La. Admin. Code tit. 71 § III-117

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

Section III-117 - Municipalities-Loans

A. Budgetary (R.S. 39:745-747). Provides for anticipation of General Fund or budgetary revenues for current operations. May anticipate regular revenues. Cannot borrow more than estimated income. The maximum interest rate for securities is 8 percent (R.S. 39:1424). Maturity-no later than March 1 of the year following that in which loan is made (R.S. 39:747). The following information is required:

1. a copy of the resolution adopted by the governing authority setting forth³ the amount of loan, maturity, interest rate,⁵ purpose, and security; and

2. a copy of the budget adopted by the governing authority for the current year.

B. Anticipation of Avails of Special Taxes Levied under Article VI, Section 32 of 1974 Constitution and R.S. 39:801 et seq. Tax must be authorized to be levied for the period of the loan. The amount which can be borrowed is limited to 75 percent of the avails of the tax. Anticipation of taxes (R.S. 39:741-744). The following information is required:

1. a copy of resolution adopted by governing authority setting forth³ the amount of loan, maturity, interest rate,⁵ purpose, and security; and

2. a certified statement of expected yield from the special tax levy according to the last assessment roll of record.

C. Excess Revenue Certificates of Indebtedness (R.S. 33:2921 et seq.). Provides for pledging excess of revenues (as shown by current budget) in an amount sufficient to pay annual debt service (principal and interest) on the loan. R.S. 33:2923 sets maximum interest rate at 8 percent. The following information is required:

1. a copy of resolution adopted by governing authority setting forth³ the amount of certificates, maturity, interest rate,⁵ purpose, and security (dedication of surplus or excess revenues accruing to the municipality above statutory, necessary, and usual charges for number of years over which certificates mature); and

2. a copy of the budget adopted by the governing authority showing expected revenues and expenditures, and excess of revenues over statutory, necessary, and usual charges for current year.

D. Public Emergency (R.S. 33:2924). A municipality may determine a public emergency and borrow an amount necessary to meet said emergency. The repayment of such sums shall be a fixed charge upon the revenues of the year next following the year in which the sum is borrowed. Interest is limited to 8 percent (R.S. 39:1424). The following information is required:

1. a copy of the ordinance or resolution adopted by the governing authority setting forth³ the amount of loan, maturity, interest rate, purpose, and security; and

2. the ordinance or resolution declaring an emergency (explain emergency).

E. Federal (Article 7, Section 17 of Constitution and R.S. 39:821-841). Political subdivisions may borrow from any governmental agency of the United States or from other sources provided said loan is insured, endorsed, or guaranteed by any governmental agency of the United States for any purpose. Political subdivision authorized to incur debt may issue bonds, notes, and certificates of indebtedness (R.S. 39:822). Description of bonds, notes, or certificates of indebtedness issued under R.S. 39:821-841 (R.S. 39:825). Interest rate limited to 6 percent (R.S. 39:826). No debt shall be incurred or bonds issued in excess of constitutional limitation and laws of state, except where the President, or a designated authority, in his or its discretion, and under such terms as he or it may prescribe, may extend any of the benefits of any act of Congress to any political subdivision (R.S. 39:823). Where under any provision of the Constitution of Louisiana, any proposition to incur debt and issue bonds is required to be submitted to a vote of qualified electors, no debt shall be incurred and no bonds shall be issued, except as provided in R.S. 39:824. The information required is the same as for similar borrowings where the United States government or agency is not the lender, endorser, insurer, or guarantor.

La. Admin. Code tit. 71, § III-117

Promulgated by the Department of the Treasury, Bond Commission, LR 2:346 (November 1976), amended LR 4:399 (October 1978).

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