La. Admin. Code tit. 71 § III-103

Current through Register Vol. 50, No. 9, September 20, 2024

Section III-103 - Original Rules (1975)

A. The following constitutes all of the existing rules, as defined in the Act, including all rules in existence on January 1, 1975, and all other written statements of policy or interpretations formulated, adopted, or used by the commission in the discharge of its functions, including all final orders, decisions and opinions, as amended.

B. The following has been adopted concerning meeting dates: Regular meetings shall be held at 10 a.m. on the third Thursday of each month, provided that:

1. any meeting at which bids are to be received for the sale of bonds may be held at either 10 a.m. or 11 a.m., any meeting held during Legislative Sessions will be held at 8 a.m. unless bids are to be received for the sale of bonds; and

2. any meeting held in lieu of a regular meeting date due to state holidays shall be deemed a regular meeting, and such new meeting date shall be determined by the chairman of the commission; special meetings may be called by the chairman of the commission on any date.

C. Applications, to include the name, address, and telephone number of the responsible official, must be filed with the commission at least 20 working days prior to the commission meeting at which the application will be considered. However, the secretary of the commission may approve a later filing for an emergency or an extraordinary situation. One copy of any related resolution or ordinance, certified by a duly authorized official, and one copy of the financial statements described in §103. E shall be submitted with the application. Unless otherwise provided by these rules, all information relating to an application shall be submitted to the commission no later than 10 working days prior to the commission meeting at which the application will be considered; otherwise, the application will not be docketed for consideration.

D. Notices of meetings and tentative agendas will be mailed or otherwise made available to each member and any other party who has requested same at least six days prior to the meeting, and notices of meetings will be posted in accordance with law.

E. Financial statements, as described below, must be submitted with all applications to incur debt.

1. If the recently completed operating year ended less than 90 days prior to the date of the application to incur debt, the following financial statements must be submitted with the application:

a. financial statements covering all funds for the second preceding year; and

b. interim financial statements, for the General Fund and for the fund from which the debt will be paid, from the date of the last financial statements to three months prior to the date of the application.

2. If the most recently completed operating year ended 90 days or more prior to the date of the application to incur debt, the following financial statements must be submitted with the application:

a. prior year financial statements covering all funds; and

b. interim financial statements, for the General Fund and for the fund from which the debt will be paid, from the date of the prior year financial statements to three months prior to the date of the application.

F. The secretary of the commission shall be responsible for docketing all matters to be considered by the commission, and no matter will be docketed that does not comply with commission policy or that cannot otherwise be legally considered.

G. A personal appearance by a representative of the applicant is necessary in emergency matters; no such personal appearance is otherwise necessary unless specifically requested by the commission staff.

H. The secretary or assistant secretary of the commission shall be responsible for presenting all matters to the commission and will report all matters with a recommendation for approval, disapproval, deferral, or no recommendation.

I. A docket meeting among representatives of the commission staff, the Legislative Auditor's Office, and the Attorney General's Office will be held prior to each commission meeting to review all matters on the agenda.

J. The following shall be furnished to the commission staff in regard to the issuance of bonds or other evidences of debt:

1. a copy of the official statement when prepared; and

2. a copy of the bid submitted by the bidder or bidders to whom the bonds were awarded and an amortization schedule when available.

K. All legal fees to be paid in connection with all applications shall be in accordance with the Attorney General's fee schedule and shall be subject to his approval. Each applicant shall state the amount of the attorney's fee or that said fee does not exceed said schedule, in order to comply with this rule.

L. The maximum financial advisor's fee and maximum underwriter's compensation on negotiated sales shall be approved by the commission; provided, however, that, in the case of industrial revenue bonds, no commission approval shall be required.

M. Approval of the Department of Commerce and Industry must be obtained for projects to be funded by industrial revenue bonds, including industrial development board and public trust projects, which approval shall certify compliance with the provisions of Rule 1 adopted by the Board of Commerce and Industry. If such approval is not obtained prior to submission of the application to the commission, then any approval of the commission will be made subject to approval of the Department of Commerce and Industry.

N. The results of all elections which are authorized by the commission shall be reported to the commission by a representative of the applicant as soon as they are promulgated.

O. All advance refundings must be conducted strictly in compliance with all proposed federal regulations regarding arbitrage or any other matter relating thereto.

