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As Passed by the Senate
123rd General Assembly
Regular Session
1999-2000 | Am. S. B. No. 206 |
SENATORS CARNES-RAY-CUPP-WATTS-PRENTISS-OELSLAGER-BLESSING-
GARDNER-MUMPER-SPADA-ESPY
A BILL
To provide for the implementation of Sections 2n and 17 of Article
VIII of the Constitution of the State of Ohio, to make an
appropriation, and to declare an emergency.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. (A) As used in this section and in the applicable
bond proceedings unless otherwise provided:
(1) "Bond proceedings" means the orders, resolutions, agreements, and
credit enhancement facilities, and amendments and supplements to
them, or any one or more or combination of them, authorizing,
awarding, or providing for the terms and conditions applicable to
or providing for the security or liquidity of, obligations, and
the provisions contained in those obligations.
(2) "Bond service fund" means the fund created by division (P) of
this section, and any accounts in that fund, including all moneys
and investments, and earnings from investments, credited and to be
credited to that fund and accounts as and to the extent provided
in the bond proceedings.
(3) "Capital facilities" means capital facilities that are
capital facilities for a system of common schools throughout the
state.
(4) "Costs of capital facilities" means the costs of acquiring,
constructing, reconstructing, rehabilitating, remodeling,
renovating, enlarging, improving, equipping, or furnishing capital
facilities, and of the financing of those costs. Costs of capital
facilities include without limitation the cost of clearance and
preparation of the site and of any land to be used in connection
with capital facilities, the cost of any indemnity and surety
bonds and premiums on insurance, all related direct administrative
expenses and allocable portions of direct costs of the state and
the using school district and the Ohio School Facilities
Commission, costs of engineering and architectural services,
designs, plans, specifications, surveys, and estimates of cost,
financing costs, interest on obligations from their date to the
time when interest is to be paid from sources other than proceeds
of obligations, amounts necessary to establish any reserves as
required by the bond proceedings, the reimbursement of all moneys
advanced or applied by or borrowed from the using school district
or any governmental agency for the payment of any item of costs of
capital facilities, and all other expenses necessary or incident
to planning or determining feasibility or practicability with
respect to capital facilities, and such other expenses as may be
necessary or incident to the acquisition, construction,
reconstruction, rehabilitation, remodeling, renovation,
enlargement, improvement, equipment, and furnishing of capital
facilities, the financing of those costs, and the placing of the
capital facilities in use and operation, including any one, part
of, or combination of those classes of costs and expenses.
(5) "Credit enhancement facilities," "financing costs," and
"interest" or "interest equivalent" have the same meanings as in
section 133.01 of the Revised Code.
(6) "Debt service" means principal, including any mandatory
sinking fund or redemption requirements for retirement of
obligations, interest and other accreted amounts, interest
equivalent, and any redemption premium, payable on obligations.
(7) "Issuing authority" means the Treasurer of State.
(8) "Net proceeds" means amounts received from the sale of
obligations, excluding: amounts used to refund or retire
outstanding obligations, amounts required to be deposited into
special funds pursuant to the applicable bond proceedings, and
amounts to be used to pay financing costs.
(9) "Net state lottery proceeds" means the amount determined by
the Director of Budget and Management to be an excess amount to
the credit of the State Lottery Fund and to be transferred to the
Lottery Profits Education Fund, and moneys from time to time in
the Lottery Profits Education Fund, all as provided for and
referred to in section 3770.06 of the Revised Code.
(10) "Obligations" means bonds, notes, or other evidences of
obligation of the state, including any appertaining interest
coupons, issued pursuant to this section.
(11) "Ohio School Facilities Commission" and "school district"
have the same meanings as in section 3318.01 of the Revised Code.
(12) "Principal amount" means the aggregate of the amount as
stated or provided for in the applicable bond proceedings as the
amount on which interest or interest equivalent on particular
obligations is initially calculated. Principal amount does not
include any premium paid to the state by the initial purchaser of
the obligations.
(13) "Special funds" or "funds," unless the context indicates
otherwise, means the bond service fund, and any other funds,
including any reserve funds, created under the bond proceedings
and stated to be special funds in those proceedings, including
moneys and investments, and earnings from investments, credited
and to be credited to the particular fund. Special funds do not
include the School Building Program Assistance Fund created by
section 3318.25 of the Revised Code, or other funds created by the
bond proceedings that are not stated by those proceedings to be
special funds.
(14) "Using school district" means the school district, or two or
more school districts acting jointly, that are the ultimate users
of the capital facilities financed with net proceeds.
(B) Subject to Sections 2n and 17 of Article VIII of the Ohio
Constitution, the state, by the issuing authority, is authorized
to issue and sell, as provided in this section and in an aggregate
principal amount not to exceed one hundred fifty million
dollars, general obligations of this state for the purpose of
paying costs of capital facilities.
