GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2015
H 5
HOUSE BILL 943
Committee Substitute Favorable 8/4/15
Third Edition Engrossed 8/5/15
Fourth Edition Engrossed 8/6/15
Senate Finance Committee Substitute Adopted 9/22/15
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Short Title: Connect NC Bond Act of 2015. |
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Referred to: |
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August 3, 2015
A BILL TO BE ENTITLED
AN ACT to authorize the issuance of general obligation bonds for the purpose of accomplishing certain interrelated and united projects to further economic development in the state consistent with the connect nc plan.
The General Assembly of North Carolina enacts:
SECTION 1.(a) Short Title. – This section shall be known as the "Connect NC Bond Act of 2015."
SECTION 1.(b) Purpose. – It is the intent of the General Assembly by this act to provide, subject to a vote of the qualified voters of the State, for the issuance of two billion dollars ($2,000,000,000) general obligation bonds of the State for the purpose of providing funds, with any other available funds, to update the State's public facilities for the 21st century, including, without limitation, construction, repair, renovation, and furnishing of new facilities in order to (i) enhance other economic development efforts of the State and (ii) attract new and assist existing industry, business, technology, and tourism for the benefit of the State and its citizenry.
SECTION 1.(c) Findings. – The General Assembly finds the following:
(1) The University of North Carolina is in need of new and renovated facilities to educate and prepare students; especially in the areas of science, technology, engineering, and math; to conduct research; and to recruit, retain, and prepare researchers and faculty for the 21st century for the purpose of enhancing the economic attractiveness of the State.
(2) The North Carolina Community College System is in need of new and renovated facilities to educate and prepare students and workers for the 21st century for the purpose of enhancing the economic attractiveness of the State.
(3) Parks and public facilities that are accessible to children with disabilities and veterans with disabilities are essential for the 21st century to attract new and assist existing industry, business, technology, and tourism for the benefit of the State and its citizenry.
(4) Clean water and sewer systems are essential for the 21st century to attract new and assist existing industry, business, technology, and tourism for the benefit of the State and its citizenry.
(5) Modern National Guard facilities attract new defense industry companies and suppliers.
(6) New facilities for agriculture will assist current agricultural endeavors in the State and will attract bioscience and other related industries, thereby benefitting the State's economic development.
(7) New and renovated State parks and attractions are vital components of tourism in the State, thereby benefitting the State's economic development.
(8) Adequate public safety is essential for the public welfare, for orderly economic development, and to attract new and assist existing industry, business, technology, and tourism for the benefit of the State and its citizenry.
(9) State facilities need routine repair and renovations in order for the facilities to be up‑to‑date for the 21st century to attract new and assist existing industry, business, technology, and tourism for the benefit of the State and its citizenry.
(10) The components set forth above are all interrelated and united and comprise a single plan for updating the State's infrastructure for the 21st century and for providing the State with necessary economic development tools to attract new and assist existing industry, business, technology, and tourism for the benefit of the State and its citizenry.
SECTION 1.(d) Definitions. – Unless the context otherwise requires, the following definitions apply in this section:
(1) Bonds. – Bonds issued under this section.
(2) Cost. – Without intending thereby to limit or restrict any proper definition of this term in financing the cost of facilities or purposes authorized by this section, any of the following:
a. The cost of constructing, reconstructing, enlarging, acquiring, and improving facilities and acquiring equipment and land therefor.
b. The cost of engineering, architectural, and other consulting services as may be required.
c. Administrative expenses and charges. Nothing in this section shall permit use of bond funds to pay salaries or fees for bond administration; such salaries and fees shall come from funds appropriated by the General Assembly.
d. Finance charges and interest prior to and during construction and, if deemed advisable by the State Treasurer, for a period not exceeding three years after the estimated date of completion of construction.
e. The cost of bond insurance, investment contracts, credit enhancement and liquidity facilities, interest‑rate swap agreements or other derivative products, financial and legal consultants, and related costs of bond and note issuance, to the extent and as determined by the State Treasurer.
f. The cost of reimbursing the State for any payments made for any cost described in this subdivision.
g. Any other costs and expenses necessary or incidental to the purposes of this section.
Allocations in this section of proceeds of bonds to the costs of a project or undertaking in each case may include allocations to pay the costs set forth in sub‑subdivisions c. through g. of this subdivision in connection with the issuance of bonds for the project or undertaking.
(3) Credit facility agreement. – An agreement entered into by the State Treasurer on behalf of the State with a bank, savings and loan association, or other banking institution; an insurance company, reinsurance company, surety company, or other insurance institution; a corporation, investment banking firm, or other investment institution; or any financial institution or other similar provider of a credit facility agreement, which provider may be located within or without the United States of America, such agreement providing for prompt payment of all or any part of the principal or purchase price (whether at maturity, presentment or tender for purchase, redemption, or acceleration), redemption premium, if any, and interest on any bonds or notes payable on demand or tender by the owner, in consideration of the State agreeing to repay the provider of the credit facility agreement in accordance with the terms and provisions of such agreement.