P. Line of Credit

1. A cash line of credit is an authorization to a state agency to proceed with a project and draw from the State Treasury funds for the project prior to the sale of bonds for that project. The maximum amount of lines of credit in any fiscal year which may be authorized by the commission shall be the amount set forth in the comprehensive capital outlay act adopted by the Legislature. Bonds shall be issued to replenish lines of credit granted in the fiscal year in which the line of credit was granted. No lines of credit may be granted for a project unless and until either the bonds have been sold, lines of credit have been granted, or a certificate of impossibility and impracticality has been issued for all projects of higher priority as stated in the comprehensive capital budget adopted by the Legislature. The maximum amount of lines of credit provided herein shall not apply in cases where the commission shall deem an item to be an emergency matter.

2. Monies advanced on a line of credit for any project shall be spent only in accordance with the description in the bond authorization act authorizing bonds to be issued for that project.

3. Prior to the execution of any contract or agreement obligating the expenditure of monies received by any state department or agency or any other entity from line of credit funds, the Attorney General's Office shall be requested to review such proposed contracts or agreements for the sole purpose of determining whether expenditure of funds thereunder is for the purpose of furthering the applicable project adopted by the Legislature. If given, such prior approval by the Attorney General's Office shall be in writing to the appropriate state department, agency, or other entity with a copy to be furnished to the Bond Commission.

4. Should the Attorney General's Office determine that the proposed expenditure of line of credit funds not be in order, no funds may be used to pay obligations which may be incurred if such contracts are executed after an adverse conclusion by the Attorney General's Office.

5. All approvals of lines of credit shall be conditioned on compliance by the state department, agency, or other entity with the aforementioned procedure, and it shall be their duty to request approval from the Attorney General's Office, stating to which bond act and to which project the contract or agreement in question pertains. Failure to comply with such procedure by any such department, agency, or other entity shall result in the immediate revocation of the line of credit, and all information regarding the possible expenditure of line of credit funds for other than authorized purposes shall be forwarded immediately by the commission to the Attorney General's Office and the District Attorney's Office.

Q. Concerning the matter of ratings obtained from rating agencies for issuances of debt, the commission has adopted the following policy.

1. The commission staff will request of the rating agency in writing what information the rating agency requested the issuer to furnish, which has not been so furnished.

2. The commission staff will ask that the rating agency inform the commission when such rating agency requests information from an issuer by providing the commission with a copy of the request.

3. The commission staff will send a letter to the issuer from whom the rating agency has requested information, with a copy to the issuer's bond attorney, and will assist the issuer and the bond attorney in preparing responses to the rating agency.

4. Once a rating has been obtained, the issuer will put forth its best effort to furnish the requested information to the rating agency.

R. Meetings of the commission shall be conducted in accordance with Robert's Rules of Order.

S. The attached guidelines are provided in part for informational purposes but also set forth requirements for approval of applications submitted to the commission.

T. Commission rules regarding revenue bonds of state agencies and public trust bonds if the state is the beneficiary are as follows.

1. No state agency or public trust authority will begin planning a project without first notifying the secretary of the commission of the details of such plans.

2. The secretary will either report the undertaking to the commission or arrange for the principals involved to appear before the commission for a preliminary presentation.

3. The secretary of the commission will be advised of all meetings as plans progress and will be furnished copies of all written documents in order that the staff of the commission may participate in and/or be kept abreast of all developments.

4. At such time as the secretary determines that the project will be undertaken and prior to any commitments by any of the parties involved, a preliminary presentation will be scheduled for commission consideration. This presentation will consist of a complete report of progress to date and future plans. The commission will either preliminarily authorize or disapprove proceedings with the project.

5. All third party contracts will be subject to review by the secretary of the commission and all contracts which directly relate to a determination which must be made by the commission will be subject to review by the commission.

6. Applications to the commission to sell bonds on behalf of an agency or public trust authority will be made by certified resolution duly adopted by the issuing authority and will be accompanied by such documents as are necessary to justify the need and feasibility of the undertaking.

7. The following acts, documents, and contracts shall either be approved by the commission prior to consummation or entered into subject to the approval or ratification of the commission (unless the authority for such approval or ratification is vested in the chairman or secretary of the commission):

a. appointment of bond counsel;

b. appointment of special legal counsel;

c. appointment of financial advisors;

d. appointment of underwriters;

e. appointment of trustee banks and paying agents banks;

f. employment of firms to undertake feasibility studies;

g. appointment of all other consultants not referred to in Subparagraphs a.-f. above;

h. official statement;

i. notice of sale;

j. authorizing bond resolution;

k. bond indenture;

l. agreement to purchase bonds;

m. all other contracts that relate to the sale or security of the bonds, the disposition of bond proceeds, or the operation of the project or undertaking.