(C) Each issue of obligations shall be authorized by resolution
or order of the issuing authority. The bond proceedings shall
provide for or authorize the manner for determining the principal
amount or maximum principal amount of obligations of an issue, the
principal maturity or maturities, the interest rate or rates, the
date of and the dates of payment of interest on the obligations,
their denominations, and the place or places of payment of debt
service which may be within or outside the state. The latest
principal maturity may not be later than the earlier of the
thirty-first day of December of the twenty-fifth calendar year
after the year of issuance of the particular obligations or of the
twenty-fifth calendar year after the year in which the original
obligation to pay was issued or entered into. Sections 9.96,
9.98, 9.981, 9.982, and 9.983 of the Revised Code apply to
obligations. The purpose of the obligations may be stated in the
bond proceedings in general terms, such as "paying costs of
capital facilities for a system of common schools throughout the state
as authorized by Section 2n of Article VIII of the Ohio Constitution."
(D) Net proceeds of obligations shall be deposited into the
School Building Program Assistance Fund created by section 3318.25
of the Revised Code.
(E) The issuing authority may appoint or provide for the
appointment of paying agents, bond registrars, securities
depositories, clearing corporations, and transfer agents, and may
retain the services of financial advisers and accounting experts,
and retain or contract for the services of marketing, remarketing,
indexing, and administrative agents, other consultants, and
independent contractors, including printing services, as are
necessary in the judgment of the issuing authority to carry out
this section. Financing costs are payable, as may be provided in
the bond proceedings, from the proceeds of the obligations, from
special funds, or from other moneys available for the purpose.
(F) The bond proceedings may contain additional provisions
customary or appropriate to the financing or to the obligations or
to particular obligations including, but not limited to,
provisions for:
(1) The redemption of obligations prior to maturity at the option
of the state or of the holder or upon the occurrence of certain
conditions, and at a particular price or prices and under particular
terms and conditions;
(2) The form of and other terms of the obligations;
(3) The establishment, deposit, investment, and application of
special funds, and the safeguarding of moneys on hand or on
deposit, in lieu of the applicability of provisions of Chapter
131. or 135. of the Revised Code, but subject to any special
provisions of this section with respect to the application of
particular funds or moneys. Any financial institution that acts
as a depository of any moneys in special funds or other funds
under the bond proceedings may furnish indemnifying bonds or
pledge securities as required by the issuing authority.
(4) Any or every provision of the bond proceedings being binding
upon the issuing authority and upon such using school district,
state agency, or government entity, officer, board, commission,
authority, agency, department, or other person or body as may from
time to time be authorized to take actions as may be necessary to
perform all or any part of the duty required by the provision;
(5) The maintenance of each pledge or instrument comprising part
of the bond proceedings until the state has fully paid or provided
for the payment of the debt service on the obligations or met
other stated conditions;
(6) In the event of default in any payments required to be made
by the bond proceedings, or by any other agreement of the issuing
authority made as part of a contract under which the obligations
were issued or secured, including a credit enhancement facility,
the enforcement of those payments by mandamus, suit in equity,
action at law, or any combination of those remedial actions;
(7) The rights and remedies of the holders or owners of
obligations or of book-entry interests in them, and of third
parties under any credit enhancement facility, and provisions for
protecting and enforcing those rights and remedies, including
limitations on rights of individual holders or owners;
(8) The replacement of mutilated, destroyed, lost, or stolen
obligations;
(9) The funding, refunding, or advance refunding, or other
provision for payment, of obligations that will then no longer be
outstanding for purposes of this section or of the applicable bond
proceedings;
(10) Amendment of the bond proceedings;
(11) Any other or additional agreements with the owners of
obligations, and such other provisions as the issuing authority
determines, including limitations, conditions, or qualifications,
relating to any of the foregoing.
(G) The Great Seal of the State or a facsimile of it may be
affixed to or printed on the obligations. The obligations
requiring execution by or for the issuing authority shall be
signed as provided in the bond proceedings. Any obligations may
be signed by the individual who on the date of execution is the
authorized signer although on the date of these obligations that
individual is not an authorized signer. In case the individual
whose signature or facsimile signature appears on any obligation
ceases to be an authorized signer before delivery of the
obligation, that signature or facsimile is nevertheless valid and
sufficient for all purposes as if that individual had remained the
authorized signer until delivery.
(H) Obligations are investment securities under Chapter 1308. of
the Revised Code. Obligations may be issued in bearer or in
registered form, registrable as to principal alone or as to both
principal and interest, or both, or in certificated or
uncertificated form, as the issuing authority determines.
Provision may be made for the exchange, conversion, or transfer of
obligations and for reasonable charges for registration, exchange,
conversion, and transfer. Pending preparation of final or definitive
obligations, the issuing authority may provide for the issuance of
temporary or interim instruments to be exchanged for the final or definitive
obligations.
(I) Obligations may be sold at public sale or at private sale,
and at such price at, above, or below par, all as provided by the
issuing authority in the bond proceedings.
(J) Except to the extent that rights are restricted by the bond
proceedings, any owner of obligations may by any suitable form of
legal proceedings protect and enforce any rights relating to
obligations under the laws of this state or granted by the bond
proceedings. Those rights include the right to compel the
performance of all applicable duties of the issuing authority and
the state. Each duty of the issuing authority and that
authority's officials, staff, and employees, and of each state
agency or using school district and its officers, members, staff,
or employees, undertaken pursuant to the bond proceedings, is
hereby established as a duty of the entity or individual having
authority to perform that duty, specifically enjoined by law and
resulting from an office, trust, or station within the meaning of
section 2731.01 of the Revised Code. The individuals who are from
time to time the issuing authority, or the issuing authority's
officials, staff, or employees, are not liable in their personal
capacities on any obligations or otherwise under the bond proceedings.
