by a nonprofit corporation recognized by a state institution of higher
17 education as its college or university foundation shall be considered non-
18 profit facilities under this chapter.
19 (w) "Project costs of a nonprofit facility" means costs of:
20 (1) Acquisition, construction and improvement of any facilities included
21 in a nonprofit facility;
22 (2) Architectural, engineering, consulting, accounting and legal costs
23 related directly to the development, financing and construction of a non-
24 profit facility, including costs of studies assessing the feasibility of a
25 nonprofit facility;
26 (3) Finance costs, including discounts, if any, the costs of issuing
27 bonds, and costs incurred in carrying out any provisions thereof;
28 (4) Interest during construction and during the six (6) months after
29 estimated completion of construction, and capitalized debt service or
30 repair and replacement or other appropriate reserves;
31 (5) The refunding of any outstanding obligations incurred for any of the
32 costs outlined in this subsection; and
33 (6) Other costs incidental to any of the costs listed in this section.
34 (x) "Agricultural facility or facilities" means land, any building or
35 other improvement thereon or thereto, to be owned by a beginning farmer or
36 rancher and any personal properties deemed necessary or suitable for use,
37 whether or not now in existence in farming or ranching, the production of
38 agricultural commodities, including, without limitation, the products of aqua-
39 culture, hydroponics and silviculture, or the treating, processing or storing
40 of such agricultural commodities when such activities are customarily engaged
41 in by beginning farmers or ranchers as a part of farming or ranching.
42 (y) "Municipality" means any county, municipal corporation, highway dis-
43 trict, taxing district or other political subdivision of this state having
44 charge of the locality in which the association desires to undertake a trans-
45 portation project.
46 (z) "State" means the state of Idaho.
47 (aa) "State body" means any department, board, commission or agency of the
48 state of Idaho.
49 (bb) "Transportation board" means the Idaho transportation board and its
50 successors.
51 (cc) "Transportation department" means the Idaho transportation department
52 and its successors.
53 (dd) "Transportation project" means any transportation infrastructure
54 project including, without limitation, a road, street, parkway, right-of-way,
55 bridge, railroad crossing, drainage structure, sign, guardrail structure,
9
1 interstate, surface, resurface, shoulder, roadside, or any other work, and any
2 planning development, management and construction related thereto, all as
3 approved or recommended to the association by the transportation board.
4 SECTION 8. That Section 67-6206, Idaho Code, be, and the same is hereby
5 amended to read as follows:
6 67-6206. POWERS OF ASSOCIATION. The housing and finance association is an
7 independent public body corporate and politic, exercising public and essential
8 governmental functions, and having all the powers which are hereby declared to
9 be public purposes necessary or convenient to carry out and effectuate the
10 purposes and provisions of this act, including the following powers in addi-
11 tion to others herein granted:
12 (a) To sue and to be sued; to have a seal and to alter the same at pleas-
13 ure; to have perpetual succession; to make and execute contracts and other
14 instruments necessary or convenient to the exercise of the powers of the asso-
15 ciation; and to make and from time to time amend and repeal bylaws, rules, not
16 inconsistent with this act, to carry into effect the powers and purposes of
17 the association.
18 (b) To conduct its operations within any or all of the counties of the
19 state.
20 (c) To cooperate with housing authorities throughout Idaho in the devel-
21 opment of housing projects.
22 (d) To assign priorities for action and revise or modify said priorities
23 from time to time.
24 (e) To make and execute agreements, contracts and other instruments nec-
25 essary or convenient in the exercise of the powers and functions of the asso-
26 ciation under this act, including contracts with any housing sponsor, mortgage
27 lender, person, firm, corporation, governmental agency, or other entity; and
28 to include in any contract let in connection with a project, stipulations
29 requiring that the contractor and any subcontractors comply with requirements
30 as to minimum wages and maximum hours of labor, and comply with any conditions
31 which the federal government may have attached to its financial aid of the
32 project and to designate mortgage lenders to act for and in behalf of the
33 association, with respect to originating or servicing and processing mortgage
34 loans of the association, and to pay the reasonable value of service rendered
35 to the association by such mortgage lenders pursuant to contracts with mort-
36 gage lenders.