U. Those portions of the Debt Policy and Procedures Law, R.S. 39:1361-66, and the Bond Commission Law, R.S. 39:1401-10, and any other law pertaining to the issuance of state general obligation bonds, are hereby declared to be the rules and procedures under which state general obligations bonds shall be authorized, issued, sold, and the procedures therefrom applied.

V.

1. All applications for special emergency elections, as allowed under the authority of R.S. 18:402(F)(6), shall first be reviewed by a special committee appointed by the chairman of the Bond Commission, to review applications for the granting of special emergency election dates. The following criteria shall be used by the committee to determine whether an emergency situation exists.

a. An emergency shall be a sudden, unexpected occurrence or set of circumstances which is beyond the control of the governing authority of the parish, municipality, or parish or city school board.

b. The resolution of the emergency situation can be accomplished only with the approval of a special emergency election date.

c. A substantial loss, either financial or nonfinancial, to the public, or the foregoing of a substantial gain by the public, will occur.

2. A governing authority may request approval of an election date only or approval of both the date and the actual holding of the election. Should the governing authority request approval of an election date only, then it shall specify such date and request such approval in resolution form prior to review by the committee. Should the governing authority request approval of both the date and the actual holding of the election, it shall submit the following in resolution form prior to review by the committee:

a. the date of the proposed election (must be on a Saturday);

b. declaration of an emergency by the governing authority of the parish, municipality, or parish or city school board;

c. written reasons for requesting a special emergency election date;

d. sufficient data for approval of a bond, tax, or other election at which a proposition or question is to be submitted to the voters; and

e. cost of the proposed emergency election.

3. After review, the committee will recommend to the Bond Commission that the application for an emergency election date be either approved or disapproved.

W. It is the policy of the Bond Commission that the interest rate be established and submitted with applications for budgetary or excess revenue loans, and for loans secured by the pledge of the avails of a special tax. Where such interest rate is above 6 percent, the applicant must apply for the loan at not less than two lending institutions and must have received replies from such institutions stating either the interest rate at which such institution will grant the loan, or that such institution will not grant the loan. Such replies must be submitted with the application to the Bond Commission.

X. Procedure for Adoption, Amendment, or Repeal of Rules of the Bond Commission [as defined by R.S. 49:951(6)]

1. The Bond Commission shall, prior to the adoption, amendment, or repeal of any rule, afford all interested persons reasonable opportunity to submit data, views, or arguments, orally or in writing. In case of substantive rules, opportunity for oral presentation or argument shall be granted if requested by 25 persons, by a governmental subdivision or agency, by an association having not less than 25 members, or by a committee of either house of the Legislature to which the proposed rule change has been referred under provisions of Section 968 of Title 49.

a. At least eight working days prior to the meeting of the Bond Commission at which a rule or rules are proposed to be adopted, amended, or repealed, notice of an intention to make an oral or written presentation shall be given to the director or assistant director of the Bond Commission. If the presentation is to be oral, such notice shall contain the name or names, telephone numbers and mailing address of the person or persons who will make such oral presentation, who they are representing, the estimated time needed for the presentation, and a brief summary of the presentation. Notice of such oral presentation may be sent to all Bond Commission members prior to the meeting. If the presentation is to be written, such notice shall contain the name or names of the person or persons submitting such written statement, who they are representing, and a copy of the statement itself. Such written statement will be sent to all Bond Commission members prior to the meeting.

b. The commission shall consider all written and oral submissions respecting the proposed rule. Upon adoption of a rule, the commission, if requested to do so by an interested person either prior to adoption or within 30 days thereafter, shall issue a concise statement of the principal reasons for or against its adoption.

2. Any interested person may petition the Bond Commission requesting the adoption, amendment, or repeal of a rule. Each request must state either the present rule to be amended along with proposed changes, or text of the proposed new rule to be presented to the Bond Commission for adoption. Upon receipt by the director, notice of such request, and such other information as he may deem appropriate, shall be sent to all Bond Commission members. The person requesting the change or his representative shall be present at the Bond Commission meeting to make a presentation and/or to answer any questions. Within 90 days after submission of a petition, the Bond Commission shall either deny the petition in writing, stating reasons for denial, or will initiate rulemaking proceedings.

La. Admin. Code tit. 71, § III-103

Promulgated by the Department of the Treasury, Bond Commission, LR 2:344 (November 1976), amended LR 4:393 (October 1978), LR 7:12 (January 1981), LR 7:50 (February 1981), LR 8:523 (October 1982), LR 11:643 (June 1985), LR 14:231 (April 1988), LR 15:197 (March 1989), LR 20:1020 (September 1994), LR 22:1244 (December 1996).

AUTHORITY NOTE: Promulgated in accordance with R.S. 49:950 et seq.