2007 Legislation
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SENATE BILL NO. 1241 – Hwy projects, GARVEE bonds

SENATE BILL NO. 1241

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Bill Status



S1241............................................................by FINANCE
HIGHWAY PROJECTS - BONDING AUTHORITY - Approves the bonding authority for
the issuance of GARVEE bonds for highway transportation projects; states
legislative intent regarding obligations of future legislatures or
governors; provides a list of projects to be financed with bond proceeds;
provides intent regarding limiting the scope of transportation projects;
urges the Transportation Board and Idaho Transportation Department to
extend GARVEE Program Management Services Agreement; provides conditions
for issuance of GARVEE bonds; provides intent regarding the priority use of
bond revenue; provides intent regarding work performed by the Idaho
Transportation Department; authorizes the Idaho Transportation Board  to
adjust allocation of GARVEE bond proceeds among projects; authorizes a
transfer of funds; provides intent regarding a report to the Legislature;
and provides a date by which bonds shall be issued.
                                                                        
03/20    Senate intro - 1st rdg - to printing
03/21    Rpt prt - to Fin
    Rpt out - rec d/p - to 2nd rdg
03/22    Ret'd to Fin

Bill Text


                                                                        
                                                                        
  ]]]]              LEGISLATURE OF THE STATE OF IDAHO             ]]]]
 Fifty-ninth Legislature                  First Regular Session - 2007
                                                                        
                                                                        
                                       IN THE SENATE
                                                                        
                                    SENATE BILL NO. 1241
                                                                        
                                    BY FINANCE COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO HIGHWAY TRANSPORTATION PROJECTS; APPROVING  BONDING  AUTHORITY  TO
  3        FINANCE CERTAIN HIGHWAY TRANSPORTATION PROJECTS; PROVIDING A LIST OF HIGH-
  4        WAY  TRANSPORTATION  PROJECTS  TO BE FINANCED WITH BOND PROCEEDS; LIMITING
  5        THE SCOPE OF TRANSPORTATION PROJECTS; URGING THE TRANSPORTATION BOARD  AND
  6        TRANSPORTATION DEPARTMENT TO EXTEND THE GARVEE PROGRAM MANAGEMENT SERVICES
  7        AGREEMENT;  PROVIDING  CONDITIONS  FOR ISSUANCE OF GARVEE BONDS; PROVIDING
  8        LEGISLATIVE INTENT AS TO THE TRANSPORTATION BOARD'S PRIORITY USE  OF  BOND
  9        REVENUE;  PROVIDING  LEGISLATIVE  INTENT  REGARDING  WORK PERFORMED BY THE
 10        IDAHO TRANSPORTATION DEPARTMENT; PROVIDING LEGISLATIVE INTENT  AUTHORIZING
 11        THE  STATE  TRANSPORTATION  BOARD  TO  ADJUST ALLOCATION OF BOND PROCEEDS;
 12        AUTHORIZING A TRANSFER OF FUNDS FOR DEBT SERVICE;  PROVIDING  A  DATE  FOR
 13        SUBMISSION OF A REPORT TO THE LEGISLATURE; AND PROVIDING THAT BONDS AUTHO-
 14        RIZED BE ISSUED NO LATER THAN JUNE 30, 2008.
                                                                        
 15    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 16        SECTION  1.  The  Idaho  Legislature hereby approves bonding authority for
 17    the issuance of highway transportation (GARVEE) bonds by the Idaho Housing and
 18    Finance Association in a principal amount sufficient to  finance  the  highway
 19    transportation  projects  listed  in  Section 2 of this act in an amount up to
 20    $246,000,000. Such bonds are expected to be paid  from  continuing  appropria-
 21    tions  of  federal funds from the State Highway Account as provided in Section
 22    40-707, Idaho Code.
                                                                        
 23        SECTION 2.  The Legislature finds that the bonding authority  provided  in
 24    Section  1 of this act shall be used in a manner that does not obligate future
 25    legislatures or governors for additional bonding authority. The bonding autho-
 26    rized in Section 1 of this act shall be used to finance  the  following  proj-
 27    ects, providing the amounts listed below:
 28        (1)  US 95     GARWOOD TO SAGLE, KOOTENAI AND BONNER COUNTY...$ 23,000,000
 29        (2)  US 95     WORLEY NORTH, KOOTENAI COUNTY..................$ 12,000,000
 30        (3)  SH 16     JUNCTION I-84 TO IDAHO 44......................$ 17,000,000
 31        (4)   I-84     CALDWELL TO MERIDIAN...........................$126,000,000
 32        (5)   I-84     ORCHARD TO ISAACS CANYON.......................$ 28,000,000
 33        (6)  US 30     MCCAMMON TO LAVA HOT SPRINGS...................$ 40,000,000
                                                                        
 34        SECTION  3.  The  Idaho  Transportation Board and the Idaho Transportation
 35    Department are hereby directed to not increase the  scope,  nor  add  specific
 36    projects,  nor  in  any  manner  extend or enlarge the transportation projects
 37    listed in Section 2 of this act.
                                                                        
 38        SECTION 4.  For the purposes of the bonding authority provided in  Section
 39    1  of  this  act,  the Idaho Transportation Board and the Idaho Transportation
 40    Department are urged to establish an extension of the GARVEE  Program  Manage-
 41    ment  Services  Agreement for the bonding authority provided in Section 1, and
                                                                        
                                       2
                                                                        
  1    the project allocation described in Section 2 of this act.
                                                                        