(K)(1) Subject to Sections 2n and 17 of Article VIII of the Ohio
Constitution and this section, the issuing authority may, in
addition to the authority provided in division (B) of this
section, authorize and provide for the issuance of obligations in
the form of bond anticipation notes, and may provide for the
renewal of those notes from time to time by the issuance of new
notes. The holders of notes or appertaining interest coupons have
the right to have debt service on those notes paid solely from the
moneys and special funds that are or may be pledged to that
payment, including the proceeds of bonds or renewal notes or both,
as the issuing authority provides in the bond proceedings
authorizing the notes. Notes may be additionally secured by
covenants of the issuing authority to the effect that the issuing
authority and the state will do all things necessary for the
issuance of bonds or renewal notes in such principal amount and
upon such terms as may be necessary to provide moneys to pay when
due the debt service on the notes, and apply their proceeds to the
extent necessary, to make full and timely payment of debt service
on the notes as provided in the applicable bond proceedings.
In the bond proceedings authorizing the issuance of bond
anticipation notes the issuing authority shall set forth for the
bonds anticipated an estimated schedule of annual principal
payments the latest of which shall be no later than provided in
division (C) of this section. While the notes are outstanding
there shall be deposited, as shall be provided in the bond
proceedings for those notes, from the sources authorized for
payment of debt service on the bonds, amounts sufficient to pay
the principal of the bonds anticipated as set forth in that
estimated schedule during the time the notes are outstanding,
which amounts shall be used solely to pay the principal of those
notes or of the bonds anticipated.
(2) Except as otherwise provided in this section, bonds or notes
authorized pursuant to division (K) of this section are subject to
the provisions of this section pertaining to obligations
generally.
(3) The principal amount of refunding or renewal obligations
issued pursuant to division (K) of this section shall be in
addition to the amount authorized by the General Assembly as
referred to in division (B) of this section, to the extent that
the principal amount of those obligations does not exceed the then
outstanding principal amount of the obligations they are to
refund, renew, or retire.
(L) Obligations are lawful investments for banks, savings and
loan associations, credit union share guaranty corporations, trust
companies, trustees, fiduciaries, insurance companies, including
domestic for life and domestic not for life, trustees or other
officers having charge of sinking and bond retirement or other
special funds of the state and political subdivisions and taxing
districts of this state, the Sinking Fund, the Administrator of
Workers' Compensation subject to the approval of the Workers'
Compensation Board, the State Teachers Retirement System, the
Public Employees Retirement System, the School Employees
Retirement System, and the Ohio Police and Fire Pension Fund,
notwithstanding any other provisions of the Revised Code or rules
adopted pursuant to those provisions by any state agency with
respect to investments by them, and are also acceptable as
security for the repayment of the deposit of public moneys.
(M) Unless otherwise provided or provided for in any applicable
bond proceedings, moneys to the credit of or in a special fund
shall be disbursed on the order of the issuing authority. No such
order is required for the payment, from the bond service fund or
other special fund, when due of debt service or required payments
under credit enhancement facilities.
(N) The full faith and credit, revenue, including net state
lottery proceeds, and taxing power of the state are and shall be
pledged to the timely payment of debt service on outstanding
obligations as it comes due, all in accordance with Section 2n of
Article VIII of the Ohio Constitution and this section. Moneys
referred to in Section 5a of Article XII of the Ohio Constitution
may not be pledged or used for the payment of debt service. The
state covenants, and that covenant shall be controlling
notwithstanding any other provision of law, that the state and the
applicable officers and agencies of the state, including the
General Assembly, shall, so long as any obligations are
outstanding in accordance with their terms, maintain statutory
authority for and cause to be levied, collected, and applied
sufficient pledged excises, taxes, and revenues of the state so
that those excises, taxes, and revenues shall be sufficient in amounts to pay
debt
service when due, to establish and maintain any reserves and other
requirements, and to pay financing costs, including costs of or
relating to credit enhancement facilities, all as provided for in
the bond proceedings.
Those excises, taxes, and revenues are and shall be deemed to be
levied and collected, in addition to the purposes otherwise
provided for by law, to provide for the payment of debt service
and financing costs in accordance with this section and the bond
proceedings.
Notwithstanding division (B) of section 3770.06 of the Revised
Code, whenever, in the judgment of the Director of Budget and
Management, an amount of net state lottery proceeds is necessary
to be applied to the payment of debt service on obligations, the
Director shall transfer that amount directly from the State
Lottery Fund or from the Lottery Profits Education Fund to the
bond service fund. The provisions of this paragraph are subject
to any prior pledges or obligation of those amounts to the payment
of bond service charges as defined in division (C) of section
3318.21 of the Revised Code, as referred to in division (B) of
section 3770.06 of the Revised Code.
(O) The General Assembly has the same authority with regard to obligations
issued under this section and revenues pledged to those obligations as it has
under division (E) of section 164.11 of
the Revised Code with regard to obligations issued under Chapter 164. of the
Revised Code.