37 (f) To lease, sell, construct, finance, reconstruct, restore, rehabili-
38 tate, operate or rent any housing projects, nonprofit facilities or any dwell-
39 ings, houses, accommodations, lands, buildings, structures or facilities
40 embraced in any housing project or nonprofit facilities and, subject to the
41 limitations contained in this act, to establish and revise the rents or
42 charges therefor.
43 (g) To own, hold and improve real or personal property; to purchase,
44 lease, obtain options upon, acquire by gift, grant, bequest, devise, eminent
45 domain or otherwise, any real or personal property or any interest therein.
46 (h) To acquire any real property; to sell, lease, exchange, transfer,
47 assign, pledge or dispose of any real or personal property or any interest
48 therein.
49 (i) To insure or provide for the insurance of any real or personal prop-
50 erty or operation of the association against any risks or hazards, and to pro-
51 cure or agree to the procurement of insurance or guarantees from the federal
52 government or other source for the payment or purchase of any bonds or parts
53 thereof issued by the association, including the power to pay for any such
10
1 insurance or guarantees.
2 (j) To invest any funds held in reserves or sinking funds, or any funds
3 not required for immediate disbursement, in property or securities in which a
4 bank, as defined in the "bank act," title 26, Idaho Code, may legally invest
5 funds including without limitation, to agree to purchase the obligations of
6 any federal, state or local government upon such conditions as the association
7 may determine to be prudent and in its best interest.
8 (k) Within its area of operation: to investigate into living, dwelling
9 and housing conditions and into the means and methods of improving such condi-
10 tions; to determine where slum areas exist or where there is a shortage of
11 adequate, safe and sanitary dwelling accommodations for persons of low-income;
12 to make studies and recommendations relating to the problem of clearing,
13 replanning and reconstruction of slum areas and the problem of providing
14 dwelling accommodations for persons of low-income, and to cooperate with the
15 city, the county, the state or any political subdivision thereof in action
16 taken in connection with such problems; and to engage in research, studies and
17 experimentation on the subject of housing.
18 (l) To participate in cooperative ventures with any agencies, organiza-
19 tions and individuals in order to undertake the provision of housing for per-
20 sons of low-income, to undertake the provision of nonprofit facilities or
21 agricultural facilities.
22 (m) To provide research and technical assistance to eligible agencies,
23 organizations and individuals eligible to develop low cost housing and to
24 research new low cost housing development and construction methods.
25 (n) To make and undertake commitments to make or participate in the mak-
26 ing of mortgage loans to persons of low-income and to housing sponsors,
27 including without limitation federally insured mortgage loans, and to make
28 temporary loans and advances in anticipation of permanent loans to housing
29 sponsors; said mortgage loans to housing sponsors shall be made to finance the
30 construction, improvement, or rehabilitation of housing projects for persons
31 of low-income, and/or mixed income housing projects upon the terms and condi-
32 tions set forth in this act; provided, however, that such loans shall be made
33 only upon the determination by the association that mortgage loans are not
34 otherwise available, wholly or in part, from private lenders upon reasonably
35 equivalent terms and conditions.
36 (o) To purchase, or make commitments to purchase or participate in the
37 purchase of mortgage loans from mortgage lenders which loans have been made
38 for the construction, improvement, or rehabilitation of housing projects for
39 persons of low-income and/or mixed income housing projects or loans which have
40 been made to persons of low-income for residential housing, upon terms set
41 forth in this act; provided, however, that any such purchase shall be made
42 only upon the determination by the association that the mortgage loans to be
43 made are not otherwise being made by mortgage lenders upon reasonably equiva-
44 lent terms and conditions. Also, to purchase, or make commitments to purchase
45 or participate in the purchase of mortgage loans from mortgage lenders whether
46 or not said loans were made to persons of low-income, upon terms set forth in
47 this act; provided, however, that the proceeds from such purchase or the
48 equivalent thereof shall be reinvested in obligations of the association, in
49 mortgage loans to persons of low-income or in mortgage loans for housing proj-
50 ects for persons of low-income and/or mixed income housing projects, and pro-
51 vided that any such purchase shall be made only upon the determination by the
52 association that the mortgage loans to be made are not otherwise being made by
53 mortgage lenders upon reasonably equivalent terms and conditions.
