Bill Summary for S 265 (2021-2022)
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AN ACT TO INCREASE THE TRANSPARENCY OF BOND REFERENDA BY REQUIRING ADDITIONAL DISCLOSURES BY UNITS OF LOCAL GOVERNMENT, TO MAKE CHANGES RECOMMENDED BY THE LOCAL GOVERNMENT COMMISSION TO STRENGTHEN THE SYSTEM FOR MONITORING THE FINANCIAL OPERATIONS OF LOCAL UNITS AND OVERSIGHT OF FISCALLY TROUBLED LOCAL UNITS, AS DIRECTED BY THE CURRENT OPERATIONS APPROPRIATIONS ACT OF 2021, AND TO AUTHORIZE CHARTER SCHOOLS TO PARTICIPATE IN THE STATE TREASURER'S ANCILLARY GOVERNMENTAL PARTICIPANT INVESTMENT PROGRAM.Intro. by Johnson, Ford.
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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.