(P) There is hereby created in the state treasury the Common
Schools Capital Facilities Bond Service Fund. All moneys received
by the state and required by the bond proceedings, consistent with
this section, to be deposited, transferred, or credited to the
bond service fund, and all other moneys transferred or allocated
to or received for the purposes of that fund, shall be deposited
and credited to the bond service fund, subject to any applicable
provisions of the bond proceedings but without necessity for any
act of appropriation. During the period beginning with the date
of the first issuance of obligations and continuing during the
time that any obligations are outstanding in accordance with their
terms, so long as moneys in the bond service fund are insufficient
to pay debt service when due on those obligations payable from
that fund (except the principal amounts of bond anticipation notes
payable from the proceeds of renewal notes or bonds anticipated)
and due in the particular fiscal year, a sufficient amount of
moneys of the state are committed and, without necessity for
further act of appropriation, shall be paid to the bond service
fund for the purpose of paying that debt service when due. For
the purpose of this section, and if so provided in the applicable
bond proceedings, debt service includes costs relating to credit
enhancement facilities that represent payment of debt service.
The bond service fund is a trust fund and is hereby pledged to the
payment of debt service. Payment of that debt service shall be
made or provided for by the issuing authority in accordance with
the bond proceedings without necessity for any act of
appropriation.
(Q) The bond proceedings may provide for the establishment of
separate accounts in the bond service fund and for the application
of those accounts only to debt service on specific obligations,
and for other accounts in the bond service fund within the general
purposes of that fund.
(R) Subject to the bond proceedings pertaining to any obligations
then outstanding in accordance with their terms, the issuing
authority may in the bond proceedings pledge all, or such portion
as the issuing authority determines, of the moneys in the bond
service fund to the payment of debt service on particular
obligations, and for the establishment and maintenance of any
reserves for payment of particular debt service.
(S) On or before the fifteenth day of July of each fiscal year,
the issuing authority shall certify to the Office of Budget and
Management the total amount of moneys required, and sources of
that money, during that fiscal year to meet in full all debt
service and financing costs. If and so long as the moneys to the
credit of the bond service fund, together with any other moneys
available for the purpose, are insufficient to meet in full all
payments when due of the amount required as stated in that
certificate or otherwise, the Office of Budget and Management
shall at the times as provided in the bond proceedings transfer a
sufficient amount to the bond service fund from the moneys
derived from all excises, taxes, and other revenues of the state, including
net state lottery proceeds, referred to in division (N) of this section.
(T) Obligations issued under this section, their transfer, and
the interest, interest equivalent, and other income or accreted
amounts on them, including any profit made on their sale,
exchange, or other disposition, shall at all times be free from
taxation within this state.
Section 2. (A) As used in this section, and in the applicable
bond proceedings unless otherwise provided:
(1) "Bond proceedings" means the resolutions, agreements, and
credit enhancement facilities, and amendments and supplements to
them, or any one or more or combination of them, authorizing,
awarding, or providing for the terms and conditions applicable to
or providing for the security or liquidity of, obligations, and
the provisions contained in those obligations.
(2) "Bond service fund" means the fund created by division (P) of
this section, and any accounts in that fund, including all moneys
and investments, and earnings from investments, credited and to be
credited to that fund and accounts as and to the extent provided
in the bond proceedings.
(3) "Capital facilities" means capital facilities that are
capital facilities for state-supported and state-assisted
institutions of higher education.
(4) "Costs of capital facilities" means the costs of acquiring,
constructing, reconstructing, rehabilitating, remodeling,
renovating, enlarging, improving, equipping, or furnishing capital
facilities, and of the financing of those costs. Costs of capital
facilities include without limitation the cost of clearance and
preparation of the site and of any land to be used in connection
with capital facilities, the cost of any indemnity and surety
bonds and premiums on insurance, all related direct administrative
expenses and allocable portions of direct costs of the state and
the using institution, costs of engineering and architectural
services, designs, plans, specifications, surveys, and estimates
of cost, financing costs, interest on obligations from their date
to the time when interest is to be paid from sources other than
proceeds of obligations, amounts necessary to establish any
reserves as required by the bond proceedings, the reimbursement of
all moneys advanced or applied by or borrowed from the using
institution or any governmental agency for the payment of any item
of costs of capital facilities, and all other expenses necessary
or incident to planning or determining feasibility or
practicability with respect to capital facilities, and such other
expenses as may be necessary or incident to the acquisition,
construction, reconstruction, rehabilitation, remodeling,
renovation, enlargement, improvement, equipment, and furnishing of
capital facilities, the financing of those costs, and the placing
of the capital facilities in use and operation, including any one,
part of, or combination of those classes of costs and expenses.
(5) "Credit enhancement facilities," "financing costs," and
"interest" or "interest equivalent" have the same meanings as in
section 133.01 of the Revised Code.
(6) "Debt service" means principal, including any mandatory
sinking fund or redemption requirements for retirement of
obligations, interest and other accreted amounts, interest
equivalent, and any redemption premium, payable on obligations.