(4) Notes. – Notes issued under this section.
(5) Par formula. – Any provision or formula adopted by the State to provide for the adjustment, from time to time, of the interest rate or rates borne by any bonds or notes, including the following:
a. A provision providing for such adjustment so that the purchase price of such bonds or notes in the open market would be as close to par as possible;
b. A provision providing for such adjustment based upon a percentage or percentages of a LIBOR rate, a prime rate, or base rate, which percentage or percentages may vary or be applied for different periods of time; or
c. Such other provision as the State Treasurer may determine to be consistent with this section and will not materially and adversely affect the financial position of the State and the marketing of bonds or notes at a reasonable interest cost to the State.
(6) State. – The State of North Carolina.
SECTION 1.(e) Authorization of Bonds and Notes. – Subject to a favorable vote of a majority of the qualified voters of the State who vote on the question of issuing public improvement bonds in the election called and held as provided in this section, the State Treasurer is hereby authorized, by and with the consent of the Council of State, to issue and sell, at one time or from time to time, general obligation bonds of the State to be designated "State of North Carolina Public Improvement Bonds," with any additional designations as may be determined to indicate the issuance of bonds from time to time, or notes of the State as provided in this section, in an aggregate principal amount not exceeding two billion dollars ($2,000,000,000) for the purpose of providing funds, with any other available funds, for the purposes authorized in this section.
SECTION 1.(f) Use of Public Improvement Bond and Note Proceeds. –
(1) Subject to the provisions of subdivision (2) of this subsection, the proceeds of public improvement bonds and notes, including premium thereon, if any, shall be used for the projects in the following general amounts set forth below:
University of North Carolina
Appalachian State Watauga New Health Sciences Building $70,000,000
University
East Carolina Pitt Life Sciences & Biotech. Building $90,000,000
University
Fayetteville State Cumberland Lyons Science Bldg. Renovation $10,000,000
University
NC Central Durham New Business School $30,000,000
University
NC State University Wake Engineering Building $75,000,000
North Carolina Guilford Engineering Building $90,000,000
A & T State
University
North Carolina Burke North Carolina School of Technology $58,000,000
School of Science and Engineering
and Math
UNC – Chapel Hill Orange Medical Education Bldg. Replacement $68,000,000
UNC – Charlotte Mecklenburg New Sciences Building $90,000,000
UNC – Greensboro Guilford Nursing School Building $105,000,000
UNC – Pembroke Robeson New Business School $23,000,000
UNC – Wilmington New Hanover Allied Health and Human Services/ $66,000,000
Nursing Building
Western Carolina Jackson Science/STEM Building $110,000,000
University
Winston‑Salem Forsyth Sciences Building $50,000,000
State University
Various Statewide Capital Repairs and Renovations $45,000,000
Total for University of North Carolina $980,000,000
NC Community Colleges
Alamance Comm. College New Construction, Repairs, Renovations $6,100,339
Asheville‑Buncombe New Construction, Repairs, Renovations $5,487,535
Technical Comm. College
Beaufort Co. Comm. College New Construction, Repairs, Renovations $6,557,819
Bladen Comm. College New Construction, Repairs, Renovations $6,533,125
Blue Ridge Comm. College New Construction, Repairs, Renovations $2,966,077
Brunswick Comm. College New Construction, Repairs, Renovations $2,857,328
Caldwell Comm. College New Construction, Repairs, Renovations $5,629,337
and Technical Institute
Cape Fear Comm. College New Construction, Repairs, Renovations $5,908,685
Carteret Comm. College New Construction, Repairs, Renovations $2,674,685
Catawba Valley Comm. College New Construction, Repairs, Renovations $6,180,268
Central Carolina Comm. College New Construction, Repairs, Renovations $6,307,085
Central Piedmont Comm. College New Construction, Repairs, Renovations $9,636,457
Cleveland Comm. College New Construction, Repairs, Renovations $5,467,357
College of the Albermarle New Construction, Repairs, Renovations $6,590,687
Coastal Carolina Comm. College New Construction, Repairs, Renovations $6,973,103
Craven Comm. College New Construction, Repairs, Renovations $5,376,640
Davidson County Comm. College New Construction, Repairs, Renovations $5,820,720
Durham Tech. Comm. College New Construction, Repairs, Renovations $4,362,997
Edgecombe Comm. College New Construction, Repairs, Renovations $7,277,875
Fayetteville Tech. Comm. College New Construction, Repairs, Renovations $10,668,066
Forsyth Tech. Comm. College New Construction, Repairs, Renovations $5,809,410
Gaston College New Construction, Repairs, Renovations $5,949,907