  2        SECTION 5.  The bonds issued under the authority provided by Section 1  of
  3    this  act shall be issued upon an approved resolution by the Idaho Transporta-
  4    tion Board requesting the Idaho Housing and Finance Association to issue bonds
  5    in amounts necessary to ensure that: the funds are necessary to  meet  program
  6    obligation  requirements;  the  funds will be used and disbursed in accordance
  7    with United States  Treasury  regulations  to  ensure  tax  exempt  status  is
  8    retained;  and  the  bonds  are issued at prevailing market rates of interest.
  9    Further, it is the intent of the Legislature that the bonds authorized by  the
 10    authority  provided in Section 1 of this act be issued on an "as needed" basis
 11    as determined by the Idaho Transportation Board in  an  amount  approximately,
 12    but not mandatorily, one-half the total amount authorized. The purpose of this
 13    intent  is  to delay debt service on additional bonding until funds need to be
 14    obligated to pay for right-of-way acquisition, construction, and/or other nec-
 15    essary project-related costs and to avoid violation of  arbitrage  rules  that
 16    may  result  from issuance of bonds too far in advance of the need to obligate
 17    for expenditure. It is also the request of the Legislature that the obligation
 18    of previously issued bonds be the signal for an additional issuance with  such
 19    issuance  dependent upon advantageous market rates and costs of bonding trans-
 20    actions.
                                                                        
 21        SECTION 6.  It is legislative intent that the Idaho  Transportation  Board
 22    direct  the  use  of the revenue raised from the bonding authority provided in
 23    Section 1 of this act in such a manner that revenue shall  be  expended  in  a
 24    priority fashion and that the first priority of expenditures shall be for con-
 25    struction,  followed  in  order  of  priority by expenditures for right-of-way
 26    acquisition, followed in priority by other necessary project-related costs.
                                                                        
 27        SECTION 7.  Relating to the projects referenced in Section 2 of this  act,
 28    it is legislative intent that, to the extent feasible and practical, the Idaho
 29    Transportation  Department  perform project-related work within the department
 30    itself. The goal of this directive is to preserve the  expenditure  of  GARVEE
 31    funds for the priorities described in Section 6 of this act.
                                                                        
 32        SECTION  8.  It  is legislative intent that the Idaho Transportation Board
 33    has the authority to adjust GARVEE bond proceeds allocated among the  projects
 34    as listed in Section 2 of this act, provided that such an adjustment is neces-
 35    sary due to unanticipated reasons or circumstances or to accommodate federally
 36    approved alternative and innovative approaches to the overall project develop-
 37    ment  process;  and  provided  further  that no proceeds shall be used for any
 38    projects not listed in Section 2 of this act.
                                                                        
 39        SECTION 9.  The Idaho Transportation Board is hereby authorized to  trans-
 40    fer  up to $7,000,000 from within the State Highway Account to the GARVEE debt
 41    service fund to pay the state match as required for federal funds committed to
 42    pay the annual scheduled debt service on GARVEE bonds for fiscal year 2008.
                                                                        
 43        SECTION 10.  Notwithstanding any other provision of law, it is legislative
 44    intent that by September 30 of each year, the board shall submit a  report  to
 45    the  Legislature  concerning  projects  currently under construction using the
 46    bond financing as authorized by the provisions of this act, and shall  include
 47    a  list  of  planned  highway transportation projects to be financed with such
 48    bond financing during the next succeeding fiscal year.
                                                                        
                                       3
                                                                        
  1        SECTION 11.  The bonds described herein shall be issued no later than June
  2    30, 2008.

Statement of Purpose / Fiscal Impact


Statement of Purpose
RS17193

This bill provides bonding authority for the issuance of Grant Anticipation Revenue Vehicle (GARVEE) bonds in a principal amount to finance up to $246,000,000 for six highway transportation projects and allocates a specific amount for each project.

The bill also authorizes the transfer of up to $7,000,000 from the State Highway Account to provide the state match portion on bond debt service in fiscal year 2008. Legislative intent language authorizes the Transportation Board to adjust the allocated amounts among the listed six projects in certain situations. Intent language also directs that neither the Transportation Board nor the Transportation Department increase the size or scope of the projects listed nor add additional projects to the list. Intent language also urges the Board and the Department to establish an extension of the GARVEE program management agreement. Intent language also provides that bonds be issued upon an approved resolution by the Transportation Board requesting the Idaho Housing and Finance Association to issue the bonds in necessary amounts. Further, it is Legislative intent that the bonds be issued on an “as needed” basis as determined by the Transportation Board. Other intent sections provide that bond revenue be expended in a priority manner with the first priority being given to construction, followed in order of priority by right-of-way acquisition, and then other necessary project-related costs. Legislative intent also provides that, to the extent feasible and practical, the Transportation Department perform project-related work within the Department itself. Finally, Legislative intent provides for a report from the Transportation Board to the Legislature concerning GARVEE projects, with such report being submitted by September 30.

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Fiscal Note

This bill approves bonding authority for the issuance of Grant Anticipation Revenue Vehicle (GARVEE) bonds in a principal amount sufficient to finance six highway transportation projects in an amount up to $246,000,000. It also authorizes the transfer of up to $7,000,000 from the State Highway Account to pay the required state match for the fiscal year 2008 debt service on the GARVEE bonds authorized by the 2006 Legislature in House Bill 854.

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Contact: Eric Milstead 334-4746

Legislative Services Office, Budget & Policy Analysis

Statement of Purpose/Fiscal Note Bill No. S1241