(7) "Issuing authority" means the Ohio Public Facilities
Commission established in section 154.03 of the Revised Code.
(8) "Net proceeds" means amounts received from the sale of
obligations, excluding: amounts used to refund or retire
outstanding obligations, amounts required to be deposited into
special funds pursuant to the applicable bond proceedings, and
amounts to be used to pay financing costs.
(9) "Obligations" means bonds, notes, or other evidences of
obligation of the state, including any appertaining interest
coupons, issued pursuant to this section.
(10) "Principal amount" means the aggregate of the amount as
stated or provided for in the applicable bond proceedings as the
amount on which interest or interest equivalent on particular
obligations is initially calculated. Principal amount does not
include any premium paid to the state by the initial purchaser of
the obligations.
(11) "Special funds" or "funds," unless the context indicates
otherwise, means the bond service fund, and any other funds,
including any reserve funds, created under the bond proceedings
and stated to be special funds in those proceedings, including
moneys and investments, and earnings from investments, credited
and to be credited to the particular fund. Special funds do not
include the Higher Education Improvement Fund created by division
(F) of section 154.21 of the Revised Code, or other funds created
by the bond proceedings that are not stated by those proceedings
to be special funds.
(12) "State-supported or state-assisted institutions of higher
education" means a state university or college, or community
college district, technical college district, university branch
district, or state community college, or two or more institutions
acting jointly, that are the ultimate users of the capital
facilities financed with net proceeds. "State university or
college" means each of the state universities identified in
section 3345.011 of the Revised Code, the Northeastern Ohio Universities
College of Medicine, and the Medical College of Ohio at Toledo.
(B) Subject to Sections 2n and 17 of Article VIII of the Ohio
Constitution, the state, by the issuing authority, is authorized
to issue and sell, as provided in this section and in an aggregate
principal amount or not to exceed one hundred fifty million
dollars, general obligations of this state for the purpose of
paying costs of capital facilities.
(C) Each issue of obligations shall be authorized by resolution
of the issuing authority. The bond proceedings shall provide for
or authorize the manner for determining the principal amount or
maximum principal amount of obligations of an issue, the principal
maturity or maturities, the interest rate or rates, the date of
and the dates of payment of interest on the obligations, their
denominations, and the place or places of payment of debt service
which may be within or outside the state. The latest principal
maturity may not be later than the earlier of the thirty-first day
of December of the twenty-fifth calendar year after the year of
issuance of the particular obligations or of the twenty-fifth
calendar year after the year in which the original obligation to
pay was issued or entered into. Sections 9.96, 9.98, 9.981,
9.982, and 9.983 of the Revised Code apply to obligations. The
purpose of the obligations may be stated in the bond proceedings
in general terms, such as "paying costs of capital facilities for
state-supported or state-assisted institutions of higher education as
authorized by Section 2n of Article VIII of the Ohio Constitution."
(D) Net proceeds of obligations shall be deposited into the
Higher Education Improvement Fund created by division (F) of
section 154.21 of the Revised Code.
(E) The issuing authority may appoint or provide for the
appointment of paying agents, bond registrars, securities
depositories, clearing corporations, and transfer agents, and may
retain the services of financial advisers and accounting experts,
and retain or contract for the services of marketing, remarketing,
indexing, and administrative agents, other consultants, and
independent contractors, including printing services, as are
necessary in the judgment of the issuing authority to carry out
this section. Financing costs are payable, as may be provided in
the bond proceedings, from the proceeds of the obligations, from
special funds, or from other moneys available for the purpose.
(F) The bond proceedings may contain additional provisions
customary or appropriate to the financing or to the obligations or
to particular obligations including, but not limited to,
provisions for:
(1) The redemption of obligations prior to maturity at the option
of the state or of the holder or upon the occurrence of certain
conditions, and at a particular price or prices and under particular
terms and conditions;
(2) The form of and other terms of the obligations;
(3) The establishment, deposit, investment, and application of
special funds, and the safeguarding of moneys on hand or on
deposit, in lieu of the applicability of provisions of Chapter
131. or 135. of the Revised Code, but subject to any special
provisions of this section with respect to the application of
particular funds or moneys. Any financial institution that acts
as a depository of any moneys in special funds or other funds
under the bond proceedings may furnish indemnifying bonds or
pledge securities as required by the issuing authority.
(4) Any or every provision of the bond proceedings being binding
upon the issuing authority and upon such using institution, state
agency, or government entity, officer, board, commission,
authority, agency, department, or other person or body as may from
time to time be authorized to take actions as may be necessary to
perform all or any part of the duty required by the provision;
(5) The maintenance of each pledge or instrument comprising part
of the bond proceedings until the state has fully paid or provided
for the payment of the debt service on the obligations or met
other stated conditions;
(6) In the event of default in any payments required to be made
by the bond proceedings, or by any other agreement of the issuing
authority made as part of a contract under which the obligations
were issued or secured, including a credit enhancement facility,
the enforcement of those payments by mandamus, suit in equity,
action at law, or any combination of those remedial actions;
(7) The rights and remedies of the holders or owners of
obligations or of book-entry interests in them, and of third
parties under any credit enhancement facility, and provisions for
protecting and enforcing those rights and remedies, including
limitations on rights of individual holders or owners;
(8) The replacement of mutilated, destroyed, lost, or stolen
obligations;
(9) The funding, refunding, or advance refunding, or other
provision for payment, of obligations that will then no longer be
outstanding for purposes of this section or of the applicable bond
proceedings;
(10) Amendment of the bond proceedings;
(11) Any other or additional agreements with the owners of
obligations, and such other provisions as the issuing authority
determines, including limitations, conditions, or qualifications,
relating to any of the foregoing.