54 (p) To provide interim financing for housing projects including mixed
55 income housing projects approved by the association, provided that the associ-
11
1 ation has determined that such financing is not otherwise available from mort-
2 gage lenders upon reasonably equivalent terms and conditions.
3 (q) To prescribe rules and policies in connection with the performance of
4 its functions and duties.
5 (r) To do all other things deemed necessary and desirable to accomplish
6 the objectives of this act.
7 (s) To borrow money and issue bonds and notes or other obligations, to
8 invest the proceeds thereof in any lawful manner and to fund or refund the
9 same, and to provide for the rights of the holders of its obligations as pro-
10 vided in this act and in connection therewith, to waive, by resolution or
11 other document of the association, the exemption from federal income taxation
12 of interest on any of the association's obligations under existing or future
13 federal law and to establish, maintain and preserve the association's general
14 obligation rating and any rating on its bonds, notes or other obligations.
15 (t) To receive and accept aid or contributions from any source.
16 (u) To employ architects, engineers, attorneys, accountants, housing con-
17 struction and financial experts and such other advisors, consultants and
18 agents as may be necessary in its judgment and to fix their compensation.
19 (v) To insure mortgage payments of any mortgage loan made for the purpose
20 of constructing, rehabilitating, purchasing, leasing, or refinancing housing
21 projects upon such terms and conditions as the association may prescribe.
22 (w) To fix and revise from time to time and charge and collect fees and
23 charges in connection with loans made or other services provided by the asso-
24 ciation pursuant to this act, and to make and publish rules respecting the
25 making and purchase of mortgage loans.
26 (x) To organize a nonprofit corporation to assist the association in pro-
27 viding for housing projects.
28 (y) To enter upon and inspect any housing project, including housing
29 projects undertaken by housing sponsors, for the purpose of investigating the
30 physical and financial condition thereof, and its construction, rehabilita-
31 tion, operation, management and maintenance, and to examine all books and
32 records with respect to capitalization, income and other matters relating
33 thereto.
34 (z) To order such alterations, changes or repairs as may be necessary to
35 protect the security of its investment in a housing project or the health,
36 safety, and welfare of the occupants thereof.
37 (aa) To make or purchase secured loans for the purpose of providing tempo-
38 rary or permanent financing or refinancing of all or part of the project costs
39 of any nonprofit facility or agricultural facility, including the refunding
40 of any outstanding obligations, mortgages or advances issued, made or given by
41 any person for the project costs of a nonprofit facility or agricultural
42 facility; and to charge and collect interest on the loans for the loan pay-
43 ments upon such terms and conditions, including without limitation bond rating
44 and issuance conditions, as the board of commissioners considers advisable
45 which are not in conflict with this chapter.
46 (bb) As security for the payment of the principal of and interest on any
47 revenue bonds issued and any agreements made in connection therewith, to mort-
48 gage, pledge, or otherwise encumber any or all of nonprofit facilities or
49 agricultural facilities or any part or parts thereof, whether then owned or
50 thereafter acquired, and to assign any mortgage and repledge any security con-
51 veyed to the association, to secure any loan made by the association and to
52 pledge the revenues and receipts therefrom.
53 (cc) To issue bonds for the purpose of financing all or part of the proj-
54 ect cost on any nonprofit facility or agricultural facility and to secure the
55 payment of the bonds as provided in this chapter.
12
1 (dd) To purchase or sell by installment contract or otherwise, and convey
2 all or any part of any nonprofit facility or agricultural facility for such
3 purchase price and upon such terms and conditions as this board of commission-
4 ers considers advisable which are not in conflict with this chapter.
5 (ee) To lease all or any part of any nonprofit facility or agricultural
6 facility for such rentals and upon such terms and conditions, including
7 options to purchase, as the board of commissioners considers advisable and not
8 in conflict with this chapter.
9 (ff) To construct and maintain one (1) or more nonprofit facilities or
10 agricultural facilities, provided that the association shall not operate any
11 nonprofit facility or agricultural facility as a business other than as les-
12 sor, seller or lender. The purchase, holding and enforcing of mortgages, deeds
13 of trust, or other security interests and contracting for any servicing
14 thereof is not considered the operation of a nonprofit facility or agricul-
15 tural facility as a business.
16 (gg) To act as the designated housing resource clearinghouse in the state
17 for matters relating to affordable housing.
