Bill Summaries: S265 (2021)

  • Summary date: May 11 2021 - View summary

    Senate committee substitute deletes the content of the 1st edition and replaces it with the following.

    Amends GS 159-52, adding to the findings and determinations the Local Government Commission (Commission) must make in order to approval a local government's proposed bond application, to include that the assumptions used by the finance officer of the unit in preparing the statement of estimated interest filed with the clerk pursuant to GS 159-55.1(a), as enacted, are reasonable. 

    Enacts GS 159-55.1, directing the finance officer to file with the clerk of the governing board of the local government a statement of disclosure after a bond order has been introduced and before the public hearing on it. Specifies required content of the statement, including a statement that the information contained in it is preliminary and for general informational purposes only, as described. Provides that the validity of the bonds authorized by the order is not subject to challenge on the grounds that actual occurrences when issued are different than the disclosures set forth in the statement. Requires the statement of disclosure to be filed with the Commission, posted online, and maintained by the clerk of the board. Repeals GS 159-55(d), which contains similar requirements (requires the finance officer to file a statement of estimated interests on bonds over the term of the bonds and a summary of assumptions upon which the estimate is based, providing for similar qualifications of the statement).

    Amends GS 159-56 and GS 159-58, which govern publication of the bond order as introduced and as adopted. Revises the required elements of the accompanying statement as follows. Adds language to notice the finance officer's filing of a statement estimating the specified tax increase or that there will be no property tax increase to pay the principal and interest on the proposed bonds. Adds that the estimates may vary from the actual property tax increases required. Makes conforming changes to the summary of assumptions that can be included in each publication.

    Enacts GS 159-33.2, authorizing the Secretary of Revenue to require a local government or public authority to report events defined by the Secretary that will or may have a material, adverse effect on the financial health, operations, or internal controls of the local government or public authority within 30 days after the occurrence of such events. Directs the Commission to adopt a policy specifying the event required under the statute. Requires the Secretary to make the policy publicly available within 30 days.

    Enacts new subsection (d) to GS 159-34 to direct the Commission to notify the State Treasurer and the Secretary of Revenue of a unit's failure to comply with the annual audit requirements if the unit has failed to file a copy of the audit report with the Secretary (as required by subsection (a)) within 12 months of the unit's fiscal year end. Provides for withholding from the unit's distributions under GS 105-486 and GS 105-501 of 150% of the cost of the required annual audit, as specified, until the Commission notifies the State Treasurer and the Secretary that the required report has been filed, reviewed, and accepted.

    Amends GS 159-148, which defines the financing agreements subject to the provisions of Article 8, to include transactions that extend for three or more years from the date of the contract and obligations over the full term of the contract to at least $50,000, including options to renew or extend, for units included on the most recently published Unit Assistance List issued by the Department of State Treasurer. Adds a new prohibition, barring dividing agreements for the purpose of or resulting in evading the requirements of Article 8. Revises the exemption from the Article for contracts for the purchase, lease, or lease with option to purchase of motor vehicles, to exclude units included on the most recently published Unit Assistance List issued by the Department of State Treasurer where the contract amount equals or exceeds $50,000.

    Makes conforming changes to the act's titles. 

  • Summary date: Mar 11 2021 - View summary

    Enacts GS 159-52(c) to require the Local Government Commission (Commission) to state three disclosures in any order approving a local government's application to issue a bond, including (1) the total amount of estimated interest using the highest interest rate, as described, (2) the governmental unit's increase in property tax liability for each $10,000 of property tax value necessary for debt service, and (3) a notice that the unit can issue additional general obligation debt of up to two-thirds of the amount of the proposed bond as the debt is retired, without a vote, specifying the calculation of that amount. Makes organizational changes.

    Amends GS 159-51 to require the local governmental unit's application to the Commission for approval to issue a bond to include the required disclosures of new GS 159-52(c). Makes conforming changes to GS 159-53 to reflect the reorganization of GS 159-52.

    Changes the form of the question for a referendum to approve a bond provided in GS 159-61(d) to include the required disclosures with calculated amounts as now required in GS 159-51 and GS 159-52. Applies to bonds proposed on or after the date the act becomes law.