Guilford Tech. Comm. College New Construction, Repairs, Renovations $9,519,543
Halifax Comm. College New Construction, Repairs, Renovations $6,519,080
Haywood Comm. College New Construction, Repairs, Renovations $2,831,380
Isothermal Comm. College New Construction, Repairs, Renovations $6,803,668
James Sprunt Comm. College New Construction, Repairs, Renovations $4,502,677
Johnston Comm. College New Construction, Repairs, Renovations $3,701,470
Lenoir Comm. College New Construction, Repairs, Renovations $8,001,502
Martin Comm. College New Construction, Repairs, Renovations $6,566,722
Mayland Comm. College New Construction, Repairs, Renovations $4,668,043
McDowell Tech. Comm. College New Construction, Repairs, Renovations $4,598,981
Mitchell Comm. College New Construction, Repairs, Renovations $3,218,011
Montgomery Comm. College New Construction, Repairs, Renovations $6,334,537
Nash Comm. College New Construction, Repairs, Renovations $7,773,798
Pamlico Comm. College New Construction, Repairs, Renovations $4,193,233
Piedmont Comm. College New Construction, Repairs, Renovations $4,850,325
Pitt Comm. College New Construction, Repairs, Renovations $8,376,397
Randolph Comm. College New Construction, Repairs, Renovations $5,086,842
Richmond Comm. College New Construction, Repairs, Renovations $7,229,431
Roanoke‑Chowan Comm. College New Construction, Repairs, Renovations $6,326,517
Robeson Comm. College New Construction, Repairs, Renovations $7,296,568
Rockingham Comm. College New Construction, Repairs, Renovations $6,848,392
Rowan‑Cabarrus Comm. College New Construction, Repairs, Renovations $7,211,552
Sampson Comm. College New Construction, Repairs, Renovations $4,774,533
Sandhills Comm. College New Construction, Repairs, Renovations $3,816,267
South Piedmont Comm. College New Construction, Repairs, Renovations $3,189,221
Southeastern Comm. College New Construction, Repairs, Renovations $6,861,620
Southwestern Comm. College New Construction, Repairs, Renovations $7,170,597
Stanly Comm. College New Construction, Repairs, Renovations $5,510,980
Surry Comm. College New Construction, Repairs, Renovations $7,222,184
Tri‑County Comm. College New Construction, Repairs, Renovations $4,515,728
Vance‑Granville Comm. College New Construction, Repairs, Renovations $7,611,910
Wake Tech. Comm. College New Construction, Repairs, Renovations $12,595,127
Wayne Comm. College New Construction, Repairs, Renovations $5,855,913
Western Piedmont Comm. College New Construction, Repairs, Renovations $5,099,649
Wilkes Comm. College New Construction, Repairs, Renovations $5,243,674
Wilson Comm. College New Construction, Repairs, Renovations $6,938,426
Total for NC Community Colleges $350,000,000
Local Parks and Infrastructure
DENR Statewide Children With Disabilities and $3,000,000
Veterans With Disabilities Local
Parks (Matching Grants)
Department of Statewide Water/Sewer Loans and Grants $309,500,000
Environmental
Quality
Total for Local Parks and Infrastructure $312,500,000
National Guard
National Guard Guilford/ Readiness Centers $70,000,000
Burke/
Wilkes
Total for National Guard $70,000,000
Agriculture
NC State University Wake Plant Sciences Building $85,000,000
Ag/NCSU Partnership
Agriculture and Wake Veterinary/Food/Drug/Motor Fuels Lab $94,000,000
Consumer Services
Total for Agriculture $179,000,000
State Parks and Attractions
State Parks Cumberland Carvers Creek $5,700,750
State Parks Durham/ Eno River $2,830,500
Orange
State Parks Washington/ Goose Creek $1,477,500
Beaufort
State Parks Onslow Hammocks Beach $1,125,000
State Parks Dare Jockeys Ridge $751,500
State Parks Vance/ Kerr Lake State Recreation Area $3,750,000
Warren
State Parks Burke/ Lake James $3,021,000
McDowell
State Parks Iredell Lake Norman $2,307,000
State Parks Yancey Mount Mitchell $600,000
State Parks Various Mountain‑To‑Sea/Other State Trails $4,500,000
State Parks Surry/ Pilot Mountain $4,481,850
Yadkin
State Parks Camden Dismal Swamp $990,750
State Parks Watauga Elk Knob $900,000
State Parks Durham/ Falls Lake State Recreation Area $789,750 Wake
State Parks New Hanover Fort Fisher State Recreation Area $1,125,000
State Parks Transylvania Gorges $2,505,750
State Parks Stokes Hanging Rock $2,100,000
State Parks Guilford/ Haw River $1,500,000
Rockingham
State Parks Chatham/ Jordan Lake State Recreation Area $3,000,000
Wake
State Parks Columbus Lake Waccamaw $1,506,000
State Parks Scotland/ Lumber River $2,628,750
Hoke/
Robeson/
Columbus
State Parks Rockingham Mayo River $750,000
State Parks Tyrell/ Pettigrew $2,830,500
Washington
State Parks Burke South Mountain $2,250,000
State Parks Alleghany/ Stone Mountain $1,338,000
Wilkes
State Parks Wake William B. Umstead $1,725,000
State Parks Avery Yellow Mountain State Natural Area $2,250,000
State Parks Watauga Beech Creek Bog State Natural Area $600,000
State Parks New Hanover Carolina Beach $855,000
State Parks Rutherford Chimney Rock $1,500,000