(G) The Great Seal of the State or a facsimile of it may be
affixed to or printed on the obligations. The obligations
requiring execution for the issuing authority shall be signed as
provided in the bond proceedings. Any obligations may be signed
by the individual who on the date of execution is the authorized
signer although on the date of these obligations that individual
is not an authorized signer. In case the individual whose
signature or facsimile signature appears on any obligation ceases
to be an authorized signer before delivery of the obligation, that
signature or facsimile is nevertheless valid and sufficient for
all purposes as if that individual had remained the authorized
signer until delivery.
(H) Obligations are investment securities under Chapter 1308. of
the Revised Code. Obligations may be issued in bearer or in
registered form, registrable as to principal alone or as to both
principal and interest, or both, or in certificated or
uncertificated form, as the issuing authority determines.
Provision may be made for the exchange, conversion, or transfer of
obligations and for reasonable charges for registration, exchange,
conversion, and transfer. Pending preparation of final
or definitive obligations, the issuing authority may provide for the issuance
of
temporary or interim instruments to be exchanged for the final or definitive
obligations.
(I) Obligations may be sold at public sale or at private sale,
and at such price at, above, or below par, all as provided by the
issuing authority in the bond proceedings.
(J) Except to the extent that rights are restricted by the bond
proceedings, any owner of obligations may by any suitable form of
legal proceedings protect and enforce any rights relating to
obligations under the laws of this state or granted by the bond
proceedings. Those rights include the right to compel the
performance of all applicable duties of the issuing authority and
the state. Each duty of the issuing authority and its members,
officers, staff, and employees, and of each state agency or using
institution and its officers, members, staff, or employees,
undertaken pursuant to the bond proceedings, is hereby established
as a duty of the entity or individual having authority to perform
that duty, specifically enjoined by law and resulting from an
office, trust, or station within the meaning of section 2731.01 of
the Revised Code. The individuals who are from time to time the
members of the issuing authority, or designees of those members
pursuant to section 154.04 of the Revised Code, or its officers,
staff, or employees, are not liable in their personal capacities
on any obligations or otherwise under the bond proceedings.
(K)(1) Subject to Sections 2n and 17 of Article VIII of the Ohio
Constitution and this section, the issuing authority may, in
addition to the authority provided in division (B) of this
section, authorize and provide for the issuance of obligations in
the form of bond anticipation notes, and may provide for the
renewal of those notes from time to time by the issuance of new
notes. The holders of notes or appertaining interest coupons have
the right to have debt service on those notes paid solely from the
moneys and special funds that are or may be pledged to that
payment, including the proceeds of bonds or renewal notes or both,
as the issuing authority provides in the bond proceedings
authorizing the notes. Notes may be additionally secured by
covenants of the issuing authority to the effect that the issuing
authority and the state will do all things necessary for the
issuance of bonds or renewal notes in such principal amount and
upon such terms as may be necessary to provide moneys to pay when
due the debt service on the notes, and apply their proceeds to the
extent necessary, to make full and timely payment of debt service
on the notes as provided in the applicable bond proceedings.
In the bond proceedings authorizing the issuance of bond
anticipation notes the issuing authority shall set forth for the
bonds anticipated an estimated schedule of annual principal
payments the latest of which shall be no later than provided in
division (C) of this section. While the notes are outstanding
there shall be deposited, as shall be provided in the bond
proceedings for those notes, from the sources authorized for
payment of debt service on the bonds, amounts sufficient to pay
the principal of the bonds anticipated as set forth in that
estimated schedule during the time the notes are outstanding,
which amounts shall be used solely to pay the principal of those
notes or of the bonds anticipated.
(2) Except as otherwise provided in this section, bonds or notes
authorized pursuant to division (K) of this section are subject to
the provisions of this section pertaining to obligations
generally.
(3) The principal amount of refunding or renewal obligations
issued pursuant to division (K) of this section shall be in
addition to the amount authorized by the General Assembly as
referred to in division (B) of this section, to the extent that
the principal amount of those obligations does not exceed the then
outstanding principal amount of the obligations they are to
refund, renew, or retire.
(L) Obligations are lawful investments for banks, savings and
loan associations, credit union share guaranty corporations, trust
companies, trustees, fiduciaries, insurance companies, including
domestic for life and domestic not for life, trustees or other
officers having charge of sinking and bond retirement or other
special funds of the state and political subdivisions and taxing
districts of this state, the Sinking Fund, the Administrator of
Workers' Compensation subject to the approval of the Workers'
Compensation Board, the State Teachers Retirement System, the
Public Employees Retirement System, the School Employees
Retirement System, and the Ohio Police and Fire Pension Fund,
notwithstanding any other provisions of the Revised Code or rules
adopted pursuant to those provisions by any state agency with
respect to investments by them, and are also acceptable as
security for the repayment of the deposit of public moneys.
