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| To enact section 3345.55 of the Revised Code to | 1 |
| permit the board of trustees of a state | 2 |
| institution of higher education to enter into an | 3 |
| agreement to convey certain property to a conduit | 4 |
| entity which will enter into a lease-leaseback | 5 |
| arrangement with an independent funding source. | 6 |
| Section 1. That section 3345.55 of the Revised Code be | 7 |
| enacted to read as follows: | 8 |
| Section 3345.55. (A) As used in this section: | 9 |
| (1) "Auxiliary facilities" has the same meaning as in section | 10 |
| 3345.12 of the Revised Code. | 11 |
| (2) "Conduit entity" means an organization described in | 12 |
| section 501(c)(3) of the Internal Revenue Code qualified as a | 13 |
| public charity under section 509(a)(2) or 509(a)(3) of the | 14 |
| Internal Revenue Code, whose corporate purpose allows it to | 15 |
| perform the functions and obligations of a conduit entity pursuant | 16 |
| to the terms of a financing agreement. | 17 |
| (3) "Conveyed property" means auxiliary facilities conveyed | 18 |
| by a state institution to a conduit entity pursuant to a financing | 19 |
| agreement. | 20 |
| (4) "Financing agreement" means a contract described in | 21 |
| division (C) of this section. | 22 |
| (5) "Independent funding source" means a private entity that | 23 |
| enters into a financing agreement with a conduit entity and a | 24 |
| state institution. | 25 |
| (6) "State institution" means a state institution of higher | 26 |
| education as defined in section 3345.011 of the Revised Code. | 27 |
| (B) The board of trustees of a state institution, with the | 28 |
| approval of the chancellor of the Ohio board of regents and the | 29 |
| controlling board, may enter into a financing agreement with a | 30 |
| conduit entity and an independent funding source selected either | 31 |
| through a competitive selection process or by direct negotiations, | 32 |
| and may convey to the conduit entity title to any auxiliary | 33 |
| facilities owned by the state institution pursuant to the terms of | 34 |
| a financing agreement. | 35 |
| (C) A financing agreement under this section is a written | 36 |
| contract entered into among a state institution, a conduit entity, | 37 |
| and an independent funding source that provides for: | 38 |
| (1) The conveyance of auxiliary facilities owned by a state | 39 |
| institution to the conduit entity for consideration deemed | 40 |
| adequate by the state institution; | 41 |
| (2) The lease of the conveyed property by the conduit entity | 42 |
| to the independent funding source and leaseback of the conveyed | 43 |
| property to the conduit entity for a term not to exceed | 44 |
| ninety-nine years; | 45 |
| (3) Such other terms and conditions that may be negotiated | 46 |
| and agreed upon by the parties, including, but not limited to, | 47 |
| terms regarding: | 48 |
| (a) Payment to the state institution by the conduit entity of | 49 |
| revenues received by it from the operations of the conveyed | 50 |
| property in excess of the payments it is required to make to the | 51 |
| independent funding source under the lease-leaseback arrangement | 52 |
| described in division (C)(2) of this section. | 53 |
| (b) Pledge, assignment, or creation of a lien in favor of the | 54 |
| independent funding source by the conduit entity of any revenues | 55 |
| derived from the conveyed property. | 56 |
| (c) Reverter or conveyance of title to the conveyed property | 57 |
| to the state institution when the conveyed property is no longer | 58 |
| subject to a lease with the independent funding source. | 59 |
| (4) Terms and conditions required by the chancellor or the | 60 |
| controlling board as a condition of approval of the financing | 61 |
| agreement. | 62 |
| (D) The state institution and the conduit entity may enter | 63 |
| into such other management agreements or other contracts regarding | 64 |
| the conveyed property the parties deem appropriate, including | 65 |
| agreements pursuant to which the state institution may maintain or | 66 |
| administer the conveyed property and collect and disburse revenues | 67 |
| from the conveyed property on behalf of the conduit entity. | 68 |
| (E) The parties may modify or extend the term of the | 69 |
| financing agreement with the approval of the chancellor and the | 70 |
| controlling board. | 71 |
| (F) The conveyed property shall retain its exemption from | 72 |
| property taxes and assessments as though title to the conveyed | 73 |
| property were held by the state institution during any part of a | 74 |
| tax year that title is held by the state institution or the | 75 |
| conduit entity and, if held by the conduit entity, remains subject | 76 |
| to the lease-leaseback arrangement described in division (C)(2) of | 77 |
| this section. However, as a condition of the continued exemption | 78 |
| of the conveyed property during the term of the lease-leaseback | 79 |
| arrangement the conduit entity shall apply for and maintain the | 80 |
| exemption as provided by law. | 81 |
| (G) Nothing in this section is intended to abrogate, amend, | 82 |
| limit, or replace any existing authority state institutions may | 83 |
| have with respect to the conveyance, lease, lease-leaseback, | 84 |
| finance, or acquisition of auxiliary facilities including, but not | 85 |
| limited to, authority granted under sections 3345.07, 3345.11, and | 86 |
| 3345.12 of the Revised Code. | 87 |