State Parks Wayne Cliffs of the Neuse $692,400
State Parks Gaston Crowders Mountain $750,000
State Parks Chatham Deep River State Trail $1,281,000
State Parks Carteret Fort Macon $135,000
State Parks Watauga Grandfather Mountain $1,501,500
State Parks Bladen Jones Lake $651,750
State Parks Chatham Lower Haw River State Natural Area $203,250
State Parks Halifax Medoc Mountain $1,383,750
State Parks Gates Merchants Millpond $870,750
State Parks Stanly Morrow Mountain $1,537,500
State Parks Ashe Mount Jefferson State Natural Area $1,500,000
State Parks Ashe New River $675,000
State Parks Harnett Raven Rock $1,125,000
State Parks Bladen Singletary Lake $575,250
State Parks Moore Weymouth Woods State Natural Area $428,250
Zoo Randolph Australasia Exhibit Complex/ $25,000,000
Replace Africa Pavilion and
Related Projects
Total for State Parks and Attractions $100,000,000
Public Safety
DPS Moore Samarcand Training Academy $8,500,000
Total for Public Safety $8,500,000
Grand Total $2,000,000,000
(2) Special Allocation Provisions. – In determining the use of the proceeds of public improvement bonds and notes, including premium thereon, if any, set forth in subdivision (1) of this subsection, the following special allocation provisions apply:
a. The proceeds of public improvement bonds and notes, including premium thereon, if any, for Statewide capital repairs and renovations for The University of North Carolina, as provided in subdivision (1) of this subsection, shall be used for projects that are eligible to receive funds from the Repairs and Renovations Reserve under G.S. 143C‑4‑3(b). Any items purchased with such proceeds and installed or replaced as part of a renovation or rehabilitation must have a useful life of at least 10 years or must extend the life of the facility by at least 10 years once renovated or rehabilitated. Such proceeds (i) shall be prioritized to constituent institutions not otherwise specified as receiving proceeds under subdivision (1) of this subsection and (ii) shall not be used to increase any amount to a constituent institution otherwise specified as receiving proceeds under subdivision (1) of this subsection.
b. The proceeds of public improvement bonds and notes, including premium thereon, if any, for NC Community Colleges, as provided in subdivision (1) of this subsection, shall be used for new construction or rehabilitation of existing facilities and repairs and renovations. Any items purchased with such proceeds and installed or replaced as part of a renovation or rehabilitation must have a useful life of at least 10 years or must extend the life of the facility by at least 10 years once renovated or rehabilitated. In order to receive the proceeds under this sub‑subdivision for projects for new construction, the community college receiving the proceeds shall provide local matching funds from county funds, other non‑State funds, or a combination of these sources for such proceeds. The amount of matching funds shall be (i) one dollar ($1.00) of local matching funds for every three dollars ($3.00) of such proceeds for a community college with a main campus located in a development tier one area, as defined in G.S. 143B‑437.08, (ii) one dollar ($1.00) of local matching funds for every two dollars ($2.00) of such proceeds for a community college with a main campus located in a development tier two area, as defined in G.S. 143B‑437.08, and (iii) one dollar ($1.00) of local matching funds for every one dollar ($1.00) of such proceeds for a community college with a main campus located in a development tier three area, as defined in G.S. 143B‑437.08. Community colleges are not required to match bond proceeds allocated in this section for rehabilitation of existing facilities and repairs and renovations.
c. The proceeds of public improvement bonds and notes, including premium thereon, if any, for the Department of Environment and Natural Resources for Statewide Children With Disabilities and Veterans With Disabilities Local Parks (Matching Grants), as provided in subdivision (1) of this subsection, shall be allocated to the Parks and Recreation Trust Fund established in G.S. 113‑44.15 and shall be used exclusively for grants to local government units or public authorities, as defined in G.S. 159‑7, for construction of special facilities or adaptation of existing facilities that meet the unique needs of children with physical and developmental disabilities and veterans with physical and developmental disabilities and enable them to participate in recreational and sporting activities, regardless of their abilities. In order to receive such proceeds under this sub‑subdivision, a local government unit or public authority shall provide matching funds in the amount of one dollar ($1.00) of local funds for every four dollars ($4.00) of such proceeds. Grants made using such proceeds under this sub‑subdivision shall not exceed five hundred thousand dollars ($500,000) per project.