18 (hh) To coordinate the development and maintenance of a housing policy for
19 the state.
20 (ii) To enter into agreements or other transactions and accept grants,
21 reimbursements or other payments, with the cooperation of the United States or
22 any agency thereof or of the state of Idaho or any agency thereof or munici-
23 pality of the state in furtherance of the purposes of this chapter, including,
24 but not limited to, the development, maintenance, operation and financing of
25 any transportation project and to do any and all things necessary in order to
26 avail the association of such aid and cooperation.
27 (jj) To borrow money and issue bonds and notes or other evidences of
28 indebtedness thereof not exceeding a maturity date of eighteen (18) years to
29 finance transportation projects approved and recommended by the Idaho trans-
30 portation board and approved by the germane committees of the legislature as
31 advancing a substantial statewide interest.
32 SECTION 9. That Section 67-6210, Idaho Code, be, and the same is hereby
33 amended to read as follows:
34 67-6210. POWER TO ISSUE BONDS. The association shall have power and is
35 hereby authorized to issue, from time to time, its negotiable notes and bonds
36 in conformity with the applicable provisions of the uniform commercial code
37 in such principal amount as the association shall determine to be necessary
38 for sufficient funds for achieving any of its corporate purposes, including
39 the payment of interest on notes and bonds of the association, establishment
40 of reserves to secure such notes and bonds, and all other expenditures of the
41 association incidental and necessary or convenient to carry out its corporate
42 purposes and powers; provided, however, that the association shall provide in
43 its resolution authorizing such bonds that all revenues received by the asso-
44 ciation as a result of the issuance of such bonds shall be pledged first to
45 the payment of principal and interest on such bonds.
46 (a) The association shall have the power, from time to time, to issue:
47 (1) notes to renew notes and
48 (2) bonds to pay notes, including the interest thereon, and
49 (3) whenever it deems refunding expedient, to refund any bonds by the
50 issuance of new bonds, whether the bonds to be refunded have or have not
51 matured, and to issue bonds partly to refund bonds then outstanding and
52 partly for any of its corporate purposes.
53 The refunding bonds may be:
13
1 (1) exchanged for the bonds to be refunded or
2 (2) sold and the proceeds applied to the purchase, redemption or payment
3 of such bonds.
4 (b) Except as may otherwise be expressly provided by the association,
5 every issue of its notes and bonds shall be payable exclusively from the reve-
6 nues or income of the association, including grants and contributions from the
7 United States of America, subject only to any agreements with the holders of
8 particular notes or bonds pledging any particular revenues.
9 (c) The notes and bonds shall be authorized by resolution or resolutions
10 of the association, shall bear such date or dates and shall mature at such
11 time or times as such resolution or resolutions may provide. The bonds may be
12 issued as serial bonds payable in annual installments or as term bonds or as a
13 combination thereof. The notes and bonds shall bear interest at such rate or
14 rates, be in such denominations, be in such form, either coupon or registered,
15 carry such registration privileges, be executed in such manner, be payable in
16 such medium of payment, at such place or places, and be subject to such terms
17 of redemption as such resolution or resolutions may provide. The notes and
18 bonds of the association may be sold by the association, at public or private
19 sale, at such price or prices as the association shall determine.