(M) Unless otherwise provided or provided for in any applicable
bond proceedings, moneys to the credit of or in a special fund
shall be disbursed on the order of the issuing authority. No such
order is required for the payment, from the bond service fund or
other special fund, when due of debt service or required payments
under credit enhancement facilities.
(N) The full faith and credit, revenue, and taxing power of the
state are and shall be pledged to the timely payment of debt
service on outstanding obligations as it comes due, all in
accordance with Section 2n of Article VIII of the Ohio
Constitution and this section. Moneys referred to in Section 5a
of Article XII of the Ohio Constitution, and net state lottery
proceeds, may not be pledged or used for the payment of debt
service. The state covenants, and that covenant shall be
controlling notwithstanding any other provision of law, that the
state and the applicable officers and agencies of the state,
including the General Assembly, shall, so long as any obligations
are outstanding in accordance with their terms, maintain statutory
authority for and cause to be levied, collected, and applied
sufficient pledged excises, taxes, and revenues of the state so
that those excises, taxes, and revenues shall be sufficient in amounts to pay
debt
service when due, to establish and maintain any reserves and other
requirements, and to pay financing costs, including costs of or
relating to credit enhancement facilities, all as provided for in
the bond proceedings.
Those excises, taxes, and revenues are and shall be deemed to be
levied and collected, in addition to the purposes otherwise
provided for by law, to provide for the payment of debt service
and financing costs in accordance with this section and the bond
proceedings.
(O) The General Assembly has the same authority with regard to
obligations issued under this section as it has under division (E) of section
164.11 of the Revised Code with regard to obligations issued under Chapter
164. of the Revised Code.
(P) There is hereby created in the state treasury the Higher
Education Capital Facilities Bond Service Fund. All moneys
received by the state and required by the bond proceedings,
consistent with this section, to be deposited, transferred, or
credited to the bond service fund, and all other moneys
transferred or allocated to or received for the purposes of that
fund, shall be deposited and credited to the bond service fund,
subject to any applicable provisions of the bond proceedings but
without necessity for any act of appropriation. During the period
beginning with the date of the first issuance of obligations and
continuing during the time that any obligations are outstanding in
accordance with their terms, so long as moneys in the bond service
fund are insufficient to pay debt service when due on those
obligations payable from that fund (except the principal amounts
of bond anticipation notes payable from the proceeds of renewal
notes or bonds anticipated) and due in the particular fiscal year,
a sufficient amount of moneys of the state are committed and,
without necessity for further act of appropriation, shall be paid
to the bond service fund for the purpose of paying that debt
service when due. For the purpose of this section, and if so
provided in the applicable bond proceedings, debt service includes
costs relating to credit enhancement facilities that represent
payment of debt service.
The bond service fund is a trust fund and is hereby pledged to the
payment of debt service. Payment of that debt service shall be
made or provided for by the issuing authority in accordance with
the bond proceedings without necessity for any act of
appropriation.
(Q) The bond proceedings may provide for the establishment of
separate accounts in the bond service fund and for the application
of those accounts only to debt service on specific obligations,
and for other accounts in the bond service fund within the general
purposes of that fund.
(R) Subject to the bond proceedings pertaining to any obligations
then outstanding in accordance with their terms, the issuing
authority may in the bond proceedings pledge all, or such portion
as the issuing authority determines, of the moneys in the bond
service fund to the payment of debt service on particular
obligations, and for the establishment and maintenance of any
reserves for payment of particular debt service.
(S) If and so long as the moneys to the credit of the bond
service fund, together with any other moneys available for the
purpose, are insufficient to meet in full all payments when due of
the amount required, the Office of Budget and Management shall at
the times as provided in the bond proceedings transfer a
sufficient amount to the bond service fund from the moneys
derived from all excises, taxes, and other revenues of the state
referred to in division (N) of this section.
(T) Obligations issued under this section, their transfer, and
the interest, interest equivalent, and other income or accreted
amounts on them, including any profit made on their sale,
exchange, or other disposition, shall at all times be free from
taxation within this state.
Section 3. (A) Unless otherwise provided in any applicable bond
proceedings, moneys to the credit of special funds referred to in
Sections 1 and 2 of this act may be invested by or on behalf of
the state only in one or more of the following:
(1) Notes, bonds, or other direct obligations of the United States
or of any agency or instrumentality of the United States, or in
no-front-end-load money market mutual funds consisting exclusively
of those obligations, or in repurchase agreements, including those
issued by any fiduciary, secured by those obligations, or in
collective investment funds consisting exclusively of those
obligations;
(2) Obligations of this state or any political subdivision of
this state;
(3) Certificates of deposit of any national bank located in this
state and any bank, as defined in section 1101.01 of the Revised
Code, subject to inspection by the Superintendent of Financial
Institutions;
(4) The Treasurer of State's pooled investment program under
section 135.45 of the Revised Code.
(B) The income from investments referred to in this section shall be
credited to such special funds or otherwise as the issuing
authority determines in the bond proceedings. Those investments
may be sold or exchanged at times as the issuing authority
determines, provides for, or authorizes.