d. The proceeds of public improvement bonds and notes, including premium thereon, if any, for the Department of Environmental Quality for Statewide Water/Sewer Loans and Grants, as provided in subdivision (1) of this subsection, shall be allocated to the Water Infrastructure Fund established in G.S. 159G‑22. One hundred million dollars ($100,000,000) shall be used for grants, and the remainder shall be used for low‑interest loans. The proceeds for loans and the proceeds for grants shall be allocated in equal proportion to the Drinking Water Reserve and the Wastewater Reserve and shall be subject to the following:
1. If the availability of loan funds exceeds project demand, the limits contained in G.S. 159G‑36 applicable to a loan may be exceeded for the purpose of ensuring that all available loan funds are utilized for projects prioritized pursuant to G.S. 159G‑23.
2. Loan and grant applications for projects shall be funded first if both of the following criteria are met: (i) the project is required to be completed due to an EPA administrative order or consent decree and (ii) the application for the project is deemed complete by the Division and meets the minimum requirements for the program from which it is seeking funding.
3. A grant application to be funded from the Wastewater Reserve and required to be prioritized under sub‑sub‑subdivision 2. of this sub‑subdivision shall be awarded a grant equal to fifty percent (50%) of the project costs that are reasonably necessary to comply with the EPA administrative order or consent decree, notwithstanding limits otherwise applicable pursuant to G.S. 159G‑36; provided that, the cumulative amount of all grants received by an applicant under this sub‑subdivision does not exceed one‑third of the amount of bond proceeds for grants allocated to the Wastewater Reserve.
4. A loan application to be funded from the Wastewater Reserve and required to be prioritized under sub‑sub‑subdivision 2. of this sub‑subdivision shall receive a loan equal to the amount sufficient to cover all project costs that are reasonably necessary to comply with the EPA administrative order or consent decree minus the amount of any grant awarded under sub‑sub‑subdivision 3. of this sub‑subdivision; provided that, the cumulative amount of all loans received by an applicant under this sub‑subdivision does not exceed fifteen million dollars ($15,000,000).
e. The proceeds of public improvement bonds and notes, including premium thereon, if any, for National Guard, as provided in subdivision (1) of this subsection, shall be used for capital improvements, as defined in G.S. 143C‑1‑1(d)(5), for readiness centers located in Guilford, Burke, and Wilkes Counties.
f. The proceeds of public improvement bonds and notes, including premium thereon, if any, for the North Carolina Zoological Park, as provided in subdivision (1) of this subsection, shall be used for capital improvements, as defined in G.S. 143C‑1‑1(d)(5). Any items purchased with such proceeds and installed or replaced as part of a renovation or rehabilitation must have a useful life of at least 10 years or must extend the life of the facility by at least 10 years once renovated or rehabilitated.
(3) Reallocation. – For public improvement bonds authorized by this section, the General Assembly may at this session or at any subsequent session increase or decrease the allocations of the proceeds of public improvement bonds and notes, including premium thereon, if any, for projects set forth in subdivision (1) of this subsection or reallocate any amounts among agencies or projects not listed in this subsection but listed in the six‑year capital improvement plan developed pursuant to G.S. 143C‑8‑5, so long as the aggregate amount of the allocations does not exceed two billion dollars ($2,000,000,000).
SECTION 1.(g) Allocation and Tracking of Proceeds. –
(1) Public improvement bonds. – The proceeds of public improvement bonds and notes, including premium thereon, if any, except the proceeds of bonds the issuance of which has been anticipated by bond anticipation notes or the proceeds of refunding bonds or notes, shall be placed by the State Treasurer in a special fund to be designated "Public Improvement Bonds Fund," which may include such appropriate special accounts therein as may be determined by the State Treasurer and shall be disbursed as provided in this section. Monies in the Public Improvement Bonds Fund shall be allocated and expended as provided in this section.
Any additional monies that may be received by means of a grant or grants from the United States of America or any agency or department thereof or from any other source for deposit to the Public Improvement Bonds Fund may be placed in the Public Improvement Bonds Fund or in a separate account or fund and shall be disbursed, to the extent permitted by the terms of the grant or grants, without regard to any limitations imposed by this section.
Monies in the Public Improvement Bonds Fund or any separate account established under this section may be invested from time to time by the State Treasurer in the same manner permitted for investment of monies belonging to the State or held in the State treasury, except with respect to grant money to the extent otherwise directed by the terms of the grant. Investment earnings, except investment earnings with respect to grant monies to the extent otherwise directed or restricted by the terms of the grant, may be (i) credited to the Public Improvement Bonds Fund, (ii) used to pay debt service on the bonds authorized by this section, (iii) used to satisfy compliance with applicable requirements of the federal tax law, or (iv) transferred to the General Fund of the State.