20 (d) Any resolution or resolutions or Idaho transportation board and leg-
21 islative approval pursuant to section 40-315, Idaho Code, authorizing any
22 notes or bonds or any issue thereof may contain provisions, which shall be a
23 part of the contract or contracts with the holders thereof, as to:
24 (1) pledging all or any part of the revenues to secure the payment of the
25 notes or bonds or of any issue thereof, subject to such agreements with
26 noteholders or bondholders as may then exist;
27 (2) pledging all or any part of the assets of the association including
28 mortgages and obligations securing the same, to secure the payment of the
29 notes or bonds or of any issue of notes or bonds, subject to such agree-
30 ments with noteholders or bondholders as may then exist;
31 (3) the use and disposition of the gross income from mortgages owned by
32 the association and payment of principal of mortgages owned by the associ-
33 ation;
34 (4) the setting aside of reserves or sinking funds and the regulation and
35 disposition thereof;
36 (5) limitations on the purpose to which the proceeds of sale of notes or
37 bonds may be applied and pledging such proceeds to secure the payment of
38 the notes or bonds or of any issue thereof;
39 (6) limitations on the issuance of additional notes or bonds; the terms
40 upon which additional notes or bonds may be issued and secured; and the
41 refunding of outstanding or other notes or bonds;
42 (7) the procedure, if any, by which the terms of any contract with
43 noteholders or bondholders may be amended or abrogated, the amount of
44 notes or bonds the holders of which must consent thereto; and the manner
45 in which such consent may be given;
46 (8) limitations on the amount of moneys to be expended by the association
47 for operating expenses of the association;
48 (9) vesting in a trustee or trustees such property, rights, powers and
49 duties in trust as the association may determine, which may include any or
50 all of the rights, powers and duties of the trustee appointed by the bond-
51 holders pursuant to this act; and limiting or abrogating the right of the
52 bondholders to appoint a trustee under this act, or limiting the rights,
53 powers and duties of such trustee;
54 (10) defining the acts or omissions to act which shall constitute a
55 default in the obligations and duties of the association to the holders of
14
1 the notes or bonds and providing for the rights and remedies of the hold-
2 ers of the notes or bonds in the event of such default, including as a
3 matter of right the appointment of a receiver; provided, however, that
4 such rights and remedies shall not be inconsistent with the general laws
5 of the state and the other provisions of this act;
6 (11) pledging all or any part of funds allocated to the association under
7 Idaho law or other revenues or the proceeds of notes or bonds to secure
8 the payment of notes or bonds issued to finance transportation projects,
9 subject to such agreements with noteholders or bondholders as may then
10 exist;
11 (12) setting forth the provisions for any contracts relating to its bonds
12 or notes including, without limitation, any investment or interest rate
13 contracts, or any contract providing for a credit enhancement, including,
14 but not limited to, letters of credit, bond insurance and surety bonds
15 provided by private financial institutions;
16 (13) setting forth the provisions for representations or certifications to
17 be made by an officer of the association with respect to funds to be allo-
18 cated to the association for transportation projects and provisions for
19 the disbursements of the proceeds of the bonds or notes for payment of the
20 costs of a transportation project, costs of issuance and other related
21 costs;
22 (14) any other matters, of like or different character, which in any way
23 affect the security or protection of the holders of the notes or bonds.
24 (e) Any pledge made by the association shall be valid and binding from
25 the time when the pledge is made; the revenues, moneys or property so pledged
26 and thereafter received by the association shall immediately be subject to the
27 lien of such pledge without any physical delivery thereof or further act, and
28 the lien of any such pledge shall be valid and binding as against all parties
29 having claims of any kind in tort, contract or otherwise against the associa-
30 tion, irrespective of whether such parties have notice thereof. Neither the
31 resolution nor any other instrument by which a pledge is created need be
32 recorded.
33 (f) Neither the commissioners of the association nor any other person
34 executing such notes or bonds shall be subject to any personal liability or
35 accountability by reason of the issuance thereof.
36 (g) The association, subject to such agreements with noteholders or bond-
37 holders as may then exist, shall have power out of any funds available there-
38 for to purchase notes or bonds of the association, which shall thereupon be
39 canceled, at a price not exceeding:
40 (1) if the notes or bonds are then redeemable, the redemption price then
41 applicable plus accrued interest to the next interest payment thereon, or
42 (2) if the notes or bonds are not then redeemable, the redemption price
43 applicable on the first date after such purchase upon which the notes or
44 bonds become subject to redemption plus accrued interest to such date.
45 (h) In the discretion of the association, the bonds may be secured by a
46 trust indenture by and between the association and a corporate trustee, which
47 may be any trust company or bank having the power of a trust company in the
48 state. Such trust indenture may contain such provisions for protecting and
49 enforcing the rights and remedies of the bondholders as may be reasonable and
50 proper and not in violation of law, including covenants setting forth the
51 duties of the association in relation to the exercise of its corporate powers
52 and the custody, safeguarding and application of all moneys. The association
53 may provide by such trust indenture for the payment of the proceeds of the
54 bonds and the revenues to the trustee under such trust indenture or other
55 depository, and for the method of disbursement thereof, with such safeguards
15
1 and restrictions as it may determine. All expenses incurred in carrying out
2 such trust indenture may be treated as a part of the operating expenses of the
3 association. If the bonds shall be secured by a trust indenture, the bondhold-
4 ers shall have no authority to appoint a separate trustee to represent them.