Section 4. (A) This section is in implementation of division (D)
of Section 17 of Article VIII of the Ohio Constitution for
purposes of issuing direct obligations of the state subject to
that section during the fiscal year ending June 30, 2000.
(B) For purposes of the computation of debt service under
Section 17 of Article VIII of the Ohio Constitution, there shall
be included debt service payable on securities that are direct
obligations of the state issued under Article VIII of the Ohio
Constitution, and on those bonds anticipated by bond anticipation
notes, to the extent that debt service on those securities is
anticipated to be paid from the General Revenue Fund or net
state lottery proceeds. Examples of securities the debt service
on which is not anticipated to be paid from either of those
sources are bonds of the state issued for highway purposes
pursuant to Section 2i or 2m of Article VIII of the Ohio
Constitution, which, although general obligations of the state,
have been and are anticipated to be paid from highway user
receipts and not from the General Revenue Fund or net state
lottery proceeds.
(C) If there is no separate constitutional or statutory provision
applicable for the purpose, debt service on bonds anticipated by
bond anticipation notes shall be estimated as provided in this
division. That amount, to be certified either by the issuing
authority of the particular notes or by the Governor or the
Governor's designee pursuant to division (E) of this section,
shall be the estimated amount that would have been payable on bonds
maturing serially in each fiscal year after the fiscal year of
issuance of the notes over the maximum period of maturity for the
bonds authorized in the particular governing constitutional or
statutory provision, as if those bonds had been issued without the
prior issuance of the notes, and computed on a substantially level
debt service basis applying an interest rate or rates certified to
be market rates at the time.
(D) In the case of securities issued to refund or retire
securities, the debt service on the new securities shall be
counted and the debt service on the securities being refunded or
retired shall not be counted, to the extent that the principal
amount of the new securities does not exceed the then outstanding
principal amount of the prior securities.
(E) The Governor, or the Governor's designee for the purpose,
shall determine and certify the fiscal year amounts required to be
applied or set aside for payment of debt service, the securities to
which that debt service relates, the total estimated revenues of the
state for the General Revenue Fund and from net state lottery
proceeds during the particular fiscal year, and any other
financial data necessary or appropriate for the purpose of the
computations under division (A) of Section 17 of Article VIII of
the Ohio Constitution and this section. Those determinations and
certifications shall be filed with the Director of Budget and
Management, the Treasurer of State, and the issuing authority for
the particular obligations, at or prior to the time those
securities are issued. The Governor's designee for the purpose
may be the Director or Assistant Director of Budget and Management, or
any employee or official of the Governor's office.
(F) For purposes of this section:
(1) "Interest" or "interest equivalent," "outstanding," and
"securities" have the same meanings as in section 133.01 of the Revised Code.
(2) "Debt service" means principal, including any mandatory
sinking fund deposits and mandatory redemption payments, and interest or
interest equivalent payable on securities, as those payments are
stated to come due and to be payable.
Section 5. There is hereby appropriated both from the General Revenue
Fund and the Common Schools Capital Facilities Bond Service Fund
created in Section 1 of this act, the amount of $13,650,000 for
Fiscal Year 2000 and $14,600,000 for Fiscal Year 2001, to be used
for the purpose of paying the debt service on general obligation
bonds issued pursuant to Section 2n of Article VIII of the Ohio
Constitution and Section 1 of this act. If it is determined that
additional appropriations are necessary for the purpose, such
amounts are hereby appropriated. The GRF appropriation item 230-428 in
Section 10 of Am. Sub. H.B. No. 282 of the 123rd General Assembly
is hereby reduced by $13,650,000 for Fiscal Year 2000 and
$14,600,000 for Fiscal Year 2001.
Section 6. There is hereby appropriated both from the General Revenue
Fund and the Higher Education Capital Facilities Bond Service Fund
created in Section 2 of this act, the amount of $4,375,000 for
Fiscal Year 2000 and $17,225,000 for Fiscal Year 2001, to be used
for the purpose of paying the debt service on general obligation
bonds issued pursuant to Section 2n of Article VIII of the Ohio
Constitution and Section 2 of this act. If it is determined that
additional appropriations are necessary for the purpose, such
amounts are hereby appropriated. The GRF appropriation item 235-401 in
Section 7 of Am. Sub. H.B. No. 282 of the 123rd General Assembly
is hereby reduced by $4,375,000 for Fiscal Year 2000 and
$17,225,000 for Fiscal Year 2001.
Section 7. This act is hereby declared to be an emergency measure
necessary for the immediate preservation of the public peace,
health, and safety. The reasons for such necessity lie in the
fact that immediate effective action is necessary in order to
promptly implement Sections 2n and 17 of Article VIII of the Ohio
Constitution adopted on November 2, 1999, by a majority of the
electors of the state voting thereon, and thereby authorize
general obligation bonds to be issued for facilities for
elementary and secondary education throughout the state and for
state-supported and state-assisted institutions of higher
education, at a lower interest cost to the state, and to enable
other direct obligations of the state to be issued consistent with
Section 17 of Article VIII of the Ohio Constitution. Therefore,
this act shall go into immediate effect.
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