The proceeds of public improvement bonds and notes, including premium thereon, if any, may be used with any other monies made available by the General Assembly for funding the projects authorized by this section, including the proceeds of any other State bond issues, whether heretofore made available or that may be made available at the session of the General Assembly at which this section is ratified or any subsequent sessions. The proceeds of public improvement bonds and notes, including premium thereon, if any, shall be expended and disbursed under the direction and supervision of the Director of the Budget. The funds provided by this section shall be disbursed for the purposes provided in this section upon warrants drawn on the State Treasurer by the State Controller, which warrants shall not be drawn until requisition has been approved by the Director of the Budget and which requisition shall be approved only after full compliance with the State Budget Act, Chapter 143C of the General Statutes.
(2) Tracking of bond proceeds. – The State Treasurer or the State Treasurer's designee is hereby authorized and directed to set up a comprehensive system of tracking the proceeds of the public improvement bonds and notes, including premium thereon, if any, to the extent necessary to enable the State Treasurer or the State Treasurer's designee to properly account for the use of such proceeds for compliance with applicable requirements of the federal tax law or otherwise. All recipients of such proceeds shall comply with any tracking system implemented by the State Treasurer or the State Treasurer's designee for this purpose. The State Treasurer may withhold such proceeds from any State agency or department not complying with this subdivision.
(3) Costs. – Allocations to the costs of a capital improvement or undertaking in each case may include allocations to pay the costs set forth in sub‑subdivisions c. through g. of subdivision (2) of subsection (d) of this section in connection with the issuance of bonds for that capital improvement or undertaking.
SECTION 1.(i) Election. – The question of the issuance of the bonds authorized by this section shall be submitted to the qualified voters of the State at the time of the election in 2016 when voters of this State are given an opportunity to express their preference for the person to be the presidential candidate of their political party. Any other primary, election, or referendum validly called or scheduled by law at the time the election on the bond question provided for in this subsection is held may be held as called or scheduled. Notice of the election shall be given in the manner and at the times required by G.S. 163‑33(8). The election and the registration of voters therefor shall be held under and in accordance with the general laws of the State. Absentee ballots shall be authorized in the election and shall be available 50 days prior to the date on which the election is to be held.
Ballots, voting systems authorized by Article 14A of Chapter 163 of the General Statutes, or both may be used in accordance with rules prescribed by the State Board of Elections. The bond question to be used in the ballots or voting systems shall be in substantially the following form:
"[ ] FOR [ ] AGAINST
The issuance of two billion dollars ($2,000,000,000) State of North Carolina Public Improvement Bonds constituting general obligation bonds of the State secured by a pledge of the faith and credit and taxing power of the State for the purpose of providing funds, with any other available funds, to fund capital improvements and new facilities for the State, including, without limitation, the construction and furnishing of new facilities and the renovation and rehabilitation of existing facilities for, without limitation, the University of North Carolina System, the North Carolina Community College System, water and sewer systems, the State's National Guard, the Department of Agriculture and Consumer Services, and attractions and parks."
If a majority of those voting on the bond question in the election vote in favor of the issuance of the bonds described in the question, those bonds may be issued as provided in this section. If a majority of those voting on a bond question in the election do not vote in favor of the issuance of the bonds described in the question, those bonds shall not be issued.
The results of the election shall be canvassed and declared as provided by law for elections for State officers; the results of the election shall be certified by the State Board of Elections to the Secretary of State in the manner and at the time provided by the general election laws of the State.
SECTION 1.(j) Issuance of Bonds and Notes. –
(1) Terms and conditions. – Bonds or notes may bear such date or dates, may be serial or term bonds or notes, or any combination thereof, may mature in such amounts and at such time or times, not exceeding 40 years from their date or dates, may be payable at such place or places, either within or without the United States of America, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts, may bear interest at such rate or rates, which may vary from time to time, and may be made redeemable before maturity, at the option of the State or otherwise as may be provided by the State, at such price or prices, including a price less than the face amount of the bonds or notes, and under such terms and conditions, all as may be determined by the State Treasurer by and with the consent of the Council of State.