5 (i) Whether or not the notes and bonds are of such form and character as
6 to be negotiable instruments under the terms of the uniform commercial code,
7 the notes and bonds are hereby made negotiable instruments within the meaning
8 of and for all the purposes of the uniform commercial code, subject only to
9 the provisions of the notes and bonds for registration.
10 (j) In case any of the commissioners or officers of the association whose
11 signatures appear on any notes or bonds or coupons shall cease to be such com-
12 missioners or officers before the delivery of such notes or bonds, such signa-
13 tures shall, nevertheless, be valid and sufficient for all purposes, the same
14 as if such commissioners or officers had remained in office until such deliv-
15 ery.
16 (k) The association shall not issue any bonds or notes to finance trans-
17 portation projects unless:
18 (1) both the Idaho transportation board and the germane committees of the
19 legislature have approved and recommended the transportation projects for
20 financing through the association;
21 (2) the Idaho transportation board has certified to the association that
22 sufficient funds are available to make the payments required for the bonds
23 or notes to be issued to finance the transportation projects and that the
24 debt service for federally-funded highway project financing does not
25 exceed twenty percent (20%) of anticipated annual revenues from federal
26 transportation funds for highway developments; and
27 (3) the association and the Idaho transportation board have entered into
28 an agreement for the association to provide financing of the transporta-
29 tion projects.
30 (l) The association shall not reissue, extend, rewrite, or in any way
31 alter the original issue of bonds or notes which provide financing of trans-
32 portation projects unless both the Idaho transportation board and the legisla-
33 ture have approved the action.
34 SECTION 10. SEVERABILITY. The provisions of this act are hereby declared
35 to be severable and if any provision of this act or the application of such
36 provision to any person or circumstance is declared invalid for any reason,
37 such declaration shall not affect the validity of the remaining portions of
38 this act.
39 SECTION 11. An emergency existing therefor, which emergency is hereby
40 declared to exist, this act shall be in full force and effect on and after its
41 passage and approval.
STATEMENT OF PURPOSE
RS15069
This legislation would amend various sections of Title 40, Chapter 3,
Idaho Code, Title 40, Chapter 7, Idaho Code, and Title 67, Chapter 62,
Idaho Code, to allow the Idaho Transportation Board, with concurrence
of the House and Senate Transportation committees, the authority to
use federal-aid highway funds to pay the principal, interest, and
other costs associated with borrowing by the State to finance specific
eligible highway projects. The board may select and designate
transportation project to be funded with bond proceeds and present the
proposal to the joint transportation committees. After approval by a
majority of both committees, the requirement for "substantial
statewide interest" is deemed to have been satisfied and the board may
proceed with bonding through the Idaho Housing Finance Association.
A 1995 federal law (Title 23, US Code, Section 122) allows states to
use their apportioned federal-aid funds as a debt-financing instrument
known as "GARVEE" (Grant Anticipation Revenue Vehicle) Bonds.
The term of most bonds will likely be eighteen years and eighteen
years is the limit without extension authorized by consent of the
Legislature. At current municipal interest rates, Idaho receives
approximately $220 million a year from federal fuel tax revenues.
Bonding shall be designed so that debt service shall not exceed 20
percent of the annual allocation of Federal funds to Idaho for highway
development.
The Idaho Housing Finance Association (IHFA) is authorized in this
legislation to issue the bonds approved by the Board as well as manage
the issuance and servicing of the bonds. IHFA has in-house the
trained personnel and systems needed to handle this work. This
legislation amends the IHFA enabling statute to authorize its
participation.
FISCAL NOTE
This legislation increases no taxes. It is anticipated that the
bonding debt service would require the dedication in a range of 10 to
20 percent of the department's total annual budget in the peak year of
debt service. Delaying construction of needed road infrastructure
projects generally results in substantially higher project costs, due
to inflation in construction costs and right-of-way acquisitions.
These savings, by accelerated construction, must be weighted against
the cost of debt service, administration of the bonds, and bond
counsel costs.
Contact
Name: Rep. Leon Smith
Phone: 332-1000
STATEMENT OF PURPOSE/FISCAL NOTE H 292