(2) Signatures; form and denomination; registration. – Bonds or notes may be issued as certificated or uncertificated obligations. If issued as certificated obligations, bonds or notes shall be signed on behalf of the State by the Governor or shall bear the Governor's facsimile signature, shall be signed by the State Treasurer or shall bear the State Treasurer's facsimile signature, and shall bear the Great Seal of the State of North Carolina or a facsimile thereof shall be impressed or imprinted thereon. If bonds or notes bear the facsimile signatures of the Governor and the State Treasurer, the bonds or notes shall also bear a manual signature, which may be that of a bond registrar, trustee, paying agent, or designated assistant of the State Treasurer. Should any officer whose signature or facsimile signature appears on bonds or notes cease to be such officer before the delivery of the bonds or notes, the signature or facsimile signature shall nevertheless have the same validity for all purposes as if the officer had remained in office until delivery, and bonds or notes may bear the facsimile signatures of persons who at the actual time of the execution of the bonds or notes shall be the proper officers to sign any bond or note, although at the date of the bond or note such persons may not have been such officers. The form and denomination of bonds or notes, including the provisions with respect to registration of the bonds or notes and any system for their registration, shall be as the State Treasurer may determine in conformity with this section; provided, however, that nothing in this section shall prohibit the State Treasurer from proceeding, with respect to the issuance and form of the bonds or notes, under the provisions of Chapter 159E of the General Statutes, the Registered Public Obligations Act, as well as under this section.
(3) Manner of sale; expenses. – Subject to the consent of the Council of State, the State Treasurer shall determine the manner in which bonds or notes shall be offered for sale, whether at public or private sale, whether within or without the United States of America, and whether by publishing notices in certain newspapers and financial journals, mailing notices, inviting bids by correspondence, negotiating contracts of purchase, or otherwise, and the State Treasurer is authorized to sell bonds or notes at one time or from time to time at such rate or rates of interest, which may vary from time to time, and at such price or prices, including a price less than the face amount of the bonds or the notes, as the State Treasurer may determine. All expenses incurred in preparation, sale, and issuance of bonds or notes shall be paid by the State Treasurer from the proceeds of bonds or notes or other available monies.
(4) Notes; repayment. –
a. Subject to the consent of the Council of State, the State Treasurer is hereby authorized to borrow money and to execute and issue notes of the State for the same, but only in the following circumstances and under the following conditions:
1. For anticipating the sale of bonds to the issuance of which the Council of State shall have given consent, if the State Treasurer shall deem it advisable to postpone the issuance of the bonds.
2. For the payment of interest on or any installment of principal of any bonds then outstanding, if there shall not be sufficient funds in the State treasury with which to pay the interest or installment of principal as they respectively become due.
3. For the renewal of any loan evidenced by notes herein authorized.
4. For the purposes authorized in this section.
5. For refunding bonds or notes as herein authorized.
b. Funds derived from the sale of bonds or notes may be used in the payment of any bond anticipation notes issued under this section. Funds provided by the General Assembly for the payment of interest on or principal of bonds shall be used in paying the interest on or principal of any notes and any renewals thereof, the proceeds of which shall have been used in paying interest on or principal of the bonds.
(5) Refunding bonds and notes. – By and with the consent of the Council of State, the State Treasurer is authorized to issue and sell refunding bonds and notes pursuant to the provisions of the State Refunding Bond Act for the purpose of refunding bonds or notes issued pursuant to this section. The refunding bonds and notes may be combined with any other issues of State bonds and notes similarly secured.
(6) Tax exemption. – Bonds and notes shall be exempt from all State, county, and municipal taxation or assessment, direct or indirect, general or special, whether imposed for the purpose of general revenue or otherwise, excluding inheritance and gift taxes, income taxes on the gain from the transfer of bonds and notes, and franchise taxes. The interest on bonds and notes shall not be subject to taxation as to income.
(7) Investment eligibility. – Bonds and notes are hereby made securities in which all public officers, agencies, and public bodies of the State and its political subdivisions; all insurance companies, trust companies, investment companies, banks, savings banks, savings and loan associations, credit unions, pension or retirement funds, and other financial institutions engaged in business in the State; and executors, administrators, trustees, and other fiduciaries may properly and legally invest funds, including capital in their control or belonging to them. Bonds and notes are hereby made securities that may properly and legally be deposited with and received by any officer or agency of the State or political subdivision of the State for any purpose for which the deposit of bonds, notes, or obligations of the State or any political subdivision of the State is now or may hereafter be authorized by law.
(8) Faith and credit. – The faith and credit and taxing power of the State are hereby pledged for the payment of the principal of and the interest on bonds and notes. In addition to the State's right to amend any provision of this section to the extent it does not impair any contractual right of a bond owner, the State expressly reserves the right to amend any provision of this section with respect to the making and repayment of loans, the disposition of any repayments of loans, and any intercept provisions relating to the failure of a local government unit to repay a loan, the bonds not being secured in any respect by loans, any repayments thereof, or any intercept provisions with respect thereto.
SECTION 1.(k) Variable Interest Rates. – In fixing the details of bonds and notes, the State Treasurer may provide that any of the bonds or notes may:
(1) Be made payable from time to time on demand or tender for purchase by the owner thereof, provided a credit facility agreement supports the bonds or notes, unless the State Treasurer specifically determines that a credit facility agreement is not required, upon a finding and determination by the State Treasurer, that the absence of a credit facility agreement will not materially or adversely affect the financial position of the State and the marketing of the bonds or notes at a reasonable interest cost to the State;
(2) Be additionally supported by a credit facility agreement;
(3) Be made subject to redemption or a mandatory tender for purchase prior to maturity;
(4) Bear interest at a rate or rates that may vary for such period or periods of time, all as may be provided in the proceedings providing for the issuance of the bonds or notes, including, without limitation, such variations as may be permitted pursuant to a par formula; and
(5) Be made the subject of a remarketing agreement whereby an attempt is made to remarket bonds or notes to new purchasers prior to their presentment for payment to the provider of the credit facility agreement or to the State.
If the aggregate principal amount repayable by the State under a credit facility agreement is in excess of the aggregate principal amount of bonds or notes secured by the credit facility agreement, whether as a result of the inclusion in the credit facility agreement of a provision for the payment of interest for a limited period of time or the payment of a redemption premium or for any other reason, then the amount of authorized but unissued bonds or notes during the term of such credit facility agreement shall not be less than the amount of such excess, unless the payment of such excess is otherwise provided for by agreement of the State executed by the State Treasurer.
SECTION 1.(l) Interpretation of Section. –
(1) Additional method. – The foregoing subsections of this section shall be deemed to provide an additional and alternative method for the doing of the things authorized thereby and shall be regarded as supplemental and additional to powers conferred by other laws and shall not be regarded as in derogation of any powers now existing.
(2) Statutory references. – References in this section to specific sections or Chapters of the General Statutes or to specific acts are intended to be references to these sections, Chapters, or acts as they may be amended from time to time by the General Assembly.
(3) Broad construction. – The General Assembly specifically has chosen to combine what otherwise might be considered differing projects to be financed into one bond bill and bond question because the General Assembly finds that such differing projects, when taken together, constitute an interrelated, united, and single plan for the State's infrastructure as stated aforesaid. Accordingly, this section, being necessary for the health, welfare, and advancement of the people of the State, shall be broadly construed to affect the purposes thereof.
(4) Inconsistent provisions. – Insofar as the provisions of this section are inconsistent with the provisions of any general laws, or parts thereof, the provisions of this section shall be controlling.
(5) Severability. – If any provision of this section or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of the section that can be given effect without the invalid provision or application, and to this end, the provisions of this section are declared to be severable.
SECTION 2. Other than community colleges, each entity receiving the proceeds of public improvement bonds and notes, including premium thereon, if any, issued pursuant to and for projects listed in Section 1 of this act shall report by January 1, 2017, and quarterly thereafter, to the Joint Legislative Oversight Committee on Capital Improvements, the House of Representatives Appropriations Committee, and the Senate Committee on Appropriations/Base Budget on the projects funded from public improvement general obligation bonds authorized by Section 1 of this act. Community colleges receiving the proceeds of public improvement bonds and notes, including premium thereon, if any, issued pursuant to and for projects listed in Section 1 of this act shall report by January 1, 2017, and quarterly thereafter, to the North Carolina Community Colleges System Office on the projects funded from public improvement general obligation bonds authorized by Section 1 of this act, and the System Office shall combine the reports and submit them to the Joint Legislative Oversight Committee on Capital Improvements, the House of Representatives Appropriations Committee, and the Senate Committee on Appropriations/Base Budget. Each report shall include the total project costs, the amount to be funded from the bonds, the expenditures to date from the bonds and other sources, and the percentage of each project completed.
SECTION 3. The State Treasurer shall not issue bonds or notes otherwise authorized by Section 1 of this act in an amount or year where the issuance of the bonds or notes would violate the Debt Affordability Advisory Committee's recommendations on debt capacities required under G.S. 142‑101.
SECTION 4.(a) The portion of funds estimated to be needed for escalation of costs for projects, other than for NC Community Colleges, for DEQ Statewide Water/Sewer Loans and Grants, and for State parks, funded in whole or in part with the proceeds of public improvement bonds and notes, including premium thereon, if any, issued pursuant to Section 1 of this act, shall remain with the Office of State Budget and Management and shall be disbursed only for the following purposes:
(1) To address unforeseen contingencies related to the specific project for which the funds were made available.
(2) To address inflation costs related to that specific project.
SECTION 4.(b) Any funds retained by the Office of State Budget and Management pursuant to subsection (a) of this section at the time a project is completed shall be retained by the Office of State Budget and Management until reallocated for other purposes by the General Assembly. The Office of State Budget and Management shall report to the Joint Legislative Oversight Committee on Capital Improvements on any funds retained pursuant to this subsection within 90 days of a project's completion.
SECTION 5. This act is effective when